Vistex Asia Pacific Pvt. Ltd. Vs Union of India & Ors. (Bombay High Court)
Subsidiary is not a Agent of HO, service provided to Foreign HO, eligible for refund under GST-Bombay HC
In recent case of Vistex Asia Pacific Pvt. Ltd. vs UOI (WRIT PETITION NO. 4852 OF 2022) of Bombay High court, Court held that, Having holding and subsidiary does not mean , principle agent relationship, refund cannot be rejected on the ground of Holding and subsidiary relationship.
The petitioner is a subsidiary of USA (parent company), providing information system products and services to customers who own and operate proprietary information systems based on software licenses of ‘SAP’. It is the petitioner’s case that, it is primarily engaged in the export of Information Technology services and provides such services to its parent company under a Service Agreement The petitioner contends that the services provided by it to its parent company, qualify as ‘export of services’ under the provisions of the CGST Act, hence, the petitioner was entitled to a refund of unutilized input tax credit in terms of Section 54(3) of the Central Goods and Services Tax Act, 2017 (‘CGST Act’). And filed the application of refund.
The Assistant Commissioner, CGST, issued a SCN, calling upon the petitioner to show cause as to why the petitioner’s refund claim be not rejected, basis the verification of documents, as the documents including the said agreement revealed that the petitioner did not satisfy the conditions of ‘export of services’ under the Integrated Goods and Services Tax Act, 2017 (‘IGST Act’). The Assistant Commissioner, considering the petitioner’s reply, passed a refund sanction order. however, in Commissioner did not agree with the view taken by the Assistant Commissioner, in regard to the petitioner’s entitlement on its refund claim, more particularly, examining the Service Agreement Further, Deputy Commissioner, CGST, also filed appeals against the refund orders before the appellate authority, i.e., the Commissioner, CGST.
