In Re: Behr-Hella Thermocontrol India Pvt. Ltd.,
GST
2018 (11) TMI 887 – AUTHORITY FOR ADVANCE RULING, MAHARASHTRA – 2019 (20) G. S. T. L. 124 (A. A. R. – GST)
AUTHORITY FOR ADVANCE RULING, MAHARASHTRA – AAR
Dated:- 15-9-2018
GST-ARA-172018-19/B-116
GST
SHRI B.V. BORHADE, AND SHRI PANKAJ KUMAR, MEMBER
PROCEEDINGS
(under section 98 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017)
The present application has been filed under section 97 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017 [hereinafter referred to as “the CGST Act and MGST”] by Behr-Hella Thermocontrol India Pvt. Ltd., the applicant, seeking an advance ruling in respect of the following question.
Whether in the facts and circumstances of the case, the Applicant is liable to pay Integrated Goods and Services Tax on the testing services provided to its overseas group entities, being a zero-rated sup
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adgaon, Pune – 411 033. The Applicant is a 100% subsidiary of Behr-Hella Thermocontrol GmBH, Lippstadt, Germany (hereinafter referred to as “BHTC Germany”). The Applicant is registered under GSTIN No. 271800000581ARQ.
2. In the normal course of business, the Applicant has entered into service agreements with BHTC Germany and its other overseas group entities such as Behr-Hella Thermocontrol, Inc. (hereinafter referred to as “BHTC USA”) and Behr-Hella Thermocontrol (Shanghai) Co. Ltd. (hereinafter referred to as “BHTC Shanghai”), inter alia, for providing testing services. Hereto annexed and marked as Exhibit “A” is the copy of the Service Agreement entered into by the Applicant with BHTC Germany.
3. The testing services provided by the Applicant are in relation to the prototype goods supplied by the overseas group entities to determine whether the products so tested function in accordance with the requisite standards based on certain identified parameters such as temperature, environ
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cation to the Hon'ble Authority for Advance Ruling.
The Applicant craves leave to submit such further facts as may be relevant after admission of the application or at the time of hearing.
Statement containing the applicant's interpretation of law and/or facts. as the case may be. in respect of the questions(s) on which advance ruling is required
In light of the facts of the case (as explained in Annexure I) and the question in respect of which the Applicant seeks an Advance Ruling, the Applicant's interpretation of facts and law in respect of the aforesaid questions is as follows:
Question: Whether in the facts and circumstances of the case, the Applicant is liable to pay Integrated Goods and Services Tax on the testing services provided to its overseas group entities, being a zero-rated supply?
Applicant's submissions
1.1 With effect from 01 July 2017, indirect tax regime in India has shifted from multiple taxes by multiple authorities at multiple times to a consolidated Go
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ld accrue to the taxing authority which has jurisdiction over the place of consumption which is also termed as place of supply.
1.3 Section 7(5) of the Integrated Goods and Service Tax Act, 2017 (hereinafter referred to as the “IGST Act”) provide that supply of service shall be treated as a supply of service in the course of inter-State trade or commerce when the supplier is located in India and the place of supply is outside India,
1.4. As per Section 16 of the IGST Act, “export of service” shall qualify as “Zero rated supply” and can be supplied without payment of IGST.
1.5 Thus, even if a supply is in the course of inter-State trade or commerce, the same can be supplied without payment of IGST if it qualifies as an export of service.
1.6 In terms of Section 2(6) of the IGST Act, a supply of service shall qualify as export of service when:
(a) the supplier of service is located in India;
(b) the recipient of service is located outside India;
(c) the place of supply of service
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e for the supply of a service, the person to whom the service is rendered,
and any reference to a person to whom a supply is made shall be construed as a reference to the recipient of the supply and shall include an agent acting as such on behalf of the recipient in relation to the goods or services or both.
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(105) “supplier” in relation to any goods or services or both, shall mean the person supplying the said goods or services or both and shall include an agent acting as such on behalf of such supplier in relation to the goods or services or both supplied.
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1.8 In the facts and circumstances of the present case, it is not in dispute that the Applicant is the “supplier of services” in terms of Section 2(105) of the CGST Act, and the overseas group entities, being liable to pay the consideration for the services supplied by the Applicant, are the “recipient of services” in terms of section 2(93) of the CGST Act.
1.9 Thus, condition provided under clause (a) and
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t is also satisfied.
