The term ‘Place of Supply’ has the vital role in the GST.

To know the nature of

Supply whether the supply is inter-state supply or intra-state supply, one should
know the place of supply to determine the nature of supply.
The tax is paid according to the nature of the Supply. If the supply is intra-state supply,
tax shall be paid as CGST+SGST and if the Supply is inter-state supply, tax shall be
paid as IGST. If the tax is paid under wrong head, means tax was to be paidg as IGST
but due to wrong determination the same (tax) had been paid in account of CGST and
SGST, then there is no such provision in the GST to adjust such mistake with one
another suo moto. The only remedy available with the person is to pay the tax in
correct account and get refund the tax which had been paid in wrong account.
Therefore it is utmost necessary for the person to determine the correct nature of
supply and pay the tax accordingly in correct head.

There is two terms which mainly determines the nature of Supply:

1. Location of the Supplier
2. Location of the Place of Supply
Location of the Supplier is from where the person is registered under GST.
Location of the Place of Supply is determined according to Sections 10, 11,12 and 13
of the IGST Acts
A. Section 7 of the IGST speaks for inter-state supply.
According to the Section 7 following Supplies shall be treated as supply in the course
of inter-state trade or commerce.

S.No. Supply Terms for Supply to be treated as supply of goods or

supply of services in the course of inter-state trade or
commerce

1 Supply of Goods or Subject to the provisions of section 10, supply of goods or

Supply of Services subject to the provisions of section 12, Supply of services,
where the location of the supplier and the place of supply
are in—
(a) two different States;
(b) two different Union
Territories; or
(c) a State and a Union territory,

2 Import Supply of goods or services imported into the territory of

India, *till they cross the customs frontiers of India.
* This term for Supply of goods imported

3 Export and SEZ a)when the supplier is located in India and the place of
supply is outside India;
(b) Supply to or by a Special Economic Zone developer or
a Special Economic Zone unit; or
(c) Supply in the taxable territory, not being an intra-State
supply and not covered elsewhere in this section,
B. Section 8 of the IGST speaks for intra-state supply
According to the Section 8 following Supplies shall be treated as intra-state supplies.

S.No. Supply Terms for Supply to be treated as supply of goods or

supply of services as intra-state Supply

1 Supply of Goods or Subject to the provisions of section 10, supply of goods or

Supply of Services subject to the provisions of section 12, Supply of services,
where the location of the supplier and place of supply are
in the same State or same Union territory shall be treated
as intra-State supply.

2 Supply of goods shall The following supply of goods shall not be treated as intra-
not be treated as intra- State supply, namely:—
state supply. (i) supply of goods to or by a Special Economic Zone
developer or a Special Economic Zone unit;
(ii) goods imported into the territory of India till they cross
the customs frontiers of India; or
(iii) supplies made to a tourist referred to in section 15.

