Accommodation for marriages/functions and related ancillary services
Any ancillary services connected with the above
## Determining the Place of Supply (PoS)
Where the property/boat/vessel is located
Place of Supply
In India
Location of the immovable property / boat / vessel
Outside India
Location of the recipient
> Note: This rule overrides the general default of "location of recipient" because the service is intrinsically linked to a physical location.
## When the Property Spans Multiple States/UTs
In absence of a contract/agreement specifying allocation, apportion the PoS as follows:
Type of Service
Basis of Apportionment
Lodging/accommodation where different properties are located in ≥ 2 States/UTs
Number of nights stayed in each State/UT
Lodging/accommodation where a single property spans ≥ 2 States/UTs, OR any other service of this category spanning ≥ 2 States/UTs
Area of the property in each State/UT
Lodging by houseboat or vessel
Time spent in each State/UT
## Critical Trap: ITC Loss for Out-of-State Recipients
If the location of supplier and PoS are in the same State but the recipient is registered in a different State, it is an intra-State supply in the supplier's State. CGST + SGST of the supplier's State will be charged, and the recipient cannot claim ITC in their own State.
Example: ABC Ltd. (Jaipur) books rooms at Taj Hotel (Mumbai) for its directors. Both supplier and PoS are Mumbai → CGST + Maharashtra SGST is charged. ABC Ltd. in Rajasthan cannot avail ITC.
Worked example
### Example 1
Example 1 — Property partly in India, partly abroad
Mr. Ron (Pune) provides architectural services to Mr. Harry (Jaipur) for two properties: one in Delhi (₹2 lacs) and one in London (₹5 lacs). Determine PoS.
Solution: Both supplier and recipient are in India → Section 12 applies.
For ₹2 lacs (Delhi property): PoS = Delhi (location of immovable property in India).
For ₹5 lacs (London property): PoS = Jaipur (location of recipient, since property is outside India).
### Example 2
Example 2 — ITC trap
ABC Ltd. (Jaipur) books accommodation at Taj Hotel, Mumbai. Both PoS and Location of Supplier = Mumbai → supplier raises CGST + Maharashtra SGST. ABC Ltd. cannot claim ITC in Rajasthan because the credit relates to a different State's SGST.
⚠️ Common exam mistakes
Treating PoS as the recipient's location for an immovable property service located in India — overrides the general rule.
Forgetting that when property is outside India, PoS shifts to the recipient (don't write "outside India" as PoS).
Ignoring the ITC loss when supplier and PoS coincide but recipient is in a different State — recipient gets stuck with non-creditable CGST/SGST.
Using the wrong apportionment basis: nights (different properties), area (single property/other services), time (houseboat/vessel).
Bare-Act text Section 12(3) · IGST Act, 2017 · click to expand
Section 12(3), IGST Act: Place of supply of services, by way of, — (a) any service directly in relation to an immovable property, including services provided by architects, interior decorators, surveyors, engineers and other related experts or estate agents, any service provided by way of grant of rights to use immovable property or for carrying out or co-ordination of construction work; or (b) by way of lodging accommodation by a hotel, inn, guest house, home stay, club or campsite, by whatever name called, and including a house boat or any other vessel; or (c) by way of accommodation in any immovable property for organising any marriage or reception or matters related thereto, official, social, cultural, religious or business function including services provided in relation to such function at such property; or (d) any services ancillary to the services referred to in clauses (a), (b) and (c), shall be the location at which the immovable property or boat or vessel, as the case may be, is located or intended to be located. Provided that if the location of the immovable property or boat or vessel is located or intended to be located outside India, the place of supply shall be the location of the recipient.