Case Law Details
In re Behr-Hella Thermocontrol India Pvt. Ltd. (GST AAR Maharashtra)
The argument of the applicant is that the services provided by the applicant in this case, as per the agreement, are completed only when the test reports are sent to their overseas clients is not tenable for the reason that first of all the service of testing provided by the applicant on the basis of examination and physical verification of prototypes is in respect of verification of traits, characteristics and defects, if any, in respect of prototypes sent to the applicant and this service of testing is over once on the basis of examination and verification of prototype, the test report is generated and sent via mail as stated by the applicant and therefore provision of testing service is over and it is clear as per detailed discussions above, that the service is completed and is clearly provided in India.
Thus the event and provision of testing service is over and the service is clearly provided in India as per Section 13(3) of the IGST Act, 2018.
The applicant’s main arguments are that the service is completed only when it is used by the applicant in manufacture of goods and their upgradation or removal of defects if any, on the basis of this test report is not sustainable and maintainable as the agreement between the applicant and the service recipient is only with respect to conducting of tests and providing of test report and is not with respect to its further use or otherwise by the service recipient as we can clearly see that even if the findings of test report are not used in any way by the service recipient, it cannot be said that the service of testing is not provided by the applicant to the service recipient as the provision of testing services as per the agreement between them is clearly there whether or not the test report is used by the service recipient. Thus the applicant’s argument does not hold any ground and we are of the opinion that in the present case it can safely be inferred from a reading of the provisions of Section 13(3) that the services supply of which has been rendered by the applicant to their overseas client as per the agreement is taxable under IGST Act.
Further we specifically find that in the SGS case cited by the applicant, the facts are different. In that cases the overseas clients of SGS used the services of SGS in inspection/test analysis of the goods which the clients located abroad intended to import from India. The tests w’ere conducted on sample goods and the said goods were not made physically available bv their overseas client. In fact the overseas clients would import the goods only after the goods were tested by SGS and a report was sent to that effect. The import would occur only the reports sent were found to confirm that the goods imported complied with requisite specifications and standards. In the subject case the situation is different. Here the overseas client had made the goods physically available to the applicant in order to enable them to conduct the tests. If the goods were not made physically available to the applicants for testing purposes, the tests could not have been conducted and therefore no reports could be generated. Hence it is clear that the facts of the SGA case are different from the facts of the subject matter. It is also seen that the applicant have also cited other case laws but the facts of the cited case laws are different from the facts of the matter at hand and therefore the decisions in those cases cannot be applied to the present case.
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