3 Supply of services shall Intra-State supply of services shall not include supply of
not be treated as Intra- services to or by a Special Economic Zone developer or a
state supply. Special Economic Zone unit.
Determination of Place of Supply
> Section 10 – Place of supply of goods other than supply of goods imported into, or
exported from India.
> Section 11 – Place of supply of goods imported into, or exported from India.
> Section 12 – Place of supply of services where location of supplier and recipient is
in India.
> Section 13 – Place of supply of services where location of supplier or location of
recipient is outside India.
> Section 9 – Supplies in territorial waters.
C. Section 10 of the IGST Act – Place of Supply of Goods
Section 10(1)(a) – Movement of Goods
> Supply involves Movement of Goods;
> Movement by any person i.e. Supplier, Recipient or Any Other Person:
> Place of Supply of such goods shall be the location of goods at the time at which
the movement of goods terminates for delivery to the recipient;
Section 10(1)(b) – Persons stated for Bill to and for Ship to are differ from each
other.
> Where the goods are delivered by the supplier to a recipient or any other person on
the direction of a third person, whether acting as an agent or otherwise, before or
during movement of goods, either by way of transfer of documents of title to the goods
or otherwise, it shall be deemed that the said third person has received the goods and
the place of supply of such goods shall be the principal place of business of such
person;
Section 10(1)(c) – Supply not involve movement of goods
> Supply does not involve movement of goods;
> Whether by the Supplier or the Recipient;
> place of supply shall be the location of such goods at the time of the delivery to the
recipient;
Section 10(1)(d) – Goods supplied and assembled or installed simultaneously
> Where the goods are assembled or installed at site, the place of supply shall be
the place of such installation or assembly;
Section 10(1)(e) – Goods supplied on board
> Where the goods are supplied on board a conveyance, including a vessel, an
aircraft, a train or a motor vehicle, the place of supply shall be the location at which
such goods are taken on board.
Section 10(2) – Power to notify place of supply if it ( place of supply ) cannot be
determined
> Where the place of supply of goods cannot be determined, the place of supply shall
be determined in such manner as may be prescribed.
Examples for Section 10 (1)(a)
Place of Supply is the location at where movement of goods terminates for delivery to
the recipient. It is immaterial who moves the goods. Goods can be moved either by
the Supplier or by the Recipient or by Any Other Person.
How the Supplier shall know the termination point? The Address of the Recipient will
be termination point. If address of the Recipient is not available to the Supplier the
termination point shall be the location of the Supplier.
According to Rule 46 (e) of CGST Act – “name and address of the recipient and the
address of delivery, along with the name of the State and its code, if such recipient is
un-registered and where the value of the taxable supply is less than fifty thousand
rupees and the recipient requests that such details be recorded in the tax invoice.”
The Location of the Supplier ‘A’ is Delhi. The place of supply and nature of supply shall
be as under:

Recipient Place of Nature of Supply

Supply

Registered in Gurgaon Gurgaon Inter-state Supply

Unregistered but address provided to the Noida Inter-state Supply

Supplier as of Noida

Unregistered. Collect the delivery of goods Delhi Intra-state Supply

from the Supplier without giving his address
and value of supply of goods is less than
Rs.50000
Examples for Section 10 (1)(b)
Under this clause the goods are delivered to the person as per directions received
from the Recipient. This is Bill to Ship to model. The Place of Supply is the principal
place of business of the person (the Recipient ) who directs to the Supplier to supply
the goods to such person.

Location of the Location of the Location of the Place of Nature of

Supplier Recipient third person to Supply ( Supply
( Bill To ) whom goods Location of the
delivered Recipient in
( Ship To ) whose favour
Bill issued by
the Supplier )

A B C D E

Delhi Haryana Punjab Haryana Inter-state

Delhi Haryana Haryana Haryana Inter-state

Delhi Delhi Punjab Delhi Intra-state

In Bill to Ship to Model there are minimum two commercial transactions. While
consider the above example there is transactions between
(1) A and B
(2) B and C
> Place of Supply for first transaction between A and B will be the principal place of
the Recipient ( Section 10 (1)(b) be applicable )
> Place of Supply for second transaction between B and C will be where the movement
of goods terminates for delivery. ( Section 10 (1)(a) be applicable )
Example for Section 10 (1)(c)
In this section Supply does not involve movement of goods, whether by the Supplier
or by the Recipient.
‘B’ a registered person of Delhi purchases a factory from the person ‘A’ of Manesar
(Haryana). The sale of factory is comprising of machines, furniture, air-conditions as
fixed and installed in factory. Invoices issued by the ‘A’ separately for machines,
furniture and air-conditions. Since the movement of goods does not involve in this
transaction, therefore, place of supply of such goods shall be location of the goods i.e.
Manesar (Haryana). Location of the Supplier and place of supply are in the same state,
therefore, transaction shall be treated as intra-state supply.
Example for Section 10 (1)(d)
The place of supply is where the work of installation or assembly is done.
‘A’ a registered person of Delhi receives order from ‘B’ of Gurgaon for supply of
Computers and installed at their different sites.

