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In this article, we will discuss the place of supply for transportation services along with numerous examples. Transportation services are 3 types:
| Service | Receiver | Place of supply |
|---|---|---|
| Transportation of goods (including by mail or courier) | Registered person | Location of such person (receiver) |
| Unregistered person | Location at which such goods are handed over for their transportation |
Example 1- Goods transportation intra-stateXYZ, a goods transportation company based in Karnataka, is hired by Akash Electronics registered in Karnataka to transport 50 tv sets.
Supply of service: Transporting goods
Place of supply: Karnataka (the location of registered person)
GST: CGST+ SGST (intra-state)
Example 2- Goods transportation inter-stateXYZ, a goods transportation company based in Karnataka, is hired by Vinay Garments (registered in Maharashtra) to transport 200 saris from Bangalore to Mumbai.
Supply of service: Transporting goods
Place of supply: Maharashtra (the location of registered person)
GST: IGST (inter-state)
Example 3- Goods transportation by unregistered personMr. Sharma (in Bangalore) is transferring his car by rail freight to Mumbai. He puts up the car in Bangalore station.
Supply of service: Transporting goods
Place of supply: Karnataka (Location at which such goods are handed over for their transportation)
GST: CGST+SGST (Indian railways have a pan-India presence and are registered in all states)
| Service | Receiver | Place of supply |
|---|---|---|
| Transportation of passengers | Registered person | Location of such person (receiver) |
| Unregistered person | location where the passenger embarks (starts) on the conveyance for a continuous journey |
If the right to passage is given for future use and the starting point i.e., point of embarkation is not known at the time of issue of right to passage, the place of supply of such service will be determined according to the general provisions-
| Supply of service | Place of supply |
| To a registered person | Location of registered recipient |
| To an unregistered person | Location of the recipient if the address is available on record Location of the supplier of services in other cases |
Example1-Registered personAkash Electronics, registered in Bangalore, purchased corporate flight tickets from Bangalore to Delhi from Happy Air Travels Ltd.’s Delhi branch
Supply of service: Transporting passengers
Place of supply: Karnataka (location of registered person)
GST: IGST since this branch of Happy Travels is registered in Delhi (most airlines are registered in all states).
Note: For the purposes of passenger transport, the return journey shall be treated as a separate journey, even if the tickets for onward and return journeys are issued at the same time.
Example 2 – Unregistered personMs. Anita books a 2-way air journey from Bangalore to Kolkata. She leaves Bangalore on 1st Aug and lands in Kolkata the same day. She leaves Kolkata on 7th Aug and comes back to Bangalore the same day. She booked the return journey tickets in Bangalore at the same time.
| Flight | Ticket issued by | Place of supply | GST |
| From Bangalore to Kolkata | Bangalore branch of airlines | Bangalore Since she is unregistered, the location where she embarks the journey becomes place of supply | CGST+SGST (Karnataka) |
| From Kolkata to Bangalore | Bangalore branch of airlines | Kolkata | IGST |
| Service | Place of supply |
| Supply of services on board a conveyance | Location of the first scheduled point of departure of that conveyance for the journey |
Example- Vimana Air (registered in West Bengal) has a flight from Guwahati (Assam) to Chennai stopping at Kolkata & Bangalore. Ms. Anita boards the flight at Kolkata (destination Bangalore). Air crew is present on board serving food to passengers and taking care of their safety.
Supply of service: Serving food passengers & safety measures
Place of supply: Guwahati (Assam) (Location of the first point of departure of that plane)
GST: IGST since this branch of Vimana Air is registered in West Bengal (most airlines are registered in all states).
For example, IndiGo has registration in all states and union territories from where it is providing air travel services.
ClearTax GST Software will make your life much easier. For your sales invoices, you do not have to calculate the place of supply each and every time. All you need to do you see enter the details of your buyer in the contacts master.
You can use ClearTax Bill Book to generate sales invoices. Based on you buyer’s and your GSTIN the software will automatically calculate the place of supply according to the provisions and inform you whether you will charge CGST/SGST or IGST. For your purchases invoices, all you need to do is upload the excel copy of your purchase invoices. The software will do the rest.
