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Determination of supply of goods/services – Intra / Inter-State

a) Supply of goods and / or services in the course of INTER-STATE trade orcommerce means in relation to such goods and / or services ‘the location of thesupplier’ and ‘the place of supply’ are in two DIFFERENT States.

b) Supply of goods and / or services in the course of INTRA-STATE trade orcommerce means in relation to such goods and / or services ‘the location of thesupplier’ and ‘the place of supply’ are in the SAME State(excluding supply ofgoods and/or services to/by a SEZ developer/ an SEZ unit and supply of goodsbrought into India in the course of import till they cross the custom frontiers ofIndia) .

c) Identifying the location of the supplier and place of supply is CRITICAL.

d) The test is whether the ‘the supply by the supplier’ is in the ‘same’ State or‘different States’.

Section 3 / 4 of IGST Act, 2016 – Principles for determining supply of goods and / or services


Supply Locationof

Supplier

Place of Supply

Type of Supply

Tax to Be Charged

Goods Karnataka Bihar Inter-State IGST

Services Delhi Haryana Inter-State IGST

Goods Goa Goa Intra-State CGST & SGST

Services Kerala Kerala Intra-State CGST & SGST

Illustration:

Situations When Supply Of Goods And / Or Services Will Be Deemed To Be Supply Of Goods And / Or Services In The Course Of Inter-state Trade Or Commerce -

Supply Of Goods In The Course Of Import Into The Territory Of India Till They Cross The Customs Frontiers Of India

Supply Of Services In The Course Of Import Into The Territory Of India

Supply Of Goods And / Or Services, When The Supplier Is Located In India And The Place Of Supply Is Outside India

Supply Of Goods And / Or Services To Or By A SEZ Developer Or An SEZ Unit

Any Supply Of Goods And / Or Services In The Taxable Territory, Not Being An Intra-state Supply And Not Covered Elsewhere In Section 3,


Location of Supplier of Service(As per Original Model GST Law)

Supply Made From Registered Place Of Business – Such Registered Place OfBusiness Location;

Supply Made From Fixed Establishment Other Registered Place Of Business -Such Fixed Establishment Location;

Supply Made From More Than One Establishment - Location Of TheEstablishment Most Directly Concerned With The Provision Of The Supply;And

In Absence Of Such Places, Location Of Usual Place Of Residence Of Supplier

Recipient of supply Where Consideration Is Payable For Supply Of Goods And / Or Services,

Person Who Is Liable To Pay That Consideration

Where No Consideration Is Payable For Supply Of Goods, Person To Whom Goods Are Delivered Or Made Available, Or To Whom Possession Or Use Of Goods Is Given Or Made Available, And

Where No Consideration Is Payable ForSupply Of A Service, Person To Whom The Service Is Rendered,

Note- “Recipient” Will Also Include An Agent Acting As Such On Behalf Of Recipient In Relation To Goods And/Or Services Supplied.

Place of supply of goods

Sub-Section

No.

Situations Place of supply of goods

(2) Supply involves movement of goods – bysupplier/ recipient/ other person

location of the goods at the time at which the movement of goods terminates for delivery to the Recipient

(3) goods are delivered to a recipient • By the supplier or • By any other person,

• on the direction of a third person• whether acting as an agent or otherwise• before or during movement of goods• either by way of transfer of documents of

title to the goods or otherwise

Principal place of business of third person

IGST - CHAPTER IV – SECTION 7

Place of supply of goods

Sub-Section No.