Location of Recipient Site for Place of Supply Transaction

Supplier for Registered installation
supply of Office
 Goods and
installation

Delhi Gurgaon Gurgaon Gurgaon Inter-state

Delhi Gurgaon Delhi Delhi Intra-state

Delhi Gurgaon Noida Noida Inter-state

Example for Section 10 (1)(e)
The Supplier is authorised to supply foods and other items in some trains departed
from New Delhi and Ghaziabad. Place of Supply will be as under:

Location of the Supplier Boarding Station from Place of Transaction

where goods are Supply
boarded to be supplied
in train

Delhi New Delhi Delhi Intra-state

Delhi Ghaziabad Ghaziabad Inter-state

D. Section 11 of the IGST Act – Place of supply of goods imported into,

or exported from India.
The place of supply of goods,—
(a) imported into India shall be the location of the importer;
(b) exported from India shall be the location outside India.
E. Section 12 of the IGST Act – Place of supply of services where location of
supplier and recipient is in India.

Section Particulars Place of Supply

12 (2)(a) Supply of Services made to a Location of such person (Recipient)

Registered Person

12 (2)(b) Supply of Services made to a (i) The location of the recipient where the
Unregistered Person address on record exists; and
(ii) the location of the supplier of services
in other cases.

> Example – Registered office of the Recipient is in Mumbai. The recipient received
consultancy in tax audit matter from the CA company of Delhi in his Delhi office. The place of
supply shall be Mumbai.
> Example – In the above example staff of the CA Company of Delhi provides services in the
office of the Recipient in Mumbai. The place of supply shall be Mumbai.

12 (3)(a) Services directly in relation to The location at which the immovable

immovable property including property is located or intended to be
services provided by – located.
• Architects,
• Interior Decorators,
 • Surveyors,
• Engineers,
• Other related experts and
• Estate Agents
• Etc..

> Example – The immovable property is located in Noida. Place of supply shall always be Noida
in regard of services directly related to such immovable property. Nature of supply whether it is
inter-state supply or intra-state depends upon location of the supplier. If the location of the
supplier is in the same state of Noida then nature of supply shall be intra-state supply or if the
location of the supplier is other state than state of the Noida then nature of supply shall be inter-
state supply.

12 (3)(b) Services by way of lodging The location at which the immovable

accommodation by a hotel, inn,
guest house, home stay, club or
campsite, by whatever name
called, and including a house boat
or any other vessel.
property or boat or vessel, as the case
may be, is located or intended to be
located.

> Example – A business man registered in Delhi visits Banglore to attend the summit in regard
of his business. He stays in a Hotel. Place of supply shall be the place where the Hotel is
located i.e. Banglore. Transaction will be intra-state supply because location of the Supplier i.e.
Hotel owner and location of the Hotel are in same State.

12 (3)(c) Services by way of The location at which the immovable

accommodation in any immovable property is located or intended to be
property for organising any located.
marriage or reception or matters
related thereto, official, social,
cultural, religious or business
function including services
provided in relation to such
function at such property

12 (3)(d) Any services ancillary to the The location at which the immovable
services referred to in clauses (a), property or boat or vessel, as the case
(b) and (c), may be, is located or intended to be
located.

Provided that if the location of the immovable property or boat or vessel is

located or intended to be located outside India, the place of supply shall be the
location of the recipient.

12 (4) The place of supply of restaurant The location where the services are
and catering services, personal actually performed.
grooming, fitness, beauty
treatment, health service including
cosmetic and plastic surgery

> Example – An Advertisement Company of Delhi contracts with a beauty salon firm of Delhi for
dressing and beauty work upon their models in Mumbai. According to section 12 (4) the place of
supply shall be where the services are provided. In this example the place of supply is Mumbai
where the dressing and beauty-work done. Transaction between the Advertisement Company
and the Beauty Saloon Firm is inter-state transaction because the location of the supplier and
place of supply are in differ states.

