MCQ Challenge On Export Of Services Under GST

MCQ SELF CHALLENGE #0083

Export Of Services Under GST

Dear Professional Seniors & Friends,

Warm Greeting!

Here is the Next post of top tax consultant in Gurgaon on concept based practical professional knowledge on Export of Services under GST in a unique manner to be self answered by participants. The detailed answer of these MCQs shall be posted next day for the self assessment of the participants.

MCQ 83.1: Mr.. X was Facilitating Recruitment of Students to a foreign university and Mr X was paid commission in foreign currency based on the performance in recruiting students. Le a percentage of total fees collected by University from the students. Which of the following statement is true?

A. GST is not leviable since it is export of Services and thus zero rated supply.

B. GST is leviable on Services provided by Mr. X

C. It is deemed Export.

D. None of the Above.

MCQ 83.2: What If in the above Question Mr. X was collecting charges from Students abroad in Indian currency directly instead getting a commission from Universities for recruiting them to Indian universities?

A. GST is not leviable since it is export of Services and thus zero rated supply.

B. GST is leviable on Services provided by Mr. X

C. It is deemed Export.

D. None of the Above

Answer MCQ Self Challenge #0083

This post of MCQ is on provisions relating to Export of Goods/ Services under GST

Answer MCQ 83.1:

B) GST is leviable on Services provided by Mr. X.

Practical Analysis for MCQ 83.1:

• As per Section 2(6) of the IGST Act, Export of Service means supply of Service where-
• Supplier is located in India-Mr. X
• The Recipient is outside India-Universities
• Place of Supply outside India-Have to determined
• Payment in Convertible foreign Exchange - Yes
• Both should not be establishments of Distinct person - Yes

• Here the main determinant of the liability to pay GST is Place of Supply
• On detailed Examination it is analyzed that the main Service of the Applicant is facilitating Recruitment of Students and Consideration is paid as Commission on the basis of Course fee and Recruitment through the applicant.
• Mr. X Acts on Behalf of the University and is not allowed to receive any fees or charges from the students or deduct anything from the fees payable by the Students to the University.
• Mr. X therefore, represents the University in the territory of India and Acts as its recruitment agent. It is therefore clear that whatever services that the applicant provides is as a representative of the University and not a an Individual Service Provider.
• Section 2(13) of the IGST Act, 2017, "Intermediary means a broker, an agent or any other person by whatever name called, who arranges or facilitates the supply of goods or services or both or securities, between two or more persons, but does not include a person who supplies such goods or services or both or securities on his own account.
• As per above analysis in our question, Mr. X shat be intermediary of foreign universities.
• Being an intermediary Service Provider, the place of Supply shall be determined under Section 13(8) of the IGST Act. The place of Supply shall be location of supplier ie in india. As the place of Supply is not outside india. The Applicants services to the Foreign Universities does not quality as "Export of services and is therefore Taxable under GST Act.

Based on the above analysis. Correct answer to MCQ 80.1 B) GST is leviable on Services provided by Mrx

Answer MCQ 83.2:

B) GST is leviable on Services provided by Mr. X

Practical Analysis for MCQ 83.2:

In this question, Mr. X is charging money directly from students so will not be an intermediary of foreign universities. Hence place of supply shall be the place of students which is outside India.

But in this case money is received in Indian currency so other condition for treating it as exports do not qualify.

Based on the above analysis. Correct answer to MCQ 83.2: B)GST Is leviable on Services provided by Mr. X.

(Disclaimer: The objective of the MCO post is just to discuss the concept it may happen by change of facts, the answer may be different, Please do not treat this as professional opinion: you can definitely have your own opinion.)

Sincere Regards!

CA Sanjay Kumar Agrawal

Mobile: 9810116321