GST on inter State branch Transfer and sale

[RAMASAMYSHANMUGAM SARAVANAN]

Sir What is GST liability when a machinery(used) transferred from Karnataka branch to a branch in Tamilnadu(inter state) for road construction work. Also the machinery is sold directly from from Tamilnadu branch.

What is gst tax implication for transfer from Karnataka Branch to Tamilnadu branch for jobwork

what is GST tax implication on sale from Tamilnadu branch. Who should prepare GST sale bill, Karnataka branch or Tamilnadu Branch.

[Ganeshan Kalyani]

Karnataka is transferring the asset. Stock transfer imoice with GST should be prepared by Karnaraka unit. Further, when Tamil Nadu bills into the customer the GST to be charged by raising Tax Invoice.

[Atul Rathod]

1. Circular dated 22.11.2017 only specifies exemption for goods on wheels and not all goods.

2. For machinery i dont think there is an exemption and even for above cases also where the goods sent are for further supply. such transfer is not exempted.

3. GST needs to be paid by tamil nadu on higher of transaction value or value after reversal of ITC proportionately.

[Pushpender Bhardwaj]

Sir for transfer of construction machinery from Karnataka to Tamilnadu, please go through the circular no 1/1/2017-GST dated 7 July 2017. This circular was later clarified through circular no 21/21/2017-GST dated 22 November 2017. To clarify further another circular bearing no 80/54/2018-GST dated 31 December 2018 was issued and at serial no 13.1 doubts regarding applicability of GST on inter state movement of machinery like tower cranes, rigs,batching plants, concrete pumps and mixers which are not mounted on wheels but require regular means of conveyance(used by companies in Infrastructure business) was raised and further clarified at serial no 13.2 that any such movement on own account( not involving distinct person in terms of section 25), where such movement is not intended for further supply of such goods does not constitute a supply and would not be liable to GST.

GST Tax invoice for sale in Tamilnadu will be prepared by Tamilnadu branch only.

AI Summary

Inter state transfer of machinery not for further supply is not a supply; sale attracts GST by destination branch. Where machinery is moved inter state by a principal for its branch and not intended for further supply, departmental circulars clarify such own account movement does not constitute a supply and is not liable to GST; if the destination branch sells to a customer, the destination branch must issue the tax invoice and charge GST, while the transferring unit should prepare a stock transfer invoice when treated as a taxable transfer.