We are Indian company and one of our holding company registered in USA gets a contract for providing software services to one of its group Indian company. Our holding company sub contracts this assignment to us. In this case the contract is between us ( Indian company) and holding company in USA to provide software services to a company in India. We will receive our fees in convertible foreign exchange. All conditions of export are fulfilled. Please let us know that where would be the place of supply and under which sub section of section 13 of IGST Act.
The facts of the case are that all the three companies are related, as you have stated that your holding co. (USA) sub-contracts the contract to your Company (Indian Company) for providing software services to a group company (Indian Company).
In instant two supplies are involved 1. Supply by your Co to holding Co and 2. Supply by holding Co. to its Indian group Co.
You have asked about place of supply of Supply No.1 and have stated that all requirement of export are fulfilled.
In this regard as per definition of ‘export of services’ given in Section 2(6) of the IGST Act one of the condition is that place of supply is outside India. Thus without determining POS we cannot conclude that instant transaction is export or not.
In our view the POS of software services would be determined as per default Section 13(2) (as no other sub-section is applicable) and thus the POS will be the location of recipient i.e. outside India.
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