Situations Place of supply of goods

(4) Supply does not involve movement of goods Location of goods at time of delivery to recipient

(5) Goods assembled/ installed at site Place of such installation/assembly

(6) Supplied on board a conveyance Location at which such goods are taken on board

(7) Place cannot be determined as above Determined by law made byparliament w.r.t. recommendation of board


Section 7 of IGST Act, 2016 - Place of Supply of Goods – Illustrations contd…

Particulars

Location of supplier (location of goods ready for supply)

Termination of movement for delivery

Place of supply Tax to Be Charged

Movement of goods by supplier [S. 7(2) of IGST Act read with S.2(85)(a) of CGST Act]

Orissa West Bengal West Bengal IGST

Orissa Orissa Orissa CGST & SGST

West Bengal Assam Assam IGST

Movement of goods by recipient (goodscollected by recipient for movement)[S. 7(2) of IGST Act read with S.2(85)(b) of CGST Act]

West Bengal Orissa Orissa IGST

Orissa Orissa Orissa CGST & SGST

Assam West Bengal West Bengal IGST

Section 5(2) of IGST Act, 2016 - Where supply involves movement of goods

Section 7(3) of IGST Act, 2016 - Place of Supply of Goods – Illustrations contd…

Facts:1. A and C have a contract for Supply2. C authorises B to collect goods from A3. C instructs A to deliver goods to BPlace of Supply by A to B will be registered place of business of C

Subsequent transactions between B and C would be asdetermined under Section 7(4) and not under Section 7(3)

A

B

CContract for supply

Instructs to deliver to B

Location of

Supplier (A)

Location of the Third

party (C)

Place of delivery of goods to

Recipient (B)

Place of supply

between A & C

Nature of Tax payable

State That will be Collecting

Tax

Haryana Punjab Delhi Punjab IGST Punjab

Haryana Punjab Haryana Punjab IGST Punjab

Haryana Punjab Punjab Punjab IGST Punjab

Haryana Haryana Delhi Haryana CGST & SGST Haryana


Place of supply between Supplier (A), Third Party (C) and Recipient (B) – Sec 7(3)

Location of

Supplier (A)

Location of the Third

party (C)

Place of delivery of goods to

Recipient (B)

Place of supply

betweenB & C


State That will be Collecting Tax

Haryana Punjab Delhi Delhi IGST Delhi

Haryana Punjab Haryana Haryana IGST Haryana

Haryana Punjab Punjab Punjab CGST & SGST Punjab

Haryana Haryana Delhi Delhi IGST Delhi


Place of supply between Recipient (B) and Third party (C) is examined in light of Section 7(4) and not u/s 7(3)

Section 7(4) of IGST Act, 2016 - Where supply does not involve movement of goods.

1. M (Delhi) has provided a DG set on lease to N (Gujarat) for its factory located in Uttar Pradesh. (Note: The taxability of the lease transaction is not examined in this illustration)

2. M (Delhi) now intends to sell the DG set located in Uttar Pradesh(“UP”) to N (Gujarat). The place of supply in such case is analysed as under:

Particulars

Location of supplier

(regd office of the

supplier)

Location of recipient

(regd office of the recipient)

Location of goods at the

time of delivery

Place of

supply

Nature of Tax

payable

State That will be

Collecting Tax

No movementby supplier/ recipient

Delhi Gujarat UP UP IGST Delhi

No movementby recipient/ supplier

Gujarat Delhi UP UP IGST Gujarat



Section 7(5) of IGST Act, 2016 - Where the goods are assembled or installed at siteNote 1: Not a works contractNote 2: Simple case of supply of lathe machine & installationNote 3: Supplier does not have a ‘fixed establishment’ u/s 2(46) at the site of installation

Particulars

Location of the recipient (regd office

of the recipient)

Site of assembly or installation

Place of supply

(tax payable by supplier)


State That will be

Collecting Tax

Location of the supplier - Madhya Pradesh (“MP”)(ie., location of goods ready for supply)

Chhattisgarh Tamil Nadu Tamil Nadu IGST Tamil Nadu

MP Tamil Nadu Tamil Nadu IGST Tamil Nadu

MP MP MP CGST & SGST MP

Tamil Nadu Tamil Nadu Tamil Nadu IGST Tamil Nadu

Tamil Nadu MP MP CGST & SGST MP


Section 7(6) of IGST Act, 2016 – When the goods are taken on board a conveyance for supply to a customer on board

1. Titan supplies watches to Indigo Airlines [1st leg of transaction – to be determined u/s 7(2)]

2. Indigo Airlines supplies goods to the passengers on board (2nd leg of transaction)

The transaction covered under Sec 7(6) is the 2nd leg between Indigo Airlines and the passengers.

