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Challenge in the instant petition is to the orderwherein it has been held that the services provided by the petitioner are in the nature of “Intermediary Services” and do not qualify as “export of services”. It is held that sub-contracting for a service is not an “intermediary” service. This court is of the considered view that the impugned order holding the petitioner to be an “intermediary” under Section 2 (13) of the IGST Act, cannot sustain. The same as such is quashed and consequently the order granting refund in favour of the petitioner is restored.

Section 16 of the IGST Act, 2017 —Refund –--The petitioner challenged the Appellate order dated 15.02.2021, wherein it has been held that the services provided by the petitioner are in the nature of “Intermediary Services” as per Section 2(13) of the IGST Act and do not qualify as “export of services” and thereby rejected the refund claim of un-utilized ITC used in zero rated supplies. The Petitioner is involved in providing BPO Services to customers located in India as well as outside India. The respondents vide Order-in-Original dated 14.03.2019 sanctioned refund, against which the department filed appeal. The Appellate Authority on 27.05.2020 allowed the appeal of the department. The court vide order dated 29.01.2021 set aside the appellate order and remanded the matter. The Appellate Authority vide order dated 15.02.2021 allowed the appeal of the department. The court observed that pursuant to the sub-contracting arrangement, the petitioner provides the main service directly to the overseas clients of GI but does not get any remuneration from such clients. It is GI which gets paid by its customers to whom the services are being provided directly by the petitioner. There is nothing on record to show that petitioner is liaisoning or acting as an “intermediary” between GI and its customers. The main contractor i.e. GI in turn is receiving commission/agents from its clients for the main services that are rendered by the petitioner. Even as per the circular dated 20.09.2021 and in reference to para 3.5 it stands clarified that sub-contracting for a service is not an “intermediary” service. Transfer Pricing Report draws a distinction between two categories of supplies as per MSA i.e. main supply and the ancillary supply. The passing of the impugned order is sought to be justified that the main supply takes place between GI and its customers whereas it is the ancillary supply which is provided by the applicant to facilitate the provision of the main supply. The court relied the judgment of the Apex Court in Mohinder Singh Gill and another Vs. The Chief Election Commissioner, New Delhi and others. The impugned order dated 15.02.2021 holding the petitioner to be an “intermediary” under Section 2 (13) of the IGST Act, cannot sustain.

Held that:- The Hon’ble High Court quashed the order dated 15.02.2021 and restored the refund of Rs.26,34,61,625/- in favour of the petitioner.