Infodesk India Pvt. Ltd. Vs Union of India & Ors. (Gujarat High Court)
Gujarat High Court held that software consultancy services to parent company located outside India provided on principal to principal basis qualifies as export of service and cannot be considered as intermediary service.
Facts- The petitioner is a wholly owned subsidiary of Info Desk. Inc. situated at USA and is established exclusively for the purpose of servicing its parent organizations’ technical requirements and for that purpose, the petitioner has developed products and services for InfoDesk. Inc. It is the case of the petitioner that it manages IT infrastructure, editorial and content creation activities, customer support and custom usage report generation for the clients of its parent company.
According to the petitioner, services provided to its parent company are in nature of ‘export of service’ in terms of provisions of Integrated Goods and Service Tax Act, 2017 as the petitioner fulfills the requirements of Section 2(6) of IGST Act, being ‘zero-rated supply in terms of Section 16 of IGST Act. The petitioner, therefore, filed refund application in accordance with the procedure prescribed vide Circular No.17/17/2017-GST dated 15th November 2017 and Circular No.24/24/2017-GST dated 21st December 2017 issued by the Central Board of Indirect Taxes and Customs. However, respondent rejected the said refund application.
