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How will inter-state or intra-state be decided for services?

Reena (Partner) (221 Points)

28 June 2017

How will it be determined in case of services?

We are an unregistered partnership. The address on the deed and PAN is of Gurgaon. But we operate from Mumbai. The deed also says that business will be conducted from other places as decided by the partners. We have got a project from a Mumbai based company (making a film). They have already paid advance 50% in June. The balance will be paid in July. The turnover is in the exemption limit so we are not registered for GST or service tax. But we are not sure if this is inter-state or not? What should we do? The address on the invoice is of Mumbai. But bank account and PAN has Gurgaon address, which is basically our permanent residential address. Even my CA didn't have any answer. Please help in this regard.

Is it possible if we change the address in the PAN?

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3 Replies

Yogesh Bathija (2 Points)
Replied 28 June 2017

Service tax is central based tax, so wherever you provide it ..Service tax will be levied at normal rate applicable.. whether within state or outside state. Had it been the case of sale of goods it would be inter state sale because you are registered in Gurgaon and dont have any branch registered in Maharashtra.

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Reena (Partner) (221 Points)
Replied 28 June 2017

Thanks for you reply, but I was stalking about GST. This is a new firm and it is our first project. So we have not registered for Service tax or GST. As we have already received 50% advance, and from 1st July GST will start, hence the confusion.

Do we mandatorily have to register for GST? The turnover limit is 20 lakh and weve only started work so there is a long way to go. The confusion is that will this be considered inter-state service and hence mandatory registration for GST? Also, how will it be calculated as 50% has already been received.

Also, we have already signed the agreement for the amount, so our client will not pay any additional tax.

One CA said that as our partnership is unregisteres and says that we can operate other premises too, that this can be considered as a service provided from Mumbai to Mumbai as the invoice has our Mumbai address. But again, he was not sure.

dattaraj meshram (68 Points)
Replied 28 June 2017

ur agreement copy needs to understand actual terms therein. with all Clauses of address, time schedule, payment options etc.
I suppose here u r providing services in maharashtra it is possible to apply GST registration in the state of maharashtra then it will be place of business further assumed that ur services r still incomplete then matter goes with splitting between two portion of pre GST and post GST so to find out proper solution and to save from undue tax burden some judicial authorities also ought to be taken into consideration before taking any decisions.
u can open as a branch here