12 (5) Services in relation to training and Place of Supply

performance appraisal.
(i) if such services made to Registered
Person then Location of such person or
(ii) If such services made to the person
other than registered person the
location where the services are actually
performed.

> Example – A company registered in Delhi contracts with the person registered in Dehradun to
give training to their employees in regard of operating the machine imported from the Japan.
The training is provided in Dehradun in the office of the Supplier of Services. The place of
supply shall be Delhi because services provided to the recipient company registered in Delhi.
> Example – The Charitable Organisation of Haridwar unregistered in GST contracts with the
Akash Institute of Delhi to provide training to ten boys to participate in interview for IAS. The
training is provided in Delhi. The place of supply shall be Delhi in this case and transaction will be
intra-state because the Supplier of Services and place of supply are in same state.

12 (6) Supply of services provided by Place of Supply where the event is

way of admission to a cultural, actually held or where the park or such
artistic, sporting, scientific, other place is located.
educational, entertainment event
or amusement park or any other
place and services ancillary
thereto.

12 (7) Services provided by way of Place of Supply

a) organisation of a cultural, artistic, (i) if such services made to Registered
sporting, scientific, educational or Person then Location of such person or
entertainment event including (ii) If such services made to the person
supply of services in relation to a other than registered person the place
conference, fair, exhibition, where the event is actually held
celebration or similar events; or (iii) if the event is held outside India, the
(b) services ancillary to place of supply shall be the location of the
organisation of any of the events or recipient.
services referred to in clause (a), or
assigning of sponsorship to such
events,

12 (8) Services by way of transportation Place of Supply

of goods, including by mail or (i) if such services made to Registered
courier Person then Location of such person or
(ii) If such services made to the person
other than registered person the
location at which such goods are handed
over for their transportation.
(iii) Provided that where the transportation
of goods is to a place outside India, the
place of supply shall be the place of
destination of such goods.

> Example – The Blue Dart Company Delhi takes a courier from the firm of Delhi to dispatch in
London. According to the proviso to the section 12 (8) place of supply in this transaction is
London. Nature of Supply is inter-state supply.
12 (9) Supply of passenger transportation Place of Supply
service (i) if such services made to Registered
Person then Location of such person or
(ii) If such services made to the person
other than registered person the place
where the passenger embarks on the
conveyance for a continuous journey.

Provided that where the right to passage is given for future use and the point
of embarkation is not known at the time of issue of right to passage, the place
of supply of such service shall be determined in accordance with the provisions
of sub-section (2).

12 (10) Supply of services on board a The location of the first scheduled point
conveyance, including a vessel, an of departure of that conveyance for the
aircraft, a train or a motor vehicle. journey.

12 (11) Supply of telecommunication services including data transfer,

broadcasting,cable and direct to home television services to any person.

(a) in case of services by way of
fixed telecommunication line,
leased circuits, internet leased
circuit, cable or dish antenna
(b) in case of mobile connection for
telecommunication and internet
services provided on post-paid
basis.
(c) mobile connection/ internet
services on pre-payment basis
through a voucher or any other
means
(d) In other casese
(a) place of supply be the location where
such instrument is installed for receipt of
services.
(b) place of supply be the location of
billing address of the recipient of services
on the record of the supplier of services
(c) place of supply be the address of the
selling agent or re-seller or distributor as
per the record of the supplier at the time
of supply of such vouchers or Vouchers
supplied by any person to the final
subscriber, be the location where such
pre-payment is received or such vouchers
are sold.
(d) place of supply be the address of the
recipient as per the records of the supplier
of services and where such address is not
available, the place of supply shall be
location of the supplier of services.

