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CMA Intermediate · Direct and Indirect Taxation · Introduction to GST Law

A Mumbai-based registered company receives consultancy services from a firm located in Singapore, and the place of supply is in Maharashtra. Under the IGST Act, 2017, how is this supply classified?

The supply is inter-State. Section 7(4) of the IGST Act states that supply of services imported into the territory of India is treated as a supply in the course of inter-State trade or commerce, so the place of supply being in Maharashtra does not make it intra-State.

  1. AIntra-State supply, because the place of supply is in Maharashtra
  2. BInter-State supply, because supply of services imported into the territory of India is treated as inter-StateCorrect
  3. CInter-State supply only if the consideration exceeds the registration threshold
  4. DNeither inter-State nor intra-State, because the supplier is outside India

Explanation

Section 7(4) of the IGST Act treats supply of services imported into the territory of India as inter-State supply. The place of supply being within one State does not make it intra-State. Option A ignores this deeming rule.

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