Place of Supply

Place of supply” is defined by the Central Goods and Services Act 2017 (CGST Act) to mean the place of supply as referred to in Chapter V of the Integrated Goods and Services Tax Act 2017 (IGST Act). An understanding of the legal meaning and factual determination of the ‘place’ of supply of goods and/or services (under the applicable CGST Act 2017, IGST Act 2017 and/or UTGST Act 2017) is essential for the following reasons—

  • Nature (Central Tax/State Tax and/or Union Territory Tax and/or Integrated Tax) of the tax
  • Rate and quantum of such tax
  • Supply classification (intra-State or inter-State)
  • Entitlement to benefits, exemptions etc.
  • Administrative jurisdiction and control
  • Compliance obligations etc.

> Read more on ‘Supply’

Section 2 of the Central Goods and Services Tax Act 2017 (CGST Act) lists the various definitions (subject to context) to various key words, terms and phrases, some of which for the purpose of ‘time and value of supply‘ have been provided below ––

Address of delivery” means the address of the recipient of goods or services or both indicated on the tax invoice issued by a registered person for delivery of such goods or services or both.

Address on record” means the address of the recipient as available in the records of the supplier.

Agent” means a person, including a factor, broker, commission agent, arhatia, del credere agent, an auctioneer or any other mercantile agent, by whatever name called, who carries on the business of supply or receipt of goods or services or both on behalf of another.

Associated enterprises” shall have the same meaning as assigned to it in section 92A of the Income-tax Act, 1961.

Board” means the Central Board of Excise and Customs constituted under the Central Boards of Revenue Act, 1963.

Business” includes––
(a) any trade, commerce, manufacture, profession, vocation, adventure, wager or any other similar activity, whether or not it is for a pecuniary benefit;
(b) any activity or transaction in connection with or incidental or ancillary to sub-clause (a);
(c) any activity or transaction in the nature of sub-clause (a), whether or not there is volume, frequency, continuity or regularity of such transaction;
(d) supply or acquisition of goods including capital goods and services in connection with commencement or closure of business;
(e) provision by a club, association, society, or any such body (for a subscription or any other consideration) of the facilities or benefits to its members;
(f) admission, for a consideration, of persons to any premises;
(g) services supplied by a person as the holder of an office which has been accepted by him in the course or furtherance of his trade, profession or vocation;
(h) services provided by a race club by way of totalisator or a licence to book maker in such club ; and
(i) any activity or transaction undertaken by the Central Government, a State Government or any local authority in which they are engaged as public authorities.

Business vertical” means a distinguishable component of an enterprise that is engaged in the supply of individual goods or services or a group of related goods or services which is subject to risks and returns that are different from those of the other business verticals.

Explanation.––For the purposes of this clause, factors that should be considered in determining whether goods or services are related include––
(a) the nature of the goods or services;
(b) the nature of the production processes;
(c) the type or class of customers for the goods or services;
(d) the methods used to distribute the goods or supply of services; and
(e) the nature of regulatory environment (wherever applicable), including banking, insurance, or public utilities.

Casual taxable person” means a person who occasionally undertakes transactions involving supply of goods or services or both in the course or furtherance of business, whether as principal, agent or in any other capacity, in a State or a Union territory where he has no fixed place of business.

Central tax” means the central goods and services tax levied under section 9.

Cess” shall have the same meaning as assigned to it in the Goods and Services Tax (Compensation to States) Act.

Composite supply” means a supply made by a taxable person to a recipient consisting of two or more taxable supplies of goods or services or both, or any combination thereof, which are naturally bundled and supplied in conjunction with each other in the ordinary course of business, one of which is a principal
Supply.