Provided that where the address of the recipient as per the records of the
supplier of services is not available, the place of supply shall be location of the
supplier of services:
Provided further that if such pre-paid service is availed or the recharge is made
through internet banking or other electronic mode of payment, the location of the
recipient of services on the record of the supplier of services shall be the place
of supply of such services.

12 (12) Supply of banking and other The location of the recipient of services
financial services, including stock on the records of the supplier of services.
broking services to any person.

Provided that if the location of recipient of services is not on the records of the
supplier, the place of supply shall be the location of the supplier of services.
 12 (13) Supply of insurance services (a) to a registered person, be the location
of such person;
(b) to a person other than a registered
person, be the location of the recipient of
services on the records of the supplier of
services.

12 (14) The place of supply of advertisement services to the Central Government, a

State Government, a statutory body or a local authority meant for the States or
Union territories identified in the contract or agreement shall be taken as being
in each of such States or Union territories and the value of such supplies
specific to each State or Union territory shall be in proportion to the amount
attributable to services provided by way of dissemination in the respective
States or Union territories as may be determined in terms of the contract or
agreement entered into in this regard or, in the absence of such contract or
agreement, on such other basis as may be prescribed.
F. Section 13 of the IGST Act – Place of supply of services where location of
supplier or location of recipient is outside India.

Section Particulars Place of Supply

13 (2) Supply of Services except the
services specified in sub-sections
(3) to (13)
> Location of the Recipient of Services.
> Where the location of the recipient of
services is not available in the ordinary
course of business, the place of supply
shall be the location of the supplier of
services.

> Example – The Delhi based professional firm renders services to the company of London by
way of detailed report of feasibility of business in India. Place of Supply will be of London i.e.
according to the Location of the Recipient. This will be export services subject to other
conditions fulfilled in section 2 (6) of the IGST Act.
> Example – The Advertisement based company of the Tripura receives services from the
London firm about legal provisions in regard of Advertisement applying in London. Place of
Supply will be Tripura i.e. according to the Location of the Recipient. This will be import services
according section 2 (11) of the IGST Act.

13 (3)(a) > Services supplied in respect of
goods.
> Provided that when such
services are provided from a
remote location by way of
electronic means,
> The location where the services are
actually performed for such goods.
> The place of supply shall be the
location where goods are situated at the
time of supply of services:

Provided further that nothing contained in this clause shall apply in the
case of services supplied in respect of goods which are temporarily imported
into India for repairs or for any other treatment or process and are exported
after such repairs or treatment or process without being put to any use in
India, other than that which is required for such repairs or treatment or
process;

> Example – The Banglore based IT company renders services to the London based Company
from its office in Banglore to start a machine equipped with digital software. Such machine is
also situated in the office of London based Company. The place of supply is London where the
machine is situated.
13 (3)(b) Services supplied to an individual, Place of Supply – The location where
represented either as the recipient the services are actually performed.
of services or a person acting on
behalf of the recipient, which
require the physical presence of
the recipient or the person acting
on his behalf, with the supplier for
the supply of services.

13 (4) Supply of services in relation to Place of Supply where the immovable

immovable property. Such as property is located or intended to be
> Services by experts, located.
> Services by estate agents,
> Accommodation services by a
hotel, inn, guest house, club or
campsite etc.
> Rights to use the property,
> Construction Services,
> Architects services and
> Interior Decorators etc..

13 (5) Services supplied by way of Place of Supply where the event is

admission to, or organisation of a actually held.
cultural, artistic, sporting,
scientific, educational or
entertainment event, or a
celebration, conference, fair,
exhibition or similar events, and of
services ancillary to such
admission or organisation

13 (6) Services referred to in sub-section Place of supply shall be the location in

(3) or sub-section (4) or sub- the taxable territory.
section (5) is supplied at more
than one location, including a
location in the taxable territory

> Example – The Delhi based company renders Demo Services of the newly product launched
by the Company of USA in Delhi and in other countries Shri Lanka, Nepal and Bangladesh.
Place of Supply will be the location of taxable territory i.e.Delhi in spite of the fact the greatest
proportion of services are rendered out of India i.e. in non taxable territories.

