GST on Storgae Services

This query is : Resolved

Mikir Khona (Querist)
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27 July 2024 Case1:
One of our client is providing storage services where they specifically charges storage charges on basis of per container or weight of cargo to his clients on monthly or daily basis. So please clarify whether they have to charge IGST (in case service provider and service recipient registered in different state) or they have to charge CGST & SGST. Since storage facility provided without earmarked of nominated place/ area and does not grant right to use immovable property. Also please clarify the SAC in which invoice to be raised.

Case2:
They are also providing fixed space in warehouse to client and charges on basis of sq ft/sq mtr on monthly or daily basis so please clarify whether they can charge IGST (in case service provider and service recipient registered in different states) or they have to charge CGST & SGST. Also please clarify the SAC in which invoice to be raised.

CA ASHOK DAHIYA

CA ASHOK DAHIYA (Expert)
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27 July 2024 Type of Supply:

Since the storage service does not grant the right to use immovable property and there is no earmarked or nominated place/area, it is considered a supply of service rather than a lease or rental of immovable property.

Place of Supply:

According to the GST provisions, the place of supply of services for immovable property is where the property is located. However, since the storage service is not granting a right to use the immovable property, it falls under general supply of services.
For services other than those related to immovable property, the place of supply is determined based on the location of the service provider and the recipient.

Inter-State vs. Intra-State:

If the service provider and the service recipient are registered in different states, it is considered an inter-state supply and IGST is applicable.
If the service provider and the service recipient are registered in the same state, it is considered an intra-state supply and CGST and SGST are applicable.
SAC (Service Accounting Code)
The service of storage of goods can be classified under the following SAC:

SAC Code: 997213 - Storage and Warehousing Services
This code includes storage and warehousing services, which involve the operation of storage facilities for all kinds of goods, including perishable, refrigerated, bulk, etc., whether in general or a specified storage facility.
Invoice Details
Invoice for Inter-State Supply: Charge IGST.
Invoice for Intra-State Supply: Charge CGST and SGST.

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Mikir Khona

Mikir Khona (Querist)
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27 July 2024 Thanks for above reply also please clarify on Case2 with your valuable comments and if any case law available on same refer me.

Asha Kanta Sharma

Asha Kanta Sharma (Expert)
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13 August 2025 Got it! You want clarity on GST treatment for providing fixed space in a warehouse on monthly/daily basis, especially:
Whether to charge IGST or CGST + SGST when service provider and recipient are in different states.
The correct SAC (Service Accounting Code) for invoicing.
Any relevant case laws or authoritative references.
Case 2: Warehousing — Providing Fixed Space to Client Charged on Sq Ft/Sq Mtr Basis
1. GST Taxability & Place of Supply
Is it Supply of Service or Goods?
Renting or leasing of immovable property (like warehouse space) is treated as supply of service under GST.
What about Inter-state vs Intra-state?
If service provider and recipient are registered in different states, then:
Scenario Tax Applicability
Provider and Recipient in Same State CGST + SGST (each 50%)
Provider and Recipient in Different States IGST
Since in your case the parties are in different states, IGST should be charged on the invoice.
2. Place of Supply (Section 12 of IGST Act)
The place of supply for renting immovable property (warehouse space) is the location of the immovable property (i.e., where the warehouse is located).
So, if the warehouse is in State A and recipient is in State B, supply is deemed to take place in State A.
Tax treatment:
If recipient is registered in a different state than the warehouse location, IGST is applicable.
If recipient is registered in the same state as warehouse location, CGST + SGST apply.
3. Applicable SAC (Service Accounting Code)
The SAC for renting/letting of immovable property is:
SAC Code Description
997212 Renting of Immovable Property (includes warehousing services)
You should use SAC 997212 on your invoice.
4. Invoice Requirements
Invoice should clearly mention:
Whether IGST or CGST + SGST is charged
SAC Code: 997212
Place of Supply (address of warehouse)
Other usual GST invoice details (GSTIN, invoice number, date, etc.)
5. Relevant Case Laws and Authority
CBIC Clarification on renting of immovable property and warehousing services supports the above view.
Advance Ruling Authority of Karnataka in M/s Prolease Properties Pvt Ltd (2018) ruled that renting of warehouse space is a supply of service liable to GST.
Place of supply rulings under IGST Act Section 12(3)(a) affirm place of supply as location of immovable property.
GST Council Meeting Minutes reiterate IGST applicability on inter-state immovable property leasing.

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