Illustration.— Where goods are packed and transported with insurance, the supply of goods, packing materials, transport and insurance is a composite supply and supply of goods is a principal supply;

Consideration” in relation to the supply of goods or services or both includes––
(a) any payment made or to be made, whether in money or otherwise, in respect of, in response to, or for the inducement of, the supply of goods or services or both, whether by the recipient or by any other person but shall
not include any subsidy given by the Central Government or a State Government;
(b) the monetary value of any act or forbearance, in respect of, in response to, or for the inducement of, the supply of goods or services or both, whether by the recipient or by any other person but shall not include
any subsidy given by the Central Government or a State Government.

Provided that a deposit given in respect of the supply of goods or services or both shall not be considered as payment made for such supply unless the supplier applies such deposit as consideration for the said supply.

Continuous supply of goods” means a supply of goods which is provided, or agreed to be provided, continuously or on recurrent basis, under a contract, whether or not by means of a wire, cable, pipeline or other conduit, and for which the supplier invoices the recipient on a regular or periodic basis and includes supply of such goods as the Government may, subject to such conditions, as it may, by notification, specify.

Continuous supply of services” means a supply of services which is provided, or agreed to be provided, continuously or on recurrent basis, under a contract, for a period exceeding three months with periodic payment obligations and includes supply of such services as the Government may, subject to such conditions, as it may,
by notification, specify.

Conveyance” includes a vessel, an aircraft and a vehicle.
“Council” means the Goods and Services Tax Council established under article 279A of the Constitution.

Deemed exports” means such supplies of goods as may be notified under section 147.

Exempt supply” means supply of any goods or services or both which attracts nil rate of tax or which may be wholly exempt from tax under section 11, or under section 6 of the Integrated Goods and Services Tax Act, and includes non-taxable supply.

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.

Goods” means every kind of movable property other than money and securities but includes actionable claim, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or under a contract of supply.

Government” means the Central Government.

Goods and Services Tax (Compensation to States) Act” means the Goods and Services Tax (Compensation to States) Act, 2017.

India” means the territory of India as referred to in article 1 of the Constitution, its territorial waters, seabed and sub-soil underlying such waters, continental shelf, exclusive economic zone or any other maritime zone as referred to in the Territorial Waters, Continental Shelf, Exclusive Economic Zone and other Maritime
Zones Act, 1976, and the air space above its territory and territorial waters.

Integrated Goods and Services Tax Act” means the Integrated Goods and Services Tax Act, 2017.

Integrated tax” means the integrated goods and services tax levied under the Integrated Goods and Services Tax Act.

Intra-State supply of goods” shall have the same meaning as assigned to it in section 8 of the Integrated Goods and Services Tax Act.

Intra-State supply of services” shall have the same meaning as assigned to it in section 8 of the Integrated Goods and Services Tax Act.

Invoice” or “tax invoice” means the tax invoice referred to in section 31.

Inward supply” in relation to a person, shall mean receipt of goods or services or both whether by purchase, acquisition or any other means with or without consideration.

Job work” means any treatment or process undertaken by a person on goods belonging to another registered person and the expression “job worker” shall be construed accordingly.

Location of the recipient of services” means,—
(a) where a supply is received at a place of business for which the registration has been obtained, the location of such place of business;
(b) 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;
(c) 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
(d) in absence of such places, the location of the usual place of residence of the recipient.

Location of the supplier of services” means,—
(a) where a supply is made from a place of business for which the registration has been obtained, the location of such place of business;
(b) 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;
(c) 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 provisions of the supply; and
(d) in absence of such places, the location of the usual place of residence of the supplier.

Manufacture” means processing of raw material or inputs in any manner that results in emergence of a new product having a distinct name, character and use and the term “manufacturer” shall be construed accordingly;

Mixed supply” means two or more individual supplies of goods or services, or any combination thereof, made in conjunction with each other by a taxable person for a single price where such supply does not constitute a composite supply.

