TMI Blog2023 (4) TMI 821X X X X Extracts X X X X X X X X Extracts X X X X ..... namely, the provision made for zero rated supply . The contention of the petitioners is also to the effect that once a transaction is of export of services and as defined under Section 2(6) of the IGST Act, in regard to which there is no definition under Section 2 of CGST Act or under section 2 of MGST Act, Section 13(8)(b) cannot by a legal fiction and/or an implication form any transaction to be taxed under the CGST Act and MGST Act, by categorizing it to be an intra-State sale. A bare reading of Section 9 of the CGST Act would indicate that subject to the provisions of sub-section (2) thereof, there shall be levy of a tax called the Central Goods and Services Tax on all intra-State supplies of goods or services or both . By virtue of Section 2(65) of the CGST Act intra-State supply of services is required to have the same meaning as assigned to it in Section 8 of the IGST Act - Section 8 of the IGST Act provides for 'intra-State supply'. Section 8(2) of the IGST Act provides that subject to the provisions of Section 12, the supply of services where the location of the supplier and the place of supply of services are in the same State or same Union Territory shall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -State trade or commerce , whereas in respect of a clear transaction of export of service as defined under sub-section (6) of Section 2 by virtue of Section 13(1), which provides that such provision shall apply to determine the place of supply of services where the location of the supplier of services or recipient of services is outside India, shall be the location of the supplier of services, when it concerns intermediary services, that is to classify the export of service as an intra-State trade or commerce. What can be discerned and derived, is that it is necessary to confine transactions which are clearly transactions in the course of Inter-State trade or commerce and more particularly transactions of export of services as defined under Section 2(6) of the IGST Act and the intermediary services, to be subjected, relevant and confined only to the provisions of the IGST Act, and transactions which are in the course of Intra-State trade or commerce, shall remain confined to the provisions of the CGST Act and the MGST Act - the approach of the Court would be by interpretative process to make the provisions of the respective enactments meaningful for their smooth and effective ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns of IGST Act only and the same cannot be made applicable for levy of tax on services under the CGST and MGST Acts - The office to place the matter before the Division Bench. - G. S. KULKARNI, J. For the Petitioner in WP No. 2031/2018 : Mr. Bharat Raichandani with Mr. Rishabh Jain i/b. UBR Legal. For the Petitioner in WP(L.) No. 639/2020 : Mr. Abhishek Rastogi with Mr. Pratyushprawa Saha, Mr. Mahir Chablani, Ms. Kanika Sharma and Mr. Marmik Kamdar i/b. Khaitan Co. For the Respondent/UOI in both the Writ Petitions : Mr. Anil C. Singh, ASG with Mr. Pradeep Jetly, Senior Advocate, Mr. J.B. Mishra and Mr. Aditya Thakkar and Mr. Dhananjay B. Deshmukh. Ms. Jyoti Chavan, AGP for State in WP No. 2031/2018. Mr. Dushyant Kumar, AGP for State in WP(L) No. 639/2020. JUDGMENT: The judgment has been divided into the following sections to facilitate analysis: Particulars Paragraph A Prelude 2-3 B Facts 4-11 C Stand of the Revenue 12-17 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioners would aid the discussion. 5. At the bar, Writ Petition No. 2031 of 2018 (Dharmendra M. Jani vs. The Union of India Ors.) was argued as the lead petition before the Division Bench as also before this Court, hence, in some detail the facts in such petition are being referred hereunder. 6. The petitioner, a proprietary firm, is engaged in providing marketing and promotion services to its customers located outside India. The overseas customers to whom services are provided by the petitioner are inter alia engaged in the manufacturing and/or sale of goods. Such customers may or may not have an establishment in India. The petitioner provides services only to its foreign principal and receives consideration in convertible foreign exchange. To provide such services, the petitioner enters into an agreement with its overseas customers. Illustratively, a copy of one such agreement is placed on record at 'Exhibit-C'. Under such agreement, the petitioner provides services to enable his foreign principal to get purchasers for its goods in India or elsewhere. The petitioner thus undertakes activities of marketing and promotion of goods sold by its overseas cus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding that with the advent of the Goods and Services Tax, in terms of Section 13(8) of the IGST Act, the place of supply of intermediary services has been defined as the place of the supplier of the service. It was stated that by virtue of such provision, the services provided by the petitioner to the overseas clients are being subjected to the Goods and Services Tax in India. The petitioner stated that it has been the policy of the Central Government to promote exports, hence, the inclusion of intermediary services under Section 13(8) of the IGST Act would lead to the closure of business of several such agencies, resulting in loss of jobs for several employees. The petitioner recorded that the petitioner intended to challenge the said provision, and hence, the petitioner would pay GST on the said commission under protest, as the petitioner did not accept the liability to pay GST on the said transactions. The petitioner, hence, reserved its right to claim refund of the duties so paid. It is on such premise, the petitioner has assailed the provisions of Section 13(8)(b) and Section 8(2) of IGST Act as noted above. The prayers as made in the Writ Petition reads thus: (a) that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... achinery manufactured by the foreign principal is directly shipped by the foreign principal to the Indian purchaser [importer]. These goods are cleared by the Indian purchaser from the customs authorities on its own account. Also, the sale invoice is directly issued by the foreign principal in the name of Indian purchaser. The consideration for such transaction is directly remitted by the Indian purchaser to the foreign principal. As a consideration for the services provided by the petitioner under the agreement, the petitioner is entitled to a commission calculated as a percentage of the ex-works net value of the foreign principal s products sold in India, for which, the payment is realized by the foreign principal. The petitioner raises periodic invoices on the foreign principal for commission. The payment is received by the petitioner in convertible foreign exchange. Thus, the facts of this petition, except nature of service offered, are similar to the first petition. The prayers as made in this petition are required to be noted, which reads thus: a) This Hon ble Court may be pleased to issue an appropriate writ, order or direction declaring Section 13(8)(b) of the IGST Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provision of specified services stipulated that the place of provision of the intermediary services shall be 'location of the service provider'. The affidavit also refers to Rule 3, which speaks in regard to the 'place of provisions' generally to mean the place of provision of a service, to be the location of the recipient of services. 13. The counter affidavit further states that several representations were received seeking modification of Rule 9 of POPSR to the extent it included intermediary services under sub-clause(c). It is stated that the issue was examined and with effect from October 1, 2014, the place of service for all intermediaries [goods and services] was made to be the location of intermediary as stipulated under Rule 9(c). The stipulation as made in Rule 9(c) was inter alia for the reasons that many times, same person provides agency services for selling of goods and subsequently selling of AMC (Annual Maintenance Contracts), therefore, making a distinction between the intermediary of goods and services caused hardship. Generally, the value addition of the service provided by an intermediary is at the place where the intermediary is located. Thus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ticle 269-A of the Constitution, is not tenable. 