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GST Refund in case of Export of Services

virag (Account and Tax consultant)   (99 Points)

28 June 2021  

Hello Everyone,

Hope you all are well.

I have one query regarding GST refund in case of export of services.

One of our clients (incorporated as LLP) is providing outsourcing IT services, It is in a legal agreement with US Inc. company where total capital contributed by Inc. company is 99.99 % out of 100. Indian company raises bills to US Inc. company on monthly basis. There is no Indian business/services, only export of services to the USA.

Now, they filed a GST refund application to GST Portal claiming GST on payment to Indian Vendors but the GST department denied a refund on grounds of non-applicablity of the clause - distinct persons.

Please suggest to us how to move further.

Thanks,

Virag


 2 Replies

CA Altamush Zafar (GST Consultant) (10960 Points)
Replied 28 June 2021

You will have to prove that both the entities one in India and one in US are separate and that Indian entity is not  a branch.

There are a number of favourable case laws. If rejection order already made then file an appeal. Or if it is on the notice stage give your reply accordingly.

Mayank Garg (32 Points)
Replied 29 June 2021

Before filing the claim it must be ensure that both are distinct entity.

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