Example

M/s ABC ltd in Mumbai dealing in building material receives an order for material from M/s PQR, construction contractor located in Haryana. M/s PQR gives instruction to M/s ABC for shipping of consignment of material to his client construction site located in Mumbai. How the billing under GST will be made.


Answer

In this example first part of transaction as per section 10(b) of IGST Act place of supply is the Haryana, location of M/s ABC, actual buyer whose instruction goods delivered to construction site in Mumbai. Thus M/s ABC shall billed invoice to M/s PQR and mentioned in invoice that ship to Mumbai and will charged IGST on invoice as interstate supply.
In the second part of transaction M/s PQR further issue Challan for transfer of construction material and in future for construction activity raise invoice as composite supply and charge IGST as place of supply is Mumbai, location of immovable property . But M/s PQR will also handover lorry receipt to M/sPQR that will enable them to take delivery of goods.