SC settles GST dispute, backs refunds for education consultants to foreign universities

Putting to rest the long-running confusion around ‘intermediary’ services under Goods and Service Tax (GST) law, the Supreme Court on Tuesday ruled that educational consultancy services rendered to foreign universities on a principal-to-principal basis constitute export of services and eligible for GST refunds.

The apex court said that such service providers cannot be treated as intermediaries merely because students in India benefit from the services and consideration is received by them in foreign exchange, thus giving a big relief to service exporters.

A Bench led by Justice JB Pardiwala upheld the Delhi High Court’s September judgment which granted GST refund to Global Opportunities, which is engaged in providing educational consultancy services to Indian students intending to pursue higher education abroad. The HC had held that Global Opportunities does not qualify as an ‘intermediary’ u/s 2(13) of the Integrated Goods and Services Tax Act (IGST Act), and that the services rendered by it to foreign universities qualify as export of services.


The Commissioner of Delhi Goods and Service Tax had challenged the HC order, arguing that the assessee acted as an agent of foreign universities and, therefore, fell within the definition of “intermediary.”

The HC had dismissed Revenue’s petition assailing the Appellate Authority’s orders granting refund of tax paid on export of educational consultancy services, observing that the assessee renders services on a principal-to-principal basis and does not merely arrange or facilitate supply between two persons, and therefore cannot be treated as an intermediary.

After admission of students, foreign universities paid commission to Global Opportunities in terms of the agreements entered between them. The company had claimed refund of GST paid on export of services. The refund claims were rejected by the department on the ground that the assessee was an “intermediary” under Section 2(13) of the IGST Act and, therefore, the services did not qualify as export of services. On appeal, the appellate authority in August 2024 favoured the assessee and asked the revenue for refund.

The HC had noted that the recent recommendations of the GST Council to omit Section 13(8)(b) of the IGST Act reflected legislative intent to remove confusion regarding intermediary services and export benefits. “Thus, ‘intermediary services’ are no longer services for which the place of location of the supplier would be deemed as the place of supply. Even for such services the place of the recipient of the services would be place of supply as per Section 13(2) of the IGST Act. The confusion that was prevalent relating to intermediaries and their entitlement to claim benefits on the basis of export of services is eliminated,” the HC judgment stated.