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CA Intermediate · Taxation · Place of Supply

Anand Interiors of Pune (Maharashtra), a registered person, buys goods from Gupta Ltd of Jaipur (Rajasthan). Anand Interiors directs Gupta Ltd to deliver the goods to a third party, Mehta Stores of Surat (Gujarat), on its behalf, before Anand Interiors receives the goods. Under the IGST Act, 2017, what is the place of supply of the goods by Gupta Ltd to Anand Interiors?

The place of supply is Pune, Maharashtra. In a bill-to ship-to arrangement, where goods are delivered to another person on the direction of a third person, the goods are deemed received by the directing person. So the directing buyer's principal place of business, Pune, is the place of supply.

  1. AJaipur, Rajasthan
  2. BSurat, Gujarat
  3. CPune, MaharashtraCorrect
  4. DPlace decided by the transporter

Explanation

Where goods are delivered by the supplier to a recipient or any other person on the direction of a third person (bill-to ship-to), the goods are deemed to have been received by the third person (the one who directs, here Anand Interiors) and the principal place of business of that third person is the place of supply. Hence it is Pune. Surat is the delivery point but not the place of supply for this supply.

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