The applicant, M/s. Fraunhofer-Gesellschaft Zur Forderung der angewandten Forschung incorporated in Germany, undertakes the business of promoting applied research and hence established their liaison office (LO) in Bangalore, India, under the permission of RBI, to act as an extended arm of the head office and to carry out the activities that are permitted by Reserve Bank of India.
The applicant sought advance ruling on the issues that whether the Activities of a liaison office amount to supply of services; whether a liaison office is required to be registered under CGST Act, 2017 and whether liaison office is liable to pay GST.
The two-member bench of Dr. M.P. Ravi Prasad and Mashood ur Rehman Faruqooi ruled that the liaison activities being undertaken by the applicant (LO) in line with the conditions specified by RBI amount to supply under Section 7(1)(c) of the CGST Act 2017.
The AAR held that the applicant (LO) is required to be registered under CGST Act 2017.
“The applicant (LO) is liable to pay GST if the place of supply of services is India,” the AAR said.Subscribe Taxscan AdFree to view the Judgment