2026-VIL-136-AAR
  1. Home
  2. 2026-VIL-136-AAR

SGST Advance Ruling Authority

GST – West Bengal AAR - Pure Agent Service - Exclusion of Reimbursement from Value of Supply - Applicant is acting as facilitator for arranging hotel accommodation through third-party agents and charging separate facilitation fee besides recovering actual hotel cost as reimbursement without GST - Whether applicant qualifies as Pure Agent under Rule 33 of CGST Rules, 2017 and can exclude actual hotel accommodation cost from taxable value of supply - HELD – The Rule 33 and the Explanation thereto prescribe four mandatory cumulative conditions for qualifying as Pure Agent namely the supplier must enter into contractual agreement with recipient to act as pure agent to incur expenditure in course of supply, must neither intend to hold nor hold any title to goods or services procured, must not use for own interest the goods or services procured and must receive only actual amount incurred plus amount for services provided on own account. All four conditions must be satisfied simultaneously and cumulatively - In the present case the applicant fails to satisfy condition (a) as there is no contractual agreement between applicant and end customer authorizing applicant to incur expenditure as pure agent in course of supply of booking service - The applicant further fails condition (b) as the third-party agent issues invoice in the name of applicant not in name of end customer which creates scenario where applicant holds title to services procured from third-party agent - The applicant also fails condition (c) as by holding title to services it is using services for own interest of providing services to end customer. Further the applicant receives amount incurred for hotel room booking as well as for intermediary services of third-party agent without prior knowledge or authorization of end customer thus failing condition (d) - In absence of a contractual agreement specifically authorizing incurrence of expenditure as pure agent in course of supply, the agent loses its status as pure agent. Mere bifurcation of invoice showing reimbursement and facilitation fee separately does not confer pure agent status if mandatory conditions are not satisfied - The applicant does not qualify as pure agent and provisions of Rule 33 do not apply. Service of booking of hotel room falls under SAC 998552 for reservation services for accommodation, cruises and package tours attracting 18% GST on entire consideration - Ordered accordingly
Download File

Quick Search

/

Advance Search

GST Resources

/

Gst Rate Finder

Tax Vista

Your Weekly Tax Recap

By Kasi Viswanathan V

Weekly Summary

VIL Video

GST Critical issues: ITC on...
By CA Vivek Jalan

Create Account

Security-Code
New Code?

Log In

New User ? Forgot Password ?

Forgot Password

Security-Code
New Code?
Please Note: This facility is only for Subscribing Members.

Email this page

Security-Code
New Code?

Feedback this page

Schedule a Demo

Schedule a demo to know the features and advantages of VILGST portal. Get to know the tips to find the desired results in faster way.

Security-Code
New Code?

Caselaw Request Form (CRF)

Didn’t find what you are searching for? No worries, please give us the following details and VIL will email you the desired Caselaws at the earliest:

Security-Code
New Code?