Informatica Business Solutions Private Limited Vs ACIT (Karnataka High Court)
The petitioner challenged a refund rejection order and related computation sheet issued for the tax period April to June 2024, seeking quashing of the impugned orders and a direction to grant the balance refund of ₹2,24,24,605 claimed as accumulated unutilized input tax credit (ITC). The petitioner is engaged in providing software development, support, and customer services to its foreign parent company in the USA and contended that such services qualify as zero-rated supplies, entitling it to refunds under the applicable provisions.
The record showed that, for multiple earlier periods under both the pre-GST and post-GST regimes, the authorities had sanctioned refunds in favour of the petitioner. An earlier order dated 14.12.2018 had held that the petitioner’s services were exports and not intermediary services, and this finding was upheld by the appellate tribunal on 18.11.2024. Despite this consistent position, for the period April to June 2024, the authorities issued a show cause notice proposing rejection of the refund and passed an order dated 18.06.2025 rejecting the claim on the ground that the petitioner was an intermediary.
After hearing both sides and examining the agreement between the petitioner and its foreign parent, the prior refund sanction orders, and relevant judicial precedents, the Court held that the petitioner could not be treated as an intermediary and that the services provided could not be classified as intermediary services. The Court found that the impugned refund rejection was contrary to the established factual and legal position already accepted by the authorities in earlier periods.
