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CA Final · Indirect Tax Laws · Place of Supply

Sundaram Traders, a registered supplier in Chennai (Tamil Nadu), sells machinery to Kavya Enterprises, a registered person in Pune (Maharashtra). Sundaram Traders dispatches the machinery by road, and it reaches Kavya's warehouse in Nagpur (Maharashtra), where the movement terminates for delivery. Kavya's principal place of business is in Pune. What is the place of supply under Section 10 of the IGST Act, 2017?

The place of supply is Nagpur, Maharashtra. Where goods move, whether by the supplier, recipient or anyone else, the place of supply is the location of the goods when the movement terminates for delivery to the recipient. The supplier's location and the recipient's registered office are irrelevant.

  1. AChennai, Tamil Nadu, being the location of the supplier
  2. BPune, Maharashtra, being the recipient's principal place of business
  3. CNagpur, Maharashtra, being the location of goods when movement terminates for delivery to the recipientCorrect
  4. DAny State chosen by the parties in the contract

Explanation

Where supply involves movement of goods, whether by supplier, recipient or another person, the place of supply is the location of the goods when the movement terminates for delivery to the recipient. The movement ends at Nagpur. Pune is wrong because the recipient's principal place of business matters only in the third-person direction case, not here.

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