{"id":30791,"date":"2021-05-21T14:39:38","date_gmt":"2021-05-21T09:09:38","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=30791"},"modified":"2024-12-17T16:56:58","modified_gmt":"2024-12-17T11:26:58","slug":"intrastate-and-interstate-supply-under-gst","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/intrastate-and-interstate-supply-under-gst\/","title":{"rendered":"Things you Must Know About Intrastate And Interstate Supply Under GST"},"content":{"rendered":"\n<p class=\"has-drop-cap\">GST implementation has revolutionized the Indian\ntaxation infrastructure by subsuming various taxes under one hood. The\ncascading effect of tax that was quite prominent with the earlier tax regime\nwas also reconciled entirely with the advent of this tax structure. <\/p>\n\n\n\n<p>In <a href=\"https:\/\/corpbiz.io\/gst-registration\" title=\"GST Registration in India\"><strong>Good and Services tax<\/strong><\/a>, the term interstate &amp; intrastate has paramount importance in determining SGST, CGST, and IGST. The interstate supply lures IGST, whereas intrastate supply attracts SGST &amp; CGST. In this write-up, we shall look into the concept of interstate supply and intrastate supply provided in the GST Act.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title ez-toc-toggle\" style=\"cursor:pointer\">Page Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/corpbiz.io\/learning\/intrastate-and-interstate-supply-under-gst\/#An_Overview_on_Goods_and_Services_Tax\" >An Overview on Goods and Services Tax<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/corpbiz.io\/learning\/intrastate-and-interstate-supply-under-gst\/#What_is_the_Concept_Behind_the_Inter-State_Supply\" >What is the Concept Behind the Inter-State Supply?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/corpbiz.io\/learning\/intrastate-and-interstate-supply-under-gst\/#Examples_of_Interstate_Supplies_under_GST\" >Examples of Interstate Supplies under GST<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/corpbiz.io\/learning\/intrastate-and-interstate-supply-under-gst\/#What_is_the_Role_of_Intra_State_supply_under_GST\" >What is the Role of Intra State supply under GST?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/corpbiz.io\/learning\/intrastate-and-interstate-supply-under-gst\/#Examples_of_intrastate_supplies_under_GST\" >Examples of intrastate supplies under GST<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/corpbiz.io\/learning\/intrastate-and-interstate-supply-under-gst\/#GST_on_Interstate_vs_Intrastate_Supply\" >GST on Interstate vs Intrastate Supply<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/corpbiz.io\/learning\/intrastate-and-interstate-supply-under-gst\/#What_is_the_need_for_supplys_categorization\" >What is the need for supply\u2019s categorization?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/corpbiz.io\/learning\/intrastate-and-interstate-supply-under-gst\/#What_if_the_Taxes_Are_Paid_Without_Intention_or_Accidentally\" >What if the Taxes Are Paid Without Intention or Accidentally?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/corpbiz.io\/learning\/intrastate-and-interstate-supply-under-gst\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"An_Overview_on_Goods_and_Services_Tax\"><\/span>An Overview on Goods and Services Tax <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>GST refers to an indirect tax imposed on the\nsupply of goods or services or both of them. To accumulate GST, supplies are\ntagged as Inter-State supplies, which implies goods arriving from one State to\nanother, &amp; intra-State supplies, which implies products in the State.<\/p>\n\n\n\n<p>The <em><strong>Central Government<\/strong><\/em><sup><a href=\"https:\/\/en.wikipedia.org\/wiki\/Central_government\"><em><strong>[1]<\/strong><\/em><\/a><\/sup> imposes the consolidated tax as per GST Act 2017 in case of inter-state supplies, whereas, in case of intra-State supplies, Central Government charges the fee as per GST Act 2017 &amp; state tax as per SGST law of 2017.<\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter is-resized\"><img decoding=\"async\" src=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/05\/An-Overview-on-Goods-and-Services-Tax.png\" alt=\"Goods and Services Tax \" class=\"wp-image-30835\" width=\"502\" height=\"294\" srcset=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/05\/An-Overview-on-Goods-and-Services-Tax.png 997w, https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/05\/An-Overview-on-Goods-and-Services-Tax-300x176.png 300w, https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/05\/An-Overview-on-Goods-and-Services-Tax-768x451.png 768w\" sizes=\"(max-width: 502px) 100vw, 502px\" \/><\/figure><\/div>\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_the_Concept_Behind_the_Inter-State_Supply\"><\/span>What is the Concept Behind the Inter-State Supply?