Advance Authority Rulings have progressively expanded the interpretation of OIDAR, covering more categories of foreign digital services.
Journal/database access is OIDAR — but exemption for genuinely non-business government/individual use
A publisher of scientific, technical, and medical journals accessed by registered and unregistered users, including government bodies and individuals, sought clarity on when it must charge GST. The AAR held that GST is chargeable on OIDAR supplies to unregistered persons where used for commerce, industry, business, or profession — but not where government, local authority, or individual recipients use the service for genuinely non-business purposes. The burden of proving non-business use was placed on the applicant.
Online gaming "e-goods" confirmed as OIDAR — reverse charge applies on import
An applicant procuring "e-goods" (in this case, online gaming credits/content) from foreign suppliers via cloud servers sought clarity on GST treatment. The Authority held these e-goods are services, not goods, and fall within OIDAR — Section 2(17) of the IGST Act specifically lists online gaming. Where such services are procured by a registered person in India from a foreign supplier, IGST applies under reverse charge.
The clearest example of the "fact-to-fact" grey area: a ruling reversed on appeal
NCS Pearson, an online testing provider, sought a ruling on whether its "Type-3" tests — a mix of multiple-choice and essay questions, algorithmically scored but with human validation of the algorithm's essay marks — qualified as OIDAR. The original AAR held it did not, reasoning that human involvement in scoring took it outside OIDAR's automation requirement. The department appealed. The AAAR reversed, holding that human validation of an already-generated algorithmic score is still "minimal human intervention," and that from the candidate's perspective the entire service — registration, testing, and results — was received digitally.
CBIC has issued binding circulars clarifying OIDAR-adjacent obligations. These are sourced directly from CBIC's own published circulars.
Data hosting services to overseas cloud providers are not "intermediary" services
CBIC clarified that when an Indian company provides data hosting services (data centre premises, hardware, power, connectivity, security) to a cloud computing service provider located outside India, this does not meet the "intermediary" definition under Section 2(13) of the CGST Act — the data hosting provider is an independent service provider in its own right, not someone merely arranging or facilitating a supply between the cloud provider and its end users.
Section 13(8)(b) of the IGST Act omitted — a major, current change to intermediary place-of-supply rules
For close to a decade, Section 13(8)(b) deemed the place of supply for an intermediary's own facilitation service to be the supplier's location, regardless of where the actual recipient sat — a carve-out from the normal recipient-location rule. The Finance Act 2026 (Section 157) omitted this clause entirely, with Presidential assent on 30 March 2026. Intermediary services now fall under the default rule in Section 13(2): place of supply is the recipient's location, the same as most other cross-border services.
The tripartite-arrangement test for identifying genuine intermediary services
CBIC clarified the conditions for identifying an "intermediary" service: a tripartite arrangement must exist (at least three distinct parties — two engaged in the principal transaction, one facilitating it); the facilitator must arrange or facilitate the main supply without supplying it on their own account; and sub-contractors who actually perform any part of the main service are treated as independent service providers, not intermediaries.
Recipient's state must be recorded on invoices for OIDAR, online gaming, and e-commerce supplies
CBIC clarified that suppliers of OIDAR services, online money gaming, and taxable e-commerce-operator services to unregistered recipients must record the recipient's state on the tax invoice, irrespective of transaction value — correcting a pattern where suppliers were instead recording their own location, causing tax revenue to be misallocated between states.
Software on physical media is "goods" — the classification line that still matters today
(2005) 1 SCC 308. The Supreme Court held that branded, packaged software sold on physical media (like a CD) constitutes "goods" for tax purposes, even though the developer retains the copyright — because the software becomes marketable and capable of being bought and sold once fixed to a medium. This remains the foundational precedent distinguishing software-as-goods from software-as-a-service, and is why OIDAR's narrow physical-media exception exists at all.
Need a ruling analysed for your business?
Our team tracks all OIDAR developments and can advise on how they affect your specific situation.
Get a ruling reviewed →