Indirect Tax Laws · Place of Supply

Place of Supply of Goods Supplied on Board a Conveyance

Updated 5 October 2026 · Fact-checked

When goods are supplied on board a conveyance such as a vessel, aircraft, train or motor vehicle, the place of supply is the location at which the goods are taken on board. It is not where the sale happens during the journey. Compare this state with the supplier's location to decide IGST or CGST plus SGST.

Understand Supply of Goods on Board a Conveyance and Special Cases

Normally, the place of supply of goods depends on where delivery ends. A conveyance creates a problem. A train or flight crosses many states, and the sale can happen anywhere on the route. You cannot tax the sale in whichever state the vehicle happens to be in at that moment.

The IGST Act solves this with a fixed rule. For goods supplied on board a conveyance, including a vessel, an aircraft, a train or a motor vehicle, the place of supply is the location at which the goods are taken on board. Think of it as the loading point. The state where the goods were loaded gets the tax claim.

This rule is in Section 10(1)(e) of the IGST Act. Do not confuse it with Section 10(1)(d), which deals with goods assembled or installed at a site. In the exam, state the rule in words and cite Section 10(1)(e).

The place of supply alone does not give you the tax. Next, find the location of the supplier. If the location of the supplier and the place of supply are in the same State or Union territory, the supply is intra-State, so CGST and SGST/UTGST apply. If they are in different States, the supply is inter-State, so IGST applies.

The rule covers goods only. A meal service, a ticket or a restaurant service on the same journey follows the rules for services. Always check first whether the question is about goods.

Key rules to remember

Place of supply for goods on board a conveyance: Place of supply = location at which the goods are taken on board; Applies to a vessel, aircraft, train, motor vehicle and any similar conveyance. Section 10(1)(e) of the IGST Act.
Intra-State test: Location of supplier and place of supply in the same State/UT → CGST + SGST/UTGST; Use the loading State as the place of supply, not the State where the sale takes place.
Inter-State test: Location of supplier and place of supply in different States/UTs → IGST; IGST is levied on the inter-State supply, and the place of supply (loading State) determines the State to which the IGST revenue is apportioned.
Scope check: Goods supplied on board → this rule; services on board → rules for services; Do not apply the loading-point rule to services.

How to solve Supply of Goods on Board a Conveyance and Special Cases questions

Use the same sequence for every question on goods sold on board. It keeps you from mixing the sale point with the loading point.

1Confirm the supply is of goods and that it is made on board a conveyance (vessel, aircraft, train, motor vehicle).
2Identify where the goods were taken on board. Ignore where the buyer bought them and where the journey ends.
3Write the place of supply as that loading State or Union territory.
4Identify the location of the supplier from the facts, such as the registered place or the place from which the supply is made.
5Compare the two. Same State means intra-State; different States means inter-State.
6Name the tax: CGST plus SGST/UTGST for intra-State, IGST for inter-State, and compute it on the value given.
7State the conclusion in one line, linking provision, facts and result.

Quickest way: Loading point, then compare

When to use it: Use it for MCQs and short case scenarios where the route has several States and the question asks which tax applies.

Underline the phrase showing where the goods were loaded.
Cross out every other State in the route.
Match the loading State with the supplier's State.
Same: CGST plus SGST. Different: IGST.

Common mistakes in Supply of Goods on Board a Conveyance and Special Cases

Taking the State where the sale happens during the journey as the place of supply.
The usual idea is that the place of supply is where the buyer receives the goods.
Fix: For goods on board, only the loading point counts. Ignore the route and the sale location.
Using the destination of the journey as the place of supply.
Students carry over the general rule for goods that are moved to the recipient.
Fix: The general rule of where the movement terminates does not apply here. The loading State decides.
Treating the supplier's State and the loading State as always the same.
The supplier is often an operator based in one State, so students assume goods are loaded there.
Fix: Read the facts. The operator may be registered in one State and load goods in another, making the supply inter-State.
Applying the rule to services such as catering or ticketing.
Food and travel are bundled in the same scenario.
Fix: Separate goods from services. This rule is for goods only; services follow their own place of supply provisions.
Quoting the wrong clause number or giving only the answer without the provision.
Clause numbers are memorised loosely, and the conveyance clause (e) is confused with the installation clause (d).
Fix: Cite Section 10(1)(e) of the IGST Act for the conveyance rule and state the rule in words. Section 10(1)(d) is the clause for goods assembled or installed at a site.

Worked examples

Example 1

An airline registered in Maharashtra sells cosmetics worth ₹10,000 on a domestic flight from Bengaluru to Chennai. The goods were taken on board at Bengaluru. Determine the place of supply and the tax payable if IGST is charged at 18%.

Show the solution

The supply is of goods made on board an aircraft, so the loading-point rule applies.
The goods were taken on board at Bengaluru, so the place of supply is Karnataka.
The location of the supplier is Maharashtra.
Maharashtra and Karnataka are different States, so the supply is inter-State.
IGST = 18% × ₹10,000 = ₹1,800.

Answer: The place of supply is Karnataka. The supply is inter-State, so IGST of ₹1,800 is payable.

Example 2

A bus operator registered in Gujarat loads packaged snacks at Surat and sells them worth ₹50,000 to passengers while the bus travels from Surat through Maharashtra to Mumbai. Assuming a total GST rate of 18%, determine the place of supply and the tax.

Show the solution

The goods are supplied on board a motor vehicle, so the place of supply is where the goods are taken on board.
The goods were taken on board at Surat, so the place of supply is Gujarat. The sale in Maharashtra does not matter.
The supplier's location is Gujarat, the same as the place of supply.
The supply is therefore intra-State, and CGST and SGST apply.
Total tax = 18% × ₹50,000 = ₹9,000, split equally: CGST ₹4,500 and SGST ₹4,500.

Answer: The place of supply is Gujarat. The supply is intra-State, with CGST of ₹4,500 and SGST of ₹4,500.

Exam tips

Start with the loading point. Examiners add distracting States to the route on purpose.
Check whether the question is about goods or services before applying the rule.
Write the provision, facts and conclusion for descriptive answers; in MCQs, find the loading State first.
Always compare with the supplier's location, because the question usually asks the tax type.
Show the arithmetic of the tax split, since marks often depend on it.

Practice questions from Place of Supply

Supply of Goods on Board a Conveyance and Special Cases in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

CMA FinalSupply of Goods on Board a Conveyance

Supply of Goods on Board a Conveyance and Special Cases: frequently asked questions

What is the place of supply for goods supplied on board a train or aircraft?

It is the location at which the goods are taken on board. The State where the passenger buys them or where the journey ends does not matter.

Is the conveyance rule in Section 10(1)(e) of the IGST Act?

Yes. The conveyance rule is in clause (e) of Section 10(1). Clause (d) covers goods assembled or installed at a site. State the rule in words and cite Section 10(1)(e).

How do I decide between IGST and CGST plus SGST in these questions?

Compare the loading State with the location of the supplier. If they are the same, the supply is intra-State and CGST plus SGST apply. If they differ, the supply is inter-State and IGST applies.

Does this rule apply to food services or tickets on the train?

No. The rule covers supply of goods. Services such as ticketing or catering services follow their own place of supply rules.