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F.No. CBIC-20001/4/2024-GST
Government of India
Ministry of Finance
Department of Revenue
Central Board of Indirect Taxes and Customs GST Policy Wing
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North Block, New Delhi Dated the 26th June, 2024
Circular No. 209/03/2024 - GST: Clarification on the provisions of clause (ca) of Section 10(1) of the Integrated Goods and Service Tax Act, 2017 relating to place of supply
To,
The Principal Chief Commissioners/Chief Commissioners/Principal Commissioners/ Commissioners of Central Tax (All)
The Principal Directors General/ Directors General (All)
Madam/Sir,
Subject: Clarification on the provisions of clause (ca) of Section 10(1) of the Integrated Goods and Service Tax Act, 2017 relating to place of supply of goods to unregistered persons– Reg.
Vide Notification 02/2023-Integrated Tax, dated 29th September, 2023, the provisions of the Integrated Goods and Services Tax (Amendment) Act, 2023 (31 of 2023) came into force with effect from 01.10.2023.
- Clause (ca) has been inserted in Section 10(1) of the Integrated Goods and Services Tax Act, 2017 (hereinafter referred to as the “IGST Act”) with effect from 01.10.2023. The same is reproduced as under:
"(ca) where the supply of goods is made to a person other than a registered person, the place of supply shall, notwithstanding anything contrary contained in clause (a) or clause (c), be the location as per the address of the said person recorded in the invoice issued in respect of the said supply and the location of the supplier where the address of the said person is not recorded in the invoice.
Explanation.—For the purposes of this clause, recording of the name of the State of the said person in the invoice shall be deemed to be the recording of the address of the said person;"
- The said provision has been inserted as a non-obstante provision overriding the provisions under Section 10(1)(a) or 10(1)(c) of IGST Act. The clause (ca) provides that where the supply of goods is made to an unregistered person, the place of supply would be the location as per the address of the said person recorded in the invoice and the location of the supplier where the address of the said person is not recorded in the invoice. An explanation has also been added to the said clause to clarify that recording the name of the State of the said person shall be deemed to be the recording of the address of the said person.
- Reference has been received from trade and industry seeking clarification regarding the place of supply in terms of newly added clause (ca) of section 10(1) of the IGST Act, in case of supply of goods made to an unregistered person where billing address is different from the address of delivery of goods, especially in the context of supply being made through e-commerce platforms.
- In order to clarify the issue and to ensure uniformity in the implementation of the provisions of law across the field formations, the Board, in exercise of its powers conferred by section 168 (1) of the Central Goods and Services Tax Act, 2017 hereby clarifies the issues as under:
| S.No. | Issue | Clarification |
| Place of supply of goods (particularly being supplied through e-commerce platform) to unregistered persons where billing address is different from the address of delivery of goods. | ||
| 1. | Mr. A (unregistered person) located in X State places an order on an e- commerce platform for supply of a mobile phone, which is to be delivered at an address located in Y State. Mr. A, while placing the order on the e-commerce platform, provides the billing address located in X state. In such a scenario, what would be the place of supply of the said supply of mobile phone, whether the State pertaining to the billing address i.e. State X or the State pertaining to the delivery address i.e. State Y? | As per the provisions of clause (ca) of sub- section (1) of section 10 of IGST Act, where the supply of goods is made to an unregistered person, the place of supply would be the location as per the address of the said person recorded in the invoice and the location of the supplier where the address of the said person is not recorded in the invoice. Further, as per Explanation to the said clause, recording the name of the State of the said unregistered person on the invoice shall be deemed to be the recording of the address of the said person. Accordingly, it is clarified that in such cases involving supply of goods to an unregistered person, where the address of delivery of goods recorded on the invoice is different from the billing address of the said unregistered person on the invoice, the place of supply of goods in accordance with the provisions of clause (ca) of sub-section (1) of section 10 of IGST Act, shall be the address of delivery of goods recorded on the invoice i.e. State Y in the present case where the delivery address is located. Also, in such cases involving supply of goods to an unregistered person, where the billing address and delivery address are different, the supplier may record the delivery address as the address of the recipient on the invoice for the purpose of determination of place of supply of the said supply of goods. |
- It is requested that suitable trade notices may be issued to publicize the contents of this Circular. Difficulty, if any, in the implementation of the above instructions may please be brought to the notice of the Board. Hindi version would follow.
