CGST + SGST or IGST

This query is : Resolved

Rohit (Querist)
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05 July 2017 One of our customers in Haryana has instructed us to deliver material directly to his job worker based in state of MP . We are also based in state of MP . What should we charge SGST +CGST or IGST ?

Amol S Joglekar

Amol S Joglekar (Expert)
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05 July 2017 you have to charge igst...
(If Haryana company is also having MP registration, then you can charge cgst + sgst)

Rohit

Rohit (Querist)
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05 July 2017 Since we will be delivering material to the job worker , will this not be treated as intrastate sale ?

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Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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19 July 2024 In this scenario, the transaction involves delivering goods from MP to a job worker in MP on behalf of a customer based in Haryana. Here’s how the GST implications apply:

1. **Nature of Transaction**:
- The supply is initiated by your customer located in Haryana.
- The goods are delivered by you, the supplier (based in MP), to a job worker located in MP.

2. **GST Treatment**:
- Since the movement of goods is happening from MP to MP (both the supplier and the recipient - job worker - are in MP), this transaction will be treated as an intra-state supply under GST.

3. **GST Applicability**:
- You will charge CGST (Central Goods and Services Tax) and SGST (State Goods and Services Tax) on the invoice.
- The rates for CGST and SGST will be based on the applicable rates in MP.

4. **Reasoning**:
- Even though the instruction to deliver the goods is coming from a customer in Haryana, the delivery itself and the receipt by the job worker are both within the state of MP.
- Intrastate supplies under GST are governed by CGST and SGST, where the revenue from these taxes accrues to the respective state governments.

Therefore, you should charge SGST + CGST on the invoice issued for delivering goods to the job worker in MP. This is because the supply is considered intrastate under GST law due to both the supplier and recipient being located within the same state (MP).