1.15 Now the only condition that needs to be satisfied for the testing service provided by the Applicant to its overseas group entities to qualify as export and therefore a “zero rated supply” which can be supplied without payment of IGST is whether the “place of supply” is outside India.
1.16 Hence, the “place of supply” is relevant to decide the taxability and the status of taxability of the testing services provided by the Applicant to its overseas group entities.
1.17 The provisions for determining the place of supply of services are contained under Section 13 of the Integrated Goods and Service Tax Act, 2017 (hereinafter referred to as the “IGST Act”). The relevant extracts of Section 13 of the IGST Act are reproduced below for ready reference:
Place of supply of services where location of supplier or location of recipient is outside India.
13. (1) The provisions of this section shall apply to determine the place of supply of services where the location
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Provided further that nothing contained in this clause shall apply in the case of services supplied in respect of goods which are temporarily imported into India for repairs and are exported after repairs without being put to any other use in India, than that which is required for such repairs;
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1.18 The terms “location of the recipient of services” and “location of the supplier of services” have been defined under Section 2(14) and Section 2(15) of the IGST Act as under:
Definitions
2. In this Act, unless the context otherwise requires, –
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(14) “location of the recipient of services” means,
(a) where a supply is received at a place of business for which the registration has been obtained, the location of such place of business;
(b) where a supply is received at a place other than the place of business for which registration has been obtained (a fixed establishment elsewhere), the location of such fixed establishment;
(c) where a supply is received
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ence” has been defined under Section 2(113) of the CGST Act as under:
Definitions
2. In this Act, unless the context otherwise requires, –
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(113) “usual place of residence” means
(a) in case of an individual, the place where he ordinarily resides;
(b) in other cases, the place where the person is incorporated or otherwise legally constituted;
1.20 In view of the above, while the location of the Applicant is in India in terms of Section 2(15)(a) of the IGST Act, the recipient of services (i.e., the overseas group entities) are located outside India in terms of Section of the IGST Act.
1.21 Further, a bare perusal of Section 13 of the IGST Act would reveal that generally, the place of supply of services shall be the location of the recipient of services in terms of Section 13(2) of the IGST Act, except in case of the services specified in sub-sections (3) to (13) of Section 13 of the IGST Act.
1.22 The Applicant understands that sub-sections (4) to (13) of Section 13 of
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t the testing services.
1.26 The Applicant is required to submit a test report and the contractual obligation of the Applicant towards overseas group entities in terms of the provision of testing services is complete only when the test reports are delivered to them. In other words, the provision of service is complete only when the test report is delivered to the overseas group entities.
1.27 It is submitted that the delivery of the test report by the Applicant to its overseas group entities is the most Important part of the services rendered by the Applicant. In fact, the overseas group entities, as recipient of Services, are expecting the test report and nothing apart from that.
1.28 As stated above, GST is a destination based tax on consumption of goods and services. Further, “Services” are something intangible in nature. Thus, service is something which is not visible but the person receiving the same is deriving some benefit from its performance. Thus, GST is levied where the s
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In other words, the ultimate deliverable or the actual provision of service is the provision of the test report.
1.31 Further, there is no compulsion on the Applicant to return the prototype goods to the overseas group entities which further confirms that the overseas group entities are not concerned with the goods. Therefore, the actual consumption of the testing services performed by the Applicant is happening outside India in the form of the test reports.
1.32 The aforesaid position is further substantiated by the second proviso to Section 13(3)(a) of the IGST Act which provides that even though the repairing of goods is done in India, the place of supply shall be outside India if the goods after repairs are exported out of India. The rationale behind such exclusion appears to be that no GST should be levied as the goods will be ultimately used or consumed outside India.
1.33 The above contention is also supported by the judgment of the Hon'ble Bombay High Court in the case of C
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dent in inspection/test analysis of the goods which the clients located abroad intended to import from India. In other words, the clients abroad were desirous of confirming the fact as to whether the goods imported complied with requisite specifications and standards. Thus, client of the respondent located abroad engaged the services of the respondent for inspection and testing the goods. The goods were tested by the respondents in India. The goods were available or their samples were drawn for such testing and analysis in India. However, the report of such tests and analysis was sent abroad. The clients of the respondent were foreign clients, paid the respondent for such services rendered, in foreign convertible currency. It is in that sense that the Tribunal holds that the benefit of the services accrued to the foreign clients outside India. This is termed as 'export of service'. In these circumstances, the Tribunal takes a view that if services were rendered to such foreign clients
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be said to be perverse or vitiated by an error of law apparent on the face of the record. If the emphasis is on consumption of service then, the order passed by the Tribunal does not raise any substantial question of law.
1.34 The aforesaid judgment of the Hon'ble Bombay High Court has been followed by it in the case of The Pr. Commissioner of Mumbai Commissionerate v. QIndia Investment Advisory Pvt. Ltd. reported in 2017-TIOL-2171-HC-MUM-ST = 2017 (10) TMI 754 – BOMBAY HIGH COURT.
1.35 Since GST is also a “destination based consumption tax” on goods and services, relying upon the judgment of the Hon'ble Bombay High Court in SGS India Ltd, (supra) and Qlndia Investment Advisory Pvt. Ltd. (supra), it is submitted that the place of supply in case of the testing Service provided by the Applicant to its overseas group companies is also outside India.
1.36 In this regard, it is further submitted that even if the services are provided from India, since the actual consumption of th
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incorporated under the laws of the Federal Republic of Germany, having its registered office at Stuttgart, register court HRB 20260, and its principal place of business at Hansastraße 40, 59557 Lippstadt, Federal Republic of Germany, represented by its Managing Directors Mr. Thomas Schulte and Dr. Andreas Teuner (hereinafter called “BHTC”) of ONE PART
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Bebr-Hella Thermocontrol India Private Limited, a Company incorporated in India and having its Registered Office at Elpro Compound, City Survey No. 4270, Chinchwadgaon, Pune – 411033, India,, represented by its Director and CEO Mr. Shrivardhan Gadgil (hereinafter called “BHTCIN”) of OTHER PART. Whereas –
a) BHTC, IN was incorporated on February 10, 2006. BHTCIN is in the process of undertaking activities as developer, manufacturer, producer, purchaser, seller, importer, exporter, distributor, dealer, commission agent and market representatives of all kinds of Control Equipment and Units for Air conditioning and Climate Contr
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ting is carried in manual mode and also in automated mode
c) BHTCIN is interested in accepting such engagements from BHTC and willing to provide services related to man and machine resources as per requirement of BHTC (hereinafter referred to as “Services”); and
d) BHTC and BHTCIN mutually desire to set forth in this Agreement certain terms and conditions applicable to all such engagements;
Now it is hereby agreed as follows:
1. Scope, Duties and Responsibilities of BHTCIN
a. BHTCIN shall recruit and maintain duly qualified, skilled and experienced resources to provide services to BHTC and its group companies as agreed in the beginning of each calendar year with BHTC. These services will be provided from BHTCIN facility or on-site as per requirement of BHTC or its affiliates.
b. BHTCIN will track its resources in the manner agreed with BHTC and will ensure that the time booking is done
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for resources planned and available at BHTCIN with all information and details about the projects. All resources identified and agreed in the business plan will have to be used by BHTC and will be invoiced by BHTCIN.
b. BHTC will provide. 4.rolling plan on services required from BHTCIN in the beginning of each calendar month covering next three months outlook of the project jobs which could be assigned to resources at BHT CIN
c. The technical coordinators at BHTC shall work closely with Dianagers/ supervisors at BHTCIN and will be responsible for the quality of deliverables and the project timelines.
d. BHTC will support BHTCIN for building competencies and enhance efficiency and productivity through sufficient workloads, exposure to now projects/ technologies, training and mentoring. BHTC will plan and send its experts to visit BHTCIN for technical training of resources at its own costs and the same will be invoiced separately from: BHTC to BHTCIN.
e. BHTC will help BHTCIN
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h calendar year commencing from January 2014 and shall be notified separately.
BHTC will pay the hourly' rate plus travel expenses (Air ticket, Transportation, Lodging, Meals or allowance), which will be approved in advance by BHTC for each Professional on project assignment on site at BHTC Lippstadt or at any other location. (BHTC will receive corresponding documentation)
Except as expressly agreed with BHTC, BHTCIN shall bear all of its own expenses arising from its performance of its obligations under this Agreement, including (without limitation) expenses for facilities, work spaces, training, utilities and the like.
4. Ownership and Rights
In relation to jobs received by BHTCIN from BHTC, all original and intermediate written material, including programs, documentation, CDs, diskettes, listings and any other material generated by BHTCIN personnel for BHTC shall belong exclusively to BHTC.
