Question

XYZ(Maharashtra) sold Control Panels to PQR(Maharashtra) by charging CGST + SGST. These panels were subsequently sold by PQR to ABC (Goa). Further, XYZ had done the installation of the panel at the Goa site of ABC on behalf of PQR and charged CGST + SGST to PQR in the service invoice towards installation. Is it correct or they should have charged IGST since the services were performed outside Maharashtra?
 

Answer

As per Section-10(1)(d) of IGST Act,2017 where the goods are assembled or installed at site, the place of supply shall be the place of such installation or assembly.

In your case control panels were supplied by XYZ (Maharashtra) to PQR (Maharashtra) but the installation of the same had done at site of ABC (Goa) on behalf of PQR.

Hence IGST will be charged because installation had been done in Goa so as per above said section the place of supply will be Goa and the supplier is located in Maharashtra. (Reply dt.29/03/2019)