9911796707
TMI BlogIntegrated Goods and Services Tax ActX X X X Extracts X X X X X X X X Extracts X X X X ..... t indirect tax system. It is significant to note that presently the Central Sales Tax Act, 1956 regulates the inter-state trade or commerce (hereinafter referred to as "CST") the authority for which is constitutionally derived from Article 269 of the Constitution. Further as per article 286 of the Constitution of India, no State can levy sales tax on any sales or purchase of goods that takes place outside the State or in the course of the import of the goods into, or export of the goods out of, the territory of India Only Parliament can levy tax on such transaction. The Central Sales Tax Act was enacted in 1956 to formulate principles for determining when a sale or purchase of goods takes place in the course of interstate trade or commerce. The Act also provides for the levy and collection of taxes on sale of goods in the course of interstate trade 4. The CST suffers from following shortcomings: i. CST is collected and retained by the origin state, which is an aberration. Any indirect tax, by definition is a consumption tax, the incidence of which is borne by the consumer. Logically, the tax should accrue to the destination state having jurisdiction over such consumer. ii. Input ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he taxable territory, not being an intra-State supply shall be deemed to be a supply of goods or services in the course of inter-State trade or commerce. Supplies to or by SEZ are defined as inter-State supply. Further supply of goods imported into territory of India till they cross the customs frontiers of India or supply of services imported into the territory of India shall be treated as supplies in the course of inter-State trade or commerce. Even supplies to international tourists are to be treated as inter-state supplies. ii. Intra-State supply: It has been defined as any supply where the location of the supplier and the place of supply are in the same State or Union territory. Intra state supply Inter-state supply * Supply of goods within the state or union territory. * Supply of services within the state or union territory * Supply of goods from one state or union territory to other state or union territory. * Supply of service from one state or union territory to other state or union territory. * Import of goods till they cross customs frontier * Import of service. * Export of goods or service. * Supply of goods/services to/by SEZ. * Supplies to inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... third person has received the goods The principal place of business of such person 3 where there is no movement of goods either by supplier or recipient Location of such goods at the time of delivery to recipient 4 where goods are assembled or installed at site The place where the goods are assembled or installed 5 where the goods are supplied on board a conveyance, like vessel, aircraft, train or motor vehicle The place where such goods are taken on board the conveyance 6 Where the place of supply of goods cannot be determined in terms of sub-section (2), (3), (4) and (5) It shall be determined in such manner as may be prescribed B. Place of supply of goods in case of import &Export [Section -11] S.No. Nature of supply of goods Place of Supply 1 Import location of importer 2 Export location outside India C. Place of supply of services in case of domestic supplies: (section12) (Where the location of supplier of services and the location of the recipient of services is in India.) i. In respect of following 12 category of services, the place of supply is determined with reference to a proxy. Rest of services are governed by a default provision. S.No Nature ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Description of supply Place of supply 1. B2B Location of such registered person 2. B2C (i) Location of the recipient here the address on record exists, and (ii) the location of the supplier of services in other cases. D. Place of supply of services in case of cross-border supplies :( Section 13) (Where the location of the supplier of services or the location of the recipient of services is outside India) i. In respect of following category of services, the place of supply is determined with reference to a proxy. Rest of the services are governed by a default provision. S.No Nature of service Place of supply 1. Services supplied in respect of goods that are required to be made physically available from a remote location by way of electronic means, (Not Applicable in case of goods that are temporarily imported into India for repairs and exported.) the location where the services are actually performed, the location where goods are situated 2. services supplied to an individual which require the physical presence of the receiver the location where the services are actually performed. 3. Immovable property related services including hotel accommodation Locatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the supplier of service and recipient of service are not merely establishments of a distinct person in accordance with explanation 1 of section 8; means the supply of any service, where (a) the supplier of service is located outside India, (b) the recipient of service is located in India, and (c) the place of supply of service is in India; 13. Zero rated supply: Exports and supplies to SEZ are considered as 'zero rated supply' on which no tax is payable. However, ITC is allowed subject to such conditions, safeguards and procedure as may be prescribed, refund in respect of such supplies may be claimed by following either of these options: i. supply made without payment of IGST under Bond and claim refund of unutilised ITC or ii. supply made on payment of IGST and claim refund of the same. 14. Refund of integrated tax paid on supply of goods to tourist leaving India: Section 15 of the IGST Act provides for refund of IGST paid to an international tourist leaving India on goods being taken outside India subject to such conditions and safeguards as may be prescribed. An international tourist has been defined as a non-resident of India who enters India for a stay of less than 6 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
