The Scope Of IGST Act :
The IGST Act envisages that Centre would levy IGST on all inter-State transactions of taxable goods and services with appropriate provision for consignment or stock transfer of goods and services.
For the purposes of this levy, the interstate supply has been specified as the one in respect of which the location of supplier and the place of supply are located in two different states (Section 3 of the IGST Act). In the situation where the state of location of supplier is the same as the state where place of supply falls, such supplies are to be treated as inter-state supplies (Section 3A of the IGST Act).
Illustratively
| S. No. | Location of supplier | Place of supply | Nature of supply |
| 1 | Haryana | U.P. | Interstate |
| 2 | Haryana | Haryana | Intrastate |
It may be seen that the location of service recipient is not the determining factor. Essentially the nature of supply is governed by the Place of Supply. Therefore, in the context of the IGST Act, the most significant factor is the place of supply, which is elaborated in section 5 and section 6 of the Act. Section 5 deals with the place of
supply of goods, while section 6 deals with the place of supply of services.
The Place of supply of goods and services have been discussed in details in the next section, as it requires extensive deliberation for proper appreciation.
Once the supply is determined as Inter-state, the subsequent business process like payment, return etc are to be complied with by the taxpayer in the manner similar to compliance in CGST Act. For this purpose, the IGST Act, borrows a large number of provisions from the CGST Act. This is for the reason the nature of tax is same, i.e. it is levied on the supply of goods and service. The requirement of registration, payment, return, compliance verification, dispute settlement are akin to CGST, depending upon the business process. The only distinction being that tax even are distinct, i.e. inter-state supplies. The provisions from CGST that have application to IGST Act are as follows,-
• Registration
• Valuation.
• Time of supply of goods and services
• Change in rate of tax of services
• Exemption
• Input tax credit and utilisation thereof
• Payment of Tax
• Furnishing of return
• Audit
• Assessment
• Adjudication
• Demands
• Refunds
• Interest
• Recovery of tax
• Offence and penalties
• Inspection
• Search and seizure
• Prosecution and power of arrest
• Appeal
• Review
• Advance Ruling
• Compounding
• Recovery of tax