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CA Intermediate · Taxation · Place of Supply

Sundaram Textiles Pvt Ltd, a registered supplier in Coimbatore (Tamil Nadu), sells and delivers machinery to an unregistered individual in Kochi (Kerala) by road transport. Under the IGST Act, 2017, what is the place of supply of these goods where the goods are delivered to the recipient?

The place of supply is Kochi, Kerala. Where goods are moved to the recipient, the place of supply is the place where the movement of goods terminates for delivery. The supplier's location in Coimbatore is only the location of supplier, so the supply is inter-State.

  1. ACoimbatore, Tamil Nadu, being the location of the supplier
  2. BKochi, Kerala, being the location where goods are delivered to the recipientCorrect
  3. CLocation of the transporter's office
  4. DLocation where the invoice is issued

Explanation

Where a supply involves movement of goods, the place of supply is the location where the movement terminates for delivery to the recipient. The goods end up in Kochi, so the place of supply is Kerala. The supplier's location only decides the location of supplier, not the place of supply, so Tamil Nadu is wrong. This makes it an inter-State supply.

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