15. It is next contended that no double taxation is allowed, as in the case of intermediary services in relation to import of goods in India, there are two distinctly identifiable supplies involved; firstly, supply of goods by the overseas supplier to the Indian importer of goods; and secondly, supply of services by the intermediary to the overseas supplier of goods. It is stated that these two supplies are distinct and are liable to tax under two different statutes, namely, the Customs Act, 1962 and the IGST Act, 2017 respectively operating under two different fields of taxation. 16. It is contended that in the first transaction, as the title of the imported goods does not lie with the intermediary service provider, the incidence of Customs duty is on the importer of goods; and in the second transaction, the commission is paid by the overseas supplier to the Indian intermediary for the services provided by the intermediary and IGST on the same is levied in India on the intermediary as the place of supply is the location of the intermediary as per Section 13(8)(b) of the IGST Act. 17. It is next contended that the services p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioners liable for the levy under the CGST Act and MGST Act, without such amount being collected by the petitioners from their foreign customers, which otherwise would be collected by a registered dealer if the supply or service was to be either inter-State or intra-state supply of goods or services. Once the service is admittedly an export of service to foreign customers located outside India, except for the provisions of Section 13(8)(b), for all purposes such service is a service used and consumed outside India. (iii) Section 13(8)(b) read with the other provisions cannot be understood and applied de hors the fundamental principles underlying the levy of goods and service tax, namely that GST is levied on the destination-based principle, wherein the place of supply of service, necessarily would be the location of the recipient of the service, which in the present case is the place outside India. The petitioners clearly fall within provisions of Section 2(6) which defines Export of Service . (iv) The legislature by the inclusion of an intermediary in Section 13(8)(b) of the Act to which a meaning is attributed as defined under Section 2(13) of the IGST Act, an at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the general rule under Section 13(2) of the Act. However, the final version of the IGST Act released on 12 April 2017 included intermediary services under Section 13(8)(b). It is submitted this is clear in the light of the 139th Parliamentary Committee Report (Clauses 15.1 to 15.3). Such principle is based on the internationally accepted and followed principles laid down by the OECD International VAT Guidelines, 2015, which records that under the destination principles, tax is ultimately levied only on the final consumption that accrues within the taxing jurisdiction, whereas in origin principles, the tax levied in various jurisdiction where the value was added. The key economic difference between the two principles is that the destination principle places all firms competing in a given jurisdiction on an even footing, whereas the origin principle places consumers in different jurisdictions on an even footing. It records that the application of the destination principle in VAT achieves neutrality in international trade. Under the destination principle, exports are not subject to tax with a refund of input taxes (that is, free of VAT or Zero-Rated ), and imports are taxed on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es out of the territory of India by treating the same as a local supply. Hence, Section 13(8)(b) is ultra vires Articles 246A and 269A of the Constitution. (ix) The expressions export and import have not been defined in the Constitution and hence would be of wide connotation as admittedly when there is a supply of services from India to a country outside India, it is an export of service in terms of Section 13(8)(2). Thus, the export of service is required to be given its ordinary meaning. Such interpretation would lead to the conclusion that no State has the authority to levy a local tax on the export of services. Once the supply takes place outside the State of Maharashtra during the course of export by virtue of Section 13(8) (b) read with Section 7(5) of the IGST Act, a clear export of service is deemed as a local supply. (x) The levy is arbitrary, unreasonable and discriminative and, hence, violative of Article 14 of the Constitution. It is submitted that the levy does not provide a level playing field to the petitioners vis-a-vis other exports of services. It creates an unfair advantage for foreign customers to set up a liaison office in India at the cost of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vision is couched in the negative. Sub-clause (2) provides that Parliament may by law formulate principles for determining when a supply of goods or of services or both in any of the ways mentioned in clause (1). The expression export and import have not been defined under the Constitution and hence, would be of wide construction. It is submitted that admittedly, there is a supply of service from India to outside India. It is an export of service in terms of section 13(2). It is an export of service in terms of the ordinary meaning of the term export under the Constitution. Thus, no State has the authority to levy a local tax on the export of services. The supply takes place outside the State of Maharashtra during the course of export. The IGST Act, by virtue of section 13(8)(b) read with section 7(5), has deemed the export of service to be a local supply. This is a violation of Article 286(1), as Central legislation cannot authorize the State to collect the tax which itself is prohibited by the Constitution. Thus, the legislation to such an extent is clearly a colorable legislation. In support of such contention, reliance is placed on the decision of the Supreme Court in Stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cted without authority of law. Hence, the doctrine of pith and substance applies. For deciding the true character and nature of a particular levy, with reference to legislative competence, the court has to look into the pith and substance of the legislation. Reliance is placed on the decision of the Supreme Court in Gujarat Ambuja Cement Limited vs. Union of India 2005 (182) ELT 33 (SC). Section 13(8)(b) is ultra vires Section 9 of the CGST Act and MGST Act (xviii) Section 9 of the CGST Act, being the charging section, provides for the levy of CGST on all intra-State supplies of goods or services or both. Such levy cannot be extended to cross-border transactions i.e. export of services. Sub-section (2) of section 8 of IGST Act, 2017 provides that where the location of the supplier and place of supply of service is in the same State or Union Territory, the said supply shall be treated as 'intra-State supply'. It is submitted that by an artificial mechanism, where the location of the recipient is outside India, the place of supply is being treated in India by the impugned provision. The same is beyond the charging section. Though ordinarily, courts would not q ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Indian purchaser (importer) (IGST). This is a classic case of double taxation. In this context, reliance is placed on the decision of the Supreme Court in BSNL v. Union of India 2006(2) STR 161 and on the decision of the Gujarat High Court in Mohit Minerals vs. Union of