Tax Invoice or Bill Can be Issued with IGST for Interstate Transactions: AAR

AAR is an acronym of Authority on Advance Ruling in Karnataka, In a recent matter, AAR stated that the tax invoice can be issued with Integrated Goods and Service Tax( IGST) to customers for the interstate transaction in the case where the goods are directly dispatched from the port of import with invoicing completed from the registered place of business.

 In this matter, the applicant is the importer of storage solutions as well as vertical storage solutions from Germany and distributes the imported items to industrial customers located across India.

At the present time, the applicant is transporting the imported goods from the port to the applicant’s registered place of business at Bangalore and then the applicant supplying the imported goods to the customer’s place. In this way, During transportation, the applicant faces a lot of logistical problems and found it expensive.

After observing that, the applicant intends to import the goods to the port nearest to the customer’s registered place and then supply directly to the customer’s location from there. The applicant also intends to issue the bill or tax invoice for the interstate transaction from the registered place of business with IGST to the customers Get to know all about the IGST (Integrated GST) model under GST law in India. Also, we have highlighted IGST model features and advantages with an illustration. Read more.

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

They considered Section 7(1) of IGST Act 2017 which elaborates that, “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”.

The AAR also mentioned that the location of the importer is the state of Karnataka where the applicant has valid GST registration Get to know the complete GST registration procedure online on the Indian government GST portal official website. We have explained by the actual screenshot of every step. Read More. The applicant here through import the goods to the nearest port to the location of the recipient thus said imported goods, deemed to have been supplied to the location of the importer which is Karnataka and then further supplied all across the country 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”.