The Delhi State Bench of the Goods and Services Tax Appellate Tribunal (GSTAT) has transferred the appeal against the Joint Commissioner, CGST Appeals-II, Delhi, to the Principal Bench of GSTAT, New Delhi, holding that the core issue in the matter concerns the place of supply of freight services and consequently falls within the exclusive jurisdiction of the Principal Bench under Section 109(5) of the CGST Act, 2017. 

The Bench of Sanjay Kumar Aggarwal (Judicial Member) and Rajiv Kapoor (Technical Member) has observed that the dispute was fundamentally connected with whether the appellant’s services qualified as export of services under Section 2(6) of the IGST Act. Since determination of the place of supply was central to that question, the matter attracted the jurisdictional provision governing GSTAT benches.

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The appellant/assessee had contended that it was engaged in providing freight services to foreign clients on a principal-to-principal basis and that its transactions satisfied the statutory requirements for “export of services” under Section 2(6) of the IGST Act, 2017.

According to the appellant, the supplier of services was located in India, the recipients were located outside India, the place of supply was outside India, consideration had been received in convertible foreign exchange, and the supplier and recipients were not merely establishments of the same person. The appellant therefore maintained that the statutory conditions for export of services stood fulfilled. 

The appellant further argued that the denial of export status and consequential refund merely because there was no written agreement with the foreign clients amounted to a hyper-technical approach. It submitted that the existence of a contractual arrangement could be established through the parties’ conduct, invoices and payment documents, and that Section 2(6) of the IGST Act does not expressly prescribe a written service agreement as a mandatory condition for export of services. 

The appellate order, however, took a different view. It recorded that the taxpayer had not submitted a service agreement either before the adjudicating authority or at the appellate stage. According to the authority, the absence of the agreement meant that the nature of the services supplied and, importantly, the actual place of supply could not be properly examined. 

The authority also raised a separate issue concerning evidence of receipt of export proceeds in convertible foreign exchange. It noted that although the taxpayer had submitted several Foreign Inward Remittance Certificates (FIRCs) at the appellate stage, it had allegedly failed to furnish the FIRC dated February 13, 2024 corresponding to Invoice No. AE500293 dated February 5, 2024. The authority therefore found substance in the objection concerning proof of realization against that particular invoice. 

On that basis, the appellate authority concluded that the adjudicating authority had sanctioned the refund claims without adequately examining the actual place of supply and the relevant FIRC. It consequently held the refund orders to be legally unsustainable. 

The GSTAT Delhi State Bench, instead of deciding the merits of the export-of-services claim, examined the nature of the controversy and found that the substantive question requiring adjudication was the determination of the actual place of supply of the freight services rendered to foreign clients.

The Tribunal relied upon Section 109(5) of the CGST Act, 2017, and held that matters involving the substantive question of place of supply fall within the exclusive jurisdiction of the Principal Bench.

The Bench specifically recorded that both the appellant and the respondent agreed during the hearing that the dispute involved a question relating to place of supply. On that basis, it concluded that only the Principal Bench of GSTAT, New Delhi, had jurisdiction to hear the appeal. 

Accordingly, the Delhi State Bench did not adjudicate whether the assessee had actually fulfilled the conditions for export of services, nor did it finally determine the validity of the refund claim. Instead, it directed the Joint Registrar of the Delhi State Bench to transfer the entire case record to the Registrar of the Principal Bench, GSTAT, New Delhi. 

The Tribunal directed the parties to appear before the Registrar of the Principal Bench on August 17, 2026. The transfer therefore leaves the substantive questions—including the correct place of supply, eligibility for export-of-services treatment and the implications of the FIRC-related objection—to be examined by the competent bench. 

The order also records that the Registry had initially placed the matter before the State Bench with a defect relating to pre-deposit. The appellant informed the Tribunal that the issue had already been taken up with the National Informatics Centre (NIC) and was under active consideration for resolution. 

The Tribunal has not held that the absence of a written agreement is immaterial, nor has it finally ruled that the appellant’s services qualify as exports.

The Bench has identified place of supply as the decisive substantive issue and held that such a dispute must be heard by the Principal Bench under Section 109(5) of the CGST Act. The merits of the appellant’s claim under Section 2(6) of the IGST Act, including the competing contentions concerning foreign recipients, place of supply, receipt of foreign exchange and documentary evidence, will therefore remain open for consideration before the Principal Bench. 

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