Place of supply of goods and services under GST regime 2017

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Place of supply in GST: Place of supply of goods and services under GST regime. All you need to know about Place of supply under GST regime. Proposed GST can be categorised into CGST i.e Central GST, SGST i.e State GST & IGST i.e Integrated GST. Place of supply will play vital role for determination levy of CGST & SGST or IGST. In present scenario, service tax is levied on service which is governed by Chapter V of Finance Act, 1994. Service Tax is consumption based tax. It is levied on the services provided in taxable territory. Hence, to determine where the services have been provided or to be provided, Place of Provision of Services Rules, 2012 (hereafter PoPoS Rules, 2012) were introduced. Now check more details for “Place of supply of goods and services under GST regime” from below….

Place of supply of goods and services under GST regime:-

Place of Supply of goods where no export /  import

Place of Supply of goods where no export import

Important points

  • Before you determine Place of supply, please decide classification
  • Location of Supplier is very important to decide
  • Decide who is recipient of service
  • Be clear of the Section your Services fall in
  • Place of supply is not equal to place of performance
  • Territorial waters – Location of Supplier or Place of supply (Section 9)
  • Determination of Place of Supply of goods is different from that of Services
  • Section 2(15) – Location of Supplier of Services

Location of Supplier of Services

Section 2(93) CGST- Recipient of Supply

Section 2(93) CGST- Recipient of Supply

Deemed Inter state Supply

  • Supply of services imported into the territory of India
  • Supply of goods or services or both when the supplier is located in India and the place of supply is outside India.
  • Supply of goods or services or both to or by a Special Economic Zone developer or a Special Economic Zone unit
  • Supply of goods or services or both when in the taxable territory, not being an intra-State supply and not covered elsewhere, shall be treated to be a supply of goods or services or both in the course of interState trade or commerce

Need for Place of Supply

For whom are these rules meant?

These rules are primarily meant for:

  • persons who deal in cross-border services
  • Persons dealing in interstate transactions
  • Suppliers operating within India from multiple locations and supplying goods /services from different locations
  • Special transaction zones like SEZ, exempted zones etc
  • To enable determination of place of levy and jurisdiction
  • To ensure no double taxation by different states on same transaction
  • To ensure proper tax collection by different states and enabling them to get their proper share
  • To ensure proper Rules for Goods and Services separatel
  • Ensure seamless credit

IGST – Levy

IGST on supply of good

supply of goods in the course of inter-State trade or commerce means any supply where:

  • the location of the supplier and
  • the place of supply are in different States

Deemed Inter State Supply

  • A supply of goods and/or services in the course of import
  • An export of goods and/or services

Exceptions to this Rule given in Section 5

IGST Levy

Online information and database access or retrieval services

means services whose delivery is mediated by information technology over the internet or an electronic network and the nature of which renders their supply essentially automated and involving minimal human intervention and impossible to ensure in the absence of information technology and includes electronic services such as,—

  • advertising on the internet;
  • providing cloud services;
  • provision of e-books, movie, music, software and other intangibles through telecommunication networks or internet;
  • providing data or information, retrievable or otherwise, to any person in electronic form through a computer network
  • online supplies of digital content (movies, television shows, music and the like);
  • digital data storage; and
  • online gaming;

Location of recipient in case of OIDAR

  • the location of address presented by the recipient of services through internet is in the taxable territory;
  • the credit card or debit card or store value card or charge card or smart card or any other card by which the recipient of services settles payment has been issued in the taxable territory;
  • the billing address of the recipient of services is in the taxable territory;
  • the internet protocol address of the device used by the recipient of services is in the taxable territory;
  • the bank of the recipient of services in which the account used for payment is maintained is in the taxable territory;
  • the country code of the subscriber identity module card used by the recipient of services is of taxable territory;
  • the location of the fixed land line through which the service is received by the recipient is in the taxable territory. Place of Supply CA Ga

Place of Supply of Services

Place of Supply of Services – General (where Location of Supplier and Recipient is in India)– Section 12

Services Service provided to Place of Supply
General – Section 12(2)(a)

[except the services specified in sub-sections (3) to (14)]

Registered Person – B2B Location of Recipient
General – Section 12(2)(b)

[except the services specified in sub-sections (3) to (14)]

Person other than a Registered Person – B2C the location of the recipient where the address on record exists; and (“address on record” means the address of the recipient as available in the records of the supplier)

the location of the supplier of services in other cases.

