R&D services provided to the foreign company considered as export of service

Last updated: 08 August 2023

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The Gujarat Advance Ruling Authority (AAR) has ruled that Research and Development (R&D) services provided by an Indian company to entities located outside India qualify as an export of service. This decision clarifies that such services are eligible for zero-rated supply under the IGST Act, provided certain conditions are met. The ruling considered the location of the supplier and recipient, as well as the nature of the R&D activities performed.

Court :
AAR, Gujarat

Brief :
The AAR, Gujarat, in M/s. Hilti Manufacturing India Pvt. Ltd. [Advance Ruling No. GUJ/GAAR/R/2023/26 dated July 12, 2023] held that, services provided by the assessee to the entities located outside India is covered under section 13(2) of the Integrated Goods and Services Tax Act, 2017 ("the IGST Act"). Accordingly, such services would qualify to be treated as export of service.

Citation :
Advance Ruling No. GUJ/GAAR/R/2023/26 dated July 12, 2023

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Judgement posted by

Bimal Jain

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FCA, FCS LLB with21 Yrs of Experience inTaxation Indirect and Direct: Education Qualification: B.Com (Hons) Chartered Accountants Company Secretary LLB Qualified SAP FI/CO Consultants Professional Membership: Chairmanof Indirect Tax Committee of PHD Chamber of Commerce Member of Indirec ... Read more

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