BPO Services to Overseas Client Are Exports, Not Intermediary Services: CESTAT Chandigarh

Genpact Services LLC Vs Commissioner of Central Goods & Service Tax (CESTAT Chandigarh)

The appeals arose from a common Order-in-Appeal dated 31.03.2021 passed by the Commissioner (Appeals), CGST, Gurugram, which allowed the Revenue’s appeals by setting aside Orders-in-Original granting refunds to the appellant. The three appeals covered the periods July 2013 to December 2013, January 2017 to March 2017, and April 2017 to June 2017, involving a total refund claim of ₹14,55,37,036. The appellant, Genpact Services LLC, India Branch, provided back-office support services, including call centre services, back-office management and IT helpdesk services, to the customers of Genpact International Inc. (GI), USA, under a Master Services Sub-Contracting Agreement dated 01.01.2013.

The appellant had no contractual relationship with GI’s customers, was remunerated solely by GI on a principal-to-principal basis, and treated the services as exports under Rule 3 of the Place of Provision of Services Rules, 2012, claiming refund of accumulated Cenvat credit under Rule 5 of the Cenvat Credit Rules read with the applicable refund notification. The Commissioner (Appeals) held that the appellant was an “intermediary” under Rule 2(f) read with Rule 9(c) of the Place of Provision of Services Rules, denied export benefits and consequently denied the refunds.

Before the Tribunal, the appellant contended that the Revenue itself had acknowledged that GI was engaged in BPO and IT services and that the appellant functioned as GI’s subcontractor without any agreement with GI’s overseas customers. It argued that it did not arrange or facilitate services but itself provided the contracted services to GI on a principal-to-principal basis, making GI its customer. The appellant further submitted that the issue stood settled by the Punjab & Haryana High Court in cases concerning its group company, Genpact India Pvt. Ltd., involving an identically worded agreement with GI.

According to the appellant, the High Court held that Genpact India Pvt. Ltd. was not an intermediary, the Revenue did not challenge that judgment before the Supreme Court, and refunds had subsequently been granted. The appellant also relied upon Circular No. 159/15/2021 dated 20.09.2021, which stated that the law relating to intermediary services under the Service Tax and GST regimes is similar. An alternative submission was also made that, even if the refund claims were rejected, accumulated Cenvat credit should be refunded in cash under Section 142(3) of the CGST Act, 2017. The Revenue supported the findings of the impugned order.

The Tribunal held that the only issue was whether the appellant’s services were intermediary services or qualified as export of services, thereby entitling it to refund of Cenvat credit under Rule 5 of the Cenvat Credit Rules, 2004 read with Notification No. 27/2012-CENT dated 18.06.2012. After examining the Master Services Agreement dated 01.01.2013, the Tribunal found that the appellant acted as a subcontractor on a principal-to-principal basis, had no contractual relationship with GI’s customers, and received remuneration only from GI. The Tribunal noted that the jurisdictional Punjab & Haryana High Court, in the appellant’s group company’s cases involving an identical agreement, had concluded that Genpact India Pvt. Ltd. was not an intermediary.

It also recorded that the Revenue had not filed a Special Leave Petition against the High Court’s judgment and had granted refunds to Genpact India Pvt. Ltd. The Tribunal further observed that the Department’s Circular No. 159/15/2021 clarified that the intermediary provisions under the Service Tax and GST regimes are similar, making the High Court’s ratio applicable. It also referred to its own decision in M/s William E Connor And Associates Sourcing Pvt Ltd, which, following the Punjab & Haryana High Court judgments, held that similar services were not intermediary services and that denial of export benefits could not be sustained. Following those judgments and Tribunal decisions, the Tribunal held that the impugned order was not sustainable in law, set it aside, and allowed all three appeals with consequential relief, if any, as per law. The order was pronounced on 01.07.2026.

Cases Discussed:

• M/s William E Connor And Associates Sourcing Pvt Ltd vs. Commr of CGST, Gurugram – 2025 (5) TMI 1898 – CESTAT CHANDIGARH
• Samsung India Electronics vs. Commissioner – (2024) 16 Centax 343 (Tri. All.)
• Genpact India Pvt Ltd, CWP No. 14151/2021, judgment dated 09.08.2023, cited as 2023 (77) GSTL 512 (P&H)
• Commissioner vs. Jindal Steel and Power – (2023) 7 Centax 130 (Ori.)
• Dhyan Networks & Technologies vs. Commissioner – (2023) 4 Centax 304 (Tri. Chennai)
• Genpact India Pvt Ltd, CWP No. 6048/2021, judgment dated 11.11.2022, cited as 2023 (68) GSTL 3 (P&H)
• Oceanic Consultants Pvt Ltd vs. Commr of CE & ST, Chandigarh-I – 2016 (45) S.T.R. 124 (Tri.-Bang.)
• Thermax Ltd vs. Union of India – 2019 (31) GSTL 60 (Guj.)