13 (7) Services referred to in sub-section Place of supply of such services shall

(3) or sub-section (4) or sub-
section (5) are supplied in more
than one State or Union territory.
be taken as being in each of the
respective States or Union territories
and the value of such supplies specific
to each State or Union territory shall be
in proportion to the value for services
separately collected or determined in
terms of the contract or agreement
entered into in this regard or, in the
absence of such contract or agreement,
on such other basis as may be
prescribed.
13 (8) For Following Services – Place of Supply shall be the location of
(a) services supplied by a banking the Supplier of Services.
company, or a financial institution,
or a non-banking financial
company, to account holders;
(b) intermediary services;
(c) services consisting of hiring of
means of transport, including
yachts but excluding aircrafts and
vessels, up to a period of one
month.

> According to this section location of the supplier and the place of supply will be in the same
state. It means that the transaction between the intermediary services provider and the recipient
of outside India will be intra-state supply.

13 (9) Services of transportation of Place of Supply shall be the place of

goods, other than by way of mail destination of such goods.
or courier.

13 (10) Passenger transportation Place of Supply shall be the place

services. where the passenger embarks on the
conveyance for a continuous journey.

> Place of Supply for single ticket issued for journey Delhi – London – Canada is Delhi.
> Place of Supply for separate tickets issued for journey Delhi to London and for journey London
to Canada then Place of Supply for ticket issued for Delhi to London will be Delhi and Place of
Supply for ticket issued for London to Canada will be London.

13 (11) Services provided on board a Place of Supply shall be the first

conveyance during the course of scheduled point of departure of that
a passenger transport operation, conveyance for the journey.
including services intended to be
wholly or substantially consumed
while on board

13 (12) > Online information and database > Place of Supply shall be the location of
access or retrieval services. the recipient of services.

Explanation.—For the purposes of this sub-section, person receiving such

services shall be deemed to be located in the taxable territory, if any two of
the following non-contradictory conditions are satisfied, namely:—
(a) the location of address presented by the recipient of services through
internet is in the taxable territory;
(b) the credit card or debit card or store value card or charge card or smart
card or any other card by which the recipient of services settles payment has
been issued in the taxable territory;
(c) the billing address of the recipient of services is in the taxable territory;
(d) the internet protocol address of the device used by the recipient of services
is in the taxable territory;
(e) the bank of the recipient of services in which the account used for payment
is maintained is in the taxable territory;
(f) the country code of the subscriber identity module card used by the
recipient of services is of taxable territory;
(g) the location of the fixed land line through which the service is received by
the recipient is in the taxable territory.
 13 (13) In order to prevent double taxation or non-taxation of the supply of a service,
or for the uniform application of rules, the Government shall have the power
to notify any description of services or circumstances in which the place of
supply shall be the place of effective use and enjoyment of a service.

> Notification 04/2019 – Integrated Tax issued to notify description of services or

circumstances to determine the place of supply for such services
G. Section 9 of the IGST Act – Supplies in territorial waters.
Notwithstanding anything contained in this Act,—
(a) where the location of the supplier is in the territorial waters, the location of such
supplier; or
(b) where the place of supply is in the territorial waters, the place of supply, shall, for
the purposes of this Act, be deemed to be in the or Union territory where the nearest
point of the appropriate baseline is located.
H. Circulars clarifying regarding determination of place of supply

S.No. Circular Particulars

1 48/22/2018 Services of short-term accommodation, conferencing, banqueting

etc. provided to a Special Economic Zone (SEZ) developer or a
SEZ unit

2 103/22/2019 (i) Services provided by Ports

(ii) Services rendered on goods temporarily imported in India

3 118/37/2019 Determination of place of supply in case of software/design

services related to Electronics Semi-conductor and Design
Manufacturing (ESDM) industry