Place of supply
The rule that decides which state a supply is treated as made in, and so whether CGST and SGST or IGST applies.
What it means in business
GST law has rules to fix the place of supply for goods and for services. For goods that are delivered, it is usually where the delivery ends. If the supplier's location and the place of supply are in the same state, the supply is within the state and CGST and SGST apply. If they are in different states, it is an interstate supply and IGST applies.
Example
A Pune manufacturer sells machine parts and ships them to a buyer in Coimbatore. The place of supply is Tamil Nadu, so the manufacturer charges IGST, even though the buyer's head office is in Mumbai. This is an illustration of normal business use rather than a quoted case study.
How to use it correctly
Fix the place of supply from the delivery address and the type of supply, not from the buyer's registered office. Record it on the invoice. For services, the rules are different and more varied, so check them for each type of service.
Common confusion
The place of supply is not always the buyer's registered address, and it is not always where the goods start. A sale billed to one place and shipped to another can have a different place of supply from what you assume.
Related glossary terms
Sources and further reading
Written on 24 October 2026 for lamp. Confirm the current rules with the official source or an adviser before relying on it.