Bombay HC: Operation of Section 13(8)(b) & Section 8(2) governing ‘Intermediary service’ confined to IGST only, not CGST/MGST Act

Bombay HC refuses to strike down provisions of Section 13(8)(b) and Section 8(2) of IGST Act as unconstitutional, however, observes that “the mechanism for Section 13(8)(b) to operate is confined only to the provisions of the IGST Act”; While upholding Section 13(8)(b) of IGST Act, caveats that “the fiction which is created by Section 13(8)(b) would be required to be confined only to the provisions of IGST Act, as there is no scope for the fiction travelling beyond the provisions of IGST Act to the CGST and the MGST Acts, as neither the Constitution would permit taxing of an export of service under the said enactments nor these legislations would accept taxing such transaction”; Observes that “cumulative effect of the provisions of Section 13(8)(b) read with Section 8(2) and Section 12 of the IGST Act, …, can neither be read nor can be said to be of any relevance for the purpose of CGST and MGST Act(s) when it comes to any levy of GST under the said Acts on intermediary services, of the nature export of services falling within the meaning of Section 2(6) of the IGST Act”; Answering a reference arising from differing opinions of Division Bench Judges, 3rd Judge remarks that “the view I have taken is distinct from the view taken by the Hon’ble members of the Division Bench. As a referral Judge, there would be no bar in expressing an independent opinion while deciding the reference by assigning reasons which would support such opinion, hence, it was available for this Court to render an opinion different from the reasons as arrived by the Hon’ble Members of the Division Bench”