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Sections 7 &amp; 8 under the IGST Act talks about the criteria for determining the type of supply i.e. inter-state or intra-state. As per Section 7 of the said Act, if the supplier\u2019s location &amp; the supply\u2019s place are in:<\/p>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter is-resized\"><img decoding=\"async\" src=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/05\/Inter-State-Supply.png\" alt=\"Concept Behind the Inter-State Supply\" class=\"wp-image-30837\" width=\"527\" height=\"169\" srcset=\"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/05\/Inter-State-Supply.png 997w, https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/05\/Inter-State-Supply-300x97.png 300w, https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2021\/05\/Inter-State-Supply-768x247.png 768w\" sizes=\"(max-width: 527px) 100vw, 527px\" \/><\/figure><\/div>\n\n\n<p>Then the supply would be tagged as inter-state\nsupply.<\/p>\n\n\n\n<p>Moreover, the goods\u2019 supply imported from other nation is often regarded as an inter-state supply before landing at the customs station. Also, supplies of goods or services come under interstate suppliers from an exclusive economic zone or specific development zone.<\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/gst-updates-2021\/\">Key Highlights of GST Updates 2021<\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Examples_of_Interstate_Supplies_under_GST\"><\/span>Examples of Interstate Supplies under GST<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><strong>Example 1:<\/strong> Suppose you have a firm, viz ABC, in the State of Uttar\nPradesh. Your company supplies product to another enterprise, namely XYZ,\nlocated in Delhi, then it comes under the ambit of inter-state supply.<\/p>\n\n\n\n<p><strong>Example 2:<\/strong> suppose Company A provides services to client B for Rs 7\nlakhs. The services are rendered from company A in Hapur (UP) and are received\nin the client\u2019s location in Delhi. Such supplies would come under the regime of\ninter-state supply.<\/p>\n\n\n\n<p>It means that interstate supply will come into\nplay if the supplies of the goods and services occurred in the place where the\nsupplier belongs.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_the_Role_of_Intra_State_supply_under_GST\"><\/span>What is the Role of Intra State supply under GST?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Under GST, intra-state supply comes into effect\nwhen the supplies of the goods and services occurred within the same State or\nterritory.<\/p>\n\n\n\n<p>The intra-state supply would remain applicable\nas long as provider and buyer location falls in the same\njurisdictions.&nbsp;&nbsp;<\/p>\n\n\n\n<p>A seller must obtain both SGST &amp; CGST from\nthe buyer in case of intra-state transactions.<\/p>\n\n\n\n<p>The CGST is furnished to the Central Government,\nand SGST is deposited to the State Government.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Examples_of_intrastate_supplies_under_GST\"><\/span>Examples of intrastate supplies under GST<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Suppose Company A supplies equipment to firm B\nlocated in the State where the former entity belongs. Such a nature of supplies\nfalls under the ambit of intrastate supply.<\/p>\n\n\n\n<p>This indicates that the concept of intrastate is\nonly applied to those supplies of goods and services that take place within the\nState or territory.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"GST_on_Interstate_vs_Intrastate_Supply\"><\/span>GST on Interstate vs Intrastate Supply<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul>\n<li>Interstate\nsupply attracts IGST, i.e. Integrated Goods and Services Tax.<\/li>\n\n\n\n<li>Both\nthe CBT as well as State Goods and Services Tax (SGST) covers intra-state\nsupply.<\/li>\n\n\n\n<li>For\nintrastate supply, the identical GST rate will apply to goods or services.<\/li>\n\n\n\n<li>The\nGST &amp; tax rate shall be bifurcated into two headings equally: SGST &amp;\nCGST.<\/li>\n\n\n\n<li>In\nlight of prevailing GST law, taxes are chargeable on different goods or\nservices based on the supply location.