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2022 (3) TMI 1088 - AAR - GSTLevy of GST - Pure Agent - reimbursement received towards stipend paid to Trainees on behalf of Industry partner as part of training agreement - reimbursement received against cost of employee compensation insurance obtained for the benefit of Trainees by the Applicant and reimbursed by the Industry partner as per the training agreement - Pure agent services or not - whether TLEF is pure agent of Industry Partner with respect to Stipend and Insurance? Stipend - HELD THAT:- TLEF is authorized by Industry partner to make payment of stipend to Trainee (Third party) and TLEF is reimbursed the amount by recipient. This amount is separately indicated in invoice. It is deemed that the work performed by the Trainees in the Industry during their training period to be services procured by TLEF from the Trainees (third party), thereby satisfying Rule 33(iii) CGST Rules - the three conditions of Pure Agent laid down vide Rule 33 CGST Rules and the expression of Pure agent as per Explanation to said Rule has been satisfied by TLEF with respect to stipend reimbursement and TLEF submits that it receives only the actual amount incurred to pay stipend amount to the Trainees, in addition to the amount it receives for supplies provided on its own account. Insurance - HELD THAT:- The said single Insurance policy was taken by TLEF for both the trainees as well as its employees. Further, we note that said ICICI Tax invoice dated 1-8-21 of ₹ 191309.86/- is total Insurance premium amount charged by Insurance company on TLEF for both trainees and its (TLEF) employees. TLEF is unable to co-relate the actual Insurance premium amount paid by it to the Insurance company exclusively for the trainees only, vis-a-vis the amount charged by it, as reimbursement, on Industry Partner. TLEF has failed to satisfy that it is pure agent, by not substantiating on record that it receives only the actual amount from Industry Partner for insurance charges incurred by it exclusively for Trainees - The facts of present case is that TLEF is unable to substantiate that the insurance amount it has charged on Industry Recipient in its Invoices was the actual reimbursement of Insurance charges, exclusively, incurred for trainees - TLEF is not pure agent of Industry partner for Insurance premium amount, as TLEF does not satisfy clause (d) to the explanation of Rule 33 CGST Rules. Thereby, insurance amount reflected its invoices, shall not be deducted from arriving at taxable value and thereby leviable to GST.
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