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

Kaveri Industries (Chennai) sells goods to Orbit Ltd, a registered person in Mumbai. On Orbit's direction, Kaveri delivers the goods before movement of goods ends, to Orbit's customer in Pune, by transfer of documents of title. Under Section 10(1)(b), what is the place of supply of Kaveri's supply?

The place of supply is Maharashtra. Under clause (b), when goods are delivered to someone else on a third person's direction, the third person is deemed to have received them, so the place of supply is that third person's principal place of business in Mumbai.

  1. APune, where the goods are finally delivered
  2. BTamil Nadu, where the supplier is located
  3. CMaharashtra, as the principal place of business of Orbit, the directing third personCorrect
  4. DDetermined by prescribed manner because the goods moved

Explanation

Where goods are delivered to another person on the direction of a third person, whether agent or otherwise, the third person is deemed to have received the goods. The place of supply is that person's principal place of business, here Orbit's in Mumbai, Maharashtra. Pune is the delivery location but is not used under clause (b).

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