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TMI Blog2024 (12) TMI 80X X X X Extracts X X X X X X X X Extracts X X X X ..... the GST regime would show that the definition has remained similar. Even as per circular dated 20-9-2021 issued by the Government of India, Ministry of Finance, Department of Revenue, Central Board of Indirect Taxes and Customs (GST Policy Wing), the scope of intermediary services has been dealt in Para 2 thereof. In Para 2.2 it stands clarified that the concept of intermediary was borrowed in GST from the Service Tax Regime. The circular after making a reference to the definition of intermediary both under Rule 2(f) of the Place of Provision of Service Rules, 2012 and under Section 2(13) of the IGST Act clearly states that there is broadly no change in the scope of intermediary services in the GST regime vis-a-vis the service tax regime except addition of supply of securities in the definition of intermediary in the GST law.' Thus, it is settled that the service in question being export of service cannot be liable to service tax. Moreover, the service being provided to an educational institute in respect of education has been exempted from the service tax as per the Notification No. 06/2014 dated 11.07.2014, therefore, the issue is no longer res-integra. The impugned order is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... earned Superintendent (AR) appearing on behalf of the Revenue reiterates the findings of the impugned order. 4. On careful consideration of the submission made by both the sides and perusal of record, we find that there is no dispute on the fact that the appellant have provided the service to the foreign universities and they have received the commission. Therefore, the service provided by the appellant falls under the category of export of service. Therefore, the same cannot be liable to service tax. This issue is no longer res-integra as on the identical facts this Tribunal has considered the issue in the case of Medway Educational Consultant Pvt. Ltd. wherein the principal bench of the Tribunal Vide final order No. 55451/2024 dated 27.03.2024 passed the following order :- 7. Having heard the parties at length we need to consider the applicability of the provisions of export of service and intermediary service. Export of Service 8. The appellant in support of his submission that prior to 1.07.2012 the services rendered by them were treated as export of service referred to the provisions of Export of Service Rules, 2005 (ESR, 2005) issued by the Central Government in exercise of p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Notification 46/2012- Service Tax) where the location of the service receiver is not available in the ordinary course of business, the place of provision shall be the location of the provider of service. 6. Place of provision of services relating to events - The place of provision of services provided by way of admission to, or organization of, a cultural, artistic, sporting, scientific, educational, or entertainment event, or a celebration, conference, fair, exhibition, or similar events, and of services ancillary to such admission, shall be the place where the event is actually held. 9. Place of provision of specified services - The place of provision of following services shall be the location of the service provider:- (a) Services provided by a banking company, or a financial institution, or a non-banking financial company, to account holders; (b) ****; omitted vide Notification 46/2016-Service Tax (c) Intermediary services; (d) Service consisting of hiring of means of transport other than, - (i) aircrafts, and (ii) vessels except yachts up to a period of one months. Rule 3 of PPSR 2012, provides the place of provision of a service as the location of the recipient of service. R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... NZMA) which stipulated as under: Consultant s Obligations (Under para-4 of the Agreement) The Consultant will: a. Use his /her best endeavors to promote the Principal and in so doing assist the Principal in its student enrolment targets, as communicated to the Consultant from time to time. The consultant shall not at any time by any actions or omissions bring the name or reputation of the Principal into disrepute or prejudice the interests of the business of the Principal. b. c. At all times promptly to the Principal (in such manner as the Principal may request), all information, explanations and assistance, as it may require, in connection with the services; d. .. e. Assist with the screening and selection of appropriate students who meet the entry criteria of the Principal. f. Inform students of the enrolment, refund and withdrawal policy of the Principal. g. .. h. .. i. j. Invoice the Principal for each student the Consultant is claiming commission for k. Provide follow-up support service and liaison with student s families as requested by the Principal. l. Assist students in applying for relevant student visas and ensure all necessary information is provided to the New Zealand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e service in India. The High Court of Delhi in Verizon Communication India Private Limited Vs Assistant Commissioner, ST, Delhi 2018 (8) GSTL 32 (Del.) observed that the recipient of the service is determined by the contract between the parties and who has the contractual right to receive the service and who is responsible for the payment for the service and the department has lost sight of this essential difference. The High Court of Delhi then considered the decision of the Larger Bench of the Tribunal in Paul Merchants Ltd. Vs. CCE, Chandigarh 2012 (12) TMI 424-CESTAT-DEL.