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The Integrated Goods And Services Tax Act, 2016
November, 28th 2016
       MODEL IGST LAW



   GST COUNCIL SECRETARIAT

       November, 2016






                                                                                  Page2of28


             THE INTEGRATED GOODS AND SERVICES TAX ACT, 2016



CHAPTER- I

PRELIMINARY



1.    Short title, extent and commencement

2.    Definitions



CHAPTER­ II

PRINCIPLES FOR DETERMINING SUPPLY OF GOODS AND/OR SERVICES IN THE
COURSE OF INTER-STATE TRADE OR COMMERCE


3.    Supplies of goods and/or services in the course of inter-State trade or commerce

4.    Supplies of goods and/or services in the course of intra-State trade or commerce


CHAPTER­ III

LEVY AND COLLECTION OF TAX


5.    Levy and collection of Integrated Goods and Services Tax

6.    Power to grant exemption from tax



CHAPTER­ IV

PLACE OF SUPPLY OF GOODS AND/OR SERVICES


7.    Place of supply of goods other than supply of goods imported into, or exported
      from India

8.    Place of supply of goods imported into, or exported from India
9.    Place of supply of services where the location of the supplier of service and the
      location of the recipient is in India

10.   Place of supply of services where the location of the supplier or the location of the
      recipient is outside India


CHAPTER­V

PAYMENT OF TAX


11.   Payment of tax, interest, penalty and other amounts





                                                                                  Page3of28


12. Special provision for payment of tax by a supplier of online information and database
     access or retrieval services located outside India to specified person in the taxable
     territory


CHAPTER­ VI

INPUT TAX CREDIT

13.    Claim of input tax credit, provisional acceptance, matching, reversal and reclaim
       of input tax credit or reduction in output tax liability

14.    Transfer of input tax credit


CHAPTER­ VII

APPORTIONMENT OF TAX AND SETTLEMENT OF FUNDS

15.    Apportionment of tax collected under the Act and settlement of funds



CHAPTER­ VIII

ZERO RATED SUPPLY

16.    Zero rated supply




CHAPTER­ IX

MISCELLANEOUS


17.    Application of certain provisions of the CGST Act, 2016

18.    Power to make rules

19.    Tax wrongfully collected and deposited with the Central or a State Government

20.    Refund of IGST paid on supply of goods to outbound tourist


CHAPTER­ X

TRANSITIONAL PROVISIONS

21.    Import of services or inter-State supply of goods and/or services made on
       or after the appointed day





                                                                                   Page4of28


CHAPTER­ XI

ADMINISTRATION


22.   Classes of officers under the Integrated Goods and Services Tax Act, 2016

23.   Appointment of officers under the Integrated Goods and Services Tax Act, 2016

24.   Appointment of Officers of SGST as proper officer in certain circumstances






                                                                                 Page5of28


               THE INTEGRATED GOODS AND SERVICES TAX ACT, 2016

                                      CHAPTER­ I

                                    PRELIMINARY

1.      Short title, extent and commencement
        (1) This Act may be called the Integrated Goods and Services Tax Act, 2016.
        (2) It extends to the whole of India.
        (3) It shall come into force on such date as the Central Government may, by
notification in the Official Gazette, appoint, and different dates may be appointed for
different provisions of this Act.
2.      Definitions
In this Act, unless the context otherwise requires,-
        (1)     "account" means an account bearing interest to the depositor, and
includes a non-resident external account and a non-resident ordinary account;
        (2)     "appropriate State", in relation to a taxable person, means that State
where he is registered or liable to be registered under section 23 of the Central Goods
and Services Tax Act, 2016.
        Explanation: For the purpose of this Act, "State" includes Union Territory with
Legislature;
        (3)     "banking company" has the meaning assigned to it in clause (a) of section
45A of the Reserve Bank of India Act, 1934 (2 of 1934);
        (4)     "customs frontiers of India" means the limits of the area of a customs
station as defined in section 2 of the Customs Act, 1962 (52 of 1962) in which imported
goods are ordinarily kept before clearance by customs authorities;

      (5)    "export of goods" with its grammatical variations and cognate expressions,
means taking goods out of India to a place outside India;

       (6)     "export of services" means the supply of any service when
         (a) the supplier of service is located in India,
         (b) the recipient of service is located outside India,
         (c) the place of supply of service is outside India,
         (d) the payment for such service has been received by the supplier of service
             in convertible foreign exchange, and
         (e) the supplier of service and recipient of service are not merely
             establishments of a distinct person in accordance with explanation 1 of
             section 5;

       (7)     "financial institution" has the meaning assigned to it in clause (c) of
section 45-I of the Reserve Bank of India Act, 1934 (2 of 1934);

       (8)      "fixed establishment" means a place other than the 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;

       (9)     "Government" means the Central Government;

      (10) "import of goods" with its grammatical variations and cognate expressions,
means bringing goods into India from a place outside India;





                                                                                 Page6of28


       (11)   "import of service" means the supply of any service, where
         (a) the supplier of service is located outside India,
         (b) the recipient of service is located in India, and
         (c) the place of supply of service is in India;
       (12)   "India" means,-

         (a) the territory of the Union as referred to in clauses (2) and (3) of Article 1
             of the Constitution;

         (b) its territorial waters, continental shelf, exclusive economic zone or any
             other maritime zone as defined in the Territorial Waters, Continental Shelf,
             Exclusive Economic Zone and other Maritime Zones Act, 1976 (80 of
             1976);

         (c) the seabed and the subsoil underlying the territorial waters;

         (d) the air space above its territory and territorial waters; and

         (e) the installations, structures and vessels located in the continental shelf of
             India and the exclusive economic zone of India, for the purposes of
             prospecting or extraction or production of mineral oil and natural gas and
             supply thereof;