FULL TEXT OF THE CESTAT CHANDIGARH ORDER

These three appeals are directed against a common impugned Order-in-Appeal dated 31.03.2021 passed by the Commissioner (Appeals), CGST, Gurugram, whereby the learned Commissioner (Appeals) has allowed the appeal of the Revenue by setting aside the Orders-in-Original vide which the Refund Sanctioning Authority had granted the refunds to the Appellant. Since the issue involved in all three appeals is identical and there is a common impugned order, therefore, all three appeals are taken up together for discussion and decision. Details of the appeals are given herein below in tabular form:

2. Briefly stated facts of the case are that the Appellant M/s Genpact Services LLC is an India Branch established as a private company with unlimited liability incorporated under the Companies Act, 1956. The Appellant was engaged in providing back office support services such as call centre services, back office management, IT helpdesk services (“BPO Services”) to the customers of M/s Genpact International Inc. (in short ‘GI’), an entity located outside India. The Appellant provided said services to third parties (clients of GI) located outside India on behalf of its client, i.e. GI, located outside India, through online, on-call or through e-mail. For the purpose of providing the services, the Appellant had entered into a Master Services Sub-Contracting Agreement dated 01.01.2013 (in short ‘MSA’) with GI, a corporation organized under the laws of Delaware, USA. As per the said MSA with GI, the Appellant was sub­contracted the services which GI was obliged to provide to its customers. The Appellant did not have any contractual relationship with the customers of GI. The Appellant was remunerated by GI, who in turn was being remunerated by its customers. The relationship between GI and the Appellant for supply of services under the MSA, was on principal-to-principal basis. The Appellant considered its services as export in terms of Rule 3 of the Place of Provision of Services Rules, 2012 (in short ‘POPS Rules’) and was filing periodical refund claims to seek refund of accumulated Cenvat credit under Rule 5 of the Cenvat Credit Rules read with the Refund Notification. Three such refund claims filed by the Appellant were allowed by the Refund Sanctioning Authority vide three different Orders-in-Original, holding that the services provided by the Appellant qualify as export of service. However, these Orders-in-Original were reviewed and the Revenue filed the appeal before the Commissioner (Appeals), who vide the Order-in-Appeal dated 31.03.2021, has allowed the Revenue’s appeal by holding that the Appellant is an Intermediary under Rule 2(f) and in view of Rule 9(c) of the POPS Rules, the place of provision of Appellant’s services would be the location of Appellant, i.e. India. Consequently, the learned Commissioner (Appeals) has denied export benefit and therefore, has denied refunds claimed by the Appellant. Aggrieved by the impugned Order-in-Appeal passed by the learned Commissioner (Appeals), the Appellant has preferred the present appeals.

3. Heard both sides and perused the material on records.

4. The learned Counsel for the appellant submits that the impugned Order-in-Appeal is not sustainable in law and is liable to be set aside as the same had been passed without properly appreciating the facts, the law and the binding judicial precedents.

4.1 The learned Counsel further submits that in para 4.2.1 of the grounds of appeal filed by the Revenue before the Commissioner (Appeals), it is admitted that GI is in the business of providing Business Process Outsourcing (‘BPO’) and Information Technology (‘IT’) services to its customers; as per the MSA, the Appellant was appointed as GI’s sub-contractor to perform certain BPO and IT services on behalf of GI for the customers of GI. He further submits that it is also admitted in the same para that the Appellant did not have any Agreement with the overseas customers of GI; therefore, the services provided by the Appellant to GI are on principal-to-principal basis. He further submits that admittedly the Appellant does not have any contract with the customers of GI; therefore, the Appellant did not provide any services to the customers of GI and provided the same to GI only.

4.2 The learned Counsel further submits that in the appeal filed by the Revenue before the Commissioner (Appeals), it has been incorrectly averred that the Appellant was required to arrange or facilitate certain BPO and IT services to overseas customers of GI. He also submits that the Appellant was not required to arrange or facilitate, but was required to provide services on behalf of GI to its customers; this is also admitted in conclusion of para 9 of the impugned Order-in-Appeal dated 31.03 2021; the services provided by the Appellant were not arranged or facilitated through some other service provider but were provided by the Appellant on its own account to GI. He further submits that the entire edifice of Revenue’s appeal before the Commissioner (Appeals) is on the basis that the Appellant arranged or facilitated services to GI’s customers, whereas the fact is that the Appellant themselves provided the services to GI, and not to the GI’s customers. He also submits that in the present case, admittedly the Appellant had contracted with GI to provide its services and GI paid for the said services; thus, GI is the customer of the Appellant, and not GI’s customers; therefore, the Appellant does not qualify under the definition of ‘intermediary’ under Rule 2(f) of the POPS Rules.

