In this era of globalisation where jurisdictions are delimiting,
taxability of an Intermediary is a tug of war in the Indian
Indirect Tax System. Business entities having operations across
geographies, in order to carry out cross-border transactions, take
benefit from specific advantages which are specific to particular
jurisdictions, such as natural resources, lower costs, a
competitive fiscal environment, etc. Transactions in multiple
jurisdictions involve efficient use of supply chain resources and
also involves working with 'agents' or
'intermediaries'.
Intermediary Services is an old concept which was defined under
Chapter V of the Finance Act, 1994, at the time of introduction of
negative list regime in erstwhile Service Tax law. The definition
was further amended in July 2014 and the legacy has been carried in
the Goods and Services Tax regime along with the dispute.
"Intermediary Services" was introduced with a motive to
tax cross border transactions of
