Place of Supply in GST: Rules for Goods & Services with Practical Examples (2026)

Why Place of Supply Matters

The Place of Supply (POS) is the single most important concept in GST for determining which tax to charge:

• If the supplier and the place of supply are in the same state → Intra-state supply → Charge CGST + SGST (split equally)
• If the supplier and the place of supply are in different states → Inter-state supply → Charge IGST (one integrated tax)

Getting the POS wrong means charging the wrong tax — and that affects your buyer's ITC, your GSTR-1 data, and can lead to demand notices. The CGST Act, 2017, dedicates Sections 10 to 14 to the Place of Supply rules. Section 10 covers goods, Sections 11–13 cover services (with Section 11 for imports/exports, Section 12 for domestic services, Section 13 for cross-border services).

Location of Supplier vs Place of Supply — The Key Distinction

Before diving into the rules, understand these two terms. The rules always compare them:

Term	Meaning	Determined By
Location of Supplier	The registered address (principal place of business) of the supplier — i.e., your GSTIN's registered state	Your GST registration
Place of Supply	The location where the supply is deemed to occur — the destination of goods or the location of the recipient (for most services)	Sections 10–13 of the CGST Act, depending on the type of supply

If the Location of Supplier and the Place of Supply are in the same state, it is intra-state. If different, it is inter-state — even if the goods physically move within the same state temporarily.

Place of Supply for Goods — Section 10

Four scenarios cover practically every goods transaction:

1. Movement of Goods (Most Common)

If goods are physically moved from one place to another, the Place of Supply is the location where the goods end up — the destination of movement. Example: A seller in Maharashtra dispatches goods to a buyer in Karnataka. The POS is Karnataka. Since the supplier is in Maharashtra, this is an inter-state supply → IGST charged.

2. Bill-to / Ship-to (Triangular Transactions)

Where goods are delivered to a third party (different from the buyer on the invoice), the POS depends on the last point of movement before delivery. Example: A Mumbai-based supplier sells goods to a Delhi-based buyer, but delivers them to a warehouse in Rajasthan. The POS is Rajasthan (the physical destination). The invoice from Mumbai to Delhi is inter-state (Maharashtra → Rajasthan), but since the buyer is in Delhi and delivery is in Rajasthan, the rule looks at where delivery ends, not the buyer's state.

3. No Movement of Goods

When goods are not physically moved — e.g., the buyer picks them up from the supplier's premises or the goods are already at the buyer's premises — the POS is the location of the goods at the time of delivery. If the buyer picks up from the supplier's godown, the POS is the supplier's location (making it intra-state if same state, inter-state if cross-state).

4. Assembly or Installation

For goods that are assembled or installed at site (machinery, equipment, furniture), the POS is the place of assembly or installation. This is usually at the buyer's premises, so it matches the buyer's location in most cases.

Place of Supply for Services — Sections 12 & 13

The POS for services is more varied. Here are the most common categories under Section 12 (domestic services):

Services Related to Immovable Property

POS is the location of the immovable property (land, building, construction, real estate agent, architect). If the property is in multiple states, POS is the proportional location of each part. Example: A Kerala architect designs a building in Tamil Nadu. The POS is Tamil Nadu. The architect in Kerala charges IGST (inter-state).

Restaurant and Catering Services

POS is the location where the service is actually performed — where the restaurant is located or where the catering takes place. A restaurant in Bangalore serving a customer from Mysore is intra-state (Karnataka) — CGST+SGST applies regardless of where the customer lives.

Training and Education Services

POS is the location of the recipient (student). If a Mumbai-based coaching institute provides online training to a student in Chennai, the POS is Tamil Nadu, and IGST is chargeable. If the same institute provides offline training at its Mumbai centre, the POS is Maharashtra regardless of the student's state.

Admission to Events, Conferences, Exhibitions

POS is the location where the event is actually held. An exhibition in Delhi attended by visitors from across India — POS is Delhi for all attendees. The organiser charges IGST if they are located outside Delhi, or CGST+SGST if they are in Delhi.

