Provisions under Rule 5 of the Integrated Goods and Services Tax (IGST) Rules, 2017 relating to “Place of Supply of Services Attributable to Different States or UTs”, applicable w.e.f. 01/01/2019, are as under:
IGST Rule 5: Place of Supply of Services Attributable to Different States or UTs
The supply of services attributable to different States or Union territories, under subsection (7) of section 12 of the said Act, in the case of-
(a) services provided by way of organisation of a cultural, artistic, sporting, scientific, educational or entertainment event, including supply of services in relation to a conference, fair exhibition, celebration or similar events; or
(b) services ancillary to the organisation of any such events or assigning of sponsorship to such events,
where the services are supplied to a person other than a registered person, the event is held in India in more than one State or Union territory and a consolidated amount is charged for supply of such services, shall be taken as being in each of the respective States or Union territories, and in the absence of any contract or agreement between the supplier of service and recipient of services for separately collecting or determining the value of the services in each such State or Union territory, as the case maybe, shall be determined by application of the generally accepted accounting principles.
Illustration : An event management company E has to organise some promotional events in States S1 and S2 for a recipient R. Three events are to be organised in S1 and 2 in S2. They charge a consolidated amount of Rs 1,000,000 from R. The place of supply of this service is in both the States S1 and S2. Say the proportion arrived at by the application of generally accepted accounting principles is 3:2. The service shall be deemed to have been provided in the ratio 3:2 in S1 and S2 respectively. The value of services provided will thus be apportioned as Rs 600,000/- in S1 and Rs 400,000/- in S2.
Amendments History:
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Commentary on Rule 5 of the IGST Rules, 2017
Rule 5 of the Integrated Goods and Services Tax (IGST) Rules, 2017 provides guidelines for determining the place of supply of services when such services are attributable to different States or Union territories in India. This rule is applicable from January 1, 2019. According to Rule 5, the provisions apply to the following types of services:
a) Organization of events such as cultural, artistic, sporting, scientific, educational, or entertainment events, including supply of services related to conferences, fairs, exhibitions, celebrations, or similar events.
b) Ancillary services to the organization of such events or assigning of sponsorship to these events.
The rule is applicable when:
i) Services are provided to a person who is not a registered person under GST;
ii) The event is held in more than one State or Union territory in India; and
iii) A consolidated amount is charged for the supply of such services.
Under these conditions, the place of supply for the services will be considered as being in each of the respective States or Union territories where the event is held. If there is no contract or agreement between the service provider and the recipient to separately collect or determine the value of the services in each State or Union territory, the value shall be determined using generally accepted accounting principles (GAAP). The illustration provided clarifies the application of Rule 5.
In summary, Rule 5 of the IGST Rules, 2017 offers guidance on determining the place of supply and value of services when such services are attributable to different States or Union territories in India and are related to organizing events or providing ancillary services.
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Note: The Integrated Goods and Services Tax (IGST) Rules 2017 were initially notified by CBEC vide Integrated Tax Notification 4/2017 dated 28/06/2017 (Rule 1 & 2). Subsequently, IGST Rule 3 has been inserted vide Notification 12/2017 and IGST Rules 4 to 9 have been inserted vide Notification 4/2018. Information on this page is a Rule-wise compilation of Amendments made by various Notifications issued by CBIC from time to time, with best possible efforts for accuracy. In any case, E&OE. For official/ updated information, please visit CBIC website.
| CBIC Updates (GST) |
| Index of GST Circulars, Notifications, Press Releases, Orders, etc. issued by CBIC from 2017 and onwards along with Section-wise/ Rule-wise Text of GST Acts/ Rules: |
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| IGST Notifications: 2022, 2021, 2020, 2019, 2018, 2017 |
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| Compensation Cess Notifications: 2023, 2022, 2021, 2020, 2019, 2018, 2017 |
| Compensation Cess Rate Notifications: 2023, 2022, 2021, 2020, 2019, 2018, 2017 |
| CBIC Orders (CGST/ IGST/ UTGST): 2023, 2022, 2021, 2020, 2019, 2018, 2017 |
| CBIC Press Releases: 2020, 2019, 2018, 2017 |
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