PPT ON PLACE OF SUPPLY

1. Is

2. TODAY’S TOPIC
TAKING THE GST BULL
BY ITS HORNS
PLACE
OF
SUPPLY

3. Constitutional provisions
• ARTICLE 286: NO
STATE LAW CAN TAX
INTER-STATE
SUPPLIES.
• ARTICLE 246A:
PARLIAMENT HAS
EXCLUSIVE POWERS
TO MAKE LAWS TO
TAX INTER-STATE
SUPPLIES.
• ARTICLE 269A(5):
PARLIAMENT MAY,
BY LAW, FORMULATE
THE PRINCIPLES FOR
DETERMINE PLACE
OF SUPPLY AND
WHAT CONSTITUTES
INTER-STATE SUPPLY.

4. WHAT ‘PLACE OF SUPPLY’ DOES:
• IT DETERMINES
WHETHER THE SUPPLY
IS INTRA-STATE OR
INTER-STATE.
• IT DETERMINES
WHICH GOVERNMENT
SHOULD ENJOY THE
TAX.

5. WHAT PLACE OF SUPPLY
DOES NOT DO:
IT DOES NOT
DETERMINE:
• ITC ELIGIBILITY OF
RECIPIENT
• THE PERSON
LIABLE TO PAY TAX

6. REMEMBER….
GST IS A DESTINATION-
BASED CONSUMPTION
TAX:
WHICH MEANS THE
STATE WHERE SERVICE IS
CONSUMED SHOULD
GENERALLY GET THE TAX
REVENUES.

7. SUPPLY IN TERRITORIAL WATERS
Notwithstanding anything
contained in this Act–
(a) where the location of
the supplier is in the
territorial waters, the
location of such supplier;
or
(b) where the place of
supply is in the territorial
waters, the place of
supply
shall for the
purposes of this Act,
be deemed to be in
the coastal State or
Union Territory
where the nearest
point of the
appropriate baseline
is located.
SECTION 9 OF IGST ACT

8. PLACE OF SUPPLY OF GOODS
The place of supply
of goods imported
into India shall be
the location of the
importer and those
exported shall be
outside India.
SECTION 11 OF
IGST ACT

9. PLACE OF SUPPLY OF GOODS
Where the supply
involves movement of
goods, whether by the
supplier or the recipient
or by any other person,
the place of supply of
such goods shall be the
location of the goods at
the time at which the
movement of goods
terminates for delivery to
the recipient.
SECTION 10 OF IGST ACT

10. NO MOVEMENT OF GOODS
WHERE THE SUPPLY
DOES NOT INVOLVE
MOVEMENT OF
GOODS, WHETHER BY
THE SUPPLIER OR THE
RECIPIENT, THE PLACE
OF SUPPLY SHALL BE
THE LOCATION OF SUCH
GOODS AT THE TIME OF
DELIVERY TO THE
RECIPIENT.

11. PLACE OF SUPPLY OF GOODS
Where the goods are
delivered by a supplier to a
recipient or any other person
on the direction of a third
person, whether acting as an
agent or otherwise, either by
way of transfer of documents
of title to the goods or
otherwise, it shall be deemed
that the said third person has
received the goods and place
of supply shall be the
principal place of business of
such person.

12. PLACE OF SUPPLY OF GOODS
Where the goods
are assembled or
installed at site,
the place of supply
shall be the place
of such installation
or assembly.

13. PLACE OF SUPPLY OF GOODS
Where goods are
supplied on board a
conveyance, including
a vessel, an aircraft, a
train or a motor
vehicle, the place of
supply shall be the
location at which such
goods are taken on
board.

14. PLACE OF SUPPLY OF SERVICES
TWO SETS OF PROXIES:
1. WHEN BOTH SUPPLIER
AND RECIPIENT ARE IN
INDIA (SECTION 12)
2. WHEN EITHER
SUPPLIER OR
RECIPIENT IS OUTSIDE
INDIA (SECTION 13)

15. GENERAL RULE - SERVICES
Section 12(2)(a):
The place of supply
of services made to
a registered person
shall be the
location of such
person
[B2B transaction]
Except services
specified in sub-
sections (3) to (14)

16. GENERAL RULE
Sec 12(2)(b): The place
of supply of services
made to a non-
registered person shall
be:
(a) the location of
recipient where
address on record
exists
(b) the location of
supplier in other cases.
[B2C transaction]
Except services
specified in sub-
sections (3) to (14)

17. EXCEPTION TO GENERAL RULE
Effective use and
enjoyment principle:
Where the customer is
physically using the
service and where the
benefit is felt.
Administrative
feasibility:
Trade practice.
Practical difficulties.
Sub-sections (3) to (14)

18. PROPERTY-BASED 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, or
(b) by way of lodging accommodation by a hotel, inn, guest house,
home stay, club or campsite, by whatever name called and including
a house boat or any other vessel, or
(c) by way of accommodation in any immovable property for organizing
any marriage or reception or matters related therewith, official,
social, cultural, religious or business function including services
provided in relation to such function at such property, or
(d) any services ancillary to the services referred to in clause (a), (b)
and (c).
SHALL BE THE LOCATION AT WHICH THE IMMOVABLE PROPERTY OR
BOAT OR VESSEL IS LOCATED OR INTENDED TO BE LOCATED.

