How to determine Inter-State Supply or Intra-State Supply Under GST

How to determine Inter State Supply or Intra State Supply Under GST

As we know that determination of place of supply is one of the most important aspects of GST. Taxpayers as well as government is always keen to know that whether supply is inter state supply or intra State supply since in case of intra-state supply then CGST/SGST is to levied while in case of interstate supply IGST/CGST is to levied. For the Taxpayer place of supply of goods and/or services are required to determine the nature of sale i.e. Inter -state / Intra state/Import/Export and For the Government place of supply of goods and/or services are required to determine the state where state component of GST would accrue.

Principle for Determination of supply of goods and/or Services during inter-state trade or intra-state are prescribed in section 7 and 8 of IGST Act 2017.

Supplies of goods and/or Service in the course of Inter-State trade can be understand with the help of Section 7 of IGST Act 2017.

S.No.Section – 7 – Supplies of goods and/or services in the course of inter-state trade.
1.Subject to Section 10, In respect of supply of goods – Location of the supplier and the place of supply are in two different States or two different Union territories or a state and a Union territory.
2.Subject to Section 12, In respect of Supply of services – Location of the Supplier and the place of supply are in two different States or two different Union territories or a state and a Union territory.
 

Also, see – Section 10 of IGST Law (Place of supply of Goods other than supply of goods imported into or exported from India “

 

 

Also, see – Section 12 of IGST Law (Place of supply of Services where the location of supplier of service and location of the recipient of service is in India. “

 

Deemed Provisions
3.Supply of Goods in case of Imports into the territory of India till they cross the customs frontiers of India shall be treated as interstate trade or commerce.
4.Supply of Services in case of Imports into the territory of India shall be treated as interstate trade or commerce.
5.Supply of Goods and/or Services, When the supplier is located in India and place of supply is outside India shall be treated as interstate supply.
6.Supply of Goods and/or Services to or by a SEZ developer or an SEZ unit shall be treated as interstate supply.
7.Any supply of Goods / Services in taxable territory which is not an intra state Supply and not covered elsewhere in this section, shall be treated as a supply of goods and/or services in the course of inter-state trade or commerce.

 
Supplies of goods and/or Service in the course of Intra-State trade can be understand with the help of Section 8 of IGST Act.

S.No.Section – 8 – Supplies of goods and/or services in the course of intra-state trade.
1.Subject to Section 10, Intra-State Supply of Goods means any supply of goods where the Location of the supplier and the place of supply are in Same States or same Union territory.
2.Subject to Section 12, Intra-State Supply of Services means any supply of services where the Location of the supplier and the place of supply are in Same States.
 

Also, see – Section 10 of IGST Law (Place of supply of Goods other than supply of goods imported into or exported from India

 

 

Also, seeSection 12 of IGST Law (Place of supply of Services where the location of supplier of service and location of the recipient of service is in India. “

 

 

Provided that the Intra-State Supply of Goods / Services shall not include Supply of Goods / Services to or by a SEZ developer or to or by an SEZ Unit.

Provided that Intra-State Supply of Goods shall not include supply of goods brought into India in the course of import till they cross the customs frontiers of India.

Provided that Intra-State Supply of Goods shall not include supply of goods to a tourist covered under section 15.

 

Supplies in case of territorial water can be understand with the help of section 9 of IGST Act. Section 9 define that. “Where the location of the supplier is in the territorial water or where the place of supply is in the territorial water then location of such supplier or place of such supply shall be treated to in the coastal State or Union territory where the nearest point of the appropriate baseline is located.

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