-LB which was rendered with reference to ESR, 2005 where the assessees were intermediary agents, providing money transfer services to foreign travellers, who were the end user on behalf of their principals and the contention of the department that this did not qualify as export of service was rejected referring to the CBEC clarification letter no. 334/1/2019-TRU dated 26.02.2010 that as long as the party abroad is deriving benefit from service in India, it is an export of service. The relevant paras of the decision in Verizon Communication India Private Limited (supra) is quoted as under:- 51. In the considered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been received in foreign currency. From the totality of facts and circumstances, there is no doubt that these services were provided from India and used outside India. 15. Lastly, we would like to refer to the decision of the Delhi High Court in Indian Associaton of Tour Operators Vs. Union of India 2017 (5) GSTL 4 (Delhi) holding that service provided by Indian Tour Operator to Foreign Tourists during the period 01.07.2012 to 01.07.2017, which has been paid for in convertible foreign exchange would not be amenable to service tax. While holding Rule 6-A(1) and (2) of the Service Tax Rules as ultra vires and invalid, in so far as it seeks to describe export of tour operator services to include non-taxable services provided by tour operators, it has been held that services rendered outside taxable territory of India are not amenable to service tax by virtue of Section 66B read with Section 65(51), 65(52) and 64(1) and 64(3) of the Finance Act, 1994, the relevant para is quoted below: 48 As already noticed since by virtue of Section 64(3) the whole of Chapter V applies only to taxable services, and Section 66C of the FA falls in that very Chapter, the rules made by the Central Govern ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for admission in educational institution/universities, i.e. recipients located outside India and therefore the place of provision of service shall be the place where the event is actually held. On the other hand, intermediary services are broader category and is not applicable to specific category. We find force in the submission of the learned counsel. 18. Further, the Chandigarh Bench in Sunrise Immigration Consultants Private Limited Vs Commissioner of Central Excise and Service Tax, Chandigarh 2018-TIOL-1849-CESTAT-CHD considered the issue whether the assessee is an intermediary with reference to the service to universities, colleges and banks and whether any service tax could be levied and answered the issue in favour of the assessee as under: 10. We find that the appellant is nowhere providing services between two or more persons. In fact, the appellant is providing services to their clients namely banks/colleges/university who are paying commission/fees to the appellant. The appellant is only facilitating the aspirant student and introduced them to the college and if these students gets admission to the college, the appellant gets certain commission which is in nature of pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... toms, 2018 (12) TMI 1242 CESTAT (Tri.), that receipt of consideration from the overseas client excluded them from tax as intermediary, the appellant cannot be held to be providing intermediary service as it is an admitted position that the appellant had been receiving consideration in the form of commission from the recipients of service placed abroad. 20. The definition of intermediary services in Section 2(13) of Integrated Goods and Service Tax Act, 2017 is pari-materia with the definition of intermediary services in Rule 2 (f) of Rules, 2012 and the same has been considered by the decision of the High Court of Punjab and Haryana in Genpact India Pvt Ltd versus Union of India, 2023 (68) GSTL 3 (P H) where the primary issue was whether the petitioner would be covered under the expression intermediary as defined under the provisions of the IGST Act and whether the services rendered by the petitioner under the agreement be treated as intermediary services . The observations of the High Court are clearly applicable in the present case and the relevant paras are quoted below : 28. As per definition of intermediary under Section 2(13) of the IGST Act the following three conditions mus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ermediary both under Rule 2(f) of the Place of Provision of Service Rules, 2012 and under Section 2(13) of the IGST Act clearly states that there is broadly no change in the scope of intermediary services in the GST regime vis-a-vis the service tax regime except addition of supply of securities in the definition of intermediary in the GST law. 21. Similarly, the Delhi High Court in a recent decision in Ernest and Young Vs. Additional Commissioner, CGST, Delhi, 2023 (73) GSTL 161 considered the issue whether the services claimed are actually exported and convertible foreign exchange received by the party in lieu of the said export services and observed as under: 33. In terms of sub-section (8) of Section 13 of the IGST Act, the place of supply of certain services would be the location of the supplier of the services. In terms of clause (b) of sub-section (8) of Section 13 of the IGST Act, the place of supply of intermediary services is the location of the supplier of services. In the present case, the place of supply of services has been held to be in India on the basis that the petitioner is providing intermediary services. As discussed above, the Services rendered by the petitione ..... X X X X Extracts X X X X X X X X Extracts X X X X
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