Place of GST Registration for Immovable Property and Works Contract Services with Examples By Udaya Chandran
Author
Udaya Chandran
uday.gstguide@gmail.com
It has been a debate more than just a confusion on deciding the place from where GST registration is to be obtained for renting of immovable property and supply of works contract services. Everyone has their own opinion in this regard. Let’s have a look at my opinion as well. Before we analyse the various situations, let us brush up a few sections and definitions:
GST Registration – Section 22 of CGST Act – Every supplier is liable to be registered under GST Act, in the State or Union territory from where he makes a taxable supply of goods or services or both as per the turnover limit prescribed for each state including special category states.
Location of the supplier of services – Section 2(71) –
(a) where a supply is made from a place of business for which the registration has been obtained, the location of such place of business;
(b) where a supply is made from a place other than the place of business for which registration has been obtained (a fixed establishment elsewhere), the location of such fixed establishment;
(c) where a supply is made from more than one establishment, whether the place of business or fixed establishment, the location of the establishment most directly concerned with the provisions of the supply; and
(d) in absence of such places, the location of the usual place of residence of the supplier;
Fixed Establishment – Section 2(50) – A place (other than the registered place of business) which is characterised by a sufficient degree of permanence and suitable structure in terms of human and technical resources to supply services, or to receive and use services for its own needs
Place of Business – Section 2(85) – It includes –
(a) a place from where the business is ordinarily carried on, and includes a warehouse, a godown or any other place where a taxable person stores his goods, supplies or receives goods or services or both; or
(b) a place where a taxable person maintains his books of account; or
(c) a place where a taxable person is engaged in business through an agent, by whatever name called;
Place of Supply – Section 12 & 13 of IGST Act – The place of supply in relation to an immovable property including works contract services is the place where the immovable property is located in both cases where the location of supplier or the location of recipient is in India or outside India.
Inter-state Supply – Where the location of the supplier and the place of supply are in two different States, Union territories or a State and a Union territory
Intra-state Supply – Where the location of the supplier and the place of supply are in the same State or same Union territory
Rending of Immovable Property: When it comes to renting of immovable property, the property can be considered as a fixed establishment (Refer to section 2(50)), for the supplier of service, which is having sufficient degree of permanence.
According to the definition given in the section 2(71)(b), for location of the supplier of services, a fixed establishment elsewhere from a place other than the place of business for which registration has been obtained, is considered to be the location of the supplier of services.
Also, according to section 2(85)(a), the place of business is where the business is ordinarily carried on. So the service of renting is provided in the fixed establishment can be considered the place of business.
Even if the supplier is located in another place, another state or union territory and got registered in that place, he has to take registration in the place where the immovable property is located, a fixed establishment, a place of business where from the business of renting is actually carried on and ultimately it is the location of supplier of service. So, it is always the location of the immovable property that determines the place of registration irrespective of the location of the supplier or the recipient.
Works Contract Services: If the supplier has no fixed establishment (like branch office, etc.) in the location where the immovable property is located, in relation to which he provides works contract services, he need not to get registration in that location as this immovable property is not his fixed establishment.
We’ll have a look at some of the examples below by applying the above provisions:
