Rule 144 — CONSULT_MANUAL

SN Scenario Applicability of Rule 144

(xi) c) By entering into a MOU/ lease agreement with the company (say ‘X’ who is the present owner of the equipment) from country which does not share a land border with India. The equipment has been purchased from the manufacturer of the company (say ‘Y’) which is from country that shares a land border with India. In this case, the actual supplier of services, prima facie, shall be ‘X.’ Status of ‘X’ in this case does not attract the provisions of Rule 144 (xi).

b) Taking an example of IT goods and services: i) if the contractor is only supplying the servers as it is from an OEM, that belongs to a country sharing land border with India, and there is no value addition done by the contractor, then the contractor acts as an agent for the OEM and registration of the OEM and the agent (contractor) both are required as per the provisions of Rule 144

(xi) of GFR 2017. ii) In case the contractor supplies value added services on a hardware, the contractor outsources, in that case the registration of OEM is not required. iii) Where there is deployment of IT services that includes both hardware and software customization, and the contractor has sourced hardware, which is made in the country sharing land border with India, the requirement of registration as per the provisions of Rule 144

(xi) are not applicable.