Residuary provision applies to all services not specified elsewhere :
Except is case of specified services discussed above, the place of supply of services shall be the location of the recipient of service. However, in case the location of the recipient of service is not available in the ordinary course of business, the place of supply shall be the location of the supplier of service – section 13(2) of IGST Act. Section 13(2) of IGST Act is a residuary provision and applies when no other provision relating to any specific
service applies.
In case of consultancy services, the place of provision of service is where customer is located – Kollektivavtalstiftelsen TRR v. Shatteverket (2012) 37 STT 172 = 26116 (ECJ).
In Tech Mahindra Ltd. v. CCE (2013) 39 STT 785 = 33 354 (CESTAT), assessee had received contract for providing onsite software maintenance services outside India. The services were provided by assessee’s subsidiaries outside India. They raised invoice on the assessee (who is in India).
Assessee raised invoice on its customers from India. It was held that service provided by assessee to his customers is export of service and service received by assessee from its subsidiaries outside India is import of service and service tax (now IGST) is payable under reverse charge.
This view has been upheld inTech Mahindra Ltd. V. CCE (2014) 48 GST 327 = 50 365 = 78 VST 135 (Bom HC DB).
In Tandus Flooring India P Ltd. In re (2014) 43 GST 26 = 45513 = 64 VST 56 (AAR), applicant, a wholly owned subsidiary of Tandus, Singapore, was providing marketing and sales support for distribution of products manufactured outside India. Applicant was to act as channel between foreign companies and their Indian dealers. Payment for services was received from foreign parties and not from Indian dealers. It was held that place of supply of service is outside India.
If telephone cards (SIM cards) of telecom operator in UK are sold to distributors outside UK, the place of provision of service is outside UK – Lebara Ltd. v. Commissioner for Her Majesty’s Revenue and Customs (2012) 37 STT 775 = 28 139 (ECJ).
In Universal Services India Pvt Ltd. In re (2016) 91 VST 483 (AAR), the assessee was providing payment processing service to WWD US on principal to principal basis. These services were for domain registration, web hosting, transfer services etc. It was held that as per rule 3 of POPS, the place of provision of service is outside India and hence service tax is not payable. Further, WWD US was providing the services to Indian customers and payment was made by Indian customers directly to WWD US. It was held that applicant is not providing any service to Indian customers- same view in Godaddy India Web Services Pvt. Ltd. In re (2016) 92 VST 1 (AAR).
Service of identifying prospective customers in India for party outside India is export of service (i.e. place of provision of service is outside India) – Gecas Services v. CST (2014) 43 GST 354 = 41 388 = 79 VST 461 (CESTAT).
Sourcing garments in India for sale abroad in USA (vendor development in India for principal abroad) is export of service – Gap International v. CST (2015) 76 VST 44 (CESTAT).
Agency fees paid to foreign banks for arranging finance – Agency fees paid to foreign banks for arranging finance is liable to service tax under reverse charge – Tata Steel v. CST (2015) 63247 (CESTAT). [In other words, place of provision of service is India. It would be ‘import’ of service].