The Central Board of Indirect Taxes and Customs ( CBIC ) has clarified that in case of failure to satisfy the mandatory requirement of inserting place of supply and the name of the State in the invoices for inter-State supply would attract penalty under the GST law.
A circular issued by the Board last day said that after the introduction of GST, which is a destination-based consumption tax, it is essential to ensure that the tax paid by a registered person accrues to the State in which the consumption of goods or services or both takes place. In case of inter-State supply of goods or services or both, this is ensured by capturing the details of the place of supply along with the name of the State in the tax invoice.
“It is, therefore, instructed that all registered persons making the supply of goods or services or both in the course of inter-State trade or commerce shall specify the place of supply along with the name of the State in the tax invoice. The provisions of sections 10 and 12 of the Integrated Goods and Services Tax Act, 2017 may be referred to in order to determine the place of supply in case of supply of goods and services respectively. Contravention of any of the provisions of the Act or the rules made thereunder attracts penal action under the provisions of sections 122 or 125 of the CGST Act,” the Board said.
Subscribe Taxscan Premium to view the Judgment