5. Confidentiality
a. Except as provided by clause 5(b) herein below, BHTC and
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enalties and obligations arising directly or indirectly from a breach of this provision.
7. Assignment
BHTCIN is not allowed to assign this Agreement or any part of this Agreement to a third Party without prior written consent of BHTC.
8. Change Of ownership
BHTCIN must inform BHTC of any pending change in ownership of the BHTCIN as soon as the change is more likely than not. Upon notice of a pending change in ownership BHTC reserves the right to change the terms and conditions of this agreement without any concurrence of BHTCIN.
9. Term and Termination:
a. This Agreement supersedes the Service Agreement between BHTC and BHTCIN dated January 1, 2012 and amendments thereof and shall come into force on the date of its execution and shall lasts until 315 December 2015 and will be automatically renewed if none of the parties terminates within ninety (90) days in advance.
b. If BHTCIN Commits any act of insolvency or any provision for winding up is admitted against BHTCIN,
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11. Severability Clause
If a provision of this agreement is or becomes illegal, invalid or unenforceable in any jurisdiction, the contract shall be construed as if the same had not been inserted. The Parties hereby agree to make an amendment to the contract containing a legal, valid or enforceable provision.
12. Amendments and Modifications
All amendments or modifications to this Agreement must be in writing, identified as an amendment to this Agreement and signed by an authorized representative of each Party
13. Governing LAW
This Agreement Shall be subject to the laws of the Federal Republic of Germany. For all claims arising out of or in connection with this Agreement as far as statutorily allowed -, the courts competent for Behr-Hella Thermocontrol GmbH domicile shall have jurisdiction.
Additional submissions 06.09.2018
WRITTEN SUBMISSIONS
1. At the outset, the Applicant expresses their gratitude to this Hon'ble Authority for Advance Ruling for granting a patient
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ds are not usually sent back. The copy of the test report us attached as page 27 of the application.
4. On the basis of the said test reports, the overseas group companies then make the suggested alterations to the product design and manufacture products based thereon.
SUBMISSIONS:
A. We refer to and reiterate the Submissions made in para 1.1 to 1.38 of the application. The Said submissions are summarized as follows:
(i) The services of testing of the prototypes provided by the Applicant to its group companies are appropriately classified under Section 13(2) of the Integrated Goods and Services Tax Act, 2017 (“IGST Act”);
(ii) The services of testing of prototype and providing the report based on which mass production is undertaken is more in the nature of advisory/ consultancy service, rather than the services prescribed under Section 13(3) of the IGST Act which, inter alia, entail provision of service on the goods made available physically by the recipient of service and which
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n'ble High Court and Hon'ble Appellate Tribunal.
C. It is submitted that the Hon'ble High Court and the Hon'ble Appellate Tribunal have taken a consistent view that service tax being a destination based consumption tax, the place of supply/ place of provision of the said services are outside India and the said services qualify as export of services.
D. Under the service tax regime, as applicable prior to 2012, i.e., prior to the negative list based approach of taxation of services, the conditions prescribed for qualifying as export of services were laid down in the Export of Services Rules, 2005, The relevant extracts Of the Export of Services Rules, 2005 are reproduced below:
“3. Export of taxable service. –
The export of taxable service shall mean, –
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(2) in relation to taxable services specified in sub-clauses (a), (), (h), (i), (i), (1), (m), (n), (o), (s), (t), (u), (w), (x), (y), (2), (zb), (zc), (zi), (zj), (zn), (zo), (zq), (zr), (zt), (zu), (zu), (zw), (zza), (zz
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ndia. It is submitted that the said provisions are substantially similar to the provisions of the Place of Supply Rules as provided under Section 13 of the IGST Act.
F. Further, w.e.f. 01 April 2011, Rule 3(2) of the Export of Services Rules, 2005 was amended and condition for the Technical Testing and Analysis Services for qualifying as export of services was changed from the place of performance of service to the location of the recipient of service.
