Continuous journey - GST Ready Reckoner - GST

Section 2(3) of IGST Act, 2017 Continuous journey means A journey for which a single or more than one ticket or invoice is issued at the same time, either by a single supplier of service or through an agent acting on behalf of more than one supplier of service, and which involves no stopover between any of the legs of the journey for which one or more separate tickets or invoices are issued. Explanation . For the purposes of this clause, the term stopover means a place where a passenger can disembark either to transfer to another conveyance or break his journey for a certain period in order to resume it at a later point of time. As per Education guide issued dated 20th June 2012 meaning of Continuous Journey 5.11.2 What does a continuous journey mean? A continuous journey means a journey for which:- (i) a single ticket has been issued for the entire journey; or (ii) more than one ticket or invoice has been issued for the journey, by one service provider, or by an agent on behalf of more than one service providers, at the same time, and there is no scheduled stopover in the journey. 5.11.3 What is the meaning of a stopover ? Do all stopovers break a continuous journey ? Stopover means a place where a passenger can disembark either to transfer to another conveyance or break his journey for a certain period in order to resume it at a later point of time. All stopovers do not cause a break in continuous journey. Only such stopovers will be relevant for which one or more separate tickets are issued. Thus a travel on Delhi-London New York-London-Delhi on a single ticket with a halt at London on either side, or even both, will be covered by the definition of continuous journey. However if a separate ticket is issued, say New York-Boston-New York, the same will be outside the scope of a continuous journey. 5.11.4 The Table below contains illustrations which explain the principle enunciated in this Rule. Illustrations S. No. Journey Place of Provision Taxability Single Ticket (No stopover) 1 Mumbai-Delhi Mumbai Yes, Mumbai being the place of embarkation. 2 Mumbai-Delhi-Jaipur Mumbai Yes, Mumbai, being the place of embarkation for the continuous journey. 3 Mumbai - Delhi - London - Delhi - London Mumbai -do- 4 Delhi - London - New York - London - New York Delhi Yes, New Delhi, being the place of provision for continuous journey with single return ticket. 5 Delhi-London-New York Delhi -do- 6 New York-London-Delhi New York No, New York is place of provision for continuous journey with single return ticket. 7 New York - London - Delhi - Mumbai - Delhi - London - New York New York -do- 8 Delhi-Jammu-Delhi Delhi Yes, Delhi is the place of provision for continuous journey. 9 Jammu-Delhi-Jammu Jammu No, Jammu is the place of provision for continuous journey with single return ticket More than one ticket for a journey (issued by a single service provider, or by a single agent, for more than one service providers) 1 (a) Delhi-Bangkok-Delhi (b) Bangkok-Bali-Bangkok Delhi is place of provision for journey (a); Bangkok is place of provision for journey (b) Journey (a) is taxable since place of provision is in taxable territory; Journey (b) is not taxable since place of provision is outside taxable territory. 2 (a) Delhi-New York-Delhi (b) New York-Boston- New York Delhi is place of provision for journey (a); New York is place of provision for journey (b) Journey (a) is taxable since place of provision is in taxable territory; Journey (b) is not taxable since place of provision is not in taxable territory. 3 (a) London-Delhi-London (b) Delhi-Chandigarh (c) Chandigarh-Amritsar (d) Amritsar-Delhi London is place of provision for journey (a); Delhi is place of provision for journey (b); Chandigarh is place of provision for journey (c); Amritsar is place of provision for journey (d) Journey (a) is not taxable since place of provision is outside taxable territory; Journeys (b), (c) and (d) are taxable since place of provision is in taxable territory. 4 (a) Delhi-Jammu (b) Jammu-Delhi Delhi is place of provision for journey (a) Jammu is place of provision for journey (b) Journey (a)is taxable since place of provision is in taxable territory. Journey (b) is not taxable since place of provision is outside taxable territory. 5 (a) Jammu - Delhi -Jammu (b) Delhi - Bangkok - Delhi Jammu is place of provision for journey (a); Delhi is place of provision for journey (b) Journey (a) is not taxable since place of provision is outside taxable territory for the continuous journey with single, return ticket. Journey (b) is taxable, since place of provision is in taxable territory for the journey with single, return ticket. 6 (a) Jammu-Delhi (b) Delhi - Bangkok - Delhi (c) Delhi-Lucknow (d) Lucknow-Jammu Jammu is place of provision for journey (a); Delhi is place of provision for journey (b); Delhi is place of provision for journey (c); Lucknow is place of provision for journey (d) Journey (a) is not taxable since place of provision is not in taxable territory; Journeys (b), (c) and (d) are taxable since place of provision is in taxable territory for each of these. It may also be pertinent to mention that for flights originating from, or terminating in, the north- east region, though the place of provision will be determined in terms of this rule, there is an exemption for air transportation of passengers, embarking from, or terminating in an airport located in the state of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, or Tripura or at Bagdogra located in West Bengal. The examples in the table below illustrate some situations. S. No. Journey Place of Provision Taxability Single ticket (No stopover) 1 Dibrugarh-Kolkata-Mumbai Dibrugarh is the place of provision Journey is taxable, but no service tax is payable owing to the exemption. 2 Dibrugarh-Kolkata-Mumbai- Kolkata-Dibrugrah Dibrugarh is the place of provision Journey is taxable, but no service tax is payable owing to the exemption. Here it is relevant to note that the journey is against a single, return ticket. 3 Guwahati-Kolkata-Bangkok- Kolkata-Guwahati Guwahati is the place of provision for the continuous journey Place of provision being in the taxable territory, the service is taxable, but no service tax is payable owing to the exemption and journey is deemed continuous. 4 Kolkata-Guwahati-Kolkata Kolkata is the place of provision for the continuous journey. Place of provision being in the taxable territory, the service is taxable, but no service tax is payable owing to the exemption (the onward and return legs of journey terminate and originate in exempted territory respectively). More than one ticket for a journey (issued by a single service provider, or by a single agent, for more than one service providers) 1 (a) Bagdogra-Kolkata (b) Kolkata-Delhi Place of provision for journey (a) is Bagdogra. Place of provision for journey (b) is Kolkata. In these cases, generally, the passenger would be required to change aircraft after exiting the airport, and is required to obtain a fresh boarding pass for the next leg. This is deemed to be a stopover. Thus, journey (b) is taxable, and service tax is payable on leg (b). 2 (a) Guwahati - Kolkata - Guwahati (b) Kolkata-Bangkok-Kolkata Each journey is deemed continuous based on the assumption that two single return tickets are purchased. For journey place of provision is Guwahati, and for journey place of provision is Kolkata. Generally, in such cases, since separate return tickets have been purchased for the two journeys, after completing journey (a) the passenger will be required to disembark from the aircraft and complete check-in formalities for journey (b). Thus, the journey will not be deemed to be continuous and place of provision for journey (b) will be Kolkata.