Materail supplied with in state but billing to other state

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This discussion clarifies a common GST query regarding supplying goods within Andhra Pradesh while billing to a Karnataka-based dealer. It confirms that this 'bill to ship to' scenario is permissible under Section 10(1)(b) of the IGST Act. IGST is applicable, and the e-way bill should reflect the 'bill to' party's state for tax component purposes.

YELLANKI RATHNAGIRI

YELLANKI RATHNAGIRI (Querist)
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08 July 2021 Dear all

My client Mr XYZ is GST Registred dealer in Andhra Pradesh,
My client got material supply order from Karnataka GST Registred Dealer with 2 conditions
1)Materail should be dispatched within andhra preadesh,
2) Tax Invoice Billing to Karnataka state with IGST Tax

now my client is suppliing materail with in andhra pradesh and billing to karnataka state with IGST
Is it right process??

please explain if any wrong

CMA Poornima Madhava

CMA Poornima Madhava (Expert)
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08 July 2021 Yes, this is possible as per section 10(1)(b) of IGST Act. Supply to a recipient on the direction of a 3rd person (KA dealer). The buyer in this case is in KA and the consignee is in AP and IGST would be levied accordingly.

CS Advocate Abhishek Goyal

CS Advocate Abhishek Goyal (Expert)
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09 July 2021 for purpose of eway bill, this transaction amounts to bill to ship to as bill to party is in karnataka and ship to party is in andhara pradesh. As per FAQs on eway bill issued by CBIC, tax components in eway bill shall be on the basis of bill to party if the bill to state and ship to state are two different states. accordingly also, you shall charge IGST on this transaction.

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