(Sanjay Mangal)
Principal Commissioner (GST)
📚 Frequently Asked Questions (FAQs): Circular No. 209/03/2024 - GST
Q1. What is Circular No. 209/03/2024-GST about?
Answer:
Circular No. 209/03/2024-GST clarifies how the place of supply should be determined when goods are supplied to unregistered persons under Section 10(1)(ca) of the IGST Act.
In simple terms, the circular explains what happens when the billing address and delivery address are different, especially in e-commerce transactions. CBIC has clarified that if both addresses are mentioned on the invoice, the delivery address should be treated as the recipient's address for determining the place of supply. This brings consistency across GST implementation and reduces disputes.
Q2. Why was Section 10(1)(ca) introduced?
Answer:
Section 10(1)(ca) was introduced because the earlier provisions did not specifically deal with supplies made to unregistered persons where multiple addresses could exist.
With the rapid growth of online shopping, customers frequently purchase goods for family members, friends, or business associates living in another State. Earlier, businesses were unsure whether GST should be determined based on the billing address or the delivery address. The amendment and subsequent circular remove this uncertainty by providing a dedicated rule for such cases.
Q3. Does this circular apply to registered persons?
Answer:
No. The circular applies only to supplies made to persons who are not registered under GST.
If the recipient is a registered taxpayer, the normal provisions relating to place of supply continue to apply. Businesses should therefore first verify whether the recipient is registered before applying Section 10(1)(ca). Applying this clarification to registered customers may result in incorrect tax treatment.
Q4. If the billing address and delivery address are different, which address determines the place of supply?
Answer:
The delivery address recorded on the invoice determines the place of supply.
This is the most important clarification issued in Circular No. 209/03/2024-GST. Although the customer may have entered a different billing address, the supplier may treat the delivery address as the recipient's address for determining the place of supply. This approach aligns GST with the actual destination of the goods.
Q5. Why is this clarification particularly important for e-commerce businesses?
Answer:
Many businesses actually face this issue because online shopping rarely involves a single address.
Customers often order products for relatives, friends, employees, or clients located in another State. If GST is calculated only on the basis of the billing address, the supplier may end up charging the wrong tax. The circular provides a uniform method for e-commerce operators and sellers to determine the correct place of supply.
Q6. What happens if no address of the unregistered customer is recorded on the invoice?
Answer:
If no address is recorded on the invoice, the location of the supplier becomes the place of supply.
Section 10(1)(ca) itself provides this rule. Therefore, businesses should always try to capture at least the State or complete delivery address of the customer whenever possible. Proper documentation helps avoid future disputes during departmental audits.
Q7. Is mentioning only the State name sufficient for determining the place of supply?
Answer:
Yes. The law specifically provides that mentioning only the name of the State is deemed to be recording the recipient's address.
This is a practical relaxation because businesses may not always collect the complete postal address in every transaction. However, wherever available, recording the full delivery address is still a better compliance practice, particularly for e-commerce supplies.
Q8. Does this circular change the law or merely clarify it?
Answer:
The circular does not create a new legal provision.
Instead, it explains how Section 10(1)(ca), introduced through the IGST (Amendment) Act, 2023, should be implemented in practical situations. Circulars issued under Section 168 of the CGST Act are intended to ensure uniform application of GST law across the country.
Q9. Can businesses continue using the billing address for GST calculation?
Answer:
Only if the billing address is also the recipient's address recorded for determining the place of supply.
If a separate delivery address is available and recorded on the invoice, businesses should follow the clarification issued by CBIC. Continuing to determine GST solely on the basis of the billing address may result in charging the wrong type of tax.
Q10. Does this clarification affect the type of GST charged?
Answer:
Yes, it can.
The place of supply determines whether a transaction is treated as an intra-State supply (liable to CGST and SGST) or an inter-State supply (liable to IGST). If the place of supply is incorrectly determined, businesses may collect the wrong tax, leading to additional compliance work, customer grievances, and possible departmental scrutiny.
Q11. Should businesses update their ERP or billing software after this circular?
Answer:
Absolutely.
If you look at it practically, compliance today depends as much on technology as it does on legal knowledge. ERP systems, billing software, POS applications, and e-commerce integrations should identify the delivery address separately from the billing address and determine the place of supply accordingly. Failure to update system logic may lead to repeated invoicing errors.
Download PDF: Circular No. 209/03/2024 - GST
More Information: https://taxinformation.cbic.gov.in/
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