Illustration.— A supply of a package consisting of canned foods, sweets, chocolates, cakes, dry fruits, aerated drinks and fruit juices when supplied for a single price is a mixed supply. Each of these items can be supplied separately and is not dependent on any other. It shall not be a mixed supply if these items are supplied
separately;

Money” means the Indian legal tender or any foreign currency, cheque, promissory note, bill of exchange, letter of credit, draft, pay order, traveller cheque, money order, postal or electronic remittance or any other instrument recognised by the Reserve Bank of India when used as a consideration to settle an obligation or exchange with Indian legal tender of another denomination but shall not include any currency that is held for its numismatic value.

Non-resident taxable person” means any person who occasionally undertakes transactions involving supply of goods or services or both, whether as principal or agent or in any other capacity, but who has no fixed place of business or residence in India.

Non-taxable supply” means a supply of goods or services or both which is not leviable to tax under this Act or under the Integrated Goods and Services Tax Act.

Non-taxable territory” means the territory which is outside the taxable territory.

Notification” means a notification published in the Official Gazette and the expressions “notify” and “notified” shall be construed accordingly.

Other territory” includes territories other than those comprising in a State and those referred to in sub-clauses (a) to (e) of clause (114).

Outward supply” in relation to a taxable person, means supply of goods or services or both, whether by sale, transfer, barter, exchange, licence, rental, lease or disposal or any other mode, made or agreed to be made by such person in the course or furtherance of business.

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.

Place of supply” means the place of supply as referred to in Chapter V of the Integrated Goods and Services Tax Act.

Prescribed” means prescribed by rules made under this Act on the recommendations of the Council.

Principal” means a person on whose behalf an agent carries on the business of supply or receipt of goods or services or both.

Principal place of business” means the place of business specified as the principal place of business in the certificate of registration.

Principal supply” means the supply of goods or services which constitutes the predominant element of a composite supply and to which any other supply forming part of that composite supply is ancillary.

Proper officer” in relation to any function to be performed under this Act, means the Commissioner or the officer of the central tax who is assigned that function by the Commissioner in the Board.

Quarter” shall mean a period comprising three consecutive calendar months, ending on the last day of March, June, September and December of a calendar year.

Recipient” of supply of goods or services or both, means—
(a) where a consideration is payable for the supply of goods or services or both, the person who is liable to pay that consideration;
(b) where no consideration is payable for the supply of goods, the person to whom the goods are delivered or made available, or to whom possession or use of the goods is given or made available; and
(c) where no consideration is payable for the supply of a service, the person to whom the service is rendered,
and any reference to a person to whom a supply is made shall be construed as a reference to the recipient of the supply and shall include an agent acting as such on behalf of the recipient in relation to the goods or services or both supplied.

Registered person” means a person who is registered under section 25 but does not include a person having a Unique Identity Number.

Regulations” means the regulations made by the Board under this Act on the recommendations of the Council.

Removal’’ in relation to goods, means—
(a) despatch of the goods for delivery by the supplier thereof or by any other person acting on behalf of such supplier; or
(b) collection of the goods by the recipient thereof or by any other person acting on behalf of such recipient;

Return” means any return prescribed or otherwise required to be furnished by or under this Act or the rules made thereunder.

Reverse charge” means the liability to pay tax by the recipient of supply of goods or services or both instead of the supplier of such goods or services or both under sub-section (3) or sub-section (4) of section 9, or under sub-section (3) or subsection (4) of section 5 of the Integrated Goods and Services Tax Act.

Services” means anything other than goods, money and securities but includes activities relating to the use of money or its conversion by cash or by any other mode, from one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged.

State” includes a Union territory with Legislature.

State tax” means the tax levied under any State Goods and Services Tax Act.

Supplier” in relation to any goods or services or both, shall mean the person supplying the said goods or services or both and shall include an agent acting as such on behalf of such supplier in relation to the goods or services or both supplied.

Tax period” means the period for which the return is required to be furnished.

Taxable person” means a person who is registered or liable to be registered under section 22 or section 24.

Taxable supply” means a supply of goods or services or both which is leviable to tax under this Act.

