Case Law Details
In re IVL India Environmental R & D Private Limited (GST AAR Maharashtra)
As per Section 2(11) of the Integrated Goods and Service Tax Act, 2017, ‘Import of services’ means the supply of any service, where: The supplier of service is located outside India; The recipient of service is located in India; and The place of supply of service is in India.
We find that in the subject case other than the service provided by the applicant to MCGM, there is a very definite service being provided by IVL Sweden, located outside India – on account of its experience, credentials and expertise – to the applicant, located in India that enables the applicant to perform under the contract. Further, there is no doubt that the services are being supplied in taxable territory i.e. in India.
Therefore, in view of Sr. No. 1 of Notification 10/2017 – IGST (Rate) dated June 28, 2017, since support services are being supplied by IVL Sweden, located in a non-taxable territory to the applicant the whole of integrated tax leviable under section 5 of the Integrated Goods and Services Tax Act, shall be paid on reverse charge basis by the recipient of the such services i.e. the applicant. Thus the applicant has to pay GST on the money proceeds which is being transferred to IVL Sweden.
Question:- Whether mere transfer of monetary proceeds by the IVL India Environmental R&D PVT Ltd (hereinafter referred to as ‘the Applicant’ or “IVL India”) to IVL Swedish Environmental Research Institute Limited (hereinafter referred to as “IVL Sweden”), without underlying import of service will be liable for payment of Integrated Goods and Service Tax under reverse charge mechanism under entry no. 1 of Notification 10/2017 – IGST (Rate) dated June 28, 2017.
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