Title: Vodafone Idea Limited Versus Union Of India & Ors.
Citation: W.P.(C) No.2472/2023, CM Nos.9473/2023, 9474/2023 & 51283/2023
Decided on: 09.10.2023
Coram: Justice Vibhu Bakhru and Justice Amit Mahajan
Introduction
The Delhi High Court in the present matter directed the respondents to refund IGST On Telecommunication Services Rendered By Vodafone Idea To Foreign Telecom Operators. The Delhi High Court, while delivering its judgement made the observation that the date on which payments had been received from FTOs would be the relevant date for the purpose limitation under Section 54(1) of the CGST Act. Further, the court noted that the place of supply of services under Rule 6A of the ST Rules are similar to Section 2(6) of the IGST Act inasmuch as the services will be treated as export of services when (a) the provider of service is located in the taxable territory, (b) the recipient of the service is located outside India, and (d) the place of provision of the service is outside India.
Facts of the case
The petitioner holds a telecommunication license from Government of India, and is engaged in providing telecommunicationservices including services in the nature of International Inbound Roaming Services (“IIR”) and International Long Distance Services (“ILD”) to inbound subscribers of FTOs. The petitioner has entered into various service agreements (International Roaming Agreements) with FTOs for providing IIR and ILD services. Undisputedly, the consideration for providing IIR and ILD services to subscribers of FTOs during their visit to India, is paid by FTOs to the petitioner. The petitioner filed its applications for refund of IGST claiming that it had exported services and paid integrated tax as provided under Section 16 (3) of the Integrated Goods and Services Tax Act (hereafter ‘IGST Act’).
The petitioner has filed the present petition challenging the order passed by the Appellate Authority, wherein the petitioner’s appeal under under Section 107 of the Central Goods and Services Tax Act was dismissed. The petitioner is aggrieved by rejection of its claims for refund of Integrated Goods and Service Tax (hereafter ‘IGST’) in respect of telecommunication services rendered by the petitioner pursuant to agreements with Foreign Telecom Operators (FTOs). The petitioner’s appeal was rejected on mainly two grounds: First, that the services provided by the petitioner in respect of which refund of IGST was claimed did not as qualify export of services. And second, that the claims preferred were beyond the period of two years from the relevant dates and therefore, were barred by limitation.
Issue before the court
whether the telecom services provided by the petitioner to inbound subscribers of FTOs constitute export of services and whether its claims were within the period of limitation as specified under Section 54(1) of the CGST Act.
Court’s observation and analysis
In terms of Section 54(1) of the CGST Act, a claim for refund may be made within a period of two years from the relevant date. The Delhi High Court, while delivering its judgement made the observation that the date on which payments had been received from FTOs would be the relevant date for the purpose limitation under Section 54(1) of the CGST Act.
Further, the court noted that the place of supply of services under Rule 6A of the ST Rules are similar to Section 2(6) of the IGST Act inasmuch as the services will be treated as export of services when (a) the provider of service is located in the taxable territory, (b) the recipient of the service is located outside India, and (d) the place of provision of the service is outside India. There is no contention that the decisions rendered on the question of export of services in the context of Rule 3 of the Export of Services Rules, 2005 are also applicable to the controversy in question.
Hence, the present petition was allowed and the respondents were directed to refund the amounts as claimed by the petitioner.
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Written by- Amrita Rout