Taxable territory” means the territory to which the provisions of this Act apply.

The State Goods and Services Tax Act” means the respective State Goods and Services Tax Act, 2017.

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;

Union territory” means the territory of—
(a) the Andaman and Nicobar Islands;
(b) Lakshadweep;
(c) Dadra and Nagar Haveli;
(d) Daman and Diu;
(e) Chandigarh; and
(f) other territory.
Explanation.––For the purposes of this Act, each of the territories specified in sub-clauses (a) to (f) shall be considered to be a separate Union territory.

Union territory tax” means the Union territory goods and services tax levied under the Union Territory Goods and Services Tax Act.

Union Territory Goods and Services Tax Act” means the Union Territory Goods and Services Tax Act, 2017.

Works contract” means a contract for building, construction, fabrication, completion, erection, installation, fitting out, improvement, modification, repair, maintenance, renovation, alteration or commissioning of any immovable property wherein transfer of property in goods (whether as goods or in some other form) is involved in the execution of such contract.

 


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Section 2 of the Integrated Goods and Services Tax Act 2017 (IGST Act) lists the various definitions (subject to context) to various key words, terms and phrases, some of which for the purpose of ‘time and value of supply‘ have been provided below ––

Continuous journey” means a journey for which a single or more than one ticket or invoice is issued at the same time, either by a single supplier of service or through an agent acting on behalf of more than one supplier of service, and which involves no stopover between any of the legs of the journey for which one or more separate tickets or invoices are issued.

Explanation.––For the purposes of this clause, the term “stopover” means a place where a passenger can disembark either to transfer to another conveyance or break his journey for a certain period in order to resume it at a later point of time;

Customs frontiers of India” means the limits of a customs area as defined in section 2 of the Customs Act, 1962.

Export of goods” with its grammatical variations and cognate expressions, means taking goods out of India to a place outside India.

Export of services” means the supply of any service when,––
(i) the supplier of service is located in India;
(ii) the recipient of service is located outside India;
(iii) the place of supply of service is outside India;
(iv) the payment for such service has been received by the supplier of service in convertible foreign exchange; and
(v) the supplier of service and the recipient of service are not merely establishments of a distinct person in accordance with Explanation 1 in section 8.

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.

Import of goods” with its grammatical variations and cognate expressions, means bringing goods into India from a place outside India.

Import of services” means the supply of any service, where––
(i) the supplier of service is located outside India;
(ii) the recipient of service is located in India; and
(iii) the place of supply of service is in India;

Integrated tax” means the integrated goods and services tax levied under this Act.

Location of the recipient of services” means,––
(a) where a supply is received at a place of business for which the registration has been obtained, the location of such place of business;
(b) 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;
(c) 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
(d) in absence of such places, the location of the usual place of residence of the recipient.

Location of the supplier of services” means,––
(a) where a supply is made from a place of business for which the registration has been obtained, the location of such place of business;
(b) 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;
(c) 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
(d) in absence of such places, the location of the usual place of residence of the supplier.

Non-taxable online recipient” means any Government, local authority, governmental authority, an individual or any other person not registered and receiving online information and database access or retrieval services in relation to any purpose other than commerce, industry or any other business or profession, located in taxable territory.

Explanation.––For the purposes of this clause, the expression “governmental authority” means an authority or a board or any other body,––
(i) set up by an Act of Parliament or a State Legislature; or
(ii) established by any Government,
with ninety per cent. or more participation by way of equity or control, to carry out any function entrusted to a municipality under article 243W of the Constitution.

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

Special Economic Zone” shall have the same meaning as assigned to it in clause (za) of section 2 of the Special Economic Zones Act, 2005.

Special Economic Zone developer” shall have the same meaning as assigned to it in clause (g) of section 2 of the Special Economic Zones Act, 2005 and includes an Authority as defined in clause (d) and a Co-Developer as defined in clause (f ) of section 2 of the said Act.

