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

Sharma Traders (Delhi) sells machinery to Kavita Enterprises, a registered person in Jaipur, and ships it by road. The goods reach Jaipur and the delivery movement ends there. Under Section 10(1) of the IGST Act, 2017, what is the place of supply?

The place of supply is Jaipur. Where goods move, the place of supply is the location of the goods when the movement ends for delivery to the recipient. The supplier's location, the invoice place and the time of payment do not matter.

  1. AJaipur, where the movement of goods terminates for delivery to the recipientCorrect
  2. BDelhi, the location of the supplier at the time of dispatch
  3. CDelhi, because the invoice was issued there
  4. DJaipur only if the recipient pays before dispatch

Explanation

Where a supply involves movement of goods, whether by the supplier, the recipient or any other person, the place of supply is the location of the goods when the movement terminates for delivery to the recipient. That is Jaipur. The supplier's location and the invoicing place are irrelevant, and payment timing does not affect the place of supply.

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