HC allowed refund on export where services are supplied by petitioner to its subsidiary which is outside India
Madras HC – Vuram Technology Solutions (P) Ltd. v. Additional Commissioner of GST (Appeals) [W.P. (MD) NO. 15092 OF 2022]
The petitioner was engaged in providing software services to its subsidiary in Australia.An assessee’s refund claim for exporting services to a subsidiary in Australia was initially rejected.
The rejection was based on the interpretation that the assessee and its subsidiary were not distinct persons under Explanation I of section 8 of the IGST Act, 2017.
The High Court noted that Circular No. 161/17/2021-GST, dated 20.09.2021 provides that the supply of services by a company to its holding company situated outside India would not be barred by condition of section 2(6)(v) of the IGST Act 2017 from being considered as export under GST. The petitioner was providing software services to its subsidiary in Australia, and the petitioner and its subsidiary were two distinct entities. Hence this would qualify as export. The High Court held that the impugned order was to be set aside and the refund claim was to be processed together with interest.
