Place of Supply incase well cleaning service

This query is : Resolved

Vijay Koradia (Querist)
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19 March 2022 we are Gujarat based entity. Gujarat Government has given well cleaning work contract to Tamil Nadu based company. We are working on sub-contract for that Tamil Nadu based company. We are providing well cleaning service. Wells are situated at Gujarat only. Sir, I have doubt that whether we have to charge CGST/SGST or IGST? Further we had charged IGST till today and if CGST/SGST is to be charged whether we have to pay tax along with interest and penalty?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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19 March 2022 Place of Supply – Section 12 & 13 of IGST Act – The place of supply in relation to an immovable property including works contract services is the place where the immovable property is located.

Pay CGST/SGST and get refund of IGST paid.
No interest will need to be paid when the taxpayer pays the correct tax later on. The penalty will not apply in these scenarios.

CA Puja Sharma

CA Puja Sharma (Expert)
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19 March 2022 Yes, in your case CGST/SGST will apply and will intrastate supply of services.

Since you have paid the required tax though under different head but on time, their wont be any interest liability.

CA Altamush Zafar

CA Altamush Zafar (Expert)
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19 March 2022 CGST/SGST will be charged instead of IGST. Pay CGST/SGST and claim refund of IGST. No interest on you. However your customer will be in a difficult positio since he is not eligible for ITC of CGST/SGST and will have to reverse IGST ITC if he has already claimed it.

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