Supply” shall have the same meaning as assigned to it in section 7 of the Central Goods and Services Tax Act.

Taxable territory” means the territory to which the provisions of this Act apply.

Zero-rated supply” shall have the meaning assigned to it in section 16.

 


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Inter-State Supply 

The ‘place’ of supply (and the related ‘location of the supplier’) is detailed in the provisions of Chapter V (see below) of the IGST Act, which read with sections 7 and 8 of the said Act determines whether a supply is ‘intra-State’ or ‘inter-State’ in nature, and in the latter case results in the consequential levy of Integrated GST or IGST (generally when the said place of supply and location of supplier are in different States/Union Territories etc).

> Read more on ‘Inter-State Supply’

Chapter V (Integrated Act) Place of Supply of Goods and/or Services

Chapter V of the IGST Act determines the ‘place of supply’ of ‘goods’ differently to that for ‘services’, and contains specified provisions for import/export of goods, overseas located supplier or recipient of services and for payment of tax by a supplier of online information and database access or retrieval services.

The place of supply of goods (other than supply of goods imported into, or exported from India) is as under ––

  • Where the supply involves movement of goods (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;
  • Where the goods are delivered by the supplier to a recipient or any other person on the direction of a third person (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, it will be deemed that the said third person has received the goods and the place of supply of such goods shall be the principal place of business of such person;
  • Where the supply does not involve movement of goods (by the supplier or the recipient), the place of supply shall be the location of such goods at the time of the delivery to the recipient;
  • Where the goods are assembled or installed at site, the place of supply shall be the place of such installation or assembly;
  • Where the 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.

> Where the place of supply of goods cannot be determined, the place of supply shall be determined in such manner as may be prescribed.

 


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The place of supply of goods ––

  • Imported into India shall be the location of the importer;
  • Exported from India shall be the location outside India.

 


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The said section applies to determine the place of supply of services where the location of supplier of services and the location of the recipient of services is in India.

Such place of supply of services (except ‘Specified Services’, see below) is determined in the following manner^––

  • Made to a registered person shall be the location of such person;
  • Made to any person other than a registered person shall be,––
    (a) the location of the recipient where the address on record exists; and
    (b) the location of the supplier of services in other cases.


Specified Services

  • The place of supply of services (with respect to immovable property) ––
    (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, 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 organising any marriage or reception or matters related thereto, 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 above,
    shall be the location at which the immovable property or boat or vessel, as the case may be, is located or intended to be located.

If the location of the immovable property or boat or vessel is located or intended to be located outside India, the place of supply shall be the location of the recipient.

Where the immovable property or boat or vessel is located in more than one State or Union territory, the supply of services shall be treated as made in each of the respective States or Union territories, in proportion to the value for services separately collected or determined in terms of the contract or agreement entered into in this regard or, in the absence of such contract or agreement, on such other basis as may be prescribed.

  • 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.
  • The place of supply of services in relation to training and performance appraisal to ––
    (a) Registered person, shall be the location of such person;
    (b) Person other than a registered person, shall be the location where the services are actually performed.
  • The place of supply of services provided by way of admission to a cultural, artistic, sporting, scientific, educational, 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.
  • The place of supply of services provided by way of —
    (a) Organisation of a cultural, artistic, sporting, scientific, educational or entertainment event including supply of services in relation to a conference, fair, exhibition, celebration or similar events; or
    (b) Services ancillary to organisation of any of the events or services referred to above, or assigning of sponsorship to such events ––
    (i) To a registered person, shall be the location of such person;
    (ii) To a person other than a registered person, shall be the place where the event is actually held and if the event is held outside India, the place of supply shall be the location of the recipient.

Where the event is held in more than one State or Union territory and a consolidated amount is charged for supply of services relating to such event, the place of supply of such services shall be taken as being in each of the respective States or Union territories in proportion to the value for services separately collected or determined in terms of the contract or agreement entered into in this regard or, in the absence of such contract or agreement, on such other basis as may be prescribed.

