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TMI Blog2023 (4) TMI 1074X X X X Extracts X X X X X X X X Extracts X X X X ..... India. In the present case, the appellant had entered in to service agreement with M/s. Integrated Managed Solutions Inc. ('IMS-US') and Integreon Managed Solutions Limited ('IMS-UK'), both located outside the country. The rendition of service as per the agreement related to Administrative Support Service like document review, preparation of presentation and business information services. Since, substantial part of the output services provided by the appellant were exported, there was no scope or occasion to utilize the accumulated Cenvat credit available in their books of account. Thus, the appellant had filed a refund application for the period of July 2016 to June 2017, claiming refund of service tax paid on the input services. The subje ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entities and thus, the conditions of Rule 6A (1) of the Service Tax Rules, 1994 have been duly satisfied, in order to claim that the transaction made between both the sides should be construed as export and the benefit of export of service should be available to the appellant. To strengthen such stand, the appellant has relied upon the Circular No.159/15/2021-GST dated 20.09.2021 issued by the CBIC, clarifying the phrase 'intermediary' for the purpose of the POPS Rules, 2012. He has also relied upon the decision of this Tribunal in the case of Blackrock Services India Pvt. Ltd. Vs. Commissioner of CGST, Gurgaon [2022 (67) GSTL 447 (Tri.-Chan)] to state that in identical set of facts, by considering the contractual norms, the Tribunal has h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... providing such services prior to subcontracting the work to IMSIPL. 6. OBLIGATIONS OF IMS NY IMS NY hereby agrees to fulfil the following obligations during the term of this Agreement: a) Carry out marketing/promotion activities on its own account, enter into contracts with its Client and subcontract such procured contracts for execution to IMSIPL. b) Assist IMSIPL with such information and assistance as may be require by IMSIPL to perform the necessary services to IMS NY. c) The terms for performing services will be mutually agreed between IMS NY & IMSIPL. d) Maintain necessary approvals, permits, registrations and licenses as are necessary for the purpose of complying with applicable law during the term of this Agreement. 8. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... their own account, payment of their own tax obligations in accordance with applicable law and for the payment of any benefits, compensation and/or dues as may be payable to their respective employees." 6. On careful examination of the contents of the agreement, it reveals that the relationship between the appellant and the overseas entities are that of Principal to Principal, and there is no otherwise relationship namely joint venture, partnership or agencies. It is not the case of revenue that the appellant had failed to export the taxable output service or failed to receive the payment for such services in convertible foreign exchange. Thus, in our considered view the condition of Rule 6A (1) ibid have been fulfilled by the appellant fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iary is sub-contracting. The supplier of main service may decide to outsource the supply of the main service, either fully or partly, to one or more sub-contractors. Such sub-contractor provides the main supply, either fully or a part thereof, and does not merely arrange or facilitate the main supply between the principal supplier and his customers, and therefore, clearly is not an intermediary. For instance, 'A' and 'B' have entered into a contract as per which 'A' needs to provide a service of, say Annual Maintenance of tools and machinery to 'B'. 'A' subcontracts a part or whole of it to 'C'. Accordingly, 'C' provides the service of annual maintenance to 'A' as part of such sub-contract, by providing annual maintenance of tools and machi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tates the supplies of goods or services or securities between two or more persons. It is thus necessary that the arrangement requires a minimum of three parties, two of them transacting in the supply of goods or services or securities (main supply) and one arranging or facilitating the said main supply. Therefore, an activity between only two parties cannot be considered as an intermediary service. An intermediary essentially arranges or facilitates the main supply between two or more persons and does not provide the main supply himself. The intermediary does not include the person who supplies such goods or services or both on his own account. Therefore there is no doubt that in cases wherein the person supplies the main supply either full ..... X X X X Extracts X X X X X X X X Extracts X X X X
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