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Under GST, there are three levels of Tax IGST, CGST & SGST/UTGST and based on the 'place of supply' and 'place of supplier' the respective tax will be levied. IGST is levied where transaction is inter-state, and CGST & SGST/UTGST are levied where the transaction is intra-state.


Particular

Inter-State

Intra-State

In a transaction where:

Both Place of supply and Location of Supplier is in different State/UT

Both Place of supply and Location of Supplier is in same State/UT

Tax to be Charged

IGST

CGST & SGST/UTGST


Place/Location of Supplier:

Location of supplier is a place mentioned as a principal place of business on the GST registration certificate.

Place of Supply:

In case of Supply of Goods:

GST is based on the consumption pattern. The state where material is consumed will get the Tax. Hence, in crux we can say that place of supply will be the place where goods are consumed.


S.No.

Nature of Supply of Goods

Place of Supply

Remark

1.

Where supply involves the movement of goods

Location of the goods at the time at which movement of goods terminates for delivery to recipient

Ram, Delhi, sells goods to Shyam, Jaipur, here place of supply would be Rajasthan as delivery terminates there.

2.

Where goods are delivered to the recipient, or any person on the direction of the third person by way of transfer of title or otherwise, it shall be deemed that the third person has received the goods.

The principal place of business of such person

This is a case of Ship to Bill to transaction. In this case, the principal place of Bill to person will be Place of Supply irrespective of movement of goods. Further, invoice is to be raised by Bill to person on Ship to person.

3

No Movement of Goods

Location of such goods at the time of delivery to the recipient

Delivery of Goods on ex-shop basis

4

Goods are assembled or installed at site

The place where the goods are assembled or installed

5

Goods are supplied on-board a conveyance

The place where such goods are taken on board

Goods sold in flight departed from Delhi, Place of Supply would be Delhi.

6.

Place of Supply cannot be determined

In manner as may be prescribed

7.

Import

Location of Importer

Material Imported from China by XYZ Ltd.. The material to be consumed in different sub stations in Assam. Material to be transported from Kolkata port to Assam. In this case, in BOE IGST would be charged with place of supply Assam(location of importer)

8.

Export

Location Outside India

As material is to be consumed outside India, No GST


In case of Supply of Service:

For understanding Place of Supply for services the following two concepts are very important namely:

  1. Location of the recipient of services
  2. Location of the supplier of services

S.No.

CASE

Location of Recipient

Location of Supplier

1.

Supply is received/ made from a place of business for which registration obtained

Such place of business

Such place of business

2

Supply is received / made from a place other than the place of registration

Such fixed establishment

Such fixed establishment

3

Supply is received / made from more than one establishment (whether registered or fixed establishment)

The location of the establishment most directly concerned with the receipt of the supply

do

4

In absence of such places

The location of the usual place of residence of the recipient

The location of the usual place of residence of the supplier


General Rule for Place of Supply of Services:-


Supply of Services

Place of Supply

To a registered person

Registered Location of service recipient

To a unregistered person

  1. Location of the recipient if address available
  2. Location of supplier of services in other cases

Example:

ABC Ltd. (Meghalaya) provides consultancy service to XYZ Ltd. (registered in Assam).

Place of Supply: Assam
Place of Supplier: Meghalaya
GST: IGST

ABC Ltd. (Registered in Meghalaya and Assam) provides consultancy service to XYZ Ltd. (registered in Assam).

Place of Supply: Assam
Place of Supplier: Assam
GST: CGST & SGST

ABC Ltd. (Meghalaya) provides consultancy service to XYZ Ltd. (Unregistered- Assam).

Place of Supply: Assam
Place of Supplier: Meghalaya
GST: IGST

ABC Ltd. (Meghalaya) provides consultancy service to XYZ Ltd. (Unregistered).

Place of Supply: Meghalaya
Place of Supplier: Meghalaya
GST: CGST & SGST

ABC Ltd. (Meghalaya) provides consultancy service to XYZ Ltd. at Assam (registered in Delhi).

Place of Supply: Delhi (location of service recipient)
Place of Supplier: Meghalaya
GST: IGST

Place of Supply in case of Specific Services:-


S.No.

Nature of Service

Service- B2B /B2C

Place of Supply

1

Immovable property related services, including hotel accommodation

Any

Location where property located, if located outside India than location of recipient

2

Restaurant, catering, fitness, beauty, health

Any

Location where services are actually performed

3.

Admission to an event or amusement park

B2C

Place where the event is actually held

4.

Services on Board a conveyance

Any

Location of the first schedule point of departure of that conveyance

5.

Banking and other financial services

Any

Location of the recipient of services on the record otherwise location of supplier of services

6.

Training and Performance appraisal

B2B

Location of such registered person

B2C

Location where service actually performed

7.

Organisation of an event

B2B

Location of such registered person

B2C

Location where event actually held; if outside India than location of recipient

8.

Transportation of goods, including mail

B2B

Location of such registered person

B2C

Location at which such goods are handed over for their transportation

9.

Insurance services

B2B

Location of such registered person

B2C

Location of the recipient of services on the records


For rest of the services other than mentioned above, a General provision has been prescribed:


S.No.

Description of Supply

Place of Supply

1

B2B

Registered Location of service recipient

2

B2C

  1. Location of the recipient if address available
  2. Location of supplier of services in other cases

Examples:


Type

Example

Place of Supply

Location of Supplier

GST

Remark

Consultancy Services at sub-station of XYZ Ltd. regarding installation of some equipments

ABC Ltd. (Meghalaya) provides consultancy services to XYZ Ltd. (Delhi) in Delhi

Delhi (Location where goods are installed )

Meghalaya

IGST

Do

ABC Ltd. (Meghalaya) provides consultancy services form a Branch in Delhi to XYZ Ltd. (Delhi) in Delhi.

Delhi (Location where goods are installed )

Delhi

CGST+SGST

ABC Ltd. will have to take registration in Delhi as it has a fixed establishment in Delhi.

Consultancy Services at sub-station of XYZ Ltd. regarding repair of some equipments

ABC Ltd. (Meghalaya) provides consultancy services to XYZ Ltd. (Delhi) in Assam

Assam (location of immovable property)

Meghalaya

IGST

Invoice will be raised on XYZ Ltd. with GSTIN of Delhi and Place of Supply as Assam

Do

ABC Ltd. (Meghalaya) provides consultancy services form a Branch in Assam to XYZ Ltd. (Delhi) in Assam

Assam (location of immovable property)

Assam

CGST+SGST

Invoice will be raised on XYZ Ltd. with GSTIN of Delhi and Place of Supply as Assam.

XYZ Ltd. will not be able to take ITC of SGST-Assam but can take ITC of CGST



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Category GST, Other Articles by - Harihar Mandal 



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