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TMI Blog2024 (8) TMI 399X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant or M/s OCA and Indian students. Therefore, it appears that the primary requirement of existence of three parties in the scheme of things is absent in the instant case. The main service is rendered by M/s OCA to the foreign universities and the appellant helps M/s OCA as far as the Indian students are concerned; neither the appellant nor M/s OCA charged any amount from the Indian students. Circular No.159/15/2021-GST dated 20.09.2021 issued by CBIC envisages that in respect of Intermediary Services, there should be a minimum of three parties and two distinct supplies i.e. main supply and ancillary supply; it also clarifies that a person involved in supply of main supply on principal-to-principal basis to another person cannot be considered as supplier of Intermediary Service. In the instant case, the appellants and M/s OCA are rendering the same service i.e. helping the students get admission in Australian universities and the appellants are rendering the same main service as M/s OCA; whereas M/s OCA get the remuneration from the universities on the fees paid by the students, the appellants get their remuneration. A doubt can arise as to whether the clarification issued by C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs.6,69,40,313/- along with interest and penalties. Hence, this appeal. 2. Shri B.L. Narasimhan, learned Counsel for the appellants, submits that the services provided to Oceanic Consultants, Australia constitute export of service; learned Commissioner wrongly observed that the appellant has performed the services in India and therefore, the condition, as provided in Rule 3(2)(a) of Export of Service Rules, 2005, was not satisfied; the appellants have entered into an agreement/ MOU with M/s OCA for marketing and promotion of the services provided by M/s OCA to foreign universities/ institutions; the service receiver is located outside India and the benefit of the service was directly accruing to M/s OCA; the services provided by the appellant cannot be considered as used and consumed in India as the students intended to study in foreign universities/ institutions and such services get completed only when the student is admitted to a foreign university/ institution; further, the service has been provided by the appellant to M/s OCA for use in their business and the payment for which was made by the M/s OCA; the service has been used outside India only; no consideration is charged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns a broker, an agent or any other person, by whatever name called, who arranges or facilitates a provision of a service or a supply of goods between two or more persons but does not include a person who provides the main service on his account. He submits that in the instant case, the foreign universities have engaged M/s OCA for marketing their education courses in India and they pay the consideration to M/s OCA who engaged the appellant; the appellant assists Indian students on behalf of M/s OCA by making them aware of the courses, the fee and helping other procedures like filling up the application form of various universities; the students pay tuition fee to the universities directly without the involvement of either the appellant or the M/s OCA; therefore, there is no main service between M/s OCA and the Indian students and therefore, the appellant cannot be said to be a link between the students and the M/s OCA; the work undertaken by the appellants in the nature of sub-contract and not an intermediary service provided; Tribunal in the case of IDP Education India Pvt. Ltd. Vs Additional Director General of Central Excise, Intelligence, New Delhi 2021 (10) TMI 1174- CESTAT- N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etational in nature, extended period cannot be invoked; when duty itself is not liable to be recovered, questions of penalty and interest do not arise. 7. Learned Authorized Representative for the Department reiterates the findings of the impugned order and distinguish the cases relied upon by the appellants as follows: The case of IDP Education India Pvt. Ltd. (supra); the Tribunal decided the case on the basis of the findings that Revenue has not established that the appellant is acting as an Intermediary between IDP, Australia and foreign universities as alleged in the Show Cause Notice; in the instant case, it is alleged that the appellant is an Intermediary between its principal OCA and the customers i.e. Indian students. Sunrise Immigration Consultants Private Ltd. (supra); in this case, the appellant therein was providing services to their clients viz. banks/ colleges/ university, who are paying commission/ fee to the appellant; whereas in this case, the appellant is providing facilitation to their principal under Agency Agreement and the principal is providing service to the universities; therefore, the facts are distinguishable. Singtel Global India Pvt. Ltd. (supra); in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to be export. 10. Learned Counsel for the appellants submits that for the period 01.04.2009 to 26.02.2010, learned Commissioner finds that the appellants did not fulfill the conditions of Rule 3(2)(a) of the Export of Service Rules, 2005; learned Counsel submits that the appellant has provided services only to the overseas master i.e. M/s OCA and as M/s OCA is outside India, the services cannot be held to have been performed and consumed in India; the service provided by the appellant to M/s OCA is in relation to their business contract is a overseas institutions/ universities; he submits that Circular No.111/05/2009 dated 24.02.2009 clarifies that the phrases used outside India is to be interpreted to mean that the benefit of the service should accrue outside India; in the instant case, the benefit is undoubtedly accruing to M/s OCA. We find Arcelor India, a service provider, is providing BAS service to Arcelor France, which is a service recipient. Arcelor India is, therefore, providing service to Arcelor France which is situated outside India and Arcelor India receives consideration in convertible foreign exchange. The service provided by Arcelor India is, therefore, delivered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that this service receiver should be located outside India and the consideration should be received in convertible foreign exchange. We find that there is no dispute on this fact and therefore, the services rendered by the appellants require to be held to be exported in terms of the said Rules; we find that Hon ble Delhi High Court in the case of Verizon Communication India Pvt. Ltd. (supra) held as follows: 48. Circular No. 141/10/2011 dated 13th May, 2011 also throws light on this aspect. It was issued to clarify the position prior to 28th February, 2010 and became necessary in view of the question raised whether for the period prior thereto the requirement that the service should be used outside India invariably meant the location of the recipient. It was clarified that the words 'accrual of benefit' was not restricted to mere impact on the bottom-line of the person who pays for the service. It had to be given a harmonious interpretation in the context where the effective use and enjoyment of the service has been obtained. 49. The position becomes even clearer in the post July 2012 period during which the POPS Rules 2012 apply. As already noted, provision of telecommunic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Indian students who intend to study in Australian universities. In the scheme of arrangements, it is not brought on record if there is any agreement or arrangement between the foreign universities and the appellant or M/s OCA and Indian students. Therefore, it appears that the primary requirement of existence of three parties in the scheme of things is absent in the instant case. The main service is rendered by M/s OCA to the foreign universities and the appellant helps M/s OCA as far as the Indian students are concerned; neither the appellant nor M/s OCA charged any amount from the Indian students. Therefore, in the circumstances, as submitted by the learned Counsel for the appellants, the appellants can at best be held to be the sub-contractor or the sub-agent of M/s OCA and not an intermediary between the India students and the universities or the Indian students and M/s OCA. 14. We find that Circular No.159/15/2021-GST dated 20.09.2021 issued by CBIC envisages that in respect of Intermediary Services, there should be a minimum of three parties and two distinct supplies i.e. main supply and ancillary supply; it also clarifies that a person involved in supply of main supply o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... versities and is receiving consideration for the same. Insofar as recruitment of students in India is concerned, IDP Australia has created the appellant as a fully owned subsidiary, and has sub-contracted the work to the appellant. Nothing has been brought on record in the show cause notice or in the order to show that the appellant has a direct contract with the foreign universities. There is nothing on record to show that the appellant is liasioning or acting as intermediary between the foreign universities and IDP Australia. All that is evident from the records is that the appellant is providing the services which have been sub-contracted to it by M/s IDP Australia. As a sub-contractor, it is receiving commission from the main contractor for its services. The main contractor - IDP Australia, in turn, is receiving commission from the foreign universities who pay a percentage of the tuition fee to IDP Australia. From the records, we find that Revenue has not established that the appellant is acting as an intermediary between M/s IDP Australia and the foreign universities, as alleged or held in the impugned order and the show cause notice. Hence, we find in favour of the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X
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