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CA Intermediate · Taxation · Place of Supply

Aarav Training Institute, Pune (registered), provides a training programme for employees of Delta Infotech Pvt Ltd, a company registered in Bengaluru (Karnataka), in a classroom at Pune. The service is provided to a registered person. What is the place of supply?

The place of supply is Bengaluru, the location of the registered recipient. The rule giving the place of performance for training applies only when the recipient is unregistered. Since Delta Infotech is registered, the general rule of the recipient's location applies, making this an inter-State supply from Maharashtra.

  1. APune, the place where the training is performed
  2. BBengaluru, the location of the registered recipientCorrect
  3. CLocation of the employees' residence, whichever is nearer
  4. DKarnataka or Maharashtra at the option of the supplier

Explanation

The special rule for training and performance appraisal under section 12(3)... applies only to services to unregistered persons (location where services are actually performed). For a registered recipient, the general rule of section 12(2) applies: the location of the recipient, i.e. Bengaluru. So the supply is inter-State. Pune would be correct only if the recipient were unregistered.

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