TaxTMI 
TaxTMI 
Clarification regarding determination of place of supply in case of software/design services related to Electronics Semi-conductor and Design Manufacturing (ESDM) industry
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....X CHHATTISGARH, NAYA RAIPUR, ATAL NAGAR, DISTRICT-RAIPUR No./ST/Tech//2019/11238 Atal Nagar, Raipur Dated : 15.10.2019 To, Special Commissioner Additional Commissioners/ Joint Commissioners/Deputy Commissioners/ Assistant Commissioner/State Tax Officers/ State Tax, Chhattisgarh (All) .....................................................
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....CGGST Act for short) hereby clarifies the issues. 2. It is stated that a number of companies that are part of the growing Electronics Semiconductor and Design Manufacturing (ESDM) industry in India are engaged in the process of developing software and designing integrated circuits electronically for customers located overseas. The client/customer electronically provides Indian development....
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....ware and design that has been developed to ensure that it is error free. 2.2 The trade has requested clarification on whether provision of hardware prototypes and samples and testing thereon lends these services the character of performance-based services in respect of '"goods required to be made physically available by the recipient to the provider". 3. The provisions relati....
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....d in software testing alone as a separate service. The testing of software/design is aimed at improving the quality of software/design and is an ancillary activity. The entire activity needs to be viewed as one supply and accordingly treated for the purposes of taxation. Artificial vivisection of the contract of a composite supply is not provided in law, These cases are fact based and each case sh....