Subsidiary Services to Parent Company Not Intermediary: Gujarat HC

The Gujarat High Court ruled that a subsidiary company providing goods or services to its parent company in an independent capacity cannot be considered an 'intermediary service' under Section 2(13) of the IGST Act.

The case involved Infodesk India Pvt. Ltd., a subsidiary that provided software consultancy services to its parent company in the US. The court found that the services were rendered on a principal-to-principal basis, not as a broker or agent.

The court directed the Department to process the refund of input tax credit, emphasizing that the petitioner’s services were not intermediary services. The ruling was based on a similar case involving Ernst & Young.