How it works
The checker follows the IGST Act for supplies where both supplier and recipient are in India.
Goods (section 10):
- Goods move → where the movement ends for delivery (s.10(1)(a)).
- Bill-to-ship-to → the buyer’s principal place of business, because the buyer directed the delivery (s.10(1)(b)).
- No movement → where the goods are at delivery (s.10(1)(c)).
- Unregistered buyer → the state of the address on the invoice, or your location if none is recorded (s.10(1)(ca), in force from 1 Oct 2023).
- Installed at site → the site (s.10(1)(d)). On board a conveyance → where taken on board (s.10(1)(e)).
Services (section 12): registered buyer → buyer’s location; unregistered buyer → address on record, else your location (s.12(2)). Property, hotel stays and function venues → where the property is (s.12(3)). Restaurants, catering, grooming, fitness, beauty and health → where performed (s.12(4)). Training, events and passenger transport → buyer’s location if registered, otherwise where held or boarded (s.12(5), (7), (9)). Admission to events → where held (s.12(6)).
Then: same state as yours → CGST + SGST; different state → IGST.
Worked example
Kaveri Agencies, Mysuru (Karnataka) sells tiles to Shree Lakshmi Hardware, Bengaluru (registered in Karnataka). Shree Lakshmi asks Kaveri to deliver the tiles straight to its customer’s site in Chennai.
- The goods physically go to Tamil Nadu.
- But it is bill-to-ship-to, so the place of supply is Shree Lakshmi’s principal place of business: Karnataka.
- Kaveri’s state is also Karnataka, so Kaveri charges CGST + SGST, not IGST.
The second leg (Shree Lakshmi to its Chennai customer) is a separate supply with its own place of supply.
Notes and edge cases
- Transport of goods and courier (s.12(8)): the CBIC online text marks this sub-section as omitted by the Finance Act 2023 from 1 Oct 2023. Check the current text and notification with your CA before deciding; the checker leaves it out.
- Cross-border services (s.13) and exports and imports (s.11) are not covered.
- Put the place of supply on the invoice: for an inter-State supply, CGST Rule 46(n) requires the place of supply with the name of the state.
- E-commerce and online services to unregistered recipients need the recipient’s state on the invoice (CGST Rule 46).