Rule 12 – Place of provision of services provided on board a conveyance :

Place of provision of services provided on board a conveyance during the course of a passenger transport operation, including services intended to be wholly or substantially consumed while on board, shall be the first scheduled point of departure of that conveyance for the journey.

Analysis of the rule

This rule covers the service which has been provided on a conveyance (aircraft, vessel, rail, or roadways bus) during the course of a passenger transport operation. The place of provision in such a case would be the first scheduled point of departure of that conveyance for the journey. Such services must be provided against a specific charge, and not supplied as part of the fare.

For instance, a video game or a movie-on-demand is provided as on-board entertainment during the Kolkata-Delhi leg of a Bangkok-Kolkata-Delhi flight. The place of provision of this service will be Bangkok (outside taxable territory, hence not liable to tax). If the above service is provided on a Delhi-Kolkata-Bangkok-Jakarta flight during the Bangkok-Jakarta leg, then the place of provision will be Delhi (in the taxable territory, hence liable to tax).