{"id":745,"date":"2023-10-16T22:27:02","date_gmt":"2023-10-16T16:57:02","guid":{"rendered":"https:\/\/enterslice.com\/research\/?p=745"},"modified":"2023-10-16T22:27:04","modified_gmt":"2023-10-16T16:57:04","slug":"once-indian-entity-was-charging-cost-for-rendering-services-to-foreign-entity-it-cannot-be-termed-as-intermediary-service","status":"publish","type":"post","link":"https:\/\/enterslice.com\/research\/high-court\/punjab-and-haryana\/once-indian-entity-was-charging-cost-for-rendering-services-to-foreign-entity-it-cannot-be-termed-as-intermediary-service\/","title":{"rendered":"Once Indian entity was charging cost for rendering services to foreign entity, it cannot be termed as \u2018intermediary service\u2019\u00a0"},"content":{"rendered":"\n

While setting aside all impugned orders and clarifying that issuance of show cause notice and granting of opportunity of hearing before rejecting of any refund claim, is a statutory requirement, the Chandigarh High Court<\/strong> allowed the writ petition filed by an appellant and directed the respondent to release the refund amount to the petitioner within a period of four weeks.<\/p>\n\n\n\n

A Division Judge Bench of Justice Ritu Bahri<\/strong> and Justice Manisha Batra<\/strong> observed that \u201cthe petitioner does not carry out any marketing of the products of FKDG nor any product is delivered by FKDG to it. The activities performed by the petitioner are original activities and for doing the same, it has been charging costs from FKDG. Therefore, it cannot be stated to be intermediary of FKDG and the services provided by it to FKDG cannot be stated to be intermediary services.\u201d<\/p>\n\n\n\n

Advocate Sandeep Goyal<\/strong> appeared for the Petitioner whereas Advocate Gurinderjit Singh<\/strong> appeared for the Respondent. <\/p>\n\n\n\n

The Brief facts of the case were that the petitioner is one of the leading pharmaceutical companies engaged in the manufacture of anti-cancer drugs as well as innovation and development in the field of oncology drugs.  The petitioner had entered into agreements distribution of products as well as innovation & development services with various companies across the world including Fresenius Kabi Deutschland GmbH Germany (FKDG) which is incorporated in Germany under German Laws. The petitioner was also entered into a Research and Development Service Contract as well as Service Agreements with FKDG. <\/p>\n\n\n\n

Under the Service Tax regime, a show cause notice was issued. the Assistant Commissioner, Service Tax, held that the petitioner fulfills all the conditions as per Section 6A of the Export of Service Rules. After the introduction of the GST Act, the petitioner had approached the respondents\u2019 authorities for a grant of refund under the GST regime but the same was rejected by the reason that the services exported by the appellant did not fulfill the conditions of export under Section 2 (b) (v) of IGST Act, 2017. Hence, the petitioner approached the bench to quash the said orders. <\/p>\n\n\n\n

After considering the submission, the Bench noted that out of eight, no show-cause notice has been issued for the claim for five invoices<\/p>\n\n\n\n

The Bench stated that it is not in dispute that issuance of show cause notice and granting of opportunity of hearing before rejecting of any refund claim, is a statutory requirement.<\/p>\n\n\n\n

The Bench also stated that if the Assistant Commissioner mentioned in its order that the service provided by the petitioner is an export of service, it has all binding effects on the Respondent, and the same could not be reconsidered, till no other appeal has been preferred against the earlier assessment.<\/p>\n\n\n\n

By referring to cases BSNL vs. Union of India, 2006 (3) SCC 1<\/strong>, and Radhasoami Satsang vs. CIT, 1992 (1) SCC 659<\/strong>, the Bench reiterated that \u201c each assessment year being a unit, what is decided in one year may not apply in the following year but where a fundamental aspect permeating through the different assessment years has been found as a fact one way or the other and parties have allowed that position to be sustained by not challenging the order, it would not be at all appropriate to allow the position to be changed in a subsequent year, [unless there was] any material change justifying the Revenue to take a different view of the matter.”<\/p>\n\n\n\n

Accordingly, the Bench on finding that the Respondent had made a wrong observation, allowed the writ petition. <\/p>\n\n\n\n

Cause Title: M\/s Fresenius Kabi Oncology Ltd. Vs. Union of India and Ors. [CWP-17437-2021 \/ 2023-Enterslice-23-HC-Chand-GST]<\/strong><\/p>\n\n\n\n

Click here to read\/download the Order<\/a><\/strong><\/p>\n\n\nFresenius-Kabi-Oncology-Ltd-Versus-Union-of-India<\/a>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

While setting aside all impugned orders and clarifying that issuance of show cause notice and granting of opportunity of hearing before rejecting of any refund claim, is a statutory requirement, the Chandigarh High Court allowed the writ petition filed by an appellant and directed the respondent to release the refund amount to the petitioner within […]<\/p>\n

Read More… from Once Indian entity was charging cost for rendering services to foreign entity, it cannot be termed as \u2018intermediary service\u2019\u00a0<\/span><\/a><\/p>\n","protected":false},"author":4,"featured_media":747,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[22,1],"tags":[136],"acf":[],"yoast_head":"\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\t\n\t\n\n","_links":{"self":[{"href":"https:\/\/enterslice.com\/research\/wp-json\/wp\/v2\/posts\/745"}],"collection":[{"href":"https:\/\/enterslice.com\/research\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/enterslice.com\/research\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/enterslice.com\/research\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/enterslice.com\/research\/wp-json\/wp\/v2\/comments?post=745"}],"version-history":[{"count":1,"href":"https:\/\/enterslice.com\/research\/wp-json\/wp\/v2\/posts\/745\/revisions"}],"predecessor-version":[{"id":748,"href":"https:\/\/enterslice.com\/research\/wp-json\/wp\/v2\/posts\/745\/revisions\/748"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/enterslice.com\/research\/wp-json\/wp\/v2\/media\/747"}],"wp:attachment":[{"href":"https:\/\/enterslice.com\/research\/wp-json\/wp\/v2\/media?parent=745"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/enterslice.com\/research\/wp-json\/wp\/v2\/categories?post=745"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/enterslice.com\/research\/wp-json\/wp\/v2\/tags?post=745"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}