India 2020-TIOL-164-HC-AHM-GST and Adani Power Ltd. vs. Union of India 2015 (330) ELT 883 (Guj.). (xxii) The alternate submission as urged on behalf of the petitioner is that Section 13(8)(b) of the IGST Act may be read down to state that the said provision would apply in a case where the tax escapes in both taxing jurisdictions i.e., India and importing country when the said provision would be applicable. This reading of the provision would be in consonance with section 13(13) of the IGST Act as well. It is submitted that this would be equally applicable to Section 13(2) of the Act. In support of this contention, reliance is placed on the decision of the Supreme Court in Sunil Batra vs. Delhi Administration and Ors. 1978 Cri LJ 1741. (xxiii) It is submitted that Section 13(8)(b) is ultra-virus Article 286 of the Constitution for the reason that it is not permissible for the State to impose tax o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as condition no.2 is the location of the recipients. The place of supply both in terms of the actual rendering of services is in India, hence, in terms of Section 13 (8) (b) of the IGST Act, the place of supply being the location of the supplier which is in India, hence, there is no export of service in regard to the transactions in question. 23. It is submitted that the plea under Section 13(8)(b) of the IGST Act introduces a deeming fiction would not arise in the instant case, wherein the services are being rendered in India, although the recipients of services are located outside India. Such an issue may arise for determination in a case where for eg. an Australian principal hires an Indian intermediary to render services in a third country like America. 24. The challenge to the constitutional validity of Section 13(8)(b) as raised by the petitioner is purely academic for the reason that such a challenge is premised on the plea that the petitioner is being taxed as an intermediary. The factual foundation, however, depicts a different picture as seen from the averments made in the petition. The averments show that the petitioner is a simplicitor agent. In paragraph 4.4 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... apply a general rule. For such reasons, the services rendered by the intermediary would be taxed as intra-State services and amenable to tax under the provisions of the CGST Act and MGST Act. Submissions on the provisions. 27. The IGST, CGST, and MGST laws have been framed pursuant to the specific amendment made to the Constitution of India by the 101st Constitution Amendment. The presumption of constitutionality must be displaced by the petitioner, for which the petitioner needs to establish that the services rendered by them amount to export of services . The challenge of the petitioner is premised on a plea that the petitioner is being taxed for services rendered outside India which is unconstitutional, which according to the respondents is an erroneous premise as canvassed by the petitioners, for the reason that Article 245(2) of the Constitution provides that no law made by the Parliament shall be deemed to be invalid on the ground that it would have an extra-territorial operation and by application of such article, a challenge to the validity of the provisions of IGST Act need to fail. In support of such submissions, reliance is placed on the decisions of the Su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Parliament to determine the supply is unbridled and unrestricted. Even power to determine as to what is inter-State trade is unbridled and unrestricted, even when the phrase in the course of inter-State trade or commerce is used. Thus, Article 269A(5) empowers the Parliament by authorising it to make law on what is inter-State supply as also to determine what is not inter-State supply i.e. intra-State supply. It is evident that there can either be inter-State supply or intra-State supply and hence, the power to determine one, would necessarily and concomitantly include the power to determine the other. Any contrary interpretation would lead to an absurd legislative vacuum. 29. Articles 246A and 286 also manifest and grant similar power to the Parliament to frame laws with respect to goods and services tax and determine a place of supply. Alternatively, another way to consider the same would be that there is no prohibition upon the Parliament from doing so in terms of residuary powers granted under Article 248, which provides for the residuary powers of legislation on the subject not mentioned in State or concurrent laws. Although this is subject to Article 246-A. Hence, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ticular item, contract, or buyer, and it may change from time to time by mutual consent, which is also clear from the facts that the invoices raised by the petitioner would show that the petitioner is entitled to commission as per the orders placed by the Indian customers and therefore, the petitioner s commission depends upon the orders placed by the Indian Customers and thus the services rendered by the petitioner are of the peculiar nature and, therefore, under Section 2(13) of the IGST Act, the petitioner has been classified as Intermediary . This classification of the petitioner is a reasonable classification due to the peculiar nature of services provided by him. In fact, it is the petitioner's case (para 4.7 of the petition) that only on receipt of the payment from the Indian Purchasers the petitioner gets his commission. Therefore, the contentions of the petitioner that the transaction is one of export of services is factually incorrect, as the petitioner is a facilitator. Similar is the position in respect of the petitioner in Writ Petition Lodging No. 639 of 2020 (A.T.E. Enterprises Private Limited vs. The Union of India Ors.) 33. In so far as the legal posi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ended to include only five goods, and Entry No. 92-C of the Union List, which pertains to taxes on services, came to be deleted. Also, by 101st amendment, Articles 246, 248, 249, 250, 268, 270, 286 366 and the entire Article 268-A, which pertains to service tax levy by the Union and collected and appropriated by the Union and State was deleted. The said changes in the Constitution have resulted in bringing about the following position:- i) The concept of one nation one tax was introduced by this amendment and the Goods and Service Tax was introduced; ii) Both the Union of India and State Government derived simultaneous powers under Article 246-A to levy Goods and Service tax. This tax is defined under Article 366 (12-A). The Union of India has enacted the CGST Act under Article 246-A and the State has enacted the MGST Act under Article 246-A. iii) Entry No.54 of the State List was amended to include five goods, similarly Entry No. 92 (C) was deleted from the Union List and Article 246-A and Article 269-A were introduced respectively. 36. It is submitted that Article 269-A is in respect of the levy and collection of Goods and Service tax in the course of inter-St ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ver, Sections 2(64) and Section 2(65) define Intra-State supply of goods and Intra-State supply of services . Thus, Sections 2(64) and 2(65) of both the CGST Act and the MGST Act are the bridging provisions to determine what is inter-State supply, and Section 9 of both the CGST and the MGST Act are the charging Sections for the levy of inter-State tax. 40. It is submitted that once the Parliament has legislative Competence to enact the provisions of law to determine as to what is the place of supply and in exercise of the said powers, the Parliament has enacted Section 13(8)(b) providing that for Intermediary services, the place of business is location of the supplier, when the recipient is outside India, the same cannot be said to be ultra vires the provisions of the Constitution. 