Place of Supply under the Model GST Law
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By CMA Vineet Chopra, FCS, ACMA, LLM, PGGDBA-Finance.
Mb: 08720-021-021, email: vineet.chopra01@gmail.com
Place of Supply (POS)
Determination of POS is an important aspect of GST dkeeping in view its relevance on Input Tax Credit, compliances for multiple states, therefore, its impact needs to be examined by the industry before the GST is made effective. POS is important to determine:
- Whether a particular supply is inter-state or intra-state for paying tax either IGST or CGST/SGST.
- The State in which various compliances to be done like registration, returns, etc.
- The State to which benefit of taxes accrue and the place where taxes will be paid?
- Whether a particular supply is export or import?
- To maintain smooth flow of credit
General Rule for determining POS
As a general rule, the place of supply will be the destination or the place where goods or services are actually consumed. The model GST law provides for POS under Chapter IV, section 5 & 6 of IGST Act, 2016.
POS of Goods
| Sr. | Type of Supply in respect of Goods | Place of supply |
| 1 | Supply with movement of goods | Location where goods are delivered to recipient |
| 2 | No movement of goods | Location of goods at time of delivery to recipient |
| 3 | Goods installed or assembled | Place of installation or assembly |
| 4 | Supply of goods on direction of third person or agent before or during movement of goods | Principal place of business of third person |
| 5 | Goods supplied on board a conveyance such as vessel, aircraft, train or motor vehicle | Location at which the goods are taken on board |
| 6 | Any other case | As may be prescribed |
POS of Services
General Rule
Supply made to a registered person - Location of such person
Supply made to other than a registered person - Location of recipient if address on record exists;
In other cases Location of supplier
Specific Rule
| Sr. | Type of Service | Place of Supply |
| 1 | Services with respect to an immovable property like - |
|
| a | Services by Architects, interior decorators, engineers, estate agents, services of right to use or carrying out construction works | |
| b | Services by way of lodging accommodation, hotel, club , etc | |
| c | Services for providing accommodation in any immovable property for social, official, religious function, marriage events at such property | |
| d | Any ancillary services to above | |
| 2 | Restaurant, catering, fitness, beauty treatment, health services including cosmetic and plastic surgery | Location where services are actually performed. |
| 3 | Training & performance appraisal |
|
| 4 | Services of admission to a cultural, artistic, sporting, educational or entertainment event or amusement park or services ancilliary thereto |
|
| 5 | Services of organizing cultural, artistic, sport, scientific, educational or entertainment event or in relation to conference, fair, exhibition or ancillary services, assigning sponsorship, etc. |
Where event held in more than one state, the supply shall be taken as made in each state proportionate to value of services provided in each State as per the contract or in absence of contract, on a prescribed basis. |
| 6 | Services by way of transportation of goods including by mail or courier |
|
| 7 | Passenger transportation |
|
| 8 | Supply of services on board a conveyance such as vessel, aircraft, train or motor vehicle | Location of first scheduled point of departure |
| 9 | Telecommunication, broadcasting, data transfer, D to H TV services | |
| a | Fixed telecommunication line, internet, cable or dish antenna | Place where line, leased circuit, cable connection, or dish antenna installed for receipt of services |
| b | Mobile telecommunication, internet on post paid basis | Location of billing address of recipient on record of supplier |
| c | Prepaid basis |
|
| 10 | Banking, financial service, stock broking, |
|
| 11 | Insurance |
|
| 12 | Advertisement services to the Central Government, State Government, statutory body, local authority |
|
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