CBIC Clarifies About Determination of Place of Supply in Certain Cases

Central Board of Indirect Taxes & Customs has clarified the determination of place of supply in certain cases like services provided by ports, service rendered on goods temporarily imported in India, supply of various services on unpolished diamonds etc. CBIC has issued the circular no. 103/2019 on 28th June 2019 in the regard. You can download the GST circular no.103/2019 in PDF format or read online.

GST Circular No. 103/22/2019 Dt. 28-06-2019 – PDF Format – Download Here

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: –

  • Services provided by Ports – place of supply in respect of various cargo handling services provided by ports to clients;
  • 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.
  1. 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: –

S.
No.
IssueClarification
1Various 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.
2Doubts 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.

  1. It is requested that suitable trade notices may be issued to publicize the contents of this
  2. Difficulty, if any, in the implementation of this circular may be brought to the notice of the Board immediately. Hindi version follows.

(Upender Gupta) Principal Commissioner (GST)

Categories GST

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