In a circular to be able to have ways-achieving implications on the export and ITeS network, the Government has clarified that absolutely everyone engaged in the facilitation of the supply of goods/offerings will now not be considered to be involved in export and could now be taken 
into consideration as a middleman until it’s miles on his account. This might imply carrier vendors engaged in backend offerings inclusive of placement and shipping and logistical aid, obtaining relevant Government clearances, transportation of products, put up-income help offerings, and others will now come below the ambit of GST and may be taxed at 18%.
With this round, most BPO-KPO offerings can now be treated as intermediaries under GST regulations and be taxed below GST. Through the Circular, CBIC has attempted to clarify the applicability of the concept of ‘middleman offerings’ and its consequent remedy under GST for Information Technology enabled Services (‘ITeS’), Back Office Support services, etc.
It has been emphasized that a provider of provider might now not be handled as an intermediary if offerings are being supplied on his very own account, notwithstanding his qualifying as an agent/ dealer. Further, the Government has tested diverse scenarios, wherein a provider of ITeS positioned in India materials offerings for and on behalf of a client placed overseas, to clarify its treatment below GST and damage it into three situations.
Scenario 1:
Supplier of service provides ITeS (backend services as enlisted below Rule 10TA(e) of Income-tax Rules) on his very own account to his customers or customers of his client’s (on patron’s behalf).
It has been clarified that such service companies would not qualify as intermediaries as he is presenting services on their accounts.
Accordingly, the said offerings might also qualify as service exports under GST.
The said role might remain appropriate, even though such offerings are furnished to the clients of the client on the client’s behalf.
Scenario 2:
Suppliers of backend offerings placed in India arrange or facilitate the supply of goods/ offerings to the purchaser’s customers through the customer set overseas.
It has been clarified that such provider companies would qualify as middlemen below GST.
This shall cover lower back-stop offerings such as support services (during pre-transport, shipping, and up-shipping of supply) inclusive of order placement and shipping and logistical help, acquiring applicable Government clearances, transportation of products, and post-sales guide services.
Providing such offerings is simply for arranging or facilitating the supply of goods or offerings between or greater people.
Accordingly, the export gain might not be available on the supply of such offerings.
Scenario 3:
Supplier of ITeS elements lower back give up offerings (as enlisted underneath Rule 10TA(e) of Income-tax Rules) on his account along with arranging or facilitating the supply of various aid offerings all through pre-delivery, transport and put up-transport of delivering for and on behalf of the purchaser placed overseas [i.E.
Scenario 1+ Scenario 2]
It has been clarified that the type of such services as a middleman would depend upon the statistics and instances of each case.
It must be determined which providers, io one offerings or Scenario 2 offerings) could represent as the n or important deliverdeliverydingly, the export gain could now not be available in case the Scenario 2 offerings (I., E. Arranging or facilitating the delivery of various assist offerings during pre-delivery, shipping, and submit-transport of supply for and on behalf of the consumer positioned abroad) might represent as the predominant or main deliver.