        (13) "intermediary" means a broker, an agent or any other person, by
whatever name called, who arranges or facilitates the supply of a service (hereinafter
called the `main' service) or the supply of goods, between two or more persons, but does
not include a person who supplies the main service or supplies the goods on his account;
        (14) "Integrated Goods and Services Tax" (IGST) means tax levied under this
Act on the supply of any goods and/or services in the course of inter-State trade or
commerce;
        (15) "input tax" in relation to a taxable person, means the Integrated Goods
and Services Tax, including that on import of goods, Central Goods and Services Tax or
State Goods and Services Tax, as the case may be, charged on any supply of goods
and/or services to him and includes the tax payable under sub-section (2) of section 5,
but does not include the tax paid under section 9 of the CGST/SGST Act;
        (16) "input tax credit" means credit of `input tax' as defined in sub-section
(15);

       (17)   "location of the recipient of services" means:
         (a) where a supply is received at a place of business for which registration
             has been obtained, the location of such place of business;
         (b) where a supply is received at a place other than the place of business for
             which registration has been obtained, that is to say, a fixed establishment
             elsewhere, the location of such fixed establishment;
         (c) where a supply is received at more than one establishment, whether the
             place of business or fixed establishment, the location of the establishment
             most directly concerned with the receipt of the supply; and
         (d) in absence of such places, the location of the usual place of residence of
             the recipient;

       (18)   "location of the supplier of services" means:






                                                                                 Page7of28


         (a) where a supply is made from a place of business for which 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, that is to say, 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 provision of the supply; and
         (d) in absence of such places, the location of the usual place of residence of
             the supplier;

       (19) "non-banking financial company" means-
         (a) a financial institution which is a company;
         (b) a non-banking institution which is a company and which has as its principal
             business the receiving of deposits, under any scheme or arrangement or in
             any other manner, or lending in any manner; or
         (c) such other non-banking institution or class of such institutions, as the
             Reserve Bank of India may, with the previous approval of the Central
             Government and by notification in the Official Gazette specify;

       (20) "non-taxable online recipient" means Government, a local authority, a
governmental authority, an individual or any person not registered under section 23 of
the CGST Act, 2016 receiving online information and database access or retrieval
services in relation to any purpose other than commerce, industry or any other business
or profession, located in taxable territory;
       Explanation: For the purposes of this clause, "governmental authority" means an
authority or a board or any other body:
             (i) set up by an Act of Parliament or a State legislature; or
             (ii) established by Government,
               with 90% or more participation by way of equity or control, to carry out
               any function entrusted to a municipality under article 243W of the
               Constitution;
       (21) "online information and database access or retrieval services" means
services whose delivery is mediated by information technology over the internet or an
electronic network and the nature of which renders their supply essentially automated
and involving minimal human intervention, and impossible to ensure in the absence of
information technology and includes electronic services such as,-
          (a) advertising on the internet;
          (b) providing cloud services;
          (c) provision of e-books, movie, music, software and other intangibles via
               telecommunication networks or internet;
          (d) providing data or information, retrievable or otherwise, to any person, in
               electronic form through a computer network;
          (e) online supplies of digital content (movies, television shows, music, etc.);
          (f) digital data storage; and
          (g) online gaming;

       (22)   "place of business" includes






                                                                                  Page8of28


         (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, provides or receives goods and/or services;
         (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;

        (23) "special economic zone'' shall have the meaning assigned to it in clause (za)
of section 2 of the Special Economic Zones Act, 2005 (28 of 2005);

       (24) "SEZ developer" means a person who, or a State Government which, has
been granted by the Central Government a letter of approval under sub-section (10) of
section 3 of the Special Economic Zones Act, 2005 (28 of 2005) and includes an
Authority and a Co-Developer as defined under section 2 of the Special Economic Zones
Act, 2005 (28 of 2005);

       (25) "State" means------

        (26)   "supply" has the same meaning as assigned to it in section 3 of the CGST
Act, 2016;
        (27)   "tourist" means a person not normally resident in India, who enters India
for a stay of not more than six months for legitimate non-immigrant purposes;
        (28)   "output tax" in relation to a taxable person, means the IGST chargeable
under the Act on taxable supply of goods and/or services made by him or his agent and
excludes tax payable by him on reverse charge basis;
        (29)   "zero-rated supply" shall have the meaning assigned to it under section
15; and

       (30) Words and expressions not defined in this Act shall have the meaning
assigned to them in the Central Goods and Service Tax Act, 2016.






                                                                                   Page9of28


                                      CHAPTER- II

   PRINCIPLES FOR DETERMINING SUPPLY OF GOODS AND/OR SERVICES IN THE
                COURSE OF INTER-STATE TRADE OR COMMERCE

3.     Supplies of goods and/or services in the course of inter-State trade or
       commerce
       (1)     Subject to the provisions of section 7, supply of goods in the course of
inter-State trade or commerce means any supply where the location of the supplier and
the place of supply are in different States.
       (2)     Subject to the provisions of section 9, supply of services in the course of
inter-State trade or commerce means any supply where the location of the supplier and
the place of supply are in different States.
       (3)     Supply of goods in the course of import into the territory of India till they
cross the customs frontiers of India shall be deemed to be a supply of goods in the
course of inter-State trade or commerce.
       (4) Supply of services in the course of import into the territory of India shall be
deemed to be a supply of services in the course of inter-State trade or commerce.
       (5)     Supply of goods and/or services, when the supplier is located in India and
the place of supply is outside India, shall be deemed to be a supply of goods and/or
services in the course of inter-State trade or commerce.

       (6)   Supply of goods and/ or services to or by a SEZ developer or an SEZ unit,
shall be deemed to be a supply of goods and/or services in the course of inter-State
trade or commerce.

        (7)   Any supply of goods and/or services in the taxable territory, not being an
intra-State supply and not covered elsewhere in this section, shall be deemed to be a
supply of goods and/or services in the course of inter-State trade or commerce.

