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

Sharma Traders, Delhi, sells machinery to Kapoor Enterprises, an unregistered person whose invoice records the address as Jaipur, Rajasthan. The goods are moved by the supplier and delivered to a warehouse in Agra, Uttar Pradesh. Under Section 10 of the IGST Act, 2017, what is the place of supply?

The place of supply is Rajasthan. For supplies of goods to an unregistered person, the place of supply is the location per the address recorded in the invoice, notwithstanding the general rule on where movement terminates. Since the invoice records Jaipur, Rajasthan, the Agra delivery location does not decide the place of supply.

  1. AAgra, Uttar Pradesh, being where the movement of goods terminates
  2. BDelhi, being the location of the supplier
  3. CRajasthan, being the address of the unregistered recipient recorded in the invoiceCorrect
  4. DUttar Pradesh or Rajasthan, at the choice of the supplier

Explanation

Clause (ca) applies to supply of goods to a person other than a registered person and operates notwithstanding clauses (a) and (c). The place of supply is the location per the address of the recipient recorded in the invoice, here Rajasthan. Agra is the delivery point under clause (a), but that clause is overridden for unregistered recipients.

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