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TMI Blog2025 (3) TMI 200X X X X Extracts X X X X X X X X Extracts X X X X ..... ill be between subcontractor and the Appellant and the responsibility will be on the Appellant; the Appellant raises bills on Air BNB Ireland and not on their Customers. The appellant has no contract with the customers of Airbnb Ireland. The fact that the appellant has subcontracted does not make them an intermediary as per CBIC Circular dated 20.09.2021. It was held in M/s Blackrock Services India Pvt Ltd [2022 (8) TMI 874 - CESTAT CHANDIGARH] following the decision in JFE Steel India Pvt Ltd [2020 (3) TMI 1342 - CESTAT CHANDIGARH] that if the case of Revenue is that the activities undertaken by the appellants in present case is not amounting to Export of Service then the proceedings need to be initiated against the appellant for demanding the service tax in respect of the taxable services provided by the appellant. In the present case no such proceedings demanding the Service Tax on these taxable services provided by the appellant have been initiated in terms of Section 73 of the Finance Act, 1994. By not initiating any such proceedings Revenue itself has allowed these taxable services provided as Export of Services. Having done so they cannot in a proceeding under Rule 5 for re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the nature of services provided are not intermediary in nature. 4. Learned Counsel submits that CBIC vide Circular No.230/24/2024-GST dated 10.09.2024 clarified that the services provided by an advertising agency/ company to a foreign company do not amount to Intermediary Services; the activities of the appellant are similar to that of an advertising agency inasmuch as the scope of the activity, as per the Agreement, is to perform business development and marketing activities to help, promote and market the M/s Airbnb Online Market Place; therefore, in view of the Circular, the activity carried out by the appellant qualifies as an Export of Service. Learned Counsel further submits that the issue in the present appeal is covered in favour of the appellant by the Final Order dated 04.09.2024 passed by this Bench wherein it was held that M/s Airbnb Payments India Pvt. Ltd. (another entity of the appellant's group) is not an intermediary as the remuneration is in the form of mark-up and the Agreement only between two parties and there is not tripartite agreement; there is no contract with the customers of foreign entity. 5. Learned Counsel further submits that the learned Commi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a) and JFE Steel India Pvt. Ltd. - 2021 (44) GSTL 299 (Tri. Chan.). He further submits that for the financial year 2020-21 and 2021-22, Revenue has sanctioned the refunds filed in the GST Regime. Therefore, Revenue cannot raise the issue in the instant case. He relies on Marsons Fan Industries - 2008 (225) ELT 334. 9. Learned Authorized Representative reiterates the findings of the impugned order. 10. Heard rival contentions and perused the records of the case. Heard rival contentions and perused the records of the case. Brief issue involved in the case is to decide as to whether the Brief issue involved in the case is to decide as to whether the appellants are appellants are intermediaries as far as the serviintermediaries as far as the services rendered by ces rendered by them to M/s Air BNB Ireland arethem to M/s Air BNB Ireland are concerned. The Original Authority concerned. The Original Authority finds as followsfinds as follows:: .......I found that the assessee is providing market support service to Airbnb Ireland. It is noticed that the company in India has only 14 full time employees as per Transfer Pricing study Report 17-18 for overall management and representation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ective clients/hosts/guests in order to get their bookings through online marketplace portal of their overseas holding company. 8. I also observe that during the personal hearing held on 05.12.2019, the appellant was also asked to produce the original of the Master Service Agreement, but appellant failed to produce the same. The appellant was given further time to get and arrange the original master service agreement and produce the same in next hearing on 15.01.2020. The appellant attended the hearing on 15.01.2020, but on being asked to produce the original service agreement, appellant failed to produce the original service agreement, and submitted only a copy of agreement on plain paper having a stamp affixed as 'certified true copy' signed by one Sh. Tushar Mehrishi, said to be authorised signatory. The appellant was again requested to provide a copy of the agreement that has been executed between Airbnb Ireland and its clients in India in order to ascertain the nature of relationship between the clients of Airbnb Ireland and the appellant, but the appellant submitted that Airbnb Ireland do not have any agreement with the customers located in India and further as the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Airbnb India promotes the same; the appellants have no say in the policy or investment etc. and are just facilitators; they have not produced the original agreement etc. we find that it is required to have a look at the definition of 'Intermediary' . 