24th May 2017
In GST, the ideas of place of supply have been made pertinent addition for exchange in products alongside exchange of services. Further, which tax is to be levied (IGST or CGST and SGST/UTGST) will rely on upon whether a specific exchange is Inter-state supply or Intra-state supply. Consequently, every exchange should experience the trial of arrangements identifying with place of supply so as to figure out which assessment is to be levied.
Why Place of Supply?
In the present tax framework, rules similar to provisions of place of supply is pervasive in service tax. It runs with the name of Place of Provision of Service Rules, 2012 (POPS). In service tax, taxable occasion is "provision of service" and thus with a specific end goal to decide if a specific transaction is assessable or not it is basic to know where the services are given. If the services are given in assessable domain i.e. Entire of India with the exception of Jammu and Kashmir then service duty is to be collected.
Supply that does not involve movement:
The expression supply does not include movement of goods does not mean the circumstance where movement is not required at all except rather movement of products is done after the viable conveyance of products is given to the recipient. Place of supply of goods, where the supply does not involve movement of goods, regardless of whether by the,
Should be the area of such goods at the time of conveyance to the recipient.
Example- Where a man buys a T-shirt from a shop, supply is finished at the shop itself when the T-shirt is conveyed to the purchaser and the cost is paid. For this situation place of supply would be resolved under sub-section 3 of section 5 i.e. supply of goods that does not involve movement.
In other words, it states that where the supply does not include movement of goods, regardless of whether by the supplier or the recipient, the place of supply might be the location of such products at the time of the conveyance to the recipient;
Another example- On the off chance that Mr. X of Uttar Pradesh comes to Delhi himself and takes conveyance and contract a transporter from that point and sends products to Uttar Pradesh. Since viable conveyance in products has as of now been passed at Delhi itself place of supply might be location of goods where conveyance has been given i.e. Delhi for this situation.
At the point when products are of such nature which does not require any movement, place of supply shall be location of such goods.
Example - Bharat Limited enlisted in Maharashtra sold its pre introduced transmission tower (electric tower) situated at Madhya Pradesh to Hindustan Limited enrolled in Delhi.
For this situation, location of provider is Maharashtra yet place of supply will be Madhya Pradesh. Hence,IGST will be exacted.
Other cases where no movement- job worker making capital goods for the principal but himself uses for making goods for the principal.
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