41. It is submitted that prior to the 101st Amendment to the Constitution. The incidence of tax, and the levy of tax in respect of Union of India and the State were distinct incidences, however, with the introduction of Article 246-A, both the Union of India and State are given simultaneous powers, and therefore the reliance of the petitioner to pass incidences of the manner of levy of the tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g with the price charged by the suppliers. The GST/VAT design of imposing a tax on value addition at each stage of production and distribution and the set-off of taxes paid on purchases by each supplier in the supply chain, except the final consumer, ensures the neutrality of tax. Mr. Maurice Laure, Joint Director of the France Tax Authority, is considered to have built upon the idea of GST/VAT and was the first to introduce such taxation system in France on April 10, 1954. Manufacturing-level VATs were introduced shortly in the 1960s. Brazil also introduced a traditional VAT by the fiscal reform of 1965 that applied at all stages of production. It is said that countries choose to introduce GST/VAT as the preferred form of consumption tax for different reasons, depending on their pre-existing tax systems. In the case of the European Union, which was formerly known as European Economic Community (EEC), adopting VAT was a pre-condition for its membership. The European Union adopted VAT to replace turnover taxes on account of the ease of handling cross-border transactions, facilitating the development of common market, and reducing trade and economic distortions. Another reason for co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ities and is not a charge on the business but on the consumer and it would, logically, be leviable only on services provided within the country. Service tax is a value added tax. 8. As stated above, service tax is VAT. Just as excise duty is a tax on value addition on goods, service tax is on value additioin by rendition of services. Therefore, for our understanding, broadly services fall into two categories, namely, property based services and performance based services. Property based services cover service providers such as architects, interior designers, real estate agents, construction services, mandapwalas etc.. Performance based services are services provided by service providers like stock-brokers, practising chartered accountants, practising cost accountants, security agencies, tour operators, event managers, travel agents etc. 17. As stated above, the source of the concept of service tax lies in economics. It is an economic concept. It has evolved on account of Service Industry becoming a major contributor to the GDP of an economy, particularly knowledge-based economy. With the enactment of Finance Act, 1994, the Central Government derived its authority from t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Supply of Indian Intermediaries of Goods will be the location of service recipient i.e. customers located abroad (and not the location of such intermediaries as is currently provided), so that Intermediary Services will be treated as Exports ; or Providing an exemption to Indian Intermediaries of Goods from levy of IGST, exercising the powers vested under Section 6(1) of IGST Act; or Notify such services under Section 13(13) of the IGST Act to prevent double taxation (tax in India as well as in the importing country) by treating place of effective use (foreign country) as place of supply. 15.3 The Government may also cause amendment to section 13(8) of the IGST At to exclude intermediary services and make it subject to the default section 13(2) so that the benefit of export of services would be available. (emphasis supplied) 51. The Division Bench of this Court in Commissioner of Service Tax, Mumbai-II vs. SGS India Pvt. Ltd. (supra) in a case where services were consumed abroad, applied the destination based principle and following the decision of the Supreme Court in the case of All India Federation of Tax Practitioners (supra) accepted the con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 54. Insofar as the present proceedings are concerned, the relevant Articles of the Constitution are Articles 245, 246, 246-A, 248, 249, 269-A, and 286. Article 246-A makes special provisions with respect to Goods and Services Tax. By virtue of Article 248, the residuary power of the legislation, subject to Article 246A, is conferred on the Parliament. It is provided that the Parliament has exclusive power to make any law with respect to any matter not enumerated in the Concurrent list or State List. By Clause (2) of Article 248, such power shall include the power of making any law imposing a tax not mentioned in either of those lists. Thereafter, Article 249 also came to be amended by the 101st Constitution Amendment Act, in the manner as provided in Clause (1), whereby the Parliament is empowered to make any law with respect to any matter enumerated in the State List and it is lawful for the Parliament to make laws for the whole or any part of the territory of India or in respect of Goods and Services Tax provided in Article 246A, and such power has been conferred considering the national interest. Article 269A provides for the levy and collection of goods and services tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny part of the territory of India with respect to goods and services tax provided under Article 246-A or that matter while the resolution remains in force. (2) A resolution passed under clause (1) shall remain in force for such period not exceeding one year as may be specified therein: Provided that, if and so often as a resolution approving the continuance in force of any such resolution is passed in the manner provided in clause (1), such resolution shall continue in force for a further period of one year from the date on which under this clause it would otherwise have ceased to be in force. (3) A law made by Parliament which Parliament would not but for the passing of a resolution under clause (1) have been competent to make shall, to the extent of the incompetency, cease to have effect on the expiration of a period of six months after the resolution has ceased to be in force, except as respects things done or omitted to be done before the expiration of the said period. Article 269-A: Levy and collection of goods and services tax in course of inter-State trade or commerce. (1) Goods and services tax on supplies in the course of inter-State trade or c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Clause (2) of Article 246-A provides that Parliament has exclusive power to make laws with respect to goods and services tax where the supply of goods, or of services, or both takes place in the course of inter-State trade or commerce. Thus, by virtue of Clause (2) of Article 246-A, it is further significant that the State legislature would not have the power to make laws with respect to goods and services tax, where the supply of goods or services, or both takes place in the course of inter-State trade or commerce. 