4.     Supplies of goods and/or services in the course of intra-State trade or
       commerce
      (1)      Subject to the provisions of section 7, intra-State supply of goods means
any supply of goods where the location of the supplier and the place of supply are in the
same State:
      PROVIDED that the intra-State supply of goods shall not include:
         (i) supply of goods to or by a SEZ developer or to or by an SEZ unit;
         (ii) supply of goods brought into India in the course of import till they cross the
               customs frontiers of India.

        (2)    Subject to the provisions of section 9, intra-State supply of services
means any supply of services where the location of the supplier and the place of supply
are in the same State:
        PROVIDED that the intra-State supply of services shall not include supply of
services to or by a SEZ developer or to or by an SEZ unit.






                                                                                  Page10of28


                                     CHAPTER­ III

                           LEVY AND COLLECTION OF TAX

5.     Levy and collection of Integrated Goods and Services Tax
       (1)     There shall be levied a tax called the Integrated Goods and Services Tax
on all supplies of goods and/or services made in the course of inter-State trade or
commerce on the value determined under section 15 of CGST Act, 2016 and at such
rates as may be notified by the Central Government in this behalf, but not exceeding
twenty eight percent, on the recommendation of Council and collected in such manner as
may be prescribed and shall be paid by every taxable person in accordance with the
provisions of this Act.
       PROVIDED that the Integrated Goods and Services Tax on goods imported into
India shall be levied and collected in accordance with the provisions of section 3 of the
Customs Tariff Act, 1975 (51 of 1975) at the point when duties of customs are levied on
the said goods under section 12 of the Customs Act, 1962 (52 of 1962), on a value as
determined under the first mentioned Act.

        (2)    The Central Government may, on recommendation of the Council, by
notification, specify categories of supply of goods and/or services the tax on which is
payable on reverse charge basis and the tax thereon shall be paid by the recipient of
such goods and/or services and all the provisions of this Act shall apply to such recipient
as if he is the person liable for paying the tax in relation to the supply of such goods
and/or services.
        (3)    The Central Government may, on the recommendation of the Council, by
notification, specify categories of services the tax on which shall be paid by the
electronic commerce operator if such services are supplied through it, and all the
provisions of this Act shall apply to such electronic commerce operator as if he is the
person liable for paying the tax in relation to the supply of such services:
        PROVIDED that where an electronic commerce operator does not have a physical
presence in the taxable territory, any person representing such electronic commerce
operator for any purpose in the taxable territory shall be liable to pay tax:
        PROVIDED FURTHER that where an electronic commerce operator does not have
a physical presence in the taxable territory and also he does not have a representative
in the said territory, such electronic commerce operator shall appoint a person in the
taxable territory for the purpose of paying tax and such person shall be liable to pay tax.

     Explanation1: For the purposes of this Act,-

       (i) an establishment of a person in India and any of his other establishments
           outside India, or

       (ii) an establishment of a person in a State and any of his other establishments
            outside that State,

       shall be treated as establishments of distinct persons.

     Explanation 2: A person carrying on a business through a branch or an agency or a
     representational office in any territory shall be treated as having an establishment
     in that territory.






                                                                                   Page11of28


6.     Power to grant exemption from tax
        (1)     Any exemption granted by the Central Government on the
recommendation of the Council, under section 11 of the CGST Act in respect of intra-
State supply of goods and/or services of any specified description, shall apply mutatis
mutandis to inter-State supply of goods and/or services of the said description unless
specifically provided otherwise.
        (2)     If the Central Government is satisfied that it is necessary in the public
interest so to do, it may, on the recommendation of the Council, by notification, exempt
generally either absolutely or subject to such conditions as may be specified in the
notification, inter-State supply of goods and/or services of any specified description from
the whole or any part of the tax leviable thereon.
       Explanation: Where an exemption in respect of any goods and/or services from
the whole of the tax leviable thereon has been granted absolutely, the taxable person
providing such goods and/or services shall not pay the tax on such goods and/or
services.
       (3)     Where the Central Government is satisfied that it is necessary in the public
interest so to do, it may, on the recommendation of the Council, by special order in each
case, exempt from payment of tax, under circumstances of an exceptional nature to be
stated in such order, any goods and/or services on which tax is leviable.
        (4)     The Central Government may, if it considers necessary or expedient so to
do for the purpose of clarifying the scope or applicability of any notification issued under
sub-section (1) or order issued under sub-section (2), insert an explanation in such
notification or order, as the case may be, by notification at any time within one year of
issue of the notification under sub-section (1) or order under sub-section (2), and every
such explanation shall have effect as if it had always been the part of the first such
notification or order, as the case may be.
       (5)    Every notification issued under sub-section (1) or sub-section (3) and
every order issued under sub-section (2) shall
          (a) come into force on the date of its issue by the Central Government for
              publication in the Official Gazette or from any date subsequent to the date
              of its issue as may be specified therein; and

          (b) be made available on the official website of the department of the Central
              Government.






                                                                                   Page12of28


                                      CHAPTER­ IV

                  PLACE OF SUPPLY OF GOODS AND/OR SERVICES


7.     Place of supply of goods other than supply of goods imported into, or
       exported from India

       (1)    The provisions of this section shall apply to determine the place of supply
of goods other than supply of goods imported into, or exported from India.
       (2)     Where the supply involves movement of goods, whether by the supplier or
the recipient or by any other person, the place of supply of goods shall be the location of
the goods at the time at which the movement of goods terminates for delivery to the
recipient.
       (3)    Where the goods are delivered by the supplier to a recipient or any other
person, on the direction of a third person, whether acting as an agent or otherwise,
before or during movement of goods, either by way of transfer of documents of title to
the goods or otherwise, it shall be deemed that the said third person has received the
goods and the place of supply of such goods shall be the principal place of business of
such person.
       (4)    Where the supply does not involve movement of goods, whether by the
supplier or the recipient, the place of supply shall be the location of such goods at the
time of the delivery to the recipient.
       (5)     Where the goods are assembled or installed at site, the place of supply
shall be the place of such installation or assembly.
        (6)     Where the goods are supplied on board a conveyance, such as a vessel, an
aircraft, a train or a motor vehicle, the place of supply shall be the location at which such
goods are taken on board.
       (7)     Where the place of supply of goods cannot be determined in terms of sub-
section (2), (3), (4), (5) or (6), the same shall be determined in a manner prescribed by
the Central Government on the recommendation of the Council.


