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place of supply

Praveen Pandit (service man) (254 Points)

12 September 2018

if Orissa registred contractor work at Jharkhand and they have buy some material in Jharkhand then cgst or igst should charged by seller and how to make waybill

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15 Replies

Suvendu (Accounts) (429 Points)
Replied 12 September 2018

Bill to Orissa and ship to Jharkhand as per way bill

Praveen Pandit (service man) (254 Points)
Replied 12 September 2018

thanks Bill should make cgst or igst while contractor has no local registration

RAJA P M ("Do the Right Thing...!!!") (127549 Points)
Replied 12 September 2018

Supply made as Intra State and CGST and SGST will be chargeable.

1 Like

Pankaj Rawat (GST Practitioner) (55037 Points)
Replied 12 September 2018

Eway bill & Tax invoice has to made in following manner

Bill To :
Address of Orissa

Ship To :
Address of Jharkand (Site address)

IGST will be Charged.

Praveen Pandit (service man) (254 Points)
Replied 12 September 2018

again confusion cgst or igst please confirm.. but in tally if we use ship to Jharkhand then igst will not calculated..

RAJA P M ("Do the Right Thing...!!!") (127549 Points)
Replied 12 September 2018

Mr Pankaj Rawat Ji.,

The Works Contractor "WORK AT" Jharkahnd. And The Works Contractor Buy material in Jharkahnd Dealer...

Works contractor works in Jharkahnd and Purchase material then Jharkahnd dealer supply to Jharkahnd as place of supply is intra State...

RAJA P M ("Do the Right Thing...!!!") (127549 Points)
Replied 12 September 2018

No need to Confusion "The Works Contractor purchase in Jharkahnd and use the material in his works in Jharkahnd. So, the supply is intra State to a URD person and charge CGST and SGST....

Praveen Pandit (service man) (254 Points)
Replied 12 September 2018

but contractor how to get ITC if we charge cgst

RAJA P M ("Do the Right Thing...!!!") (127549 Points)
Replied 12 September 2018

No way for claim ITC by the Contractor. Bcoz, He is URD in Jharkahnd.

Pankaj Rawat (GST Practitioner) (55037 Points)
Replied 12 September 2018

You mean to say that work contractor has to registered in every state where he got the contract for construction to take ITC .....
No & NOooooooooo

Section 22 Of The ACT Reads As 'Every Supplier Shall Be Liable To Be Registered Under This Act In The State Or Union Territory, Other Than Special Category States, From Where He Makes A Taxable Supply Of Goods Or Services Or Both, If His Aggregate Turnover In A Financial Year Exceeds Twenty Lakh Rupees, Provided That Where Such Person Makes Taxable Supplies Of Goods Or Services Or Both From Any Of The Special Category States, He Shall Be Liable To Be Registered If His Aggregate Turnover In A Financial Year Exceeds Ten Lakh Rupees.'

"PLEASE NOTE FROM WHERE....MEANS WHERE HE IS REGISTERED"

Any Company Need Not Maintain The Separate GST Registration Because Under GST Regime, Works Contract Is Covered Under The Definition Of Service And Which Also Can Be Provided Directly From Dehradun, Uttarakhand To Anywhere In The Country.

Further, The Place Of Supply In Case Of Construction Shall Be The Location Of The Construction Site.

So If Company Is Executing Any Works Contract Outside The State, Then It Shall Be Treated As Interstate Supply And Therefore IGST Shall Be Applicable And Therefore, No Separate GST Registration Is Required To Be Maintained.

The module Bill to & Ship to will applied here & IGST will be charged

kindly read section 10(1)(b) IGST Act

Goods are delivered by the supplier to a recipient or any other person, on the direction of a third person by way of by way of documents of title to the goods or otherwise
It shall be deemed that the said third person has received the goods and the POS of such goods shall be the principal place of business of such person.

So in above case IGST will be charged , the Bill to : orissa address & Ship To : Jharkand site adress

1 Like

Pankaj Rawat (GST Practitioner) (55037 Points)
Replied 13 September 2018

The above section 10 IGST actually says that : .Where a Works contractor (third person) who is located in one state (Orissa) who is awarded a works contract in another state (Jharkand) and if such works contractor instructs a supplier of goods in that state to deliver specified goods to the awarder's premises then it would be deemed that such goods have been received by the Works Contractor and the place of supply would be the principal place of business of such person i.e Orissa which would make it an IGST sale and would be chargeable to IGST. Again as per Section 12 (3) of the IGST Act, when the Works Contractor from Orissa executes the works contract in Jharkand by using the materials already delivered at site and providing labour /service by himself the place of supply of such service would be the location of the immovable property which is Jharkand This means that the bill for services which would be raised by the Works Contractor would again be an IGST Bill for services This would also mean that this works contractor can take the IGST credit for the materials billed to him by the supplier of goods and charge the IGST for labour supplied by him and discharge the net tax liability from Orrisa itself without any registration being required in Jharkand May this might be enough to proof my point of raising of IGSt invoice

1 Like

RAJA P M ("Do the Right Thing...!!!") (127549 Points)
Replied 13 September 2018

Yes... I agreed to You and sec 10 of IGST Act Mr Pankaj Rawat Ji.,

We will understand the meaning of "Third Person";

The Buyer intent to "third person" and supply made to local then use "Bill to Ship to" mode...

But,
Same rule not applicable if buyer directly buying in the other State...