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CMA Final · Indirect Tax Laws and Practice · Place of Supply

Dhanush Agro Ltd., Nashik, sells goods to Ravi Enterprises, Pune. On the direction of Ravi Enterprises, the goods are delivered during transit to Sunil Stores, Indore, by transfer of documents of title. Ravi Enterprises' principal place of business is Pune. What is the place of supply under Section 10(1)(b) of the IGST Act, 2017?

The place of supply is Pune. Under Section 10(1)(b), when goods are delivered on the direction of a third person, before or during movement, that person is deemed to have received them, and the place of supply is the third person's principal place of business, here Ravi Enterprises in Pune.

  1. AIndore, where the goods finally arrive
  2. BNashik, where the goods originate
  3. CPune, the principal place of business of the third personCorrect
  4. DPlace of the transporter's registered office

Explanation

Section 10(1)(b) deems that where goods are delivered by the supplier to a recipient or other person on the direction of a third person, before or during movement, the third person is deemed to have received the goods. The place of supply is then that person's principal place of business. Ravi Enterprises is the directing third person, so the place of supply is Pune, not Indore.

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