ParticularsLocation of the supplier (goods taken on board)

Termination of conveyance

Place of supply

Where the goods are supplied on board a

conveyance (goods taken aboard)

Delhi Telangana Delhi

Place of supply of goods imported into, or exported from India

Sub-section

No.

Services Place Of Supply Of Services

(1) Supply Of Goods Imported Into India Location Of Importer

(2) Supply Of Goods Exported From India Location Outside India


Place Of Supply Of Services Where Location Of Supplier Of Service And Location Of Recipient Of Service Is In India

Sub-section No.


(2) Supply Of Services Made To Registered Person

Location Of Such Person

(3) Supply Of Services Made To Any Person Other Than A Registered Person

(A) Location Of Recipient Where Address On Record Exists, And(B) Location Of Supplier Of Services In Other Cases



Sub-section

No.


(4) Supply Of Services, -(A) 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, Or(B) By Way Of Lodging Accommodation By A Hotel, Inn, Guest House, Homestay, Club Or Campsite, By Whatever Name Called And Including A House Boat Or Any Other Vessel, Or(C) By Way Of Accommodation In Any

• If Location Of Immovable Property Or Boat Or Vessel Is Located Or Intended To Be Located Outside India –oLocation Of Recipient.

• If Immovable Property / Boat / Vessel Is Located In More Than One State –oSupply Of Service Shall Be Treated As

Made In Each Of The States In Proportion To The Value For Services Separately Collected Or Determined, In Terms Of The Contract Or Agreement Entered Into In This Regard Or,

oIn The Absence Of Such Contract Or Agreement, On Such Other Reasonable Basis As May Be Prescribed In This


Place Of Supply Of Services Where Location Of Supplier Of Service And Location Of Recipient Of Service

Is In India

Sub-section

No.


(5) Restaurant And Catering Services, Personal Grooming, Fitness, Beauty Treatment, Health Service Including Cosmetic And Plastic Surgery

Location Where Services Are Actually Performed

(6) Services In Relation To Training And Performance Appraisal

• Registered Person - Location Of Such Person• Person Other Than A Registered Person -

Location Where Services Are Actually Performed

(7) Services Provided By Way Of Admission To A Cultural, Artistic, Sporting, Scientific, Educational, Or Entertainment Event Or Amusement Park Or Any Other Place And Services Ancillary Thereto

Place Where Event Is Actually Held Or Where Park Or Such Other Place Is Located.



Sub-section

No.


(8) Services Provided By Way Of—(A) Organization Of A Cultural, Artistic, Sporting, Scientific, Educational Or Entertainment Event Including Supply Of Service In Relation To A Conference, Fair, Exhibition, Celebration Or Similar Events, Or(B) Services Ancillary To Organization Of Any Of The Above Events Or Services, Or Assigning Of Sponsorship Of Any Of The Above Events

• If Event Is Held Outside India - Location Of Recipient• If Event Is Held In More Than One State And A

Consolidated Amount Is Charged For Supply Of Services Relating To Such Event –

• Place Of Supply Of Such Services Shall Be Taken As Being In The Each Of The States In Proportion To The Value Of Services So Provided In Each State As Ascertained From The Terms Of The Contract Or Agreement Entered Into In This Regard Or,

• In Absence Of Such Contract Or Agreement, On Such Other Reasonable Basis As May Be Prescribed In This Behalf

• In Any Other Case(general Case) –• Registered Person - Location Of Such Person• Person Other Than A Registered Person - Place

Where Event Is Actually Held



Sub-section

No.