Transportation of Goods

POS is the destination of the goods — where the goods are ultimately delivered. A transporter in Gujarat carrying goods from Gujarat to West Bengal — POS is West Bengal. The transporter charges IGST (inter-state).

Transportation of Passengers

POS is the place of embarkation for the passenger. A bus journey from Chennai to Bangalore — POS is Tamil Nadu (where the passenger boards). The bus operator may charge CGST+SGST or IGST depending on the origin state and the operator's location.

Banking, Financial, and Insurance Services

POS is the location of the recipient as recorded in the service provider's records. If the provider cannot determine the recipient's location, the POS is the location of the service provider. A bank in Mumbai providing a loan to a customer whose address is in Delhi — POS is Delhi, IGST applies.

Telecommunication Services

Detailed rules based on billing address, SIM registration, and network usage:

• Post-paid: POS is the billing address of the subscriber
• Pre-paid: POS is the address of the seller of the SIM/voucher
• Internet/ mobile: POS follows the location of the network provider's registered address for the relevant telecom circle

Comparison Table — Goods vs Services POS

Aspect	Goods (Section 10)	Services (Section 12)
General rule	Destination of goods movement	Location of recipient (for most specified services)
Bill-to / Ship-to	Last physical delivery point	Not applicable — follows specific rules
No movement	Location of goods at delivery	Location of performance
The exception	Assembly / installation at site	Many specific rules (see above)
Default (fallback)	Location of goods at time of delivery	Location of recipient (if known), else supplier location

Practical Examples — Place of Supply Decision Tree

Ask these questions in order when determining POS for any transaction:

1. Is this goods or services? → Goods use Section 10, services use Section 12 or 13.
2. For goods: Are the goods moving? → Yes → POS = destination. No → POS = location at delivery.
3. For services: Is there a specific rule (immovable property, transport, telecom, event)? → Use that rule. Otherwise → POS = location of recipient.
4. Can I determine the recipient location? → Yes → use it. No → POS = supplier location (default).
5. Compare: Is the POS in the same state as the supplier? → Yes = intra-state (CGST+SGST). No = inter-state (IGST).

Common POS Mistakes

• Confusing the buyer's billing address with the POS: For goods, the POS is the physical delivery address, not the buyer's registered office address. If you deliver to a different state, charge IGST even if the buyer is in your state.
• Treating online services as "seller location": For most online services (SaaS, consulting, training), the POS is the recipient's location, not where the server is hosted or the consultant sits.
• Ignoring the bill-to/ship-to rule: If the buyer on the invoice is in State A, but goods go to State B, charge IGST — not CGST+SGST.
• Applying "origin" for goods: Unlike some older tax regimes, GST does not use the origin principle for goods — POS is always the destination.
• Guessing for services: There are over 20 specific service categories with unique POS rules. Always check Section 12 before assuming "recipient location" for an unfamiliar service.

How POS Impacts Your Returns

The POS determines the tax column in GSTR-1 Tile 4 (B2B) and Tile 7 (B2C):

• Same-state POS: Enter CGST and SGST amounts separately
• Different-state POS: Enter IGST amount
• Export: POS is outside India — zero-rated (IGST with refund or under LUT)

In GSTR-3B, the POS also controls the inter-state vs intra-state reporting in Table 3.2 (supplies to unregistered persons). In the e-Way Bill system, the POS determines state code entry for the consignee.

Practice Place of Supply on IndIaTaxSim

IndIaTaxSim helps you practice POS determination: create invoices with different buyer states and delivery addresses, and watch the system automatically switch between CGST+SGST and IGST. The study notes include a full POS decision flowchart for all 20+ service categories. Explore the course modules →

Disclaimer

This guide covers the standard Place of Supply rules under Sections 10–13 of the CGST Act, 2017. Specific notifications and amendments may apply to certain sectors. Always refer to the latest Act and rules for live compliance.