8.     Place of supply of goods imported into, or exported from India
       (1)   The place of supply of goods imported into India shall be the location of the
importer.
       (2)     The place of supply of goods exported from India shall be the location
outside India.


9.     Place of supply of services where the location of supplier of service and
       the location of the recipient of service is in India

       (1)      The provisions of this section shall apply to determine the place of supply
of services where the location of supplier of service and the location of the recipient of
service is in India.
       (2)     The place of supply of services, except the services specified in sub-
sections (4), (5), (6), (7), (8), (9), (10), (11), (12), (13), (14) and (15), made to a
registered person shall be the location of such person.
       (3)     The place of supply of services, except the services specified in sub-
sections (4), (5), (6), (7), (8), (9), (10), (11), (12), (13), (14) and (15), made to any
person other than a registered person shall be
          (a) the location of the recipient where the address on record exists, and



                                                                                   Page13of28


          (b) the location of the supplier of services in other cases.
       (4)     The place of supply of services, -
          (a) directly in relation to an immovable property, including services provided
              by architects, interior decorators, surveyors, engineers and other related
              experts or estate agents, any service provided by way of grant of rights to
              use immovable property or for carrying out or co-ordination of construction
              work, or
          (b) by way of lodging accommodation by a hotel, inn, guest house, homestay,
              club or campsite, by whatever name called and including a house boat or
              any other vessel, or
          (c) by way of accommodation in any immovable property for organizing any
              marriage or reception or matters related therewith, official, social, cultural,
              religious or business function including services provided in relation to
              such function at such property, or
          (d) any services ancillary to the services referred to in clause (a), (b) and (c),
               shall be the location at which the immovable property or boat or vessel is
                located or intended to be located:
        PROVIDED that if the location of the immovable property or boat or vessel is
located or intended to be located outside India, the place of supply shall be the location
of the recipient.
       Explanation: Where the immovable property or boat or vessel is located in more
than one State, the supply of service shall be treated as made in each of the States in
proportion to the value for services separately collected or determined, in terms of the
contract or agreement entered into in this regard or, in the absence of such contract or
agreement, on such other reasonable basis as may be prescribed in this behalf.
       (5)     The place of supply of restaurant and catering services, personal
grooming, fitness, beauty treatment, health service including cosmetic and plastic
surgery shall be the location where the services are actually performed.
       (6)     The place of supply of services in relation to training and performance
appraisal to
          (a) a registered person, shall be the location of such person;
          (b) a person other than a registered person, shall be the location where the
              services are actually performed.
         (7)    The place of supply of services provided by way of admission to a cultural,
artistic, sporting, scientific, educational, or entertainment event or amusement park or
any other place and services ancillary thereto, shall be the place where the event is
actually held or where the park or such other place is located.
       (8)     The place of supply of services provided by way of--
          (a) organization of a cultural, artistic, sporting, scientific, educational or
              entertainment event including supply of service in relation to           a
              conference, fair, exhibition, celebration or similar events, or
          (b) services ancillary to organization of any of the above events or services, or
              assigning of sponsorship of any of the above events,
               to
               (i)    a registered person, shall be the location of such person;
               (ii)   a person other than a registered person, shall be the place where
                      the event is actually held:





                                                                                  Page14of28


        PROVIDED that if the event is held outside India, the place of supply shall be the
location of the recipient.
       Explanation: Where the event is held in more than one State and a consolidated
amount is charged for supply of services relating to such event, the place of supply of
such services shall be taken as being in the each of the States in proportion to the value
of services so provided in each State as ascertained from the terms of the contract or
agreement entered into in this regard or, in absence of such contract or agreement, on
such other reasonable basis as may be prescribed in this behalf.
        (9)   The place of supply of services by way of transportation of goods,
including by mail or courier to,
         (a) a registered person, shall be the location of such person;
         (b) a person other than a registered person, shall be the location at which
             such goods are handed over for their transportation.
       (10)   The place of supply of passenger transportation service to
         (a) a registered person, shall be the location of such person;
         (b) a person other than a registered person, shall be the place where the
             passenger embarks on the conveyance for a continuous journey:
       PROVIDED that where the right to passage is given for future use and the point of
embarkation is not known at the time of issue of right to passage, the place of supply of
such service shall be determined in the manner specified in sub-sections (2) or (3), as
the case may be.
        Explanation: For the purposes of this sub-section, the return journey shall be
treated as a separate journey even if the right to passage for onward and return journey
is issued at the same time.
        (11) The place of supply of services on board a conveyance such as vessel,
aircraft, train or motor vehicle, shall be the location of the first scheduled point of
departure of that conveyance for the journey.
      (12) The place of supply of telecommunication services including data transfer,
broadcasting, cable and direct to home television services to any person shall--
              (a)    in case of services by way of fixed telecommunication line, leased
                     circuits, internet leased circuit, cable or dish antenna, be the
                     location where the telecommunication line, leased circuit or cable
                     connection or dish antenna is installed for receipt of services;
              (b)    in case of mobile connection for telecommunication and internet
                     services provided on post-paid basis, be the location of billing
                     address of the recipient of services on record of the supplier of
                     services;
              (c)    in cases where mobile connection for telecommunication, internet
                     service and direct to home television services are provided on pre-
                     payment through a voucher or any other means,
                        (i) through selling agent or a re-seller or a distributor of SIM
                        card or re-charge voucher, shall be address of the selling agent
                        or re-seller or distributor as per the record of the supplier at the
                        time of supply; or
                        (ii) by any person to the final subscriber shall be the location
                        where such pre-payment is received or such vouchers are sold;
              (d)    in other cases not covered in (b) and (c) above, shall be the
                     address of the recipient as per records of the supplier of the
                     service:



                                                                                    Page15of28


       PROVIDED that where address of the recipient as per records of the supplier of
service is not available, the place of supply shall be location of the supplier of service:
       PROVIDED FURTHER that if such pre-paid service is availed or the recharge is
made through internet banking or other electronic mode of payment, the location of the
recipient of services on record of the supplier of services shall be the place of supply of
such service.
       Explanation: Where the leased circuit is installed in more than one State and a
consolidated amount is charged for supply of services relating to such circuit, the place
of supply of such services shall be taken as being in each of the States in proportion to
the value of services so provided in each State as ascertained from the terms of the
contract or agreement entered into in this regard or, in absence of such contract or
agreement, on such other reasonable basis as may be prescribed in this behalf.
       (13) The place of supply of banking and other financial services including stock
broking services to any person shall be the location of the recipient of services on the
records of the supplier of services:
       PROVIDED that if the location of the recipient of services is not on the records of
the supplier, the place of supply shall be location of the supplier of services.
       (14)   The place of supply of insurance services shall:
              (a) to a registered person, be the location of such person;
              (b) to a person other than a registered person, be the location of the
                  recipient of services on the records of the supplier of services.
        (15) The place of supply of advertisement services to the Central Government,
a State Government, a statutory body or a local authority meant for identifiable States,
shall be taken as located in each of such States and the value of such supplies specific to
each State shall be in proportion to amount attributable to service provided by way of
dissemination in the respective States as may be determined in terms of the contract or
agreement entered into in this regard or, in the absence of such contract or agreement,
on such other reasonable basis as may be prescribed in this behalf.
10.    Place of supply of services where the location of the supplier or the
       location of the recipient is outside India

       (1)     The provisions of this section shall apply to determine the place of supply
of services where the location of the supplier of service or the location of the recipient of
service is outside India.

       (2)     The place of supply of services except the services specified in sub-
sections (3), (4), (5), (6), (7), (8), (9), (10), (11), (12) and (13) shall be the location of
the recipient of service:
        PROVIDED that in case the location of the recipient of service is not available in
the ordinary course of business, the place of supply shall be the location of the supplier
of service.

       (3)     The place of supply of the following services shall be the location where
the services are actually performed, namely:-
              (a) services supplied in respect of goods that are required to be made
                  physically available by the recipient of service to the supplier of
                  service, or to a person acting on behalf of the supplier of service in
                  order to provide the service:
        PROVIDED that when such services are provided from a remote location by way
of electronic means, the place of supply shall be the location where goods are situated at
the time of supply of service:





                                                                                   Page16of28


       PROVIDED FURTHER that this clause shall not apply in the case of a service
supplied in respect of goods that are temporarily imported into India for repairs and are
exported after repairs without being put to any use in India, other than that which is
required for such repairs;
              (b) services supplied to an individual, represented either as the recipient
                    of service or a person acting on behalf of the recipient, which require
                    the physical presence of the receiver or the person acting on behalf
                    of the recipient, with the supplier for the supply of the service.

       (4)    The place of supply of services supplied directly in relation to an
immovable property, including services supplied in this regard by experts and estate
agents, supply of hotel accommodation by a hotel, inn, guest house, club or campsite,
by whatever name called, grant of rights to use immovable property, services for
carrying out or co-ordination of construction work, including architects or interior
decorators, shall be the place where the immovable property is located or intended to be
located.

        (5)    The place of supply of services supplied by way of admission to, or
organization of, a cultural, artistic, sporting, scientific, educational, or entertainment
event, or a celebration, conference, fair, exhibition, or similar events, and of services
ancillary to such admission, shall be the place where the event is actually held.

        (6)    Where any service referred to in sub-sections (3), (4), or (5) is supplied at
more than one location, including a location in the taxable territory, its place of supply
shall be the location in the taxable territory where the greatest proportion of the service
is provided.
       (7)     Where the services referred to in sub-sections (3), (4), (5) or (6) are
supplied in more than one State, the place of supply of such services shall be taken as
being in each of the States in proportion to the value of services so provided in each
State as ascertained from the terms of the contract or agreement entered into in this
regard or, in absence of such contract or agreement, on such other reasonable basis as
may be prescribed in this behalf.






       (8)     The place of supply of following services shall be the location of the
supplier of service:-
           (a) services supplied by a banking company, or a financial institution, or a
               non-banking financial company, to account holders;
           (b) intermediary services;
           (c) services consisting of hiring of means of transport other than aircrafts
               and vessels except yachts, upto a period of one month.
           Explanation.- For the purpose of this section, the expression "goods" shall
               include `securities' as defined in sub-section (90) of section 2 of the CGST
               Act, 2016.

       (9)    The place of supply of services of transportation of goods, other than by
way of mail or courier, shall be the place of destination of the goods.
       (10) The place of supply in respect of a passenger transportation service shall
be the place where the passenger embarks on the conveyance for a continuous journey.

       (11) Place of supply of services provided on board a conveyance during the
course of a passenger transport operation, including services intended to be wholly or
substantially consumed while on board, shall be the first scheduled point of departure of
that conveyance for the journey.
       (12) (a) The place of supply of the "online information and database access or
                retrieval services" services shall be location of recipient of service.




                                                                                    Page17of28


            (b) For the purposes of this sub-section, person receiving such services shall
                be deemed to be located in the taxable territory if any two of the
                following non-contradictory conditions are satisfied, namely:-
                (i) the location of address presented by the recipient of service via
                      internet is in taxable territory;
                (ii) the credit card or debit card or store value card or charge card or
                      smart card or any other card by which the recipient of service
                      settles payment has been issued in the taxable territory;
                (iii) the billing address of recipient of service is in the taxable territory;
                (iv) the internet protocol address of the device used by the recipient of
                      service is in the taxable territory;
                (v) the bank of recipient of service in which the account used for
                      payment is maintained is in the taxable territory;
                (vi) the country code of the subscriber identity module (SIM) card used
                      by the recipient of service is of taxable territory;
                (vii) the location of the fixed land line through which the service is
                      received by the recipient is in taxable territory.

