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Place of Supply for GST

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R Hiremath

articleship

168 Points Posted on 20 May 2025

Mr A GST Taxpayer from Karnataka owns JCB and he rents to Mr B who is registered from Telangana. But he doing work in Karnataka for that he hires JCB from Mr A. My question is, Is Mr.A Collects IGST or CGST+SGST ? Kindly help me.

Replies (3)

Quick Summary

This discussion clarifies the Goods and Services Tax (GST) implications for a JCB rental service provided by a Karnataka-based owner (Mr. A) to a Telangana-based client (Mr. B), where the work is performed in Karnataka. Based on Section 8(2) of the IGST Act 2017, the place of supply is considered Karnataka, making it an inter-state transaction. Therefore, Mr. A should collect IGST from Mr. B on the rental income.

Rama chary Rachakonda

Master in Accounts & high court Advocate

7021 Points Posted on 20 May 2025

To determine whether Mr. A should collect IGST or CGST+SGST, let's analyze the situation: Place of Supply -

*Location of Service*: The place of supply for services is typically determined by the location where the service is provided. In this case, the JCB rental service is being used in Karnataka. GST Applicability

- *Inter-State vs. Intra-State*: Since Mr. A (Karnataka) is providing services to Mr. B (Telangana), this would be considered an inter-state supply, subject to IGST.

Tax Collection - *IGST Collection*: Mr. A should collect IGST on the rental income from Mr. B, as it is an inter-state supply. By collecting IGST, Mr. A will comply with GST regulations for inter-state supplies [1].