Place of Supply of Services – General (where Location of Supplier and Recipient is in India)– Section 12

Section 2(14) “location of the recipient of services” means,––

  • where a supply is received at a place of business for which the registration has been obtained, the location of such place of business;
  • where a supply is received at a place other than the place of business for which registration has been obtained (a fixed establishment elsewhere), the location of such fixed establishment;
  • where a supply is received at more than one establishment, whether the place of business or fixed establishment, the location of the establishment most directly concerned with the receipt of the supply; and
  • in absence of such places, the location of the usual place of residence of the recipient;

Section 2 (85) CGST: “place of business” includes––

  • (a)   a place from where the business is ordinarily carried on, and includes a warehouse, a godown or any other place where a taxable person stores his goods, supplies or receives goods or services or both; or
  • (b)   a place where a taxable person maintains his books of account; or
  • (c)a place where a taxable person is engaged in business through an agent, by whatever name called;

Section 2 (50)CGST / (7) IGST:  “fixed establishment” means a place (other than the registered place of business) which is characterised by a sufficient degree of permanence and  suitable structure in terms of human and technical resources to supply services or to receive and use services for its own needs;

Section 2 (113) CGST: “usual place of residence” means––

  • (a)  in case of an individual, the place where he ordinarily resides;
  • (b)   in other cases, the place where the person is incorporated or otherwise legally constituted;

Section 2(15) “location of the supplier of services” means,––

  • where a supply is made from a place of business for which the registration has been obtained, the location of such place of business;
  • where a supply is made from a place other than the place of business for which registration has been obtained (a fixed establishment elsewhere), the location of such fixed establishment;
  • where a supply is made from more than one establishment, whether the place of business or fixed establishment, the location of the establishment most directly concerned with the provision of the supply; and
  • in absence of such places, the location of the usual place of residence of the supplier;
Registered Person Consumer Address on Record exists Place of Supply of Service
ABC LTD  of  Gujarat  providing Service of iPhone repairing Mr. Raju –Maharashtra YES Maharashtra – IGST apply
Ms. Mohini No Gujarat – CGST/SGST apply

Illustrative Case Study

ABC is a big CA firm of Vadodara; receives assignment from Client HO at Chennai for physical verification of fixed assets at various plants located throughout the country, as also its Guest House at Delhi & Mumbai, and its Administrative Office at Ahmedabad. What would be the Place of Supply for the professional services for which the invoice is to be raised to HO?

ABC is a CA firm of Mumbai having offices at Bangalore, Kolkata, Delhi & Chennai; receives an assignment from Client HO at Mumbai for multi-disciplinary professional services to be provided at multiple locations of the client. The Mumbai office involves specialist staff from its other offices. How to determine the nature and place of supply of services?

A CA firm at Vadodara is appointed by BOB(Vadodara office) for stock audit at the factory of the bank’s customer located at Thane. What would be the place of supply?

Services Service provided to Place of Supply
Directly in relation to an immovable property, including services provided by architects, interior decorators, surveyors, engineers and other related experts or estate agents, any service provided by way of grant of rights to use immovable property or for carrying out or co-ordination of construction work – Section 12(3)(a)

AND any ancillary services – Section 12(3)(d)

 Recipient of services

(Registered Person or Person other than Registered Person)

B2B or B2C

Location at which the immovable property or boat or vessel, as the case may be,

is located or intended to be located

Registered Person Consumers Location of immovable Property Place of Supply of Service
ABC LTD  of  Gujarat  providing Service of interior decorators XYZ LTD

Gujarat

Maharashtra Maharashtra – IGST Apply
Mr. Ramesh

SURAT

Rajkot Gujarat  – CGST/SGST Apply
Mr. Kedar

Maharashtra

Surat Gujarat – CGST/SGST Apply

Recipient deemed  be in taxable territory

Two of the following conditions need to be satisfied:

  • Location of the address presented by recipient of service via internet is in taxable territory
  • Debit/credit/any other card for settlement of payment has been issued in the taxable territory
  • Billing Address of recipient of service is in the taxable territory
  • IP address of the device used by the recipient is in the taxable territory
  • Bank of recipient in which the account used for payment is maintained in the taxable territory
  • Country code of SIM card used by the recipient is of taxable territory
  • Location of fixed landline through which service is received by the recipient is in taxable territory

