TMI BlogPlace of Supply of Goods and ServiceX X X X Extracts X X X X X X X X Extracts X X X X ..... erritory or else would attract IGST if it is an inter-state supply. Q 2. Why are place of supply provisions different in respect of goods and services? Ans. Goods being tangible do not pose any significant problems for determination of their place of consumption. Services being intangible pose problems w.r.t determination of place of supply mainly due to following factors: (i) The manner of delivery of service could be altered easily. For example, telecom service could change from mostly post-paid to mostly pre-paid; billing address could be changed, billers address could be changed, repair or maintenance of software could be changed from onsite to online; banking services were earlier required customer to go to the bank, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion etc. Q 3. What proxies or assumptions in a transaction can be used to determine the place of supply? Ans. The various element involved in a transaction in services can be used as proxies to determine the place of supply. An assumption or proxy which gives more appropriate result than others for determining the place of supply, could be used for determining the place of supply. The same are discussed below: (a) location of service provider; (b) the location of service receiver; (c) the place where the activity takes place/ place of performance; (d) the place where it is consumed; and (e) the place/person to which actual benefit flows Q 4. What is the need to have separate rules for place of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supply where the goods or services are supplied on board a conveyance, such as a vessel, an aircraft, a train or a motor vehicle? Ans. In respect of goods, the place of supply shall be the location at which such goods are taken on board. (Section 10 of IGST Act) However, in respect of services, the place of supply shall be the location of the first scheduled point of departure of that conveyance for the journey. (Section 12 and 13 of IGST Act) Q 8. What is the default presumption for place of supply in respect of B2B supply of services? Ans. The terms used in the IGST Act are registered taxpayers and non-registered taxpayers. The presumption in case of supplies to registered person is the location of such person. Si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... person. However, if the recipient is not registered, the place of supply shall be the place where event is held. Since the event is being held in multiple states and a consolidated amount is charges for such services, the place of supply shall be taken as being in each state in proportion to the value of services so provided in each state. (The Explanation clause to section 12(7) of the IGST Act) Q 12. What will be the place of supply of goods services by way of transportation of goods, including mail or courier? Ans. In case of domestic supply: If the recipient is registered, the location of such person shall be the place of supply. However, if the recipient is not registered, the place of supply shall be the place ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IGST Act) Q 15. What will be the place of supply for mobile connection? Can it be the location of supplier? Ans. For domestic supplies: The location of supplier of mobile services cannot be the place of supply as the mobile companies are providing services in multiple states and many of these services are inter-state. The consumption principle will be broken if the location of supplier is taken as place of supply and all the revenue may go to a few states where the suppliers are located. The place of supply for mobile connection would depend on whether the connection is on postpaid or prepaid basis. In case of postpaid connections, the place of supply shall be the location of billing address of the recipient of service. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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