G. The aforesaid amendment indicates that the intention of the legislature at all times was to treat the said testing and analysis services, the report for which was issued to the overseas service recipient as export of service, based on the location of the recipient of service. The key factor being that service tax was a destination based consumption tax and the services with regard to the said testing were being consumed outside India, The Frequently Asked Questions (FAQs) to the Central Goods and Services Tax Act, 2017 published by
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of the Place of Provision of Services Rules, 2012 have been reproduced below:
RULE 4. Place of provision of performance based services. –
The place of provision of following services shall be the location where the services are actually performed, namely:-
(a) services provided in respect of goods that are required to be made physically available by the recipient of service to the provider of service, or to a person acting on behalf of the provider of service, in order to provide the service:
Provided that when such services are provided from a remote location by way of electronic means the place of provision shall be the location where goods are situated at the time of provision of service:
Provided further that this clause shall not apply in the case of a service provided in respect of goods that are temporarily imported into India for repairs and are exported after the repairs without being put to any use in the taxable territory, other than that which is required for su
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dgment on the prevalent issue wherein, the Hon'ble Bombay High Court while interpreting the Export of Services Rules, 2005 has held as follows:
24. In the present case, the Tribunal has found that the assessee like the respondent rendered services, but they were consumed abroad. The clients of the respondents used the services of the respondent in inspection/test analysis of the goods which the clients located abroad intended to import from India. In other words, the clients abroad were desirous of confirming the fact as to whether the goods imported complied with requisite specifications and standards. Thus, client of the respondent located abroad engaged the services of the respondent for inspection and testing the goods. The goods were tested by the respondents in India. The goods were available or their samples were drawn for such testing and analysis in India. However, the report of such tests and analysis was sent abroad. The clients of the respondent were foreign clients, paid
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activities and is not a charge on the business, but on the consumer, then, it is leviable only on services provided within the country. It is this finding and conclusion of the Hon'ble Supreme Court which has been applied by the Tribunal in the facts and circumstances of the present case.
The copy of the said judgment in the case of SGS India Pvt. Ltd. has been attached at page 25 of the first compilation of documents.
K. It is submitted that said judgment in the case of SGS India Pvt. Ltd. (supra) has been followed by the Hon'ble Bombay High Court in the case Of QIndia Investment Advisory Pvt. Ltd. reported in 2017-TIOL-2171-HC-MUM-ST = 2017 (10) TMI 754 – BOMBAY HIGH COURT. The copy of the said judgment has been attached at page 31 of the first compilation of documents.
L. The aforesaid two judgments are issued under the Export of Services Rules, 2005. The Hon'ble Tribunal, in Commissioner of Central Excise, Pune-l v/ s. Sai Life Sciences Ltd. reported in 2016 (42) STR 882 (Tri.-
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e Hon'ble Bombay High Court in the case of SGS (supra), the ratio of the said judgment cannot be said to be in jeopardy, as no Stay has been granted against the same. In this regard, reliance is placed on the following judgments:
(i) Union of India v/s. Kamlakshi Finance Corporation Ltd. reported in 1991 (55) ELT 433 (SC) = 1991 (9) TMI 72 – SUPREME COURT OF INDIA;
(ii) Mycon Construction Ltd. v/s. Union of India reported in 2017 (350) ELT 514 (Bom.) = 2017 (3) TMI 347 – BOMBAY HIGH COURT;
(Ill) Shree Sai Vamika Industries v/ s. Union of India reported in 2017 (347) ELT 93 (Gau.) = 2015 (12) TMI 1778 – GAUHATI HIGH COURT
The copies of the said judgments are attached at pages 31 to 36 of the second compilation of documents.
In view of the aforesaid, it is submitted that the place of supply of the testing services provided by the Applicant is outside India and the testing services qualify as export of service in terms of Section 2(6) of the IGST Act.
03. CONTENTION – AS PER THE
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ion of the recipient of services:
Provided that where the location of the recipient of services is not available in the ordinary course of business, the place of supply shall be the location of the supplier of services.
(3) The place of supply of the following services shall be the location where the services are actually performed, namely:
(a) services supplied in respect of goods which are required to be made physically available by the recipient of services to the supplier of services, or to a person acting on behalf of the supplier of services in order to provide the services:
Provided that when such services are provided from a remote location by way of electronic means, the place of supply shall be the location where goods are situated at the time of supply of services:
Provided further that nothing contained in this clause shall apply in the case of services supplied in respect of goods which are temporarily imported into India for repairs and are exported after repair
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“export of services” means the supply of any service when,
(i) the supplier of service is located in India;
(ii) the recipient of service is located outside India;
(iii) the place of supply of service is outside India;
(iv) the payment for such service has been received by the supplier of service in convertible foreign exchange; and
(v) the supplier of service and the recipient of service are not merely establishments of a distinct person in accordance with Explanation 1 in section 8;
The applicant satisfies the clauses of sec(2)(6) and as the place of supply of service is outside India, this office is of the view that the applicant is not liable to pay Integrated Goods and Services Tax on the testing services provided to its overseas group entities.