        (13) In order to prevent double taxation or non-taxation of the supply of a
service, or for the uniform application of rules, the Central Government shall have the
power to notify any description of service or circumstances in which the place of supply
shall be the place of effective use and enjoyment of a service.






                                                                                   Page18of28


                                       CHAPTER-V

                                PAYMENT OF TAX
11.    Payment of tax, interest, penalty and other amounts

       (1)     Every deposit made towards tax, interest, penalty, fee or any other
amount by a taxable person by internet banking or by using credit/debit cards or
National Electronic Fund Transfer or Real Time Gross Settlement or by any other mode,
subject to such conditions and restrictions as may be prescribed in this behalf, shall be
credited to the electronic cash ledger of such person to be maintained in the manner as
may be prescribed.
Explanation: The date of credit to the account of the appropriate Government in the
authorized bank shall be deemed to be the date of deposit in the electronic cash ledger.

       (2)     The input tax credit as self-assessed in the return of a taxable person shall
be credited to his electronic credit ledger, in accordance with section 36 of the CGST Act,
2016 to be maintained in the manner as may be prescribed.
       (3) The amount available in the electronic cash ledger may be used for making
any payment towards tax, interest, penalty, fees or any other amount payable under the
provisions of the Act or the rules made thereunder in such manner and subject to such
conditions and within such time as may be prescribed.
      (4) The amount available in the electronic credit ledger may be used for making
any payment towards output tax payable under the provisions of the Act or the rules
made thereunder in such manner and subject to such conditions and within such time as
may be prescribed.
       (5)(a) The amount of input tax credit on account of IGST available in the
              electronic credit ledger shall first be utilized towards payment of IGST and
              the amount remaining, if any, may be utilized towards the payment of
              CGST and SGST, in that order.
          (b) The amount of input tax credit on account of CGST available in the
              electronic credit ledger shall first be utilized towards payment of CGST and
              the amount remaining, if any, may be utilized towards the payment of
              IGST.
          (c) The amount of input tax credit on account of SGST available in the
              electronic credit ledger shall first be utilized towards payment of SGST and
              the amount remaining, if any, may be utilized towards the payment of
              IGST.
       (6)    The balance in the cash or credit ledger after payment of tax, interest,
penalty, fee or any other amount payable under the Act or the rules made thereunder
may be refunded in accordance with the provisions of section 48 of the CGST Act, 2016
and the amount collected as IGST shall stand reduced to that extent.
      (7)     All liabilities of a taxable person under this Act shall be recorded and
maintained in an electronic liability register as may be prescribed.
        (8)   Every taxable person shall discharge his tax and other dues under this Act
or the rules made thereunder in the following order:
          (a) self-assessed tax, and other dues related to returns of previous tax
              periods;
          (b) self-assessed tax, and other dues related to the return of the current tax
              period;






                                                                                   Page19of28


          (c) any other amount payable under the Act or the rules made thereunder
              including the demand determined under section 66 and 67 of the CGST
              Act, 2016.
(9) Every person who has paid the tax on goods and/or services under this Act shall,
unless the contrary is proved by him, be deemed to have passed on the full incidence of
such tax to the recipient of such goods and/or services.
Explanation: For the purposes of this section, the expression "tax dues" means the tax
payable under this Act and does not include interest, fee and penalty.
12. Special provision for payment of tax by a supplier of online information and
    database access or retrieval services located outside India to specified
    person in the taxable territory

     (1) On supply of online information and database access or retrieval services by any
person located in a non-taxable territory and received by non-taxable online recipient
the supplier of service located in a non-taxable territory shall be the person liable for
paying IGST:
     PROVIDED that in case the supply of online information and database access or
retrieval services by any person located in a non-taxable territory and received by non-
taxable online recipient, an intermediary located in the non-taxable territory, who
arranges or facilitates provision of such service, shall be deemed to be receiving such
services from the service provider in non-taxable territory and supplying such services to
the non-taxable online recipient except when such intermediary satisfies all the following
conditions, namely :-
          (a) the invoice or customer's bill or receipt issued or made available by such
                intermediary taking part in the supply clearly identifies the service in
                question and its supplier in non-taxable territory;
          (b) the intermediary involved in the supply does not authorise the charge to
                the customer or take part in its charge i.e. intermediary neither collects or
                processes payment in any manner nor is responsible for the payment
                between the non-assesse online recipient and the supplier of such
                services;
          (c)   the intermediary involved in the supply does not authorise delivery;
          (d) the general terms and conditions of the supply are not set by the
                intermediary involved in the supply but by the service provider.
        (2) The supplier of online information and database access or retrieval services
referred in sub-section (1) shall, for payment of IGST, take a single registration under a
Simplified Registration Scheme as may be prescribed:
        PROVIDED that any person located in taxable territory representing such supplier
for any purpose in the taxable territory shall take a registration and pay IGST on behalf
of the supplier:
        PROVIDED FURTHER that if such supplier does not have a physical presence or
does not have a representative for any purpose in the taxable territory, he may appoint
a person in the taxable territory for the purpose of paying IGST and such person shall be
liable for paying IGST.






