Telangana AAR: Providing marketing, recruitment, or referral consultancy to foreign universities may be considered as exports

By: Admin
May 16, 2024
Categories: GST Recent News
4 Min Read

In a recent ruling, the Telangana Bench of the Authority of Advance Ruling (AAR) clarified that the Center for International Admission and Visas (CIAV), which provides marketing, recruitment, and referral services to foreign universities, does not fall under the category of ‘intermediary service’. Instead, these services are classified as exports, exempt from goods and services tax (GST), provided that the payments are received in convertible foreign exchange.

The applicant, CIAV, has agreements with various foreign universities and colleges. Its primary role is to refer students aspiring to study abroad to these institutions. However, CIAV is not obligated to refer students to any specific university or college; rather, it makes referrals based on the merits of each student and their compatibility with the institutions. CIAV does not have the authority to accept students on behalf of the universities or guarantee their admission. It operates as an independent contractor. Although CIAV is based in India, its services are rendered to recipients (foreign universities and colleges) located outside India.

The AAR bench concluded that since CIAV’s services are provided on a principal-to-principal basis, they qualify as ‘export of service’ as long as the payments are received in convertible foreign exchange.