Place of Supply of Goods and Services | Taxation for CA Intermediate PDF Download

 Page 2


Usually, in case of goods, the place of supply is where the goods are delivered. So, the place of 
supply of goods is the place where the ownership of goods changes. What if there is no 
movement of goods. In this case, the place of supply is the location of goods at the time of 
delivery to the recipient. 
For example: In case of sales in a supermarket, the place of supply is the supermarket itself. 
Place of supply in cases where goods that are assembled and installed will be the location where 
the installation is done. 
For example: A supplier located in Kolkata supplies machinery to the recipient in Delhi. The 
machinery is installed in the factory of the recipient in Kanpur. In this case, the place of supply 
of machinery will be Kanpur. 
B. Place of Supply for Services 
Generally, the place of supply of services is the location of the service recipient. In cases where 
the services are provided to an unregistered dealer and their location is not available the location 
of service provider will be the place of provision of service. 
Special provisions have been made to determine the place of supply for the following services: 
Services related to immovable property 
Restaurant services 
Admission to events 
Transportation of goods and passengers 
Telecom services 
Banking, Financial and Insurance services 
In case of services related to immovable property, the location of the property is the place of 
provision of services. 
 
Example 1: 
Mr. Anil from Delhi provides interior designing services to Mr. Ajay (Mumbai). The property 
is located in Ooty (Tamil Nadu). 
In this case, place of supply will be the location of the immovable property i.e. Ooty, Tamil 
Nadu. 
 
Example 2: 
A registered taxpayer offers passenger transport services from Bangalore to Hampi. The 
passengers do not have GST registration. What will be the place of supply in this case? 
The place of supply is the place from where the departure takes place i.e. Bangalore in this case. 
Page 3


Usually, in case of goods, the place of supply is where the goods are delivered. So, the place of 
supply of goods is the place where the ownership of goods changes. What if there is no 
movement of goods. In this case, the place of supply is the location of goods at the time of 
delivery to the recipient. 
For example: In case of sales in a supermarket, the place of supply is the supermarket itself. 
Place of supply in cases where goods that are assembled and installed will be the location where 
the installation is done. 
For example: A supplier located in Kolkata supplies machinery to the recipient in Delhi. The 
machinery is installed in the factory of the recipient in Kanpur. In this case, the place of supply 
of machinery will be Kanpur. 
B. Place of Supply for Services 
Generally, the place of supply of services is the location of the service recipient. In cases where 
the services are provided to an unregistered dealer and their location is not available the location 
of service provider will be the place of provision of service. 
Special provisions have been made to determine the place of supply for the following services: 
Services related to immovable property 
Restaurant services 
Admission to events 
Transportation of goods and passengers 
Telecom services 
Banking, Financial and Insurance services 
In case of services related to immovable property, the location of the property is the place of 
provision of services. 
 
Example 1: 
Mr. Anil from Delhi provides interior designing services to Mr. Ajay (Mumbai). The property 
is located in Ooty (Tamil Nadu). 
In this case, place of supply will be the location of the immovable property i.e. Ooty, Tamil 
Nadu. 
 
Example 2: 
A registered taxpayer offers passenger transport services from Bangalore to Hampi. The 
passengers do not have GST registration. What will be the place of supply in this case? 
The place of supply is the place from where the departure takes place i.e. Bangalore in this case. 
Time of supply of goods or services related to an addition in the value of supply by way 
of interest, late fees or penalty 
Time of supply related to an addition in the value of supply by way of interest, late fee or 
penalty for delayed payment of any consideration shall be the date on which suppliers receives 
such addition in value. For example a supplier receives consideration in the month of September 
instead of due date of July and for such delay he is eligible to receive an interest amount of 
`1000/- and said amount is received on 15.12.2017. The time of supply of such amount ( `1000/-
) will be the 15.12.2017 i.e. the date on which it is received by the supplier and tax liability on 
this is to be discharged by 20.01.2018. 
“Value of Supply of Goods or Services” 
Section 15 of CGST Act, 2017 explains value of taxable supply. Value of supply means the  
money that a seller would want to collect for the goods and services supplied. The amount 
collected by the seller from the buyer is the value of supply. But where parties are related and 
a reasonable value may not be charged, or transaction may take place as a barter or exchange; 
the GST law prescribes that the value on which GST is charged must be its ‘transactional 
value’. This is the value at which unrelated parties would transact in the normal course of 
business. It makes sure GST is charged and collected properly, even though the full value may 
not have been paid.