<\/li>\n\n\n\n<li>If\nthe transaction falls under intra-state supply, the CGST is imposed by the\nCenter of Commerce. Similarly, the state GST will be received by the State\nwhere the supply came into existence.<\/li>\n\n\n\n<li>In\nthe interstate supply of services or goods, the Centre accumulates the IGST.\nSGST &amp; CGST shall not be chargeable in such a case.<\/li>\n\n\n\n<li>The\nIGST rate shall be equivalent to the SGST + CGST rate.<\/li>\n\n\n\n<li>For\nexample, when charges on a specific product are 9%, the interstate supply shall\nbe chargeable @ 9% SGST &amp; at @ 9% CGST.<\/li>\n\n\n\n<li>The\ninterstate supply refers to as IGST is chargeable @ 18% (i.e., 9%+9%).<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_the_need_for_supplys_categorization\"><\/span>What is the need for supply\u2019s categorization?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>At present, the GST system entails four forms of\ntaxes, i.e. SGST, UTGST, CGST, and IGST.<\/p>\n\n\n\n<p>When an intrastate supply came to effect,\nSGST\/UTGST and CGST are charged accordingly as per GST Act. Similarly, the IGST\nis charged &amp; payable in cross border supply.<\/p>\n\n\n\n<p>Hence, it can be concluded that different taxes\nare chargeable on the corresponding suppliers. The determination of supply for\nintra-state as well as inter-state suppliers is of utmost importance.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_if_the_Taxes_Are_Paid_Without_Intention_or_Accidentally\"><\/span>What if the Taxes Are Paid Without Intention or Accidentally?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul>\n<li>Where\nthe valid taxpayer paid the CGST &amp; SGST \/ UTGST pertaining to inter-State\nsupply, no interest shall be chargeable during the imposition of IGST. The\nmistakenly paid former taxes will be claimable as per the GST refund provision.<\/li>\n\n\n\n<li>Where\nthe valid taxpayer has paid IGST pertaining to intrastate supply, CGST &amp;\nSGST\/ UGST is payable without interest. The unintentional payment of IGST will\nrevert to the taxpayer under the refund provision.<\/li>\n<\/ul>\n\n\n\n<p>Hence, it is of paramount importance to\ndetermine the supply category in such a category.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>We spoke about the fundamental of different tax forms exist within GST\u2019s regime.&nbsp; A taxpayers are required to record the transaction based on Inter-State and Intra-State transaction as per the provisions of GST Act. Let us know if you have some doubt regarding this topic. Use our message box to share your concern. <\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/migration-to-the-new-tax-structure-under-gst-transition-process\/\">The Migration to the New Tax Structure under GST Transition Process <\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>GST implementation has revolutionized the Indian taxation infrastructure by subsuming various taxes under one hood. The cascading effect of tax that was quite prominent with the earlier tax regime was also reconciled entirely with the advent of this tax structure. In Good and Services tax, the term interstate &amp; intrastate has paramount importance in determining [&hellip;]<\/p>\n","protected":false},"author":22,"featured_media":30840,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[16],"tags":[1758],"acf":{"service_id":"96"},"authorName":"Pankaj Tyagi","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2022\/01\/MicrosoftTeams-image-42.jpg","authorDescription":"Pankaj has a diverse experience of writing research papers, blog, and articles during his college time. Earlier, he was working as a tax consultant in a financial firm, but his interest in writing drives him to pursue a career in the writing field.","postViews":12551,"readingTime":4,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/30791"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/22"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=30791"}],"version-history":[{"count":21,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/30791\/revisions"}],"predecessor-version":[{"id":67910,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/30791\/revisions\/67910"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/30840"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=30791"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=30791"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=30791"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}