Archive · 7 Oct 2026
Nasscom Seeks GST Clarity on Branch and R&D Exports
Nasscom represents companies that provide technology and other services.
It wants clearer rules for deciding when work done in India for customers abroad counts as an export under GST.
One question is whether it should matter if a company serves customers through its own overseas branch.
Another is how to treat work done in India on a sample or prototype sent by a foreign customer.
Nasscom says that work should count as an export when the customer receives and uses the results abroad.
Current rules generally treat it as supplied in India because that is where the work happens.
Nasscom says unclear rules can create extra costs and legal disputes for companies.
The GST Council meeting is scheduled for October 8.
Nasscom raised two unresolved GST issues ahead of the Council meeting scheduled for October 8.
It says a company's overseas-branch structure should not alone determine whether services supplied from India qualify as exports.
Nasscom argues that Indian R&D, engineering and testing on customer-provided prototypes should qualify as exports when customers use the results abroad.
Current rules generally treat prototype-related services as supplied in India because the work is performed there, according to Nasscom.
The industry says differences between overseas-branch and subsidiary arrangements can cause input tax credit reversals, compliance burdens and litigation.
- Who
- Nasscom, including Vice President and Head of Public Policy Ashish Aggarwal.
- What
- Nasscom sought clarity on GST treatment of services supplied through overseas branches and Indian R&D, engineering or testing on overseas customers' prototypes.
- When
- Ahead of the GST Council meeting scheduled for October 8; the report is dated October 6.
- Where
- New Delhi; the issues concern services performed in India for overseas customers.
- Why
- Nasscom says clarity could support competitiveness, release working capital, reduce litigation and prevent future disputes.
- Industry body
- Nasscom
- GST Council meeting
- Scheduled for October 8
- Issue one
- GST treatment of services supplied from India through overseas branches
- Issue two
- Export status of Indian R&D, engineering and testing on overseas customers' prototypes or samples
- Nasscom representative
- Ashish Aggarwal, Vice President and Head of Public Policy
- Earlier steps
- Nasscom said 2021 Council clarifications settled export status for services provided by global capability centres to overseas group companies, and that removing the intermediary provision this year addressed a long-standing issue for IT-BPM firms.
- Industry concerns
- Nasscom says the framework can create disparities between branch- and subsidiary-based exports, input tax credit reversals, compliance burdens and litigation.