The applicant may carry out export of service under LUT/Bond without payment of IGST or may carry out export with payment of IGST and claim refund later on.
04. HEARING
The case was taken up for preliminary hearing on
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Dy. Commr. S. T. (PUNE-BST-E-001), Pune Division, Pune appeared and stated that they will be making detailed submissions in due course.
The application was admitted and final hearing was held on 29,08.2018, Sh. Mihir Mehta, Advocate along with Sh. Suyog Bhave Advocate and Sh. Sandeep Deshmukh, D G M Finance appeared and made oral and written submissions and requested time for further submissions before 06.09.2018.
The jurisdictional officer, Sh. Ramesh Phadtare, Dy. Commr. S. T. (PUNE-BST-E-001), Pune Division, Pune appeared and made written submissions.
05. OBSERVATIONS
5.1 We have perused the records on file and gone through the facts of the case and the submissions made by the applicant and the department.
5.2 facts of the subject matter are that the Applicant has entered into service agreement for providing testing services in relation to the prototype goods supplied by their overseas clients. The tests are directly carried out on the prototype goods provided by the overseas
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of service in the course of Inter-State trade,
5.4 Now we take the opportunity to discuss whether the supply of service by the applicant in this case attracts the provisions of Section 2(6) of the IGST Act, so as to be treated as an export of service so as to qualify as “Zero rated supply” under the provisions of Section 16 of the IGST Act.
5.5 An exporter of services in the case of Inter-State trade must satisfy all the conditions of Section 2(6) of the IGST Act which is reproduced as under:-
Section 2(6) “export of services” means the supply of any service when,-
(i) the supplier of service is located in India;
(ii) the recipient of service is located outside India;
(iii) the place of supply of service is outside India;
(iv) the payment for such service has been received by the supplier of service in convertible foreign exchange; and
(v) the supplier of service and the recipient of service are not merely establishments of a distinct person in accordance with Explana
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ervices specified in sub-sections (3) to (13) of Section 13 of the IGST Act. We agree with the applicant that sub-sections (4) to (13) of the said Section 13 are irrelevant in the present case for the purpose of determination of the “place of supply” of the testing services provided by them to their overseas clients and therefore we restrict ourselves to the provisions of sub-section (3) of Section 13 of the IGST Act, which is as under:-
Section 13 (3) The place of supply of the following services shall be the location where the services are actually performed, namely:-
(a) services supplied in respect of goods which are required to be made physically available by the recipient of services to the supplier of services, or to a person acting on behalf of the supplier of services in order to provide the services:
Provided that when such services are provided from a remote location by way of electronic means, the place of supply shall be the location where goods are situated at the ti
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. From a reading of the agreement it is very clear that the testing activities that are carried out include Functional tests, Electrical tests, Mechanical tests, Life cycle tests, Endurance tests, Illumination tests, Environmental tests, Software tests, Product robustness tests, etc. The facts and situation in the present case clearly attract the provisions of Section 13 (3)(a) of the IGST Act and therefore it can be inferred that the said services of testing of the protypes, which are physically made available by the service receiver to the service provider, are provided in India and therefore liable to tax.
5.9 The argument of the applicant is that the services provided by the applicant in this case, as per the agreement, are completed only when the test reports are sent to their overseas clients is not tenable for the reason that first of all the service of testing provided by the applicant on the basis of examination and physical verification of prototypes is in respect of verific
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its further use or otherwise by the service recipient as we can clearly see that even if the findings of test report are not used in any way by the service recipient, it cannot be said that the service of testing is not provided by the applicant to the service recipient as the provision of testing services as per the agreement between them is clearly there whether or not the test report is used by the service recipient. Thus the applicant's argument does not hold any ground and we are of the opinion that in the present case it can safely be inferred from a reading of the provisions of Section 13(3) that the services supply of which has been rendered by the applicant to their overseas client as per the agreement is taxable under IGST Act.
5.10 Further we specifically find that in the SGS case cited by the applicant, the facts are different. In that case the overseas clients of SGS used the services of SGS in inspection/ test analysis of the goods which the clients located abroad inten
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