Issuance of Tax Invoice/ Bill can be done with IGST to Customers

Issuance of Tax Invoice/ Bill can be done with IGST to Customers for Interstate Transactions under GST.

The Authority on Advance Ruling (AAR) in Karnataka held that the tax invoice can be issued with Integrated Goods and Service Tax (IGST) to customers for the interstate transaction when the goods are directly dispatched from the port of import with invoicing done from the registered place of business.

The applicant is the importer of storage solutions and vertical storage solutions from Germany and distributes the imported goods to industrial customers all over India.

Presently, the applicant is transporting the imported goods from the port of import to applicants registered place of business at Bengaluru and then supplying the same to the customer’s place.

During the process of transportation, the applicant came across a lot of logistical problems and found it costly. The further applicant intends to import the goods to the port nearest to the customer’s place and supply directly to the customer’s location from the said port of import.

The applicant intends to issue the bill/ tax invoice for the interstate transaction from a registered place of business with IGST to the customers.

The AAR bench comprising of two members Dr. Ravi Prasad M.P, Additional Commissioner of Commercial Taxes and Mashood Rahman Farooqui, Joint Commissioner of Central Taxes pronounced the order based on an application filed by Kardex India Storage Solution Private Limited.

Section 7(1) of IGST Act 2017 elaborates as the supply of goods in the course of inter-state trade or commerce shall be treated as a supply of goods where the location of the supplier and the place of the supply of goods are in the same state or same Union territory shall be treated as intra-state supply under GST.

The AAR observed the location of the importer is the state of Karnataka where the applicant has obtained GST registration. The applicant here through import the goods to the port nearest to the location of the recipient, so said imported goods deemed to have been supplied to the location of the importer i.e. Karnataka and then further supplied to the customers.

The AAR also said that, “the imported goods supplied directly from the port of import, to the customer located in other states or union territories other than the state of Karnataka”, such transaction shall be treated as supply of goods in the course of trade or commerce.

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