Place of Supply of Services under GST (2026): The General Rule under Section 12
CA Meet Dhrangadhariya 
April 28, 2026
CA Meet Dhrangadhariya April 28, 2026
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Last updated: 21 September 2026 · Written and reviewed by CA Meet Dhrangadhariya, CSM & Co LLP
Quick summary
Place of supply for goods is comparatively simple - goods are tangible, so the law can anchor the rule to where they physically move to or sit. Services are intangible, which is why GST needs a separate, more detailed set of rules to fix a place of supply for them. Our Place of Supply of Goods guide covers the goods side; this post covers the general rule for services.
New to terms such as “registered recipient” or “address on record”? See the technical terms explained in simple words further down.
Section 12 of the IGST Act, 2017 applies only where both the supplier and the recipient of a service are located in India. Where either party is located outside India, a separate provision - section 13 - applies instead, with its own distinct set of rules.
Within section 12 itself, sub-sections (3) to (14) carve out specific categories with their own rules - services directly relating to immovable property, hotel and lodging accommodation, event admission and organisation, passenger transportation, services on board a conveyance, telecommunication services, banking and financial services, insurance services, and advertisement services to the Government, among others. The general rule in section 12(2) is the default, applying to any service that is not separately covered by one of those specific categories.
Under section 12(2)(a), where the service is supplied to a registered person, the place of supply is simply that recipient’s own location - full stop. It does not matter where the supplier is based, where the service is actually performed, or where any physical element of it takes place.
Example: A consultant based in Karnataka provides consultancy services to a company registered in Maharashtra. The place of supply is Maharashtra (the registered recipient’s location), so IGST applies, since the supplier and the place of supply are in different States.
Under section 12(2)(b), where the service is supplied to a person who is not registered, the place of supply is:
Example (address on record): The same Karnataka consultant provides services to an unregistered individual whose recorded address shows Tamil Nadu. The place of supply is Tamil Nadu, so IGST applies.
Example (no address on record): The consultant provides services to an unregistered individual with no address on record at all. The place of supply falls back to the supplier’s own location - Karnataka - so CGST and SGST apply instead of IGST.
Even with a long list of specific-service categories in section 12(3) to (14), most ordinary professional, consultancy, and business services a typical firm provides or receives fall under the general rule, not one of the carved-out categories. Knowing when the general rule applies - and confirming a service genuinely does not fall into one of the specific categories - is usually the first real determination to make before invoicing.
If a service is wrongly treated as intra-State when it should have been inter-State (or the reverse), the supplier cannot simply net it off later. The correct tax (say, IGST) has to be paid separately, and the wrongly-charged tax (CGST and SGST) then has to be claimed back as a refund - a real cash-flow cost and a compliance burden, not a paperwork-only correction.
Confirming whether a service falls under the general rule or one of section 12’s specific categories, and getting the registered-versus-unregistered recipient test right, prevents exactly this kind of costly correction later. Please reach out to our team and we will be happy to assist with service classification and place-of-supply determination.
| Term | What it means |
|---|---|
| Registered recipient | A GST-registered person or business receiving the service, identified by their GSTIN. |
| Address on record | The recipient’s address the supplier has genuinely captured and kept - used to determine place of supply when the recipient is unregistered. |
| Intra-State supply | A supply where the supplier’s location and the place of supply are in the same State or Union Territory - taxed as CGST plus SGST/UTGST. |
| Inter-State supply | A supply where the supplier’s location and the place of supply are in different States or Union Territories - taxed as IGST. |
| Default/general rule | The rule that applies to a transaction when no more specific rule covers it - here, section 12(2), which applies unless a service falls under one of section 12’s specifically listed categories. |
Section 12 of the IGST Act, 2017, but only where both the supplier and the recipient of the service are located in India. Where either party is outside India, section 13 applies instead - a separate set of rules.
The place of supply is simply the location of that registered recipient - under section 12(2)(a) - regardless of where the service is actually performed or delivered from.
The recipient’s own location, if their address is on record with the supplier; if no address is on record, the supplier’s own location instead - under section 12(2)(b).
No. Section 12(2) is the default, applying only to services not separately covered by sub-sections (3) to (14) of the same section - which set out their own specific rules for immovable property, hotels and lodging, events, passenger transport, telecommunications, banking and several other categories.
Because it decides whether CGST plus SGST or IGST is charged. If the wrong one is charged, the supplier typically has to separately pay the correct tax and then claim a refund of the tax wrongly paid - a real cash-flow and compliance cost, not a paperwork-only error.
Goods are tangible and physically move or sit somewhere, giving a natural location to anchor the rule to. A service is intangible, so the law has to choose a fixed reference point instead - most often the recipient’s own location - rather than trying to track where an intangible service “is”.
This article is for general informational purposes only and should not be considered professional advice. Please consult a qualified expert for advice tailored to your specific situation. The author and website owner are not liable for any errors or actions based on this content.
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