56. Article 269-A of the Constitution provides for levy and collection of goods and services tax, in the course of inter-State trade or commerce. Clause (1) thereof provides that goods and services tax on supplies in the course of inter-State trade or commerce shall be levied and collected by the Government of India, and such tax shall be apportioned between the Union and the States in the manner as may be provided by the Parliament by law, on the recommendations of the Goods and Services Tax Council. Explanation below Clause (1) of Article 269-A, ordains that for the purposes of this clause, supply of goods, or of services, or both in the course of import into the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he course of the import of the goods into, or export of the goods out of, the territory of India. Explanation . For the purposes of subclause (a), a sale or purchase shall be deemed to have taken place in the State in which the goods have actually been delivered as a direct result of such sale or purchase for the purpose of consumption in that State, notwithstanding the fact that under the general law relating to sale of goods the property in the goods has by reason of such sale or purchase passed in another State. (2) Except in so far as Parliament may by law otherwise provide, no law of a State shall impose, or authorise the imposition of, a tax on the sale or purchase of any goods where such sale or purchase takes place in the course of inter-State trade or commerce. Provided that the President may by order direct that any tax on the sale or purchase of goods which was being lawfully levied by the Government of any State immediately before the commencement of this Constitution shall, notwithstanding that the imposition of such tax is contrary to the provisions of this clause, continue to be levied until the thirty-first day of March, 1951. (3) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied by a State under article 246A, such amount shall not form part of the Consolidated Fund of India. [Clause (3) of Article 269-A] (vi) No law passed by a State Legislature shall impose, or authorize the imposition of a tax, on the supply of goods or of services or both, where such supply takes place outside the State ; or in the course of the import of the goods or services or both into, or export of the goods or services or both out of, the territory of India . (Article 286(1)) (vii) The Parliament may by law formulate principles for determining when a supply of goods or of services or both in any of the ways as mentioned in clause (1) of Article 286. (Article 286(2)) 59. Thus explicitly, by virtue of clause (1)(b) of Article 286, no law of a State can impose, or authorize the imposition of, a tax on the supply of goods or of services or both, where such supply takes place outside the State; or in the course of the import or export of the goods or services outside the territory of India. 60. The question posed by the petitioners is in the context of their transactions, which is an export of service, as provided by the petitioners to their foreign principa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the supplier of service is located in India; (ii) the recipient of service is located outside India; (iii) the place of supply of service is outside India; (iv) the payment for such service has been received by the supplier of service in convertible foreign exchange [or in Indian rupees wherever permitted by the Reserve Bank of India]; and (v) the supplier of service and the recipient of service are not merely establishments of a distinct person in accordance with Explanation 1 in section 8; Section 2(13) intermediary means a broker, an agent or any other person, by whatever name called, who arranges or facilitates the supply of goods or services or both, or securities, between two or more persons, but does not include a person who supplies such goods or services or both or securities on his own account; Section 2 (14) location of the recipient of services means, (a) where a supply is received at a place of business for which the registration has been obtained, the location of such place of business; (b) where a supply is received at a place other than the place of business for which registration has been obtained (a fix ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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. (4) The Government may, on the recommendations of the Council, by notification, specify a class of registered persons who shall, in respect of supply of specified categories of goods or services or both received from an unregistered supplier, pay the tax on reverse charges basis as the recipient of such supply of 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 such supply of goods or services or both. (5) The Government may, on the recommendations of the Council, by notification, specify categories of services, the tax on inter-State supplies of which shall be paid by the electronic commerce operator if such services are supplied through it, and all the provisions of this Act shall apply to such electronic commerce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the same State or same Union territory shall be treated as intra-State supply: Provided that the following supply of goods shall not be treated as intra-State supply, namely: (i) supply of goods to or by a Special Economic Zone developer or a Special Economic Zone unit; (ii) goods imported into the territory of India till they cross the customs frontiers of India; or (iii) supplies made to a tourist referred to in section 15. (2) Subject to the provisions of section 12, supply of services where the location of the supplier and the place of supply of services are in the same State or same Union territory shall be treated as intra-State supply: Provided that the intra-State supply of services shall not include supply of services to or by a Special Economic Zone developer or a Special Economic Zone unit. Explanation 1. For the purposes of this Act, where a person has, (i) an establishment in India and any other establishment outside India; (ii) an establishment in a State or Union territory and any other establishment outside that State or Union territory; or (iii) an establishment in a State or Union territory and any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... services supplied in respect of goods which are temporarily imported into India for repairs or for any other treatment or process and are exported after such repairs or treatment or process without being put to any use in India, other than that which is required for such repairs or treatment or process; (b) services supplied to an individual, represented either as the recipient of services or a person acting on behalf of the recipient, which require the physical presence of the recipient or the person acting on his behalf, with the supplier for the supply of services. (4) The place of supply of services supplied directly in relation to an immovable property, including services supplied in this regard by experts and estate agents, supply of accommodation by a hotel, inn, guest house, club or campsite, by whatever name called, grant of rights to use immovable property, services for carrying out or co-ordination of construction work, including that of architects or interior decorators, shall be the place where the immovable property is located or intended to be located. (5) The place of supply of services supplied by way of admission to, or organisation of a cultural, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f such institutions, as the Reserve Bank of India may, with the previous approval of the Central Government and by notification in the Official Gazette, specify. (9) The place of supply of services of transportation of goods, other than by way of mail or courier, shall be the place of destination of such goods. (10) The place of supply in respect of passenger transportation services shall be the place where the passenger embarks on the conveyance for a continuous journey. (11) The place of supply of services provided on board a conveyance during the course of a passenger transport operation, including services intended to be wholly or substantially consumed while on board, shall be the first scheduled point of departure of that conveyance for the journey. (12) The place of supply of online information and database access or retrieval services shall be the location of the recipient of services. Explanation . For the purposes of this sub-section, person receiving such services shall be deemed to be located in the taxable territory, if any two of the following non-contradictory conditions are satisfied, namely: (a) the location of address presented ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and Services Tax Act or the rules made thereunder. (emphasis supplied) 63. It may be observed that the IGST Act has been enacted to make provision for the levy and collection of tax on inter-State supply of goods or services or both , by the Central Government and for matters connected therewith or incidental thereto. It is to achieve such intent and purpose various provisions are incorporated, so as to enable the Central Government to levy and collect tax on the inter-State supply of goods or services . 