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

Mehta Traders, Surat (registered), sells machinery to Kiran Fabrics, Jaipur (registered), and the goods are transported from Surat to Jaipur. Under Section 10(1)(a) of the IGST Act, 2017, what is the place of supply?

The place of supply is Jaipur. For a supply involving movement of goods, Section 10(1)(a) fixes the place of supply at the location of the goods when the movement terminates for delivery to the recipient, regardless of who arranges the transport or where the supplier is located.

  1. ASurat, the location of the supplier
  2. BJaipur, the location of the goods when movement terminates for delivery to the recipientCorrect
  3. CThe place where the invoice is raised
  4. DThe place where the transporter is registered

Explanation

Section 10(1)(a) states that where the supply involves movement of goods, the place of supply is the location of the goods at the time the movement terminates for delivery to the recipient. The goods end up at Jaipur, so Jaipur is the place of supply. Surat is wrong because the supplier's location is not the test for movement cases.

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