What shall be the Place of Supply ?

Place of supply determines the place (the State) where the GST shall be received by the government treasury.  It is pertinent to note that in the proposed regime, though taxes will travel to different states, tax payers would not be troubled with the liability of obtaining registration and undertaking compliance at all locations where their place of supply is established.  If the Supplier and placae of supply are in same state, it shall be an instra state supply and CGST and SGST shall be collected by respective government in the state from the supplier.  However, in case the Supplier is registered in state A and place of supply falls in other state, it shall be called an intere state supply and GST shall be transferred to the receiving state by the mechanism of IGST.  Thus, it is very important to understand the place of supply as to in which state does it exactly falls.  Section 5 and 6 of Model Integrated Goods And Services Tax Act details the provisions for place of supply.  We have summarized the provisions here under for ready reference.

Place of Supply in case of Goods

TransactionPlace of Supply
Where the supply involves movement of goodslocation 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 personPlace of supply of such goods shall be the principal place of business of such third person
Where the supply does not involve movement of goodsLocation of such goods at the time of the delivery to the recipient
Where the goods are assembled or installed at siteplace of such installation or assembly
Where the goods are supplied on board a conveyanceLocation at which such goods are taken on board.

Place of Supply in case of Services

TransactionPlace of Supply in case of supply to registered personPlace of Supply in case of supply to registered person
Supply of services:Location at which the immovable property or boat or vessel is located or intended to be located.Location at which the immovable property or boat or vessel is located or intended to be located.awer
·         in relation to an immovable property
·         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
·         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
·         any services ancillary to the services referred to in clause (a), (b) and (c),
Restaurant and catering services, personal grooming, fitness, beauty treatment, health service including cosmetic and plastic surgeryLocation where the services are actually performed.Location where the services are actually performed.
Services in relation to training and performance appraisalLocation of such recipientlocation where the services are actually performed
supply of services provided by way of—Location of such recipientlocation where the even is actually held
(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,
services by way of transportation of goodsLocation of such recipientlocation at which such goods are handed over for their transportation
supply of passenger transportation serviceLocation of such recipientplace where the passenger embarks on the conveyance for a continuous journey
services on board a conveyancelocation of the first scheduled point of departure of that conveyance for the journeylocation of the first scheduled point of departure of that conveyance for the journey
telecommunication services by way of fixed telecommunication line, leased circuits, internet leased circuit, cable or dish antennalocation where the telecommunication line, leased circuit or cable connection or dish antenna is installed for receipt of serviceslocation where the telecommunication line, leased circuit or cable connection or dish antenna is installed for receipt of services
telecommunication services in case of mobile connection for telecommunication and internet services provided on post-paid basislocation of billing address of the recipient of services on record of the supplier of serviceslocation of billing address of the recipient of services on record of the supplier of services
telecommunication services in cases where mobile connection for telecommunication and internet service are provided on pre-payment through a voucher or any other meanslocation where such pre-payment is received or such vouchers are soldlocation where such pre-payment is received or such vouchers are sold
banking and other financial services including stock broking serviceslocation of the recipient of services on the records of the supplier of serviceslocation of the recipient of services on the records of the supplier of services
banking and other financial services including stock broking services when not linked to the account of the recipient of serviceslocation of the supplier of serviceslocation of the supplier of services
place of supply of insurance serviceslocation of such personlocation of the recipient of services on the records of the supplier of services