Sundyne Pumps and Compressors India Pvt Ltd Vs Union of India (Bombay High Court)
In recent case of Sundyne Pumps and Compressors India Private Limited vs UOI, Bombay HC, held that the primary requirement to satisfy the definition of an “agent” is that the agent supplies goods or services or both on behalf of principle. But this does not make every time subsidiary as “agent” of Holding company. And therefore, service supplied by Indian Subsidiary to foreign holding company is eligible for Export of Service.
The Petitioner supplies engineering services for industrial and manufacturing projects, specialized office support services, management consulting and management services, maintenance and repair services etc., and also supplies goods to its customers. The said supplies are to Petitioner’s group companies/ related persons located outside India.
the Petitioner had filed two refund applications for the period July to September 2021 and October to December 2021 of the unutilised ITC under Section 54(3) of Central Goods and Services Act, 2017 (“CGST Act”) / Maharashtra Goods and Services Tax Act, 2017 (“MGST Act”) read with Rule 89 (4) of Central Goods and Services Rules, 2017 (“CGST Rules”) / Maharashtra Goods and Services Tax Rules, 2017 (“MGST Rules”) for making zero rated supplies, which came to be rejected by the Original Authority – State Tax officer upheld by the Appellate Authority. on the ground that the recipients of the services located outside India are carrying on business through the “agency” in India i.e. the Petitioner and hence the Petitioner qualifies as “mere establishment of distinct person”. Thus, the Petitioner did not provide zero rated supplies and consequently, not entitled to a refund of unutilized ITC under Section 54(3) of the CGST/MGST Act.