12.1 Section 2(f) of POPS Rules, 2012 defines "Intermediary" as below: "intermediary" means a broker, an agent or any other person, by whatever name called, who arranges or facilitates a provision of a service (hereinafter called the 'main' service) or a supply of goods, between two or more persons, but does not include a person who provides the main service or supplies the goods on his account". 12.2. We find that Hon'ble Punjab & Haryana High Court has held in the case of Genpact India Pvt. Ltd. (supra) that the following three conditions must be satisfied primarily for a person to qualify as an Intermediary: * the relationship between the parties must be that of a principal-agency relationship. * the person must be involved in arrangement or facilitation of provisions of the service provided to the principal by a 3rd party. * the person must not actually perform the main service intended to be rece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (c) Service Provider has no authority to make any agreement on behalf of or in any way to bind Airbnb Ireland or User to any third party. (d) Nothing in this Agreement or in the arrangements hereby contemplated shall constitute or be taken to mean that Service Provider acts as the agent of Airbnb Ireland or User for any purpose whatsoever and Service Provider shall not hold itself out or make any warranty, representation or do any act on behalf of the Airbnb Ireland or User except in accordance with this Agreement. (e) If Service Provider receives any enquiry or order from inside or outside the Territory Service Provider shall immediately pass each such enquiry or order to Airbnb Ireland. * RELATIONSHIP OF PARTIES. 2.1 Independent Contractor and Arms Length Relationship. The relationship of Airbnb Ireland and Service Provider established by this Agreement is that of independent contractors,and nothing in this Agreement shall be construed: (a) to give either party the right or power to direct or control the daily activities of the other party; (b) to constitute the parties as principal and agent, employer and employee, partners, joint ventures, co-owners or otherwise a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eement and Service Provider shall remain primarily obligated for the performance of the Services. * 4.1.2.5 Assistance in attracting customers and support services The role of Airbnb India is limited to performing promotional activities to attract prospective customers. Airbnb India plays no role in the acceptance of customers and price negotiation, nor does it enter into contract with customers. 14. On going through various clauses of the contract, we find that the authorities below have not interpreted the clauses of the agreements and the facts of the case correctly. The terms of the agreements give an unmissable understanding that Only the main service i.e. promotional and marketing services is being provided by the Appellant and there is no auxiliary service is involved; the compensation to the appellant is on cost plus markup basis; appellant is an independent contractor of Airbnb Ireland; there is no agent-principal relationship; appellant may have entered in to subcontracts for the provision of service, agreement will be between subcontractor and the Appellant and the responsibility will be on the Appellant; the Appellant raises bills on Air BNB Ireland and not on thei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Revenue cannot take a different stand for the year 2017-18. He relies on the judgment of Marsons Fan Industries vs. Commissioner of C. Ex., Calcutta (supra). We find that there is considerable force in the argument of the appellant. We find that Hon'ble Punjab and Haryana High Court held in the case of M/s Genpact India (supra) that there is no material change in the definition of Intermediary in the Service Tax Regime and the GST Regime. We find that though the principal of estoppel is not applicable to the matters of taxation, it is not open to the Revenue to hold on to the stand taken by them in the past, once they have revised their stand at a later date. 18. We find further that the department seeks to deny the refund claimed under Rule 5 of the CENVAT Credit Rules. The appellant submits that Revenue cannot take recourse to recovery without initiating proceedings under Rule 14 read with Section 73 of the Finance Act. We find that the appellant the Appellant had filed refund claim under Rule 5 of the CENVAT Credit Rules read with Notification 27/2012 dated 18.06.2012. which provide for safeguards, conditions and limitations along with the procedure to claim refund of CE ..... X X X X Extracts X X X X X X X X Extracts X X X X
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