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2022 (6) TMI 755 - AAR - GSTClassification of services - rate of GST - Intermediary services - Overseas Commission Agent is covered within the definition of the term ‘intermediary’ as provided under section 2(13) of the IGST Act, 2017 or not - import of services or not - Levy of GST on RCM basis under section 5(3) of the IGST Act, 2017 on commission paid to the Overseas Commission Agent. Overseas Commission Agent is covered within the definition of the term ‘intermediary’ as provided under section 2(13) of the IGST Act, 2017 or not - HELD THAT:- Any person, who enables the supply of goods/services between two persons, is considered as intermediary. However, where a person is providing services or supplies of goods on his own account to his customers, It cannot be termed as intermediary. As per the agreement dated 05.03.2021, Mr Bobby Kapoor, has to arrange or facilitate the supply of goods of the applicant to international Market and in return he shall get the commission on agreed terms - on perusal of legal provisions, agreement dated 05.03.2021 & other records submitted by the applicant in this regard, it is observed that Mr Bobby Kapoor, a overseas commission agent, fall within the definition of ‘intermediary’ as provided under section (2)13 of the IGST Act, 2017. Services received by applicant form the Overseas Commission Agent falls within the meaning of the term ‘import of services’ or not - HELD THAT:- As per facts & circumstances, services received by applicant form the Overseas Commission Agent falls within the meaning of the term ‘import of services’ means the supply of any services where, (i) the supplier of service is located outside India; (ii) the recipient of service is located in India; and (iii) the place of supply of service is in India. On perusal of said legal provisions, it is found that the services can be called as ‘import of services’ only when it is satisfied all the three conditions mentioned therein. On perusal of records, it is found that the conditions (i) & (ii) are satisfied in as much as Mr Bobby Kapoor, supplier of service, is located within India. Now in respect of (iii) condition, section 13 of the IGST Act, 2017 specifically deals with place of supply of a service as to whether a service can be termed as import of service or otherwise. On perusal of section 13 of the IGST Act, 2017 is relevant to the issue in hand which provides that the place of supply of the intermediary services would be the location of the supplier of such services (i.e. location of intermediary service provider). Thus the condition (iii) is not satisfied as the place of supply of service is not in India. Thus, the services received by the applicant is out of the ambit of “import of services” in as much as the condition (iii), is not satisfied in terms of section 13(8)(b) of IGST Act, 2017 as place of supply of service is out of India, since the location of Mr. Bobby Kapoor, is UAE, which is a place outside India. Whether the applicant is required to pay GST on RCM basis under section 5(3) of the IGST Act, 2017 on commission paid to the Overseas Commission Agent? - HELD THAT:- On perusal of section 5 of the IGST Act, 2017, it is found that the said section deals with levy and collection of tax i.e. IGST and section 5(3) of the IGST Act, 2017 provides that the Government may, on the recommendations of the Council, by notification, specify categories of supply of goods or services or both, the tax on which shall be paid on reverse charge basis by the recipient of such goods or services or both and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods or services or both. In the present case, the import of services shall be treated as inter-state supply of services and the same is chargeable to IGST under reverse charge i.e. service recipient located within Indian territory has to pay the tax. Since the transaction is related to an intermediary service which is out of the ambit of ‘import of services’ as discussed in foregoing paras, accordingly we observe that GST under reverse charge is not payable on the same.
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