Levy of GST— In the instant case, the applicant seeking an advance ruling in respect of the following questions.
1. Whether the Incentive received from Intel inside US LLC under Intel Approved Component Supplier Program (IACSP) can be considered as Trade Discount?
2. If not considered as Trade Discount then whether it is consideration for any supply?
3. If it is considered as supply than whether it will qualify as export of service?
The Applicant is a GST registered person in Maharashtra and is a reseller of Intel products which they purchase from the from various Distributors of Intel Inside US LLC (IIUL). These products are imported by the various distributors from IIUL and sold to Applicant for further sale to various retailers.
The Applicant has further submitted that they have entered into agreement with IIUL under Intel Authorized Components Supplier Program (IACSP) pertaining to a non-binding Plan of Record Target (POR Target) under which the Applicant will earn certain incentives directly from IIUL as a percentage of performance to quarterly goal on eligible Intel products.
The Applicant has further submitted that they have entered into agreement with IIUL under Intel Authorized Components Supplier Program (IACSP) pertaining to a non-binding Plan of Record Target (POR Target) under which the Applicant will earn certain incentives directly from IIUL as a percentage of performance to quarterly goal on eligible Intel products.
Held that—
1. The Incentive received from Intel inside US LLC under Intel Approved Component Supplier Program (IACSP) cannot be considered as Trade Discount.
2. Incentives are a consideration for supply of any product.
3. In the instant case, the marketing services are provided in respect of goods which are made physically available by the recipient of services (i.e IIUL, through its distributors) to the supplier of marketing services (i.e. the applicant), in order to provide the services. Therefore, as per Section 13 (3) (a), the place of provision of services is the location of the supplier of services i.e the applicant, which is in India. Hence, we hold that the impugned supply does not qualify as export of services.