Summary of Circular:
Various
representations have been received from trade and industry seeking
clarification in respect of the determination of place of supply in following
cases:
Issue Involved
|
Analysis
|
Clarification
|
Place of supply in respect of various cargo handling
services provided by ports to clients
|
Such services are ancillary to cargo handling services not
immovable property
|
Place of Supply will be Location of Recipient (if known)
otherwise it will be location of Supplier
|
Place of supply in case of supply of various services on
unpolished diamonds such as cutting and polishing activity which have been
temporarily imported into India and are not put to any use in India
|
Place
of supply in case of performance based services is the actual place of
performance (i.e. location of goods)
But
an exception has been carved out in case of services supplied in respect of
goods which are temporarily imported into India for repairs and are exported
after such repairs without being put to any use in India, other than that
which is required for such repairs or treatment or process.
|
Place
of Supply will be Location of Recipient (if known) otherwise it will be
location of Supplier
|
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Details of Circular:
Subject: Clarification regarding determination of place of
supply in certain cases – reg.
Various representations have been received from trade and
industry seeking clarification in respect of determination of place of supply
in following cases: -
(I) Services provided by Ports - place of supply in respect of
various cargo handling services provided by ports to clients;
(II) Services rendered on goods temporarily imported in India
- place of supply in case of services rendered on unpolished diamonds received
from abroad, which are exported after cutting, polishing etc.
2. The provisions relating to determination of place of supply
as contained in the Integrated Goods & Services Tax Act, 2017 (hereinafter
referred to as “the IGST Act”) have been examined. In order to ensure
uniformity in the implementation of the provisions of the law, the Board, in
exercise of its powers conferred by sub-section (1) of section 168 of the
Central Goods & Services Tax Act, 2017 (hereinafter referred to as “the
CGST Act”) clarifies the same as below: -
Sr. No.
|
Issue
|
Clarification
|
1
|
Various services are being provided by the
port authorities to its clients in relation to cargo handling. Some of such
services are in respect of arrival of wagons at port, haulage of wagons
inside port area up-to place of unloading, siding of wagons inside the port,
unloading of wagons, movement of unloaded cargo to plot and staking hereof,
movement of unloaded cargo to berth, shipment/loading on vessel etc. Doubts
have been raised about determination of place of supply for such services
i.e. whether the same would be determined in terms of the provisions
contained in sub-section (2) of Section 12 or sub-section (2) of Section 13
of the IGST Act, as the case may be or the same shall be determined in terms
of the provisions contained in sub-section (3) of Section 12 of the IGST Act.
|
It is hereby clarified that such services
are ancillary to or related to cargo handling services and are not related to
immovable property. Accordingly, the place of supply of such services will be
determined as per the provisions contained in sub-section (2) of Section 12
or sub-section (2) of Section 13 of the IGST Act, as the case may be,
depending upon the terms of the contract between the supplier and recipient
of such services.
|
2
|
Doubts have been raised about the place of supply in case of
supply of various services on unpolished diamonds such as cutting and
polishing activity which have been temporarily imported into India and are
not put to any use in India?
|
Place of supply in case of performance based services is to
be determined as per the provisions contained in clause (a) of sub-section
(3) of Section 13 of the IGST Act and generally the place of services is
where the services are actually performed. But an exception has been carved
out in case of services supplied in respect of goods which are temporarily
imported into India for repairs or for any other treatment or process and are
exported after such repairs or treatment or process without being put to any
use in India, other than that which is required for such repairs or treatment
or process. In case of cutting and polishing activity on unpolished diamonds
which are temporarily imported into India are not put to any use in India,
the place of supply would be determined as per the provisions contained in
sub-section (2) of Section 13 of the IGST Act.
|
3. It is requested that suitable trade notices may be issued
to publicize the contents of this circular.
4. Difficulty, if any, in the implementation of this circular
may be brought to the notice of the Board immediately. Hindi version follows.
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