4.3 The learned Counsel further submits that the issue involved in the present case is no longer res integra and has been settled by the Hon’ble Punjab & Haryana High Court in the cases of the Appellant’s group company viz., Genpact India Pvt Ltd, which had entered into identically worded agreement with GI; para 9 of the impugned Order-in-Appeal dated 31.03.2021 will bear testimony to the fact that the clauses in the impugned agreement and that entered into between Genpact India Pvt Ltd and GI were identical.

4.4 He submits that the Hon’ble Punjab & Haryana High Court in CWP No. 6048/2021, vide its judgement dated 11.11.2022, [cited as 2023 (68) GSTL 3 (P&H)], examined the said agreement in the context of Intermediary and came to the conclusion that Genpact India Pvt Ltd is not an Intermediary; the said judgment of the High Court was not challenged by the Revenue before the Hon’ble Supreme Court and the Revenue has granted the refund to Genpact India Pvt Ltd. He further submits that under Circular No. 159/15/2021 dated 20.09.2021, it is clarified that the provisions of law with respect to Intermediary are similar under the Service Tax and GST regimes and therefore the ratio of the above-said judgment of Hon’ble Punjab & Haryana High Court should apply for the Service Tax regime also.

4.5 He further submits that in CWP No. 14151/2021, decided by the Hon’ble Punjab & Haryana High Court vide its judgment dated 09.08.2023, [cited as 2023 (77) GSTL 512 (P&H)], Genpact India Pvt Ltd had challenged Show Cause Notice for the period April 2012 to June 2017 vide which the Revenue was seeking to recover the refund granted to Genpact India Pvt Ltd and seeking to impose service tax on Genpact India Pvt Ltd holding them to be Intermediary and therefore would not qualify as exporter of services; the Hon’ble Punjab & Haryana High Court set aside the said Show Cause Notice by specifically recording that the Revenue has taken conscious decision not to file the SLP against the previous judgement dated 11.11.2022 in CWP No. 6048 of 2021.

4.6 He further submits that the Hon’ble Punjab & Haryana High Court in its judgment dated 11.11.2022 has reproduced certain clauses of the Agreement dated 01.01.2013 between Genpact India Pvt Ltd and GI and these clauses are identical in the present case also. He further submits that various clauses of the Agreement examined by the Hon’ble Punjab & Haryana High Court in the above-said case and the clauses of the Agreement in the present appeal, are identically worded. Further, he also submits that as per the Revenue’s own Circular, law under the Service Tax regime and the GST regime, as far as Intermediary is concerned, is similar.

4.7 He further submits that the Revenue has started giving refund to the Genpact India Pvt Ltd after the judgement dated 09.08.2023 of Hon’ble Punjab & Haryana High Court wherein the Hon’ble Punjab & Haryana High Court has held Genpact India Pvt Ltd is not ‘Intermediary’, even under the Service Tax regime.

4.8 He also places relies on the following decisions of the Tribunal:

• M/s William E Connor And Associates Sourcing Pvt Ltd vs. Commr of CGST, Gurugram – 2025 (5) TMI 1898 – CESTAT CHANDIGARH
• Oceanic Consultants Pvt Ltd vs. Commr of CE & ST, Chandigarh-I [2016 (45) S.T.R. 124 (Tri.-Bang.)]

wherein the Tribunal, after following the ratios of the judgments dated 11.11.2022 & 09.08.2023 of the Hon’ble Punjab & Haryana High Court, has decided the identical issue in favour of the Assessees.

4.9 The learned Counsel also makes an alternative argument that even if the refund claim was to be rejected, the Appellant would be entitled to receive the refund of the accumulated Cenvat credit in cash in terms of Section 142(3) of the CGST Act, 2017. For this submission, he relies on the following case-laws:

• Thermax Ltd vs. Union of India – 2019 (31) GSTL 60 (Guj.)
• Commissioner vs. Jindal Steel and Power – (2023) 7 Centax 130 (Ori.)
• Samsung India Electronics vs. Commissioner – (2024) 16 Centax 343 (Tri. All.)
• Dhyan Networks & Technologies vs. Commissioner – (2023) 4 Centax 304 (Tri. Chennai)

5. On the other hand, the learned Authorized Representative for the department reiterates the findings of the impugned order.