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16 COMMENTS

  1. Dear sir,

    We represent many over seas organizations and sell their products in india. Material is directly billed by Overseas OEM to indian customers and we get fixed commission (as per contract). They are not ready to pay GST and they pay faxes in their country. Under service tax we were paying 15% service tax (it is like turnover tax for us). Now it is becoming no more viable. Can some one explain under new IGST, what will be the tax our flow for my company as OEM are ready to pay the same. I red some where that it is against international norms to charge IGST to over seas OEM under this circumstances. Please advice, is there any solution.

    • It will charge under GST act, if the overseas organisation does not pay the GST, the assess in India has to pay tax on the same.

      • MY FURTHER QUERY IS:
        **In the said case IF the Place of Service is taken as Overseas then IT is Export of Service and Not Taxable

        **If place of Service is taken as Office of Indian Service provider THEN Will it be treated as INTRA-STATE and exemption of 20 Lacs will be available ???

        • Dear sir,
          Thanks for clrifications. How can I show that place of service is out side India. OEM is located out side India. But we are a local company sells their products in India and receive commission in FE. Under this how can I prove the place of service is out side India?
          Best regards
          Syam

  2. If address of buyer is Rajasthan and buyer is exporter, place of supply is same state of supplier i.e. Kandla Port (Gujarat), then IGST will apply or CGST/SGST?

  3. sir,

    My registered office in Mumbai I want to export my product from Gujarat but on SB I want my registered office address which GST no is applicable for me. when I am entering GST no of Gujarat & address is of Mumbai office same is not accepting by custom server pls. guide how to file the Shipping bill.

  4. Sir
    partnership firm having registered office at Kolkata and having immovable property at Delhi. The property situated at delhi is let out to one of the party registered in chennai. Now my question is whether we need to registered in Delhi and raise invoice with SGST and CGST or we can raise invoice to chennai party for renting of immovable property at delhi and charge IGST.
    Please suggest.

  5. Dear Sir,

    Our Institute registered with company act in Punjab and we have franchisees in other states and providing vocational courses to Students. We received only registration fees from students directly and provided soft copy of study material, ID Cards and Diploma Certificate. So please tell which category of the GST will be applicable and which section of Place of Supply of Services.
    We have to register GST with other states or only IGST will applicable.
    Please clear
    Thanks

  6. Sir
    we are from Rajasthan , and go to Gujarat for business trip and stay at Gujarat hotel and provide Name of my company and gstin no..on invoice bill , so
    1) its apply IGST on it. so, we can got Input tax credit.
    2) if its apply CGST & SGST , So we can got also Input tax credit.
    3) like same we book flights tickets online or by Call center , so how we get input tax credit , and what they apply on IGST, SGST & CGST.
    please clearfy

  7. Dear Sir,

    I am providing intermediary services to the party outside india. According to POPS , place of supply will be location of service provider. To become a inter state supply , both location of supplier and place of supply should be in different states. But in my case both are same. So according to definition , my service is not inter state supply & i able to claim the 20 lac exemption. Is I am correct??

  8. Dear Sir,
    We are manufacturer based at Gujarat.
    We have purchased goods from Mumbai supplier, who has sent it to a jobworker in Mumbai for further processing and finally jobworker has delivered to our END CUSTOMER on our instruction.
    Goods have not come to Gujarat. Supplier has billed to us and we will be billing to our END CUSTOMER.
    Jobworker will be billing to us.

    Will IGST be applicable ?

  9. Dear Sir,
    Pls answer me
    A customer unregistered under gst, customer vehicle registered in uttarakhand but address in tata motors sible of customer address rajasthan. serivce center rishikesh uttrakhand .
    vehcle service and maintaince make invoice confusions applicable Igst/cgst,sgst.
    pls. provide answer me apicable igst and cgst sgst.

  10. We are having a Warehouse in Haryana. We have given a space in the said Warehouse to a Customer located in Chennai. The Customer has not taken GST Registration for the portion of the warehouse taken by him from us in Haryana. Now we have to raise Invoice on Customer at their Chennai Address – whether we have to charge IGST or CGST & SGST – please guide.

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