While going through GST, the Prima facie question that arise in everybody mind is What to tax i.e. Nature of tax to be paid, Whether SGST, CGST or IGST as these 3 type of taxes are leviable under GST.
All these taxes are leviable whenever there is a movement of Goods or services.
Now movement of Goods/Services are of 2 type:
- Intra State i.e. With in state
- Inter state i.e. Between two states
Here, Intra state movement of Goods/Services attract CGST and SGST both.
Whereas Interstate movement attracts IGST.
As GST is destination based tax ie. The goods/services will be taxed at the place where they are consumed and not at the origin, therefore the state where they are consumed will have the right to collect GST.
This in turn makes the concept of “PLACE OF SUPPLY” that defines whether the transaction will be counted as intra state or interstate and accordingly SGST, CGST and IGST will be levied.
Place of Supply In Case Of Goods Other Than Imported/Exported Goods
| S. No. | Nature Of Transaction | Place Of Supply (POS) | Relevant Section | Example |
| 1. | Supply involves movement of goods | Location of delivery of goods to the recipient. | Sec.10(1)(a) of IGST Act,2017 | Mr. Arvind of Ajmer, Rajasthan sells 50 laptop to Ms. Sweety of Jaipur, Rajasthan.
POS = Jaipur , Rajasthan GST = SGST & CGST as its intra state transaction. |
| Mr. Arvind of Mumbai, Maharashtra sells 50 laptop to Ms. Sweety of Jaipur, Rajasthan
POS= Jaipur, Rajasthan GST = IGST as it is interstate transaction. |
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| 2. | Supply without movement of goods | Location of goods at the time of delivery to the recipient. | Sec. 10(1)(c) of IGST Act,2017 | Ms. Sweety from jaipur purchases a laptop from an electronic store in New delhi. Sweety takes the delivery of the laptop in new delhi itself and brings it to jaipur in her own vehicle.
POS = New Delhi, as the location of laptop at the time of delivery. GST = CGST & SGST |
| 3. | Assembly or Installation at site | Place of assembly or Installation. | Sec. 10(1)(d) of IGST Act,2017 | Ms. Sweety purchases a Machinery to be installed in her new delhi office from a vendor in U.P.
POS = New Delhi ie. Place of installation GST = CGST & SGST |
| 4. | Supply on board a conveyance such as vessel, aircraft, train, motor vehicle etc. | Location at which the goods were taken on board. | Sec 10(1)(e) of IGST Act,2017 | Mr. Arvind boards a flight from Mumbai to Jaipur and purchases a bottle of water in flight during the journey.
POS = Mumbai, Maharashtra as the items were loded into the plane at Mumbai. GST = CGST & SGST |
| 5. | Supplier delivering to a recipient on direction of a 3rd person | 3rd person principal place of business. | Section 10(1)(b) | Mr. Arvind of Mumbai, Maharashtra orders a Mobile Phone from Flipcart to be delivered to his friend Ms. Sweety in Jaipur as a gift. M/s Champion Computers (An online seller registered in New delhi) processes the order and send the mobile accordingly and Mr. Arvind is billed by Flipcart.
POS = Mumbai, Maharashtra ie. It will be assumed that buyer in Mumbai has received the goods. GST = IGST |
Author Bio
Such a nice article mam ,it will help alot
Thanks
Very informative