64. As noted above, Section 2(6) of the IGST defines export of services, to mean the supply of any service when (i) the supplier of service is located in India; (ii) the recipient of service is located outside India; (iii) the place of supply of service is outside India; (iv) the payment for such service has been received by the supplier of service in convertible foreign exchange; and (v) the supplier of service and the recipient of service are not merely establishments of a distinct person in accordance with Explanation 1 in section 8. As observed above, the case of the petitioners is to the effect that the transactions of the petitioners, subject matter of the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supplier and the place of supply of goods are in the same State or same Union territory , shall be treated as intra-State supply. The proviso below sub-section (1) provides for three exceptions, which may not be of relevance for the present proceedings. What is significant is as to what sub-section (2) of Section 8 provides, namely, that subject to the provisions of section 12, supply of services where the location of the supplier and the place of supply of services are in the same State or same Union territory, shall be treated as intra-State supply , provided that the intra-State supply of services shall not include supply of services to or by a Special Economic Zone developer or a Special Economic Zone unit. Thus, sub-section (2) of Section 8 is another relevant provision for the present proceedings, as it incorporates the effect of Section 12 of the IGST Act. 67. Section 10 provides for the place of supply of goods, other than supply of goods imported into, or exported from India . Section 11 provides for the place of supply of goods imported into India or exported from India . These provisions need not be discussed in the context of the present proceedings. 68. S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ices , the place of supply shall be (is deemed to be) the location of supplier of services. This provision has a cascading effect on what Section 12 sub-section (1) read with sub-section (2)(ii) would provide, namely, that the place of supply of services for an intermediary shall be where the location of supplier of services, i.e., the location in India. Section 12 has a further reverse cascading effect on what Section 8(2) provides, namely, when the location of the supplier of services and the place of supply by virtue of Section 12 is in India, in that event, such supply of services is to be treated as intra-State supply of services. The legal consequence as brought about by such deeming combination is that a supply of service, of the nature of intermediary services, which is in the nature of export of service as defined under Section 2(6) of the IGST Act becomes an intra-State sale falling under the charging provision (Section 9) of the CGST Act and the MGST Act. Thus, according to the petitioners, a transaction/trade or commerce which is necessarily a transaction of export of service becomes an intra-State /local transaction, being available to be taxed as an intra-Sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an be discussed hereunder. The provisions of the CGST Act and the MGST Act are pari materia, hence reference to only the provisions of the CGST Act would suffice. 74. In such context, at the outset, it may be observed that CGST Act isan act framed by the Parliament to make a provision for levy and collection of tax on the intra-State supply of goods or services or both , by the Central Government and for matters connected therewith or incidental thereto. Thus, the CGST Act as also the MGST Act concerns only the intra-state supply of goods or services, for levy and collection of GST. Although, the object and purpose of the enactments is such, however, the provisions of the IGST Act stand referred/incorporated under the CGST Act, which is the cause and concern as echoed by the petitioners. The incorporation of the provisions of the IGST Act within the CGST Act begins with the definition clause itself. The relevant definitions in the CGST Act are 2(57), 2(58), 2(62), 2(64), 2(65), 2(70), 2(71), 2(72), 2(86) and 2(98). Further, Section 9 is the charging section. It would be necessary to note these provisions which read thus:- 2. Definitions. In this Act, unless the contex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a place other than the place of business for which registration has been obtained (a fixed establishment elsewhere), the location of such fixed establishment; (c) where a supply is made from more than one establishment, whether the place of business or fixed establishment, the location of the establishment most directly concerned with the provisions of the supply; and (d) in absence of such places, the location of the usual place of residence of the supplier; (72) manufacture means processing of raw material or inputs in any manner that results in emergence of a new product having a distinct name, character and use and the term manufacturer shall be construed accordingly; (86) place of supply means the place of supply as referred to in Chapter V of the Integrated Goods and Services Tax Act; . (98) reverse charge means the liability to pay tax by the recipient of supply of goods or services or both instead of the supplier of such goods or services or both under sub-section (3) or sub-section (4) of section 9, or under sub-section (3) or sub- section (4) of section 5 of the Integrated Goods and Services Tax Act; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be liable to pay tax: Provided further that where an electronic commerce operator does not have a physical presence in the taxable territory and also he does not have a representative in the said territory, such electronic commerce operator shall appoint a person in the taxable territory for the purpose of paying tax and such person shall be liable to pay tax. 75. A bare reading of Section 9 of the CGST Act would indicate that subject to the provisions of sub-section (2) thereof, there shall be levy of a tax called the Central Goods and Services Tax on all intra-State supplies of goods or services or both . By virtue of Section 2(65) of the CGST Act intra-State supply of services is required to have the same meaning as assigned to it in Section 8 of the IGST Act. As noted above, Section 8 of the IGST Act provides for 'intra-State supply'. Section 8(2) of the IGST Act provides that subject to the provisions of Section 12, the supply of services where the location of the supplier and the place of supply of services are in the same State or same Union Territory shall be treated as intra-State supply. Sub-section (2) of Section 8 recognizes the effect of Section 12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds that considering the clear effect as brought about under Article 246A, Article 269A and Article 286, explicitly the Parliament does not have legislative competence nor does the State Legislature has the legislative competence to tax export of services under the CGST and the MGST Acts, which indisputedly pertain to intra-State supply of goods and services. 