                                                                                   Page20of28


                                      CHAPTER­ VI

                                   INPUT TAX CREDIT

13.    Claim of input tax credit, provisional acceptance, matching, reversal and
       reclaim of input tax credit or reduction in output tax liability

        (1) Every registered taxable person shall, subject to such conditions and
restrictions as may be prescribed in this behalf, be entitled to take credit of input tax, as
self-assessed, in his return and such amount shall be credited, on a provisional basis, to
his electronic credit ledger to be maintained in the manner as may be prescribed.
        (2) The credit referred to in sub-section (1) shall be utilized only for payment of
self-assessed output tax liability as per the return referred to in sub-section (1).
        (3) The provisions of section 37 and 38 of the CGST Act, 2016 relating to
matching, reversal and reclaim of input tax credit or reduction in output tax liability shall
apply mutatis mutandis to the matching, reversal and reclaim of input tax credit or
reduction in output tax liability under this section.


14.    Transfer of input tax credit
       (1) On utilization of input tax credit availed under this Act for payment of tax
dues under the CGST Act as per sub-section (5) of section 11, the amount collected as
IGST shall stand reduced by an amount equal to the credit so utilized and the Central
Government shall transfer an amount equal to the amount so reduced from the IGST
account to the CGST account in the manner and time as may be prescribed.
       (2) On utilization of input tax credit availed under this Act for payment of tax
dues under the SGST Act as per sub-section (5) of section 11, the amount collected as
IGST shall stand reduced by an amount equal to the credit so utilized and shall be
apportioned to the appropriate State government and the Central Government shall
transfer the amount so apportioned to account of the appropriate State Government in
the manner and time as may be prescribed.






                                                                                  Page21of28


                                         CHAPTER- VII

              APPORTIONMENT OF TAX AND SETTLEMENT OF FUNDS

15.     Apportionment of tax collected under the Act and settlement of funds
        (1)    Out of the IGST paid to the Central Government in respect of inter-State
supply of goods and/or services to an unregistered person or to a taxable person paying
tax under section 9 of the CGST Act, 2016 the amount of tax calculated at the rate
equivalent to the CGST on similar intra-state supply shall be apportioned to the Central
Government.
        (2)    Out of the IGST paid to the Central Government in respect of inter-State
supply of goods and/or services where such taxable person is not eligible for input tax
credit, the amount of tax calculated at the rate equivalent to the CGST on similar intra-
State supply shall be apportioned to the Central Government.
        (3)    Out of the IGST paid to the Central Government in respect of inter-State
supply of goods and/or services made in a year to a registered taxable person, where he
does not avail of the said credit within the specified period and thus remains in the IGST
account after expiry of the due date for filing of annual return for such year in which the
supply was made, the amount of tax calculated at the rate equivalent to the CGST on
similar intra-State supply shall be apportioned to the Central Government.
        (4)    Out of the IGST paid to the Central Government in respect of import of
goods and / or services by an unregistered person or by a taxable person paying tax
under section 9 of the CGST Act, 2016 the amount of tax calculated at the rate
equivalent to the CGST on similar intra-State supply shall be apportioned to the Central
Government.
        (5)    Out of the IGST paid to the Central Government in respect of import of
goods and / or services, where the such taxable person is not eligible for input tax
credit, the amount of tax calculated at the rate equivalent to the CGST on similar intra-
State supply shall be apportioned to the Central Government.
        (6)    Out of the IGST paid to the Central Government in respect of import of
goods and / or services made in a year by a registered taxable person, where he does
not avail of the said credit within the specified period and thus remains in the IGST
account after expiry of the due date for filing of annual return for such year in which the
supply was received, the amount of tax calculated at the rate equivalent to the CGST on
similar intra-State supply shall be apportioned to the Central Government.
        (7)    The balance amount of tax remaining in the IGST account in respect of the
supply for which an apportionment to the Central Government has been done under sub-
section (1), (2), (3), (4), (5) or (6) shall be apportioned to the State where such supply
takes place as per sections 7, 8, 9 or 10:
        PROVIDED that where the place of such supply made by any taxable person
cannot be determined separately, the said balance amount shall be apportioned to each
of the States to which such taxable person has made supplies during the financial year in
the proportion of the total supplies made to each of such States:
        PROVIDED FURTHER that where the taxable person making such supplies cannot
be determined, the said balance amount shall be apportioned to all States as per the
order made by the President under clause (2) of Article 270.
        (8)    The provisions of sub-sections (1), (2), (3), (4), (5), (6) and (7) relating
to apportionment of tax shall mutatis mutandis apply to the apportionment of interest,
penalty and compounding amount realized in connection with the tax so apportioned.
        (9)    Where an amount has been apportioned to the Central Government or a
State Government under sub-sections (1), (2), (3), (4), (5), (6), (7) and (8) the amount
collected as IGST shall stand reduced by an amount equal to the amount so apportioned
and the Central Government shall transfer to the CGST account an amount equal to an
amount apportioned to the Central Government and shall transfer to the SGST account
of the State an amount equal to an amount apportioned to that State, in the manner and
time as may be prescribed.





                                                                            Page22of28


(10) Any IGST amount apportioned to a State, if subsequently found refundable to any
person and refunded to such person, shall be reduced from the amount apportioned to
such State under this section or otherwise, in the manner and time as may be
prescribed.






                                                                                Page23of28


                                     Chapter VIII

                                 ZERO RATED SUPPLY

16. Zero rated supply

       (1) "zero rated supply" means any of the following taxable supply of goods
and/or services, namely -
           (a) export of goods and/or services; or
           (b) supply of goods and/or services to a SEZ developer or an SEZ unit.
        (2) Subject to provisions of sub-section (3) of section 17 of the CGST Act, 2016,
credit of input tax may be availed for making zero-rated supplies, notwithstanding that
such supply may be an exempt supply.
       (3) A registered taxable person exporting goods or services shall be eligible to
claim refund under one of the following two options, namely -
           (a) a registered taxable person may export goods or services under bond,
               subject to such conditions, safeguards and procedure as may be
               prescribed in this regard, without payment of IGST and claim refund of
               unutilized input tax credit in accordance with provisions of section 48 of
               the CGST Act, 2016 read with rules made thereunder;
           (b) a registered taxable person may export goods or services, subject to
               such conditions, safeguards and procedure as may be prescribed in this
               regard, on payment of IGST and claim refund of IGST paid on goods and
               services exported in accordance with provisions of section 48 of the
               CGST Act, 2016 read with rules made thereunder.
       (4) The SEZ developer or SEZ unit receiving zero rated supply specified in clause
(a) of sub-section (1) shall be eligible, subject to the conditions, safeguards and
procedure as may be prescribed in this regard, to claim refund of IGST paid by the
registered taxable person on such supply.






