Dear Professional Colleagues,

S. No.   

Issue

Clarification

1 

In case of supply of services by way of transportation of goods, including by mail or courier, where the transportation of goods is to a place outside India, and where the supplier and recipient of the said supply of services are located in India, what would be the place of supply of the said services?

In case of supply of services by way of transportation of goods, including by mail or courier, where the transportation of goods is to a place outside India, and where the supplier and recipient of the said supply of services are located in India, the place of supply is the concerned foreign destination where the goods are being transported, w.e.f. 01.02.2019.

Illustration:

X is a person registered under GST in the state of West Bengal who intends to export goods to a person Y located in Singapore. X avails the services for transportation of goods by air to Singapore from an air cargo operator Z, who is also registered under GST in the state of West Bengal.

In this case, the place of supply of the services provided by Z to X is the place of destination of goods i.e., Singapore.

2 

In the case given in Sl. No. 1, whether the supply of services will be treated as inter-State supply or intra-State supply?

The aforesaid supply of services would be considered as inter-State supply in terms of subsection (5) of section 7 of the IGST Act since the location of the supplier is in India and the place of supply is outside India. Therefore, integrated tax (IGST) would be chargeable on the said supply of services.

3

In the above illustration, whether the recipient of service of transportation of goods would be eligible to avail input tax credit in respect of the said input service of transportation of goods?

The recipient of service of transportation of goods shall be eligible to avail input tax credit in respect of the IGST so charged by the supplier, subject to the fulfilment of other conditions laid down in section 16 and 17 of the CGST Act.

In the illustration given above, X would be eligible to take input tax credit of IGST in respect of supply of services received by him from Z, subject to the fulfilment of other conditions laid down in section 16 and 17 of the CGST Act.

4 

In the case mentioned above, what state code has to be mentioned by the supplier of the said service of transportation of goods, where the transportation of goods is to a place outside India, while reporting the said supply in FORM GSTR-1?

The supplier of service shall report place of supply of such service by selecting State code as ‘96- Foreign Country’ from the list of codes in the dropdown menu available on the portal in FORM GSTR-1.