  • The place of supply of services by way of transportation of goods, including by mail or courier to ––
    (a) Registered person, shall be the location of such person;
    (b) Person other than a registered person, shall be the location at which such
    goods are handed over for their transportation.
  • The place of supply of passenger transportation service to —
    (a) Registered person, shall be the location of such person;
    (b) Person other than a registered person, shall be the place where the passenger embarks on the conveyance for a continuous journey.

For the above said purposes, the return journey shall be treated as a separate journey, even if the right to passage for onward and return journey is issued at the same time.

^These provisions apply where the right to passage is given for future use and the point of embarkation is not known at the time of issue of right to passage.

  • The place of supply of services on board a conveyance, including a vessel, an aircraft, a train or a motor vehicle, shall be the location of the first scheduled point of departure of that conveyance for the journey.
  • The place of supply of telecommunication services including data transfer, broadcasting, cable and direct to home television services to any person shall —
    (a) In case of services by way of fixed telecommunication line, leased circuits, internet leased circuit, cable or dish antenna, be the location where the telecommunication line, leased circuit or cable connection or dish antenna is installed for receipt of services;
    (b) In case of mobile connection for telecommunication and internet services provided on post-paid basis, be the location of billing address of the recipient of services on the record of the supplier of services;
    (c) In cases where mobile connection for telecommunication, internet service and direct to home television services are provided on pre-payment basis through a voucher or any other means ––
    (i) through a selling agent or a re-seller or a distributor of subscriber identity module card or re-charge voucher, be the address of the selling agent or re-seller or distributor as per the record of the supplier at the time of supply; or
    (ii) by any person to the final subscriber, be the location where such prepayment is received or such vouchers are sold;
    (d) in other cases, be the address of the recipient as per the records of the supplier of services and where such address is not available, the place of supply shall be location of the supplier of services.

Where the address of the recipient as per the records of the supplier of services is not available, the place of supply shall be location of the supplier of services.

If such pre-paid service is availed or the recharge is made through internet banking or other electronic mode of payment, the location of the recipient of services on the record of the supplier of services shall be the place of
supply of such services.

Where the leased circuit is installed in more than one State or Union territory and a consolidated amount is charged for supply of services relating to such circuit, the place of supply of such services shall be taken as being in each of the respective States or Union territories in proportion to the value for services separately collected or determined in terms of the contract or agreement entered into in this regard or, in the absence of such contract or agreement, on such other basis as may be prescribed.

  • 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.

If the location of recipient of services is not on the records of the supplier, the place of supply shall be the location of the supplier of services.

  • 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.
  • The place of supply of advertisement services to the Central Government, a State Government, a statutory body or a local authority meant for the States or Union territories identified in the contract or agreement shall be taken as being in each of such States or Union territories and the value of such supplies specific to each State or Union territory shall be in proportion to the amount attributable to services provided by way of dissemination in the respective States or Union territories as may be determined in terms of the contract or agreement entered into in this regard or, in the absence of such contract or agreement, on such other basis as may be prescribed.


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The above said section applies to determine the place of supply of services where the location of the supplier of services or the location of the recipient of services is outside India, which shall be

  • The location of the recipient of services (except ‘Specified Services’, see below).
  • 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.


Specified Services

  • The place of supply of the following services shall be the location where the services are actually performed
    (a) Services supplied in respect of goods which are required to be made physically available by the recipient of services to the supplier of services, or to a person acting on behalf of the supplier of services in order to provide the services.**
    (b) Services supplied to an individual, represented either as the recipient of services or a person acting on behalf of the recipient, which require the physical presence of the recipient or the person acting on his behalf, with the supplier for the supply of services.

**When such services are provided from a remote location by way of electronic means, the place of supply shall be the location where goods are situated at the time of supply of services.

**Nothing contained above shall apply in the case of services supplied in respect of goods which are temporarily imported into India for repairs and are exported after repairs without being put to any other use in India, than that which is required for such repairs.

