SC Upholds Bombay HC Ruling: Foreign University Services Are Exports, Not Intermediary, Refund Allowed:

SC Upholds Bombay HC Ruling: Foreign University Services Are Exports, Not Intermediary, Refund Allowed The assessee company provided education consultancy services to foreign universities, helping and assisting  in admission of Indian students. The company claimed refund of GST paid, treating its services as “export of services” under Section 2(6) of the IGST Act, as the foreign universities were the recipients and paid consideration in convertible foreign exchange. The department denied the refund, classifying KC Overseas as an “intermediary” under Section 2(13) of the IGST Act, on the ground that services were provided to students in India. The assessee challenged the denial before the High Court. HC's Decision: The High Court noted that identical issues had been considered in Ernst & Young Ltd. v. Addl. Commr. CGST (Del HC) and that the CESTAT had earlier held, in KC Overseas’ own case under the service tax regime, that the recipient of services were not the students involved but the foreign university. The Court found that the reasoning of the appellate authority dated 07.03.2024 could not be sustained and the denial of refund was contrary to law. Main Issue: Whether services provided by KC Overseas to foreign universities constituted “export of services” under Section 2(6) of the IGST Act, or intermediary services taxable in India. SC's Decision:  When the Union of India challenged this decision before the Supreme Court in SLP, the Court dismissed the petitions. The dismissal was based on its earlier rulings in Vodafone India Ltd. and Blackberry India Pvt. Ltd., which had settled the legal position on intermediary services. Thus, the High Court’s decision in favor of KC Overseas was affirmed by the Apex Court. To Read Full Judgment, Download PDF Given Below