(9) Transportation Of Goods, Including By Mail Or Courier • Registered Person - Location Of Such Person• Person Other Than A Registered Person - Location At

Which Such Goods Are Handed Over For Their Transportation

(10) Passenger Transportation Service • Registered Person - Location Of Such Person• Person Other Than A Registered Person - Place Where

Passenger Embarks On Conveyance For A Continuous Journey

• If Right To Passage Is Given For Future Use And Point Of Embarkation Is Not Known At Time Of Issue Of Right To Passage - Refer Sub-sections (2) Or (3), As The Case May Be

Note: Return Journey Will Be Treated As A Separate Journey Even If Right To Passage For Onward And Return Journey Is Issued At Same Time.

(11) Services On Board A Conveyance Such As Vessel, Aircraft, Train Or Motor Vehicle

Location Of First Scheduled Point OfDeparture Of That Conveyance For Journey



Sub-section

No.


(12) Telecommunication Services Including Data Transfer, Broadcasting, Cable And Direct To Home Television Services To Any Person

Services By Way Of Fixed Telecommunication Line, Leased Circuits, Internet Leased Circuit, Cable Or Dish Antenna - Location Where The Telecommunication Line, Leased Circuit Or Cable Connection Or Dish Antenna Is Installed For Receipt Of Services

• If Address Of Recipient As Per Records Of Supplier Of Service Is Not Available -Location Of Supplier

• If Such Pre-paid Service Is Availed Or Recharge Is Made Through Internet Banking Or Other Electronic Mode Of Payment - Location Of Recipient Of Services On Record Of Supplier Of Services

• If Leased Circuit Is Installed In More Than One State And A Consolidated Amount Is Charged For Supply Of Services Relating To Such Circuit• Place Of Supply Of Such Services Shall

Be Taken As Being In Each Of The States In Proportion To Value Of Services So Provided In Each State As Ascertained From Terms Of The Contract Or Agreement Entered Into In This Regard Or

• In Absence Of Such Contract Or Agreement, On Such Other Reasonable

Mobile Connection For Telecommunication And Internet Services Provided On Post-paid Basis - Location Of Billing Address Of Recipient On Record Of Supplier

Mobile Connection For Telecommunication, Internet Service And Direct To Home Television Services Are Provided On Prepayment Through A Voucher Or Any Other Means –• Through Selling Agent Or A Re-seller Or

A Distributor Of SIM Card Or Re-charge Voucher - Address Of Selling Agent Or Re-seller Or Distributor As Per Record Of The Supplier At Time Of Supply

• By Any Person To The Final Subscriber -



Sub-section

No.


(13) Banking And Other Financial Services Including Stock Broking Services To Any Person

• Location Of Recipient On Records Of Supplier• If Location Of Recipient Of Services Is Not On Records

Of Supplier - Location Of Supplier

(14) Insurance Services • Registered Person - Location Of Such Person• Person Other Than A Registered Person - Location Of

Recipient On Records Of Supplier

(15) Advertisement Services To The Central Government, A State Government, A Statutory Body Or A Local Authority Meant For Identifiable States

• Place Of Supply Of, Shall Be Taken As Located In Each Of Such States And Value Of Such Supplies Specific To Each State Shall Be In Proportion To Amount Attributable To Service Provided By Way Of Dissemination In Respective States As May Be Determined In Terms Of Contract Or Agreement Entered Into In This Regard Or,

• In The Absence Of Such Contract Or Agreement, On Such Other Reasonable Basis As May Be Prescribed In This Behalf.


Place of supply of services where location of supplier or location of recipient is outside India

Sub-section

No.


(2) Supply Of Services Made To Registered Person • Location Of Recipient• If Location Of Recipient Is Not Available In Ordinary

Course Of Business - Location Of Supplier

(3) a) Services Supplied In Respect Of Goods That Are Required To Be Made Physically Available By Recipient Of Service To Supplier Of Service, Or To A Person Acting On Behalf Of Supplier Of Service In Order To Provide Service (Excluding Service Supplied In Respect Of Goods That Are Temporarily Imported Into India For Repairs And Are Exported After Repairs Without Being Put To Any Use In India, Other Than That Which Is Required For Such Repairs)

b) Services Supplied To An Individual, Represented Either As Recipient Of Service Or A Person Acting On Behalf Of Recipient, Which Require Physical Presence Of Receiver Or Person Acting On Behalf Of Recipient, With Supplier For The Supply Of Service

Location Where Services Are Actually PerformedException - When Services Under Clause (A) Are Provided From Remote Location By Way Of Electronic Means -Location Where Goods Are Situated At Time Of Supply Of Service



Sub-section

No.