  • The place of supply of services supplied directly in relation to an immovable property, including services supplied in this regard by experts and estate agents, supply of 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 that of architects or interior decorators, shall be the place where the immovable property is located or intended to be located.
  • The place of supply of services supplied by way of admission to, or organisation 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 or organisation, shall be the place where the event is actually held.

Where any of the above said services are supplied at more than one location, including a location in the taxable territory, its place of supply shall be the location in the taxable territory.

Where the above said services are supplied in more than one State or Union territory, the place of supply of such services shall be taken as being in each of the respective States or Union territories and the value of such supplies specific to each State or Union territory shall be in proportion to the value for services separately collected or determined in terms of the contract or agreement entered into in this regard or, in the absence of such contract or agreement, on such other basis as may be prescribed.

  • The place of supply of the following services shall be the location of the supplier of services ––
    (a) services supplied by a banking company, or a financial institution, or a non-banking financial company, to account holders;
    (b) intermediary services;
    (c) services consisting of hiring of means of transport, including yachts but excluding aircrafts and vessels, up to a period of one month.
  • 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.
  • The place of supply in respect of passenger transportation services shall be the place where the passenger embarks on the conveyance for a continuous journey.
  • The place of supply of 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, shall be the first scheduled point of departure of that conveyance for the journey.
  • The place of supply of online information and database access or retrieval services shall be the location of the recipient of services.

For the above said purpose, person receiving such services shall be deemed to be located in the taxable territory, if any two of the following non-contradictory conditions are satisfied ––

(a) the location of address presented by the recipient of services through internet is in the taxable territory;
(b) 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;
(c) the billing address of the recipient of services is in the taxable territory;
(d) the internet protocol address of the device used by the recipient of services is in the taxable territory;
(e) the bank of the recipient of services in which the account used for payment is maintained is in the taxable territory;
(f) the country code of the subscriber identity module card used by the recipient of services is of taxable territory;
(g) the location of the fixed land line through which the service is received by the recipient is in the taxable territory.

  • In order to prevent double taxation or non-taxation of the supply of a service, or for the uniform application of rules, the Government shall have the power to notify any description of services or circumstances in which the place of supply shall be the place of effective use and enjoyment of a service.

 


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  • On supply of online information and database access or retrieval services by any person located in a non-taxable territory and received by a non-taxable online recipient, the supplier of services located in a non-taxable territory shall be the person liable for paying integrated tax on such supply of services.
  • In the case of supply of online information and database access or retrieval services by any person located in a non-taxable territory and received by a non-taxable online recipient, an intermediary located in the non-taxable territory, who arranges or facilitates the supply of such services, shall be deemed to be the recipient of such services from the supplier of services in non-taxable territory and supplying such services to the non-taxable online recipient except when such intermediary satisfies the following conditions ––
    (a) The invoice or customer’s bill or receipt issued or made available by such intermediary taking part in the supply clearly identifies the service in question and its supplier in non-taxable territory;
    (b) The intermediary involved in the supply does not authorise the charge to the customer or take part in its charge which is that the intermediary neither collects or processes payment in any manner nor is responsible for the payment between the non-taxable online recipient and the supplier of such services;
    (c) The intermediary involved in the supply does not authorise delivery; and
    (d) The general terms and conditions of the supply are not set by the intermediary involved in the supply but by the supplier of services.
  • Such supplier of online information and database access or retrieval services shall, for payment of integrated tax, take a single registration^^ under the Simplified Registration Scheme to be notified by the Government.

^^Any person located in the taxable territory representing such supplier for any purpose in the taxable territory shall get registered and pay integrated tax on behalf of the supplier.

^^If such supplier does not have a physical presence or does not have a representative for any purpose in the taxable territory, he may appoint a person in the taxable territory for the purpose of paying integrated tax and such person shall be liable for payment of such tax.

 


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