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TMI Blog2023 (8) TMI 1203X X X X Extracts X X X X X X X X Extracts X X X X ..... of Section 104 of the Act, where the Authority finds that advance ruling pronounced by it under sub-section (4) of Section 98 or under sub-section (1) of section 101 has been obtained by the applicant by fraud or suppression of material facts or misrepresentation of facts, it may, by order, declare such ruling to be void ab initio and thereupon all the provisions of this Act or the rules made thereunder shall apply to the applicant as if such ruling had never been made. 5. At the outset, we would like to make it clear that the provisions of both the Central Goods and Service Tax Act and the Tamil Nadu Goods and Service Tax Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the Central Goods and Service Tax Act would also mean a reference to the same provisions under the Tamil Nadu Goods and Service Tax Act. M/s. Luksha Consulting Private Limited, Elampillai, Salem (hereinafter referred to as The Applicant'), with GSTIN 33AAECL3474C1ZU have filed an application for Advance Ruling under section 97 of GST Acts read with Rule 104 of GST Rules, 2017, in Form ARA-01 paying the prescribed fee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the submissions. 5.2. The AR has been asked to furnish the following details/ documents;- * Incorporation certificate of the foreign entity viz., M/s. Luksha Limited, UK. * Agreement between foreign entity and its customer * Copy invoice issued by the Applicant to foreign entity * Detailed write up on the nature of service associated with monitoring of customer applications running (like software, machinery, etc.,) in UK, as mentioned in the AR application. 5.3. Subsequently, the applicant has submitted the following documents:- * Certification of incorporation of a Private Limited Company of Luksha Limited issued by the Registrar of Companies for England and Wales. * VAT certificate issued to Luksha Limited in UK * Copy of the agreement dated 10.01.2022 between Luksha Limited, UK and Luksha Consulting P. Ltd, India * General Service Agreement between Spovens Limited, UK and Luksha Consulting P. Ltd, India * Copy of invoice No. INV-000001 dated 30.03.2022 issued by Luksha Consulting P. Ltd, India to Luksha Limited, UK. 6.1. The Applicant is assigned to State jurisdiction. The State jurisdictional authority, the Assistant Commissioner (ST), Sankari Assessment Ci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g), i.e. the clauses other than clause (e), are in specific "pigeon holes" the provision as per clause (e) of sub-section (2) of Section 97 is in wide terms and the Parliament has clearly mandated that the latter issue of determination of liability to pay tax on any goods or services or both, should also be matters on which the applicant concerned could seek advance ruling from the Advance Ruling Authority on which the said authority is obliged to render answers thereto. The Parliament has made the said provision envisaging that in transactions in nature, where India is now a growing economy and has to make its substantial performance in economic growth and development not only domestic investments, but even foreign investments would also be heavily required and that host of tax laws has been subsumed into the overarching umbrella of the goods and services tax regime introduced by the Parliament and the parliament would have certainly taken cognizance of the fact and has intended that very often applications would require clearly and precision about various aspects of taxation in the transactions and that there should be certainty and precision in those matters, so that the applica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Advance Ruling Authority is legally wrong and faulty and therefore the matter requires interdiction in judicial review in the instant writ proceedings. In that view of the matter, it is ordered that the above said view taken by the Advance Ruling Authority is legally wrong and faulty and is liable to be quashed and accordingly declared and ordered." Thus, this case is admitted based on the above observations made by the Hon'ble High Court of Kerala cited supra. Now it is imperative to analyze whether the said transactions satisfy the conditions stipulated under section 2(6) of IGST Act, 2017 to qualify it as export of service. 7.4.1. The export of services has been defined in subsection (6) of the section 2 of the IGST Act, 2017 as extracted below; "export of services" means 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 establis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntry. 4.3. In view of the above, it can be stated that supply of services made by a branch or an agency or representational office of a foreign company, not incorporated in India, to any establishment of the said foreign company outside India, shall be treated as supply between establishments of distinct persons and shall not be considered as "export of services" in view of condition (v) of sub-section (6) of section 2 of IGST Act. Similarly, any supply of service by a company incorporated in India to its branch or agency or representational office, located in any other country and not incorporated under the laws of the said country, shall also be considered as supply between establishments of distinct persons and cannot be treated as export of services. 4.4 From the perusal of the definition of "person" under sub-section (84) of section 2 of the CGST Act, 2017 and the definitions of "company" and "foreign company" under Section 2 of the Companies Act, 2013, it is observed that a company incorporated in India and a foreign company incorporated outside India, are separate "person" under the provisions of CGST Act and accordingly, are separate legal entities. Thus, a subsidiary/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... M/s. Luksha Limited, UK are not considered as establishments of distinct person as the directors of both the establishments are different persons, as evident from the certificate of incorporation furnished by the applicant. 7.5. The Applicant M/s. Luksha Consulting Private Limited has entered into an agreement with M/s. Luksha Limited, UK and Spovens Limited UK and submitted copy of the agreement. The Applicant has also stated that they have potential business with M/s. Exigo solution, Stockport. 7.6. In this context, it is imperative to ascertain whether the services rendered by M/s. Luksha Consulting Private Limited as per the agreement satisfies the conditions prescribed under Section 2(6) of the IGST Act, 2017; Conditions Remarks (i) the supplier of service is located in India The supplier of service M/s. Luksha Consulting Private Limited is located in India. (ii) the recipient of service is located outside India; The recipient M/s. Luksha Limited, UK is located outside India. (iii) the place of supply of service is outside India; In terms of Section 13(2) of the IGST Act, the place of supply of services except the services specified in subsections (3) to (13) shall ..... X X X X Extracts X X X X X X X X Extracts X X X X
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