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Place of supply in case of international courier services

Mukesh babu (No) (104 Points)

07 February 2020

my client(karnataka) engaged an international courier agency in karnataka for transportation of goods to abroad. In this case where will the place of supply falls? The courier company says that, as per latest amendment to section 12(8) of IGST act, "provided that where the transportation of goods is to a place outside India, the place of supply shall be the destination of such goods" Is the above stand correct? or the place of supply shall be the service receiver's location (i.e my client's location)?

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3 Replies

Nilkesh Parmar (106 Points)
Replied 07 February 2020

[8] The place of supply of services by way of transportation of goods, including by mail or courier to,-

[a] a registered person, shall be the location of such person;

[b] a person other than a registered person, shall be the location at which such goods are handed over for their transportation.

13 [9] The place of supply of services of transportation of goods, other than by way of mail or courier, shall be the place of destination of such goods.

[2] The place of supply of services except the services specified in sub-sections [3] to [13] shallots be the location of the recipient of services: Provided that where the location of the recipient of services is not available in the ordinary course of business, the place of supply shall be the location of the supplier of services.

GULAM HUSAIN (PROPRIETOR) (22 Points)
Replied 20 April 2021

Provided that where the transportation of goods is to a place outside India, the place of supply shall be the place of destination of such goods

The above proviso Inserted by The Integrated Goods and Services Tax (Amendment) Act, 2018 (No. 32 of 2018) – Brought into force w.e.f. 01st February, 2019

ARHAM SHAFIQUE (2 Points)
Replied 02 May 2023

As per Section 12(8) of the IGST Act, the place of supply for the transportation of goods to a place outside India is considered to be the destination of such goods. Therefore, in this case, since your client (in Karnataka) is engaging an international courier agency for the transportation of goods to a place outside India, the place of supply will be the destination country where the goods are being shipped to, and not the location of the service receiver (i.e., your client's location in Karnataka). Hence, the courier company's stand is correct.