Place of supply of goods under GST defines whether the transaction will be counted as intrastate or interstate, and accordingly, levy of SGST, CGST & IGST will be determined. The state where they are consumed will have the right to collect GST – the place of supply state gets the revenue. In case of SGST, the state directly collects it. In case of IGST, the centre gives its to the state. Therefore, place of supply is crucial under GST. For assessees it doesn’t matter much – their tax liability will always be the same (except in special situations like Kerala Flood Cess)
Supply involving movement of goods [Section 10(1)(a)]
In this case, the place of supply is the location of the goods at the time when the movement of goods ends for delivery to the recipient. The movement can be undertaken by the supplier or recipient or any other person like transporter but the place of supply is declared at the time when the goods are taken out for delivery from the supplier. Note: This provision does not apply in cases where there is no movement of goods. This provision does not apply to include the transfer of property and only for the movement of goods.
Goods delivered on Bill to Ship to basis [Section 10(1) (b)]
These are supplies involving the movement of goods where goods are delivered to the recipient on the instruction of a third party. This section lays down the provisions to determine the place of supply in cases where there is a tri-party arrangement of supply, commonly known as ‘bill to ship to’ transactions. Where goods are delivered by the supplier to the recipient (original buyer) at the instruction of the third person, the place of supply is the principal place of business of the third person and not the actual recipient or the original buyer.
Points to note
Two supplies occur in this case i.e. supply by the supplier to the third person and by the third person to the recipient. This provision deals only with the first set of transactions i.e. supply by the supplier to the third person.
Supply not involving movement of goods [Section (10) (c)]
If the supply does not involve the movement of goods, the place of supply is the location of goods at the time of delivery to the recipient.
Supply involving installation or assembly of goods [Section 10(1) (d)]
If the supply involves goods that are to be installed or assembled at the site, the place of supply is the place of such installation or assembly.
Goods supplies on board for conveyance [Section 10(1) (e)]
This means the supply of goods during a journey. When goods are sold/supplied during a journey, it becomes difficult to determine the place of supply – whether it is the location from the journey begun or the destination of the journey. This section states that the place of supply for such supplies like aircraft, trains, motor vehicles is the location where such goods have been on board.
Points to be noted: Place of supply under this case is determined even if the supply has been made by any of the passengers onboard and not by the carrier of the conveyance. Place of supply of goods Imported to or Exported from India
Import of goods: All import of goods are to be treated as Inter-state supply and IGST tax is levied in addition to applicable customs duties.
If goods are imported, the place of supply of goods is the place where the importer is located.
Export of goods: Exports are treated as inter-state supply and zero-rated supply where the exported goods are relieved of GST levy.
In this case, the place of supply is the place where they have been exported i.e. the destination of supply (Outside India)
Place of supply of service within India
This explains the case where the location of the supplier of service and the recipient of service is in India. The place of supply of services differs in the supply of services based on the nature of service availed and the location of supply of such service.
The place of supply of services made to an unregistered person is the location of the person receiving the services.
If supplied to unregistered persons, the place of supply would be the location of such unregistered person if his address is available or the location of the supplier of services if the address is not available.
Place of supply of services outside India
In the case of export of services, the place of supply of such services is the location of the recipient of services. However, if the location of the recipient is not available, the place of supply is the location of the supplier of services.