(4) Services Supplied Directly In Relation To An Immovable Property, Including Services Supplied In This Regard By Experts And Estate Agents, Supply Of Hotel Accommodation By A Hotel, Inn, Guest House, Club Or Campsite, By Whatever Name Called, Grant Of Rights To Use Immovable Property, Services For Carrying Out Or Co-ordination Of Construction Work, Including Architects Or Interior Decorators

Place Where Immovable Property Is Located Or Intended To Be Located

(5) Admission To, Or Organization Of, A Cultural, Artistic, Sporting, Scientific, Educational, Or Entertainment Event, Or A Celebration, Conference, Fair, Exhibition, Or Similar Events, And Of Services Ancillary To Such Admission

Place Where Event Is Actually Held.



Sub-section

No.


(6) If Any Service Referred To In Sub-sections (3), (4), Or (5) Is Supplied At More Than One Location, Including A Location In The Taxable Territory

Location In The Taxable Territory Where Greatest Proportion Of Service Is Provided

(7) Where Services Referred To In Sub-sections (3), (4), (5) Or (6) Are Supplied In More Than One State

• Place Of Supply Of Such Services Shall Be Taken As Being In Each Of The States In Proportion To Value Of Services So Provided In Each State As Ascertained From Terms Of Contract Or Agreement Entered Into In This Regard Or,

• In Absence Of Such Contract Or Agreement, On Such Other Reasonable Basis As May Be Prescribed In This Behalf



No. Services Place Of Supply Of Services

(8) (A) Services Supplied By Banking Company / Financial Institution / Non-banking Financial Company, To Account Holders(B) Intermediary Services(C) Services Consisting Of Hiring Of Means Of Transport Other Than Aircrafts And Vessels Except Yachts, Upto A Period Of 1 MonthExplanation.- For The Purpose Of This Section, The Expression “Goods” Will Include ‘Securities’ As Defined In Sub-section (90) Of Section 2 Of The CGST Act, 2016

Location Of Supplier

(9) Transportation Of Goods, Other Than By Way Of Mail Or Courier

Place Of Destination Of The Goods.

(10) Passenger Transportation Service Place Where Passenger Embarks On Conveyance For A Continuous Journey.

(11) Services Provided On Board A Conveyance During The Course Of A Passenger Transport Operation, Including Services Intended To Be Wholly Or Substantially Consumed While On Board

First Scheduled Point Of Departure OfThat Conveyance For Journey



No. Services Place Of Supply Of Services

(12) Online Information And Database Access Or Retrieval Services

Note - Person Receiving Such Services Will Be Deemed To Be Located In Taxable Territory If Any 2 Of Following Non-contradictory Conditions Are Satisfied, Namely:-(I) Location Of Address Presented By Recipient Of Service Via Internet Is In Taxable Territory(Ii) Credit Card Or Debit Card Or Store Value Card Or Charge Card Or Smart Card Or Any Other Card By Which Recipient Of Service Settles Payment Has Been Issued In Taxable Territory(Iii) Billing Address Of Recipient Of Service Is In Taxable Territory(Iv) IP Address Of Device Used By Recipient Of Service Is In Taxable Territory(V) Bank Of Recipient Of Service In Which Account Used For Payment Is Maintained Is In Taxable Territory(Vi) Country Code Of SIM Card Used By Recipient Of Service Is Of Taxable Territory;(Vii) Location Of Fixed Land Line Through Which Service Is Received By Recipient Is In Taxable Territory

Location Of Supplier

(13) Description Of Service Or Circumstances Notified By Central Government , In Order To Prevent Double Taxation Or Non-taxation Of Supply Of A Service, Or For Uniform Application Of Rules

Place Of Effective Use And Enjoyment Of A Service


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