Education Consultancy Services to Foreign Universities Are Not ‘Intermediary Services’ – Eligible as Export of Services- Delhi High Court
Education Consultancy Services to Foreign Universities Are Not ‘Intermediary Services’ – Eligible as Export of Services- Delhi High Court
Date and Year of Judgment
08 May 2026
The Delhi High Court reaffirmed that Indian education consultants providing marketing and recruitment support services to foreign universities are not “intermediaries” merely because students are incidentally assisted in the admission process.
The Court followed and reinforced the growing judicial consensus restricting the scope of “intermediary services” under GST.
1. Main Issue Involved
Whether education consultancy, marketing and recruitment support services rendered by an Indian company to foreign universities qualify as:
“Export of services”, or
“Intermediary services” under Section 2(13) of the IGST Act.
A connected issue was whether refund of IGST paid on export of such services can be denied by treating the assessee as an intermediary.
The key controversy was whether incidental interaction with Indian students converts the service provider into an “intermediary”.
2. Sections and Provisions Discussed
Section 2(13) IGST Act – Definition of intermediary
Section 54 CGST Act – Refund provisions
Export of services provisions under IGST Act
Article 226 of Constitution
Judgments discussed:
Global Opportunities Pvt. Ltd. – Delhi HC
K.C. Overseas Education Pvt. Ltd. – Bombay HC
Vodafone India Ltd. – Supreme Court
Blackberry India Pvt. Ltd. – Supreme Court
Ernst & Young Ltd. – Delhi HC
The judgment consolidates evolving jurisprudence limiting the misuse of “intermediary” classification.
3. Facts of the Case
The petitioner, Fateh Education Consulting Pvt. Ltd., was engaged in providing:
education consultancy,
marketing support, and
student recruitment support services
to foreign universities.
The petitioner filed refund claim of ₹2.63 crores under Section 54 on account of:
“Export of services with payment of tax”
for the period September 2023 to March 2024.
The department issued SCN requiring the petitioner to demonstrate that its services were not intermediary services under Section 2(13).
The refund claim was rejected on the ground that:
petitioner was promoting courses of foreign universities,
identifying prospective students,
assisting in recruitment/admission, and
receiving commission linked to tuition fees.
According to the department, this made the petitioner an “agent” and hence an “intermediary”.
The petitioner challenged the refund rejection before the Delhi High Court.
The department equated recruitment assistance and commission-based remuneration with intermediary services.
4. Petitioner’s Submissions
The petitioner contended that:
It provides services directly to foreign universities.
Consideration is received only from foreign universities and not from students.
It does not facilitate a supply between two other persons.
It has no authority to:
bind the university,
guarantee admission,
enter contracts on behalf of university.
The petitioner relied heavily on:
Global Opportunities Pvt. Ltd.
K.C. Overseas Education Pvt. Ltd.
and pointed out that SLPs against those decisions were dismissed.
The petitioner argued that:service recipient is the foreign university, not the student.
5. Department’s Submissions
The department argued that:
The petitioner acted as an “agent” of foreign universities.
Services facilitated admission/recruitment of students.
Hence petitioner was an intermediary under Section 2(13).
The department also relied upon clauses in agreements allegedly indicating agency relationship.
The department attempted to broaden the meaning of intermediary based on:
commission structure, and
assistance in admission process.
6. Analysis and Findings of the Court
The Court held that the controversy is no longer res integra.
It relied extensively on:
Global Opportunities Pvt. Ltd. (Delhi HC)
K.C. Overseas Education Pvt. Ltd. (Bombay HC)
and observed that materially similar services had already been held to constitute export of services.
(i) Service Recipient Is the Foreign University
The Court emphasized that:
foreign universities engaged the petitioner,
invoices were raised on foreign universities, and
consideration was received from foreign universities.
Thus, the petitioner was supplying services to foreign universities on principal-to-principal basis.
(ii) Incidental Assistance to Students Does Not Create Intermediary Relationship
The Court specifically held that merely because:
Indian students are assisted in the admission process,
the petitioner cannot be treated as intermediary.
The decisive factor is:
who contracts for the service,
who pays for the service,
nature of contractual obligation.
(iii) No Principal-Agent Relationship
The Court noted that:
petitioner had no authority to bind universities,
no partnership/joint venture/agency relationship existed,
petitioner could not guarantee admission.
Hence intermediary relationship was absent.
(iv) Services Rendered on Own Account
The Court reiterated the settled principle that:
a person supplying services on his own account cannot be treated as intermediary merely because the service facilitates the business objective of recipient.
Insight: The Court strongly narrowed the scope of intermediary services and reaffirmed the “principal-to-principal” test.
Important Observations of the Court
Issue No Longer Res Integra
The Court held:
“The issue arising in the present petition is no longer res integra.”
Incidental Assistance to Students Does Not Make Service an Intermediary Service
The Court observed:
“…such services would not constitute intermediary services merely because students in India are incidentally assisted in the process.”
Determinative Factor is Contractual Recipient
The Court held:
“The determinative factor is not the place where the incidental beneficiary may be located, but the contractual recipient of the service, the person liable to pay consideration, and the nature of the service supplied.”
Services Rendered on Own Account Cannot Be Intermediary Services
The Court reiterated:
“…a person who supplies services on its own account cannot be treated as an intermediary merely because such services may facilitate or further the business objective of the foreign recipient.”
Refund Rejection Unsustainable
The Court concluded:
“…the impugned order dated 30.10.2025, which rejects the refund claim by treating the petitioner as an intermediary, cannot be sustained.”
These observations are now becoming foundational precedents in intermediary litigation under GST.
7. Judgment of the Court
The Delhi High Court held that:
Petitioner was not providing intermediary services.
Services qualified as export of services.
Refund rejection order was quashed.
Department directed to grant refund with statutory interest within two months.
The Court granted complete relief and reinforced export benefits for education consultancy services.
8. Similar / Related Judgments
Global Opportunities Pvt. Ltd. – Delhi HC
K.C. Overseas Education Pvt. Ltd. – Bombay HC
Vodafone India Ltd. – Supreme Court
Blackberry India Pvt. Ltd. – Supreme Court
Ernst & Young Ltd. – Delhi HC
Courts are consistently moving toward: restrictive interpretation of “intermediary services”.
9. CA BTA Insights
This is one of the most significant judgments on intermediary services under GST.
Key Legal Principles Emerging
1. Mere Facilitation ≠ Intermediary
Incidental assistance to third parties does not automatically create intermediary relationship.
2. Principal-to-Principal Test Is Crucial
Important factors:
who contracts,
who pays,
who receives service.
3. Services Rendered on Own Account Are Not Intermediary Services
If the service provider independently renders services to foreign recipient:
intermediary classification fails.
4. Commission-Based Remuneration Is Not Decisive
Receiving commission does not by itself establish agency/intermediary relationship.
“A service provider rendering services on principal-to-principal basis to a foreign entity cannot be treated as intermediary merely because the services incidentally facilitate the recipient’s business.”