78. In my opinion, there is certainly some substance in the petitioners contention that there is a polarity which is brought about insofar as taxing export of services provided by the intermediaries are concerned, as a consequence of an interplay of the enactments, namely, the IGST Act on one hand and the CGST and the MGST Acts on the other hand. Also, there appears to be some internal friction within the provisions of the IGST Act in this regard, which also needs to be discussed. Firstly such enigma is noticed in the operation of Section 5 which is the charging section and Section 13(8)(b) of the IGST Act. This for the reason that sub-section (1) of Section 5 interalia provides that subject to the provisions of sub-section (2), there shall be levied a tax called the Integrated Goods and Services Tax on all inter-State suppl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be substance in the contention as urged on behalf of the petitioners that applying the principles that the GST is the destination based tax, if an exporter of service, who is regarded as an intermediary by the respondents, exports his services to a foreign principal, who, for example, is based in the United Kingdom and as a benefit of the service provided by such Indian intermediary/exporter of service, the foreign principal enters into a contract with a person in the U.S.A., such transaction between the UK party with the U.S.A. party having materialized, and the Indian intermediary receiving commission for the services offered by him to the foreign principal, in convertible foreign exchange, in these circumstances, it is not understood as to how such a transaction of export of service, is being categorized as an intermediary services and can amount to an intra-State sale, so as to be liable for levy of GST under the CGST Act and the MGST Act. In regard to such transaction, there is no basis or any hypothesis to conclude that the beneficiary of the services provided by the intermediary, becomes an Indian party so as to apply the destination principle and that too at the hands of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter-State trade or commerce and in relation to the same supply of services by providing that the location of the recipient of the services being outside India, for intermediary services, the place of supply is deemed to be location of the supplier of services. Thus, there is an apparent dichotomy. A transaction of export of services as that of the petitioners, on one hand is treated as inter-State trade or commerce by virtue of sub-section (5) of Section 7, and on the other hand, the same transaction is treated as an intra-State trade and commerce by virtue of Section 13(8)(b) of the IGST Act. 82. In my opinion, certainly, the intention of the legislature is not to tax such transaction of export of services, also categorized as an intermediary services both under the IGST Act as also under the CGST and the MGST Acts. If it is to be such effect, interpretation and operation of these two provisions, it would lead to an absurdity making the provisions unworkable but also creating an uncertainty in the operation of the statutory mechanism, as neither there could be a desire of double taxation nor such a consequence would be acceptable under the regime of both the legislations, name ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... attempt can be made to examine whether the provision can be rendered meaningful. Unless the provision falls foul of the well-settled norms to strike down legislations, namely lack of legislative Competence, manifest, arbitrariness and/or the provisions being rendered unconstitutional being contrary to the provisions of the Constitution, the Court would be loath to strike down the validity of the legislative provision. 85. In such context, a reference to the decision of the Constitution Bench of the Supreme Court in Sunil Batra Vs. Delhi Administration Ors. (1978)4 SCC 494 is also required to be made in regard to the principles of statutory interpretation the Courts would be guided in considering the validity and constitutionality of legislations. In the concurring judgment of Mr. Justice Krishna Iyer, it was observed that a validation- oriented approach becomes the philosophy of the statutory construction recognizing that certain provisions of law construed in one way to be consistent with the Constitution and if another interpretation would render them unconstitutional, the Court would lean in favour of the former construction. The relevant observations of the Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ces' has been defined only under the IGST Act under Section 2(6); 'intermediary' has been defined for the purposes of IGST Act under Section 2(13). Thereafter, 'intra-State supply' has been defined in Section 8 of the IGST Act; Section 12 of the IGST Act defines 'place of supply of services where location of supplier and recipient is in India; and finally, Section 13 of the IGST Act is the provision which determines the place of supply of services where location of supplier or location of recipient is outside India. There is another provision that is relevant, namely, Section 16 of the IGST Act providing for Zero Rated Supply , which ordains that export of goods or services or both would amount to a zero-rated supply. A person registered to make zero rated supply shall be eligible to claim a refund, as provided for in sub-section (3). Thus, a cumulative reading of these provisions of the IGST Act gives a complete indication of a statutory mechanism as created for the purpose of the IGST Act, namely, insofar as the transaction of export of services by the intermediary is concerned, the same would necessarily fall within the framework of the IGST Act only. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act itself is a legislation, which concerns GST to be levied on inter-State trade and commerce and not on intra-State trade and commerce . 89. Be that as it may, as noted above, these provisions under the IGST Act, in my opinion, need to be applied and understood in their applicability only under the IGST Act, even applying the principles of strict construction of the taxing statutes. Under such principles, it is not permissible to recognize any vague and/or non-specific incorporation of the provisions of the IGST Act and/or any incorporation by mere implication, unless such incorporation is explicit and as permissible under the Constitution. 90. [Blank] 91. In such context, it would also be required to be examined whether Section 13(8)(b), along with the ancillary provisions, namely Section 12 and Section 8 of the IGST Act would have any applicability and/or relevance in the context of export of services under the CGST Act and MGST Act. In forwarding the discussion on this aspect, it may be stated and as noted above, the provisions of the IGST Act find recognition in their applicability in the CGST Act and the MGST Act under the provisions of Sections 2(57), 2(58), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re is anything repugnant in the subject or context . In view of this qualification, the Court has not only to look at the words but also to look at the context, the collocation and the object of such words relating to such matter and interpret the meaning intended to be conveyed by the use of the words under those circumstance . (See : Vanguard Fire and General Insurance Co. Ltd. Madras v. Fraser Ross, AIR 1960 SC 971). 93. In TATA Power Company Ltd. v. Reliance Energy Ltd. (2009)16 SCC 659 the Supreme Court considered the principles of contextual interpretation in interpreting Section 23 of the Electricity Act, 2003. The Court observed thus: Supply - Contextual Meaning 96. It was submitted by the respondents that in any event the word supply as used in Section 23 should be given the same meaning as is given to it in Section 2(70) of the Act i.e. the sale of electricity to a licensee or consumer. Accordingly by its very nature, supply would have a supplier and a receiver and any direction which is aimed at ensuring or regulating supply by its very nature would have to be directed to both the supplier and the receiver. 