Important Keyword: Notification No. 03/2021 – Integrated Tax, GST B2B shipping MRO, place of supply amendment, IGST shipping services 2021, Notification 4/2019 IGST, GST shipping industry, place of supply rules, MRO services GST, B2B GST amendment 2021, IGST Council decisions, Notification 03/2021 Integrated Tax,
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Table of Contents
[F. No. 354/53/2021]
Government of India
Ministry of Finance
(Department of Revenue)
New Delhi, the 2nd June, 2021
Notification No. 03/2021 - Integrated Tax: Seeks to amend Notification No. 4/2019-Integrated Tax dt. 30.09.2019 to change the place of supply for B2B MRO services in case of Shipping industry, to the location of the recipient.
[TO BE PUBLISHED IN THE GAZZETE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB- SECTION (i)]
G.S.R (E).- In exercise of the powers conferred by sub-section (13) of section 13 of the Integrated Goods and Services Tax Act, 2017 (13 of 2017), the Central Government, on being satisfied that it is necessary in order to prevent double taxation or non-taxation of the supply of a service, or for the uniform application of rules, on the recommendations of the Council, hereby makes the following further amendments in the notification of the Government of India, in the Ministry of Finance (Department of Revenue), No.4/2019- Integrated Tax, dated the 30th September, 2019, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 748 (E), dated the 30th September, 2019, namely:-
In the said notification, in Table A, after serial number (2) and the entries relating thereto, the following serial number and entry shall be inserted, namely: -
| (1) | (2) | (3) |
| “3 | Supply of maintenance, repair or overhaul service in respect of ships and other vessels, their engines and other components or parts supplied to a person for use in the course or furtherance of business | The place of supply of services shall be the location of the recipient of service.” |
2. This notification shall come into force with effect from the 2nd day of June, 2021.
Rajeev Ranjan)
Under Secretary to the Government of India
Note: - The principal notification No. 04/2019 - Integrated Tax, dated the 30th September, 2019 was published in the Gazette of India, Extraordinary, vide number G.S.R. 748 (E), dated the 30th September, 2019 and was last amended by notification No. 02/2020 – Integrated Tax, dated the 26th March, 2020 vide number G.S.R. 224 (E), dated the 26th March, 2020.
📚 Frequently Asked Questions (FAQs): Notification No. 03/2021- Integrated Tax
Q1: What is Notification No. 03/2021 – Integrated Tax about?
Answer:
Issued on 2nd June 2021, this notification amends Notification No. 4/2019-Integrated Tax. It changes the place of supply rule for B2B maintenance, repair, and overhaul (MRO) services in the shipping industry, shifting it to the location of the recipient. ⚓
Q2: Why was this change introduced?
Answer:
The amendment prevents double taxation or non-taxation of shipping MRO services. It also ensures a uniform rule application across India, aligning with GST Council’s recommendations. ✅
Q3: How does the new place of supply rule work for shipping MRO services?
Answer:
Earlier, ambiguity existed on whether the place of supply was where services were performed. Now, under Notification No. 03/2021, the place of supply is clearly the recipient’s location, reducing disputes and compliance issues. 📍
Q4: Which services in the shipping sector are covered under this notification?
Answer:
The notification specifically covers maintenance, repair, or overhaul services for:
Ships & other vessels 🚢
Engines ⚙️
Components & parts used in the course of business
Q5: From when is this amendment effective?
Answer:
The new rule is effective from 2nd June 2021 as per the official gazette notification. 🗓️
Q6: How will this benefit Indian shipping companies?
Answer:
By shifting the tax liability to the recipient’s location, Indian shipping companies and service providers avoid unnecessary IGST complexities. It encourages ease of doing business and makes B2B contracts smoother. 🌊
Q7: How is Notification No. 03/2021 connected to earlier IGST notifications?
Answer:
This notification amends Notification No. 4/2019 – Integrated Tax. The earlier rule created challenges in defining place of supply for cross-location services. The 2021 amendment brings clarity and consistency.
Q8: What is the larger GST Council agenda behind this change?
Answer:
The GST Council aims to simplify cross-border and interstate supply taxation. By clarifying shipping MRO service taxation, India also boosts its competitiveness in the global maritime repair sector. 🌍
Download PDF: Notification No. 03/2021- Integrated Tax
More Information: https://taxinformation.cbic.gov.in/
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