19. PERFORMANCE-BASED SERVICES
The place of supply of
restaurant and catering
services, personal
grooming, fitness,
beauty treatment,
health service including
cosmetic and plastic
surgery shall be the
location where the
services are actually
performed.

20. EVENT-BASED SERVICES
The place of supply of
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, shall be
the place where the event
is actually held or where
the park or such other
place is located.

21. EVENT-BASED SERVICES
The place of supply of 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,
to:
(i) a registered person, shall be the location of such person;
(ii) a person other than a registered person, shall be the place
where the event is actually held:
PROVIDED that if the event is held outside India, the place of
supply shall be the location of the recipient.

22. TRANSPORTATION OF GOODS
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.

23. PASSENGER TRANSPORTATION
The place of supply of
passenger transportation
service to:
(a) a registered person, shall
be the location of such
person;
(b) a person other than a
registered person, shall
be the place where the
passenger embarks on
the conveyance for a
continuous journey.

24. SUPPLY OF SERVICES ON BOARD
The place of supply of
services on board a
conveyance such as
vessel, aircraft, train or
motor vehicle, shall be
the location of the first
scheduled point of
departure of that
conveyance for the
journey.
Baby bassinets, Spa, mini-bar,
massage, casinos, games,
movies, beauty parlour, binge
watching etc.

25. BANKING & OTHER FINANCIAL SERVICE
The place of supply of banking
and other financial services
including stock broking services
to any person shall be the
location of the recipient of
services on the records of the
supplier of services:
PROVIDED that if the location
of the recipient of services is
not on the records of the
supplier, the place of supply
shall be location of the supplier
of services.

26. INSURANCE SERVICE
The place of supply of
insurance services shall:
(a) to a registered person,
be the location of such
person;
(b) to a person other than a
registered person, be the
location of the recipient
of services on the records
of the supplier of services.

27. TRAINING AND PERFORMANCE
APPRAISAL SERVICES
The place of supply of
services in relation to
training and performance
appraisal to:
(a) a registered person, shall
be the location of such
person;
(b) a person other than a
registered person, shall
be the location where the
services are actually
performed.

28. TELECOMMUNICATION SERVICE
• Services of fixed line,
leased circuits, cable
or dish antenna, the
location of such
installation.
• In case of mobile on
post-paid basis, the
billing address of
recipient.

29. TELECOMMUNICATION SERVICE
In case of mobile /
internet / DTH on pre-
paid basis, sold through:
 a selling agent, the
address of selling agent.
 by any person to the
final subscriber, the
location where such pre-
payment is received or
vouchers sold.
PROVIDED FURTHER that
if such pre-paid service
is availed or the
recharge is made
through internet
banking or other
electronic mode of
payment, the location of
recipient as per the
records of the supplier
of services.

30. SEC 13: FOR EXPORTS / IMPORTS….
(8) The place of supply of intermediary services
shall be the location of the supplier of service
(i.e., place where intermediary is located)
“intermediary” means a broker, an agent or any
other person, by whatever name called, who
arranges or facilitates the supply of a service
(hereinafter called the ‘main’ service) or the supply
of goods, between two or more persons, but does
not include a person who supplies the main service
or supplies the goods on his account.

31. TEASERS

32. TEASER-1
You are an account
holder with the Indian
Bank, Cantonment
Branch, Trichy.
You go on tour to
Amritsar and use your
Debit Card to draw cash
from Punjab National
Bank’s ATM there.
• Who is the service
provider?
• What is the location of
service provider?
• What is the place of
supply?
• Which State gets the
SGST portion of tax paid
on ATM charges?

33. TEASER-2
• You have bought a SUV
from Maruti Suzuki Ltd.
through a car dealer in
Trichy.
• After a few months, you
give it for free service
during warranty period.
• The service charges are
reimbursed to the
dealer by Maruti.
• Who is the service
recipient of repair /
maintenance
service?
• Should the dealer
pay IGST or CGST /
SGST?
• What is the place of
supply?

34. TEASER-3
• You have a cashless medi-
claim policy with an
insurance company in
Trichy.
• Unfortunately, during a trip
to Mumbai you are taken ill
and admitted to Apollo
Hospitals, Mumbai.
• Thank god, you get well
soon and the bill is settled
by insurance company.
• Who is the service
recipient of health
service?
• What is the place
of supply?
• Should the
hospital pay
CGST/SGST or
IGST?

35. TEASER-4
• A company based in
Kerala conducts a
trade fair at
Coimbatore.
• It engages the
services of IAB Arts
Bureau for photo /
videography of the
event.
Should IAB
pay IGST or
CGST /
SGST?

36. TEASER-5
• YOU ARE ON A HOLIDAY,
WOW!
• YOU TAKE THE GLASS-
BOTTOM CRUISE TO
ANDAMAN & NICOBAR
ISLANDS.
• ON BOARD, YOU INDULGE IN
SOME ETHNIC SEA-FOOD
DISHES.
WHAT IS THE
PLACE OF
SUPPLY FOR
RESTAURANT
SERVICES?
SECTION 9 or
12(4) or
12(10)?