97. However, when the que ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d for under the CGST Act and the MGST Act. The CGST Act and the MGST Act both pertain to 'intra-State supply of goods and services'. These enactments do not define what is 'export of services.' They also do not give any indication as to any express incorporation of any provision in regard to export of services and/or there is an absence of any specific incorporation, as to what would be the place of supply when the supply of services where the location of the supplier or location of the recipient is outside India , in the manner Section 13 more particularly sub-section 8(b) of Section 13, would provide in the case of 'intermediary services'. If the legislature, and it ought not be without a reason, has refrained from making any specific reference or incorporation to such provision, it may not be permissible for the respondent to read into the provisions by the CGST and the MGST Act, as to what has been omitted and/or expressly not provided. It clearly appears that the entire concept of export of services which has been specifically stipulated and provided only under the provisions of the IGST Act, to be read into the provisions of the CGST and MGST Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oods or services or both, takes place in any of the ways mentioned in clause (1) of such Article. 96. In the context of such provisions of the Constitution, it is difficult to conceive that the CGST Act, which has been enacted only for the purpose of levy of GST on intra-State trade and commerce and the MGST Act, which is also an enactment to levy tax on intra-State trade and commerce, would be legislations which would recognize tax on export of services , as governed and contained within the domain of IGST Act. This position is also supported by significant and glaring indications intrinsic to the CGST Act and MGST Act, namely, that these enactments do not define export of services. As noted above, they do not define an intermediary; they do no contain provisions akin to the provisions of Section 13(8)(b) and Section 12 as contained in the IGST Act. Thus, the cumulative effect of the provisions of Section 13(8)(b) read with Section 8(2) and Section 12 of the IGST Act, in my opinion, can neither be read nor can be said to be of any relevance for the purpose of CGST and MGST Act(s) when it comes to any levy of GST under the said Acts on intermediary services, of the nature expor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ings Co. Ltd. vs. Finsbury Borough Council, Lord Asquith has said: If you are bidden to treat an imaginary state of affairs as real, you must surely, unless prohibited from doing so, also imagine as real the consequences and incidents which, if the putative state of affairs had in fact existed, must inevitably have flowed from or accompanied it. The statute says that you must imagine a certain state of affairs. It does not say that having done so, you must cause or permit your imagination to boggle when it comes to the inevitable corollaries of that state of affairs. 100. In State of Punjab Ors. vs. Dr. R.N. Bhatnagar Anr. 1999 2 SCC 330, it was held that the deeming fiction cannot be extended by analogy to cover any other field not meant to be covered by its sweep. 101. In Prafulla Kumar Swain vs. Prakash Chandra Mishra Ors., the Supreme Court referring to the celebrated commentary of Justice G.P. Singh: Principles of Statutory Interpretation (Fourth Edition 1988), in the context of a statute creating a legal fiction observed thus: 35. Coming to the deeming clause, that creates a legal fiction; the Court is to ascertain for what purpose the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the legislative wisdom to have the provisions of Section 2(6), Section 7, Section 8(2), Section 12 and Section 13 under the IGST Act and the consequence of any such transaction of export of service being scrutinized for the benefit under Section 16 of a Zero Rated Tax, need not be gone into, suffice it to observe that the mechanism for Section 13(8)(b) to operate is confined only to the provisions of the IGST Act. It also cannot be overlooked that there is likelihood that there are categories of transactions in relation to the intermediaries which may stricto sensu fall under the provisions of the IGST Act only and hence, to dislodge the provisions of Section 13(8)(b) from the IGST Act merely because it is deemed to have an application under the CGST Act and the MGST Act qua the export of service, in regard to such categories of person who can also be classified as intermediaries, would be a fatal proposition. It is for such reason, in my opinion, insofar as the provisions of Section 13(8)(b) is concerned, the same are required to be read to confined only to the provisions of the IGST Act. Constitutionally and for the reasons as discussed in the forgoing paragraphs, it is not p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use the territorial jurisdiction to decide an issue of Constitutional validity would be available before different Courts as held by the Supreme Court in the decision in M/s. Kusum Ingots Alloys Ltd vs. Union of India And Anr. (2004) 6 SCC 254, in the present context, such decision would not support the respondents. 105. In the context of the present proceedings, the reliance on behalf of the respondents on the decision of the Supreme Court in G. V. K. Industries Ltd. Vs. Income Tax Officer (supra) is not well founded for more than one reason. Firstly, there can be no doubt that no law made by the Parliament would be invalid on the ground that it has an extraterritorial operation as Clause (2) of Article 245 would provide. The present case, in my opinion, does not involve any extra-territorial operation of law made by the Parliament inasmuch as the subject matter of legislation purely pertains to inter-State trade and commerce in respect of which goods and services tax can be levied in the spheres as covered by the legislation. Further, in the context of the transaction in question to say that a law has been enacted to have an extra-territorial operation, would be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch observations of the Parliamentary Committee certainly must have fell for consideration of the respondents. It would definitely reflect upon the operation of Section 13(8)(2) outside the purview of the IGST legislation. 108. In so far as the contentions as urged on behalf of the State Government are concerned, the contentions on interpretation of the provisions of the Constitution and the CGST and MGST Acts are not different from what has been urged on behalf of the Union of India. The contention as urged on behalf of the State Government that because the foreign exporter sells its goods to the Indian importer and which is as a consequence of the services provided by the exporter of service, it needs to be accepted that the transaction of export of service changes its character as a intra-State transaction, is untenable in view of the aforesaid discussion. Such contention cannot be accepted on the interpretation of the provisions of the Constitution or on the interpretation of the provisions of IGST Act as discussed in detail in the foregoing paragraphs. 109. In the light of the above discussion in my opinion the provisions of Section 13(8)(b) and Section 8(2) are confined ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expressing an opinion, while deciding a reference, by assigning reason(s) which would support such opinion. It has not been shown to me from Jyoti Prokash Mitter (supra) that the issue as to whether the referee Judge can assign separate reasons for his own conclusions without accepting any of the reasons assigned by the differing Judges in support of their respective decisions arose for decision there . I have also not been referred to any provision in the rules framed by the High Court at Calcutta that precludes the referee Judge from adopting the approach indicated in the decision in Shivani Properties (supra), or, in other words, that such an approach as adopted by the referee Judge in Shivani Properties (supra) is contrary to the rules. The difference of opinion having arisen in the present case in regard to the fate of the appeal, an opinion as of necessity has to be rendered either way based on the reasoning that would support such opinion. Even if the reason in support of the opinion rendered by the referee Judge is different from the reason assigned by one of the differing Judges for arriving at the same conclusion, such course of action is not precluded by the rules r ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