   Page24of28







                                                                                   Page25of28


                                      CHAPTER­ IX
                                 MISCELLANEOUS
17.    Application of certain provisions of the CGST Act, 2016

        The provisions relating to registration, valuation, time of supply of goods, time of
supply of services, change in rate of tax in respect of supply of goods or services, input
tax credit and utilization thereof, distribution of input tax credit by an Input Service
Distributor, job work, accounts and records, payment, tax deduction at source, return,
tax collection at source, audit, assessment, adjudication, demands, refunds, interest,
recovery of tax, offences and penalties, inspection, search and seizure, prosecution and
power to arrest, appeals, review, advance ruling and compounding shall apply, so far as
may be, in relation to the levy of tax under this Act as they apply in relation to levy of
tax under the CGST Act, 2016:

        Provided that in the case of tax deduction at source, the deductor shall deduct tax
at the rate of two percent from the payment made or credited to the supplier:

        Provided further that in the case of tax collection at source, the operator shall
collect tax at the rate of two percent of the value of net supplies.

18.    Power to make rules

        (1)    The Central Government may, on the recommendation of the Council, by
notification, make rules for carrying out the purposes of this Act.

      (2)     In particular and without prejudice to the generality of the foregoing
power, such rules may

              (a) provide for settlement of cases in accordance with Chapter XII of this
                  Act;

              (b) provide for all or any of the matters which under any provision of this
                  Act are required to be prescribed or to be provided for by rules.


19. Tax wrongfully collected and deposited with the Central or a State
      Government
      (1) A taxable person who has paid IGST on a supply considered by him to be an
inter-state supply, but which is subsequently found to be an intra-State supply, shall, be
granted refund of the amount of IGST so paid in such manner and subject to such
conditions as may be prescribed.
      (2) A taxable person who has paid CGST / SGST on a transaction considered by
him to be an intra-State supply, but which is subsequently found to be an inter-State
supply, shall not be required to pay any interest on the amount of IGST payable.

20. Refund of IGST paid on supply of goods to outbound tourist
       (1) The IGST paid on any supply of goods to outbound tourist shall be refunded,
in the manner and subject to such conditions and safeguards as may be prescribed, if
such goods are taken out of India.
       (2) The refund under sub-section (1) shall be allowed only on such supply of
goods that is procured from a registered taxable person who satisfies the conditions and
complies with the requirement, including relating to issue of invoice in the prescribed
manner.






                                                                                 Page26of28


                                      CHAPTER­ X

                            TRANSITIONAL PROVISIONS



21.     Import of services or inter-State supply of goods and/or services made
        on or after the appointed day
        Notwithstanding anything contained in section 12 and 13 of the CGST Act, 2016
import of services or inter-State supply of goods and/or services made after the
appointed day shall be liable to tax under the provisions of this Act regardless of whether
the transactions for such import of services or inter-state supply had been initiated
before the appointed day:
        PROVIDED that if the tax on such import or inter-State supply had been paid in
full under the earlier law, no tax shall be payable on such import or inter-state supply
under this Act:
        PROVIDED FURTHER that if the tax on such import of services had been paid in
part under the earlier law, balance amount of tax shall be payable on such import or
inter-state supply under this Act.
        Explanation: For the purpose of this section, a transaction shall be deemed to
have been initiated before the appointed day if either the invoice relating to such supply
or payment, either in full or in part, has been received or made before the appointed
day.






                                                                                      Page27of28


                                       CHAPTER- XI

                                   ADMINISTRATION


22.   Classes of officers under the Integrated Goods and Services Tax Act,
      2016

      (1) There shall be the following classes of officers under the Integrated Goods
and Services Tax Act, 2016 namely;
              (a) Principal Chief Commissioners of IGST or
                  Principal Directors General of IGST,

              (b) Chief Commissioners of IGST or
                  Directors General of IGST,

              (c) Principal Commissioners of IGST or
                  Principal Additional Directors General of IGST,

              (d) Commissioners of IGST or
                  Additional Directors General of IGST,

              (e) Additional Commissioners of IGST or
                  Additional Directors of IGST,

              (f) Joint Commissioners of IGST or
                  Joint Directors of IGST,

              (g) Deputy Commissioners of IGST or
                  Deputy Directors of IGST,

              (h) Assistant Commissioners of IGST or
                  Assistant Directors of IGST, and

              (i) such other class of officers as may be appointed for the purposes of
                  this Act.

23.   Appointment of officers under the Integrated Goods and Services Tax
      Act, 2016

       (1) The Board may appoint such persons as it may think fit to be officers under
the Integrated Goods and Services Tax Act, 2016.

      (2)   Without   prejudice   to   the   provisions   of   sub-section   (1),   the   Board
may authorize a Principal Chief Commissioner/Chief Commissioner of Central Goods and
Services Tax or a Principal Commissioner/Commissioner of Central Goods and Services
Tax or an Additional/Joint or Deputy/Assistant Commissioner of Central Goods and
Service Tax to appoint officers of Integrated Goods and Services Tax below the rank of
Assistant Commissioner of Integrated Goods and Services Tax Act, 2016.






                                                                               Page28of28


[24. Appointment of Officers of SGST as proper officer in certain circumstances
      The officers appointed under the SGST Acts shall, to such extent and subject to
      such conditions, as may be prescribed in the rules made in this behalf, be the
      proper officers for the purposes of sections (...........) of this Act.]




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