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2021 (10) TMI 146 - AAAR - GSTLevy of GST - international transactions - supply of Hardware by the appellant in the manner commercially known as ‘Merchant Trade Transaction’ - goods are supplied from a place in the non-taxable territory to another place in the non-taxable territory without such goods entering into India - Place of supply of goods - N/N. 35/2020-Central Tax dated 03.04.2020, as amended vide Notification No. 55/2020-Central Tax dated 27.06.2020 - HELD THAT:- As per the charging section 5 of the IGST Act, 2017, integrated goods and services tax is levied on all inter-State supplies of goods or services or both, except on the supply of alcoholic liquor for human consumption - as per this charging section, integrated goods and services tax is levied on all inter-State supplies of goods or services or both, except on the supply of alcoholic liquor for human consumption. As per clause (a) of sub-section (1) of Section 10 of the IGST Act, 2017, ‘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’. In the present case, the supply involves movement from the premises of the vendor located outside India to the buyer of the appellant located outside India. Therefore, the place of supply in this case is outside India inasmuch as the movement of goods terminates for delivery at the premises of the buyer located outside India - Section 7 of the CGST Act, 2017 defines the scope of supply. As per clause (a) of sub-section (1) of said section 7, the expression “supply” includes all forms of supply of goods or services or both such as sale, transfer, barter, exchange, licence, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business. As the transactions of the appellant, wherein the goods are supplied from a place in the non-taxable territory to another place in the non-taxable territory without such goods entering into India, are covered under Paragraph 7 of Schedule III of the GST Acts, it is evident that the said transactions shall be treated neither as a supply of goods nor a supply of services with effect from 01.02.2019. As such, Goods and Services Tax is not leviable on such transactions with effect from 01.02.2019 - Integrated Goods and Services Tax was payable during the period from 01.07.2017 to 31.01.2019 on supply of goods directly from the vendor’s premises located outside India in the non – taxable territory to the customer’s premises located at another place outside India in the non-taxable territory, without such goods entering into India. However, with effect from 01.02.2019, Integrated Goods and Services Tax is not payable on supply of goods directly from the vendor’s premises located outside India in the non – taxable territory to the customer’s premises located at another place outside India in the nontaxable territory, without such goods entering into India. When a transaction is leviable to IGST / GST in terms of clear provisions of law, the same cannot be held as not liable to IGST / GST merely on the grounds that such transactions were not taxable under erstwhile Indirect Tax Laws or under the United Kingdom VAT legislation or that there is no mechanism to report place of supply of such transaction in GSTR-1 Return. The Integrated Goods and Services Tax was payable from 01.07.2017 to 31.01.2019 and is not payable with effect from 01.02.2019 on supply of goods directly from the vendor’s premises located outside India in the non – taxable territory to the customer’s premises located at another place outside India in the non-taxable territory, without such goods entering into India.
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