Payment received frm outside india but supply with in india

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

23 May 2018
Facts of the case,

1. Sales of Materials from Karnataka to Andhra Pradesh - GST applicable
2. Holding company(HC) located in Korea & subsidiary company (SC) is in India
3. Invoiced in USD/ payment will be from HC/ Supply of Materials to SC
4. Since delivery is with in India we need to pay GST
5. but SC is insisting for Input credit -

The issue, can we show the place of supply as SC even if payment received from HC ? if yes, any other issues with the bank for realising the payments?

CA Suresh Jain

CA Suresh Jain (Expert)
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23 May 2018 This is a case of supply of goods to a Company in India which is a subsidiary of a Korean Company. Since, supply is taking place within India and the receiver of the goods is situated in another state, it is an Interstate supply (not an Export sale) liable for IGST even if payment is received from Korean Holding Company in FX

Querist : Anonymous

Querist : Anonymous (Querist)

23 May 2018 Yes sir its not export sale we will pay IGST but the issue is, subsidiary company located in India is insisting us to pass the input credit to them even though payment made by holding company outside India

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CA Suresh Jain

CA Suresh Jain (Expert)
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23 May 2018 You need to charge IGST in your invoice. Could not understand the meaning of passing on ITC benefit.

Querist : Anonymous

Querist : Anonymous (Querist)

23 May 2018 Ok Sir i will charge IGST, can i mention the place of supply with in India (subsidiser company) even though payment is made by holding company outside india.

Vishakha Kejriwal.

Vishakha Kejriwal. (Expert)
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24 May 2018 So long as movement of goods is within India as per your facts, place of supply will be in India. The payment made by HC would not determine the place of supply.