Place of Supply - In case of Transportation of Goods and Passengers

1. The place of supply of services by way of transportation of goods, including by mail or courier to,-

a. a registered person, shall be the location of such person;

b. a person other than a registered person, shall be the location at which such goods are handed over for their transportation.

Analysis: As per Section 2(52) 'goods' means every kind of movable property other than money and securities but includes actionable claim, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or under a contract of supply

Example- Transporter Mr 'A' provide transport service to Mr 'B’ for transport of goods from Delhi to Mumbai and Mr. 'B' is a register person, place of supply will be location of Mr. 'B' i.e. Delhi and if Mr. 'A' from unorganized section then Mr. 'B' will pay GST under reverse charge by charging CGST+SGST because place of supply is Delhi and location of supplier is also in Delhi.

2. The place of supply of passenger transportation service to, -

i. a registered person, shall be the location of such person;

ii. a person other than a registered person, shall be the place where the passenger embarks on the conveyance for a continuous journey:

Provided that where the right to passage is given for future use and the point of embarkation is not known at the time of issue of right to passage, the place of supply of such service shall be determined in accordance with the provisions of sub-section (2).

Explanation. For the purposes of this sub-section, the return journey shall be treated as a separate journey, even if the right to passage for onward and return journey is issued at the same time.

Analysis: As per section 2(3) of IGST Act 'continuous journey' means a journey for which a single or more than one ticket or invoice is issued at the same time, either by a single supplier of service or through an agent acting on behalf of more than one supplier of service, and which involves no stopover between any of the legs of the journey for which one or more separate tickets or invoices are issued

Explanation.--For the purposes of this clause, the term 'stopover' means a place where a passenger can disembark either to transfer to another conveyance or break his journey for a certain period in order to resume it at a later point of time;

As per section 2(34) of  'conveyance' includes a vessel, an aircraft and a vehicle;

(Inclusive definition increase the scope of conveyance it covers other modes also)

Example-1 If a taxi hiring company XYZ (P) Limited in Haryana provide taxi on hire to registered company ABC (P) Limited in Delhi for pick and drop facility to their employees, then place of supply will be Delhi and IGST will be charged.

Example-2 If above mentioned XYZ (P) Limited provide taxi to NRI (not register) from abroad let say Mr. 'B' from Haryana to Delhi and Delhi to Haryana. Then both treated as difference journey from Haryana to Delhi CGST+SGST will be charge, it that case place of supply is Haryana and location of supplier is Haryana. For return journey (Delhi to Haryana), IGST will be charge because place of supply is Delhi and location of supplier is Haryana.