6. After considering the submissions made by both the parties and perusal of the material on record, we find that the only issue involved in the present case is whether the services provided by the Appellant to the customers of its overseas client, are in the nature of ‘Intermediary’ or not? and as the place of supply of Appellant’s services being outside India, the said services qualify as ‘export of services’, thus, making the Appellant entitled for refund of Cenvat credit under Rule 5 of the Cenvat Credit Rules, 2004, read with Notification No. 27/2012-CENT dated 18.06.2012 or not?

7. We have examined the various terms of the Agreement (‘MSA’) dated 01.01.2013 entered into by the Appellant with GI. We find that as per the said Agreement, the Appellant has entered into this Agreement on principal-to-principal basis and has agreed to provide the services as a sub-contractor of GI. We also find that there is no contractual relationship between the Appellant and the customers of GI. The Appellant was remunerated for its services by GI only, who in turn was being remunerated by its customers.

8. Further, we find that the Original Authority/Refund Sanctioning Authority, after considering the provisions of the Cenvat Credit Rules and the Notification No. 27/2012-CENT dated 18.06.2012, had allowed the refund, which was reviewed and challenged by the Revenue before the Commissioner (Appeals). The learned Commissioner (Appeals), vide the impugned Order-in-Appeal, has held the Appellant is an ‘Intermediary’ under Rule 2(f) and has also denied export benefit and consequently, denied the refund claimed by the Appellant.

9. Further, we find that this issue, i.e. whether the Appellant is an ‘intermediary’ under Rule 2(f) read with Rule 9(c) of the POPS Rules, has been considered by the jurisdictional High Court of Punjab & Haryana in the cases of Appellant’s group company viz. M/s Genpact India Pvt Ltd, which had entered into identically worded Agreement with GI; and after considering the various clauses of the said Agreement, the Hon’ble High Court vide its judgment dated 11.11.2022 (in CWP No. 6048/2021) came to the conclusion that Genpact India Pvt Ltd is not an ‘intermediary’. It is further noted that the Revenue did not file SLP against the judgment dated 11.11.2022 of the High Court before the Hon’ble Supreme Court and has granted the refunds to Genpact India Pvt Ltd. We also note that vide Circular No. 159/15/2021 dated 20.09.2021, the Department has clarified that the provisions of law with respect to ‘Intermediary’ are similar under the Service Tax regime and GST regime, and therefore the ratio of the judgment dated 11.11.2022 of the Hon’ble Punjab & Haryana High Court is applicable for the Service Tax regime also. Further, we also note that subsequently, the Hon’ble Punjab & Haryana High Court vide its judgment dated 09.08.2023 (in CWP No. 14151/2021) allowed the plea of Genpact India Ltd and set aside the Show Cause Notice for the period April 2012 to June 2017 vide which the Revenue was seeking to recover the refund granted to Genpact India Pvt Ltd and seeking to impose service tax on Genpact India Pvt Ltd.

10. Further, we find that this bench of the Tribunal in the case of M/s William E Connor And Associates Sourcing Pvt Ltd (supra) has also considered the identical issue; the Tribunal, after considering the definition of ‘intermediary’ under the Service Tax regime as well as the above-mentioned judgment of the Hon’ble Punjab & Haryana High Court, has held as under:

“16. This Bench has taken similar view in respect of M/s Airbnb Payments India Pvt Ltd. vide Final Order No. 60505­60506/2024 dated 04.09.2024. We find that in the instant case too, the appellants cannot be called intermediary as per the criteria laid down by the Hon’ble Punjab & Haryana High Court in the case of Genpact India Pvt Ltd. – 2023 (77) GSTL 512 (P&H). Therefore, we find that the impugned order incorrectly holds the appellants as ‘intermediary’ and denies the benefit of export. Therefore, we find that the impugned order, confirming the demand holding that the appellants are an intermediary, cannot be sustained. When the impugned order does not survive on this issue, we find that it is a futile exercise to go into the elaborate submissions given by the learned Counsel for the appellants.”

11. In view of our discussion above and by following the ratios of the judgments of the jurisdictional High Court as well as the decisions of the Tribunal, as cited above, we are of the considered opinion that the impugned order is not sustainable in law and is liable to be set aside and therefore, we do so by allowing all three appeals of the Appellant with consequential relief, if any, as per law.

(Order pronounced in the open court on 01.07.2026)