How do we determine whether IT services provided by us constitute export of service? As per Sec 2(6) of IGST Act: “Export of Services” means the supply of any service when,–– (i) The supplier of service is located in India; (ii) The recipient of service is located outside India; (iii) The place of supply of service is outside India; (iv) The payment for such service has been received by the supplier of service in convertible foreign exchange; and (v) The supplier of service and the recipient of service are not merely establishments of a distinct person in accordance with Explanation 1 in section 8 of the IGST Act, 2017; All the following 5 conditions should be exclusively satisfied:-
- SUPPLIER of service is located IN INDIA
- RECIPIENT of service is located OUTSIDE INDIA
- PLACE of SUPPLY of service is OUTSIDE INDIA
- PAYMENT RECEIVED by the Supplier of Service in CONVERTIBLE FOREIGN EXCHANGE
- As per Schedule II of the CGST Act 2017, following shall be treated as SUPPLY OFSERVICES
- But, if PRE-DEVELOPED or PRE-DESIGNED software is supplied in any medium/storage (commonly bought off-the-shelf) or made available through the use of encryption keys, the same is treated as a SUPPLY OF GOODS classifiable under heading HSN-8523.