Services received from Overseas Commission Agent are not ‘import of services’ as place of supply is out of India: AAR UK
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- Last Updated on 29 July, 2021
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Case details: Authority for Advance Rulings, Uttarakhand Midas Foods (P.) Ltd., In re - [2021] 128 taxmann.com 360 (AAR- UTTARAKHAND)
Judiciary and Counsel Details
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- Anurag Mishra and Amit Gupta, Member.
- Ashwarya Sharma, Adv. for the Applicant.
Facts of the Case
The applicant entered into agreement with Overseas Commission Agent located outside India to arrange supply of applicant’s goods outside India. The applicant sought advance ruling on classification and determination of the liability to pay tax on supply of such services.
AAR Held
The Authority for Advance Ruling observed that Overseas Commission Agent engaged in providing services in the international market and the applicant wished to utilize his expertise to get confirmed purchase order from outside India and for that the applicant shall pay commission. The section 2(13) of the IGST Act, 2017 provides that “intermediary” means a broker, an agent or any other person, by whatever name called, who arranges or facilitates the supply of goods or include a person who supplies such goods or services or both or securities on his own account.
Therefore, after checking the agreement between the parties, it was observed that the overseas commission agent would fall within the definition of ‘intermediary’ as provided under section 2(13) of the IGST Act, 2017. Also, the section 13(8)(b) of IGST Act, 2017 provides that the place of supply for the intermediary services would be the location of the supplier of such services i.e. outside India in this case. Hence, the services received by the applicant would be out of the ambit of “import of services” being place of supply would be out of India and no tax would be levied.
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