Place of Supply under GST – Online/Virtual Coaching Classes


In the past few months, the online/virtual coaching segment has boomed due to the shift in the social/educational environment imposed by the covid-19 pandemic. This change in social/educational environment necessitated every training/coaching service provider to shift from conventional physical class rooms to online/virtual class rooms to adapt with the needs of the industry. These online/virtual coaching classes may be provided through own software infrastructure or by means of third-party service provides such as Zoom, Google Meets, or the like. The place of supply of the services provided by online training/coaching service providers can be determined from section 12 and 13 of the IGST Act, 2017.

There is no room for confusions regarding the place of supply when the service provider and recipient are located in India and the services are provided to a registered person. The place of supply shall be the location of such registered person (recipient) i.e., the place where such person is registered. The confusion arises when such services are provided to an unregistered person. So, we can concentrate on the area where the ambiguity exists i.e., the scenario when such online/virtual coaching classes are provided to an unregistered person.

The relevant provisions are reproduced below: –

  • When the service provider and recipient are located in India (Section 12 of IGST Act)
    • The place of supply of services provided in relation to: –
      • training and performance appraisal
      • admission to cultural, educational or entertainment event
      • organisation of cultural, educational or entertainment event

1. to a registered person shall be the location of such registered person;

2. to a person other than registered person shall be the location where the services are actually performed/the event is actually held or such park or such other place is located. 

  • When the location of service provider or location of recipient of services are outside India (Section 13 of IGST Act) 
  • The place of supply of services supplied by way of admission to or organisation of cultural, educational or entertainment event and services ancillary to such admission or organization shall be the place where the event is actually held.

So, irrespective of the location of recipient of service, when such services are provided to an unregistered person, the Place of Supply shall be the location where the services are actually performed/the event is actually held or such park or such other place is located.

But, on a thorough analysis of Section 12 and 13 of the IGST Act, 2017, we can understand that the legislator has created the above-mentioned provisions assuming that such services would be a performed/provided at a physical location where the person who provides the service and the person who receives such service will meet together. However, in the case of online/virtual coaching classes, we cannot actually determine the place where the services are actually performed/the event is actually held. This is because the service provider and the recipient of service do not necessarily meet/interact in a physical location but only at a virtual location which cannot be determined. Therefore, sub-sections (5), (6) and (7) of section 12 and sub-section (5) of Section 13 of the IGST Act, 2017 cannot be applied to determine the place of supply as there is no physical location where the event is actually held.

Hence, the place of supply shall be determined by the general provision of section 12(2) of the IGST Act, 2017 where the location of supplier of services and the location of the recipient of services is in India and by the general provision of section 13(2) of the IGST, 2017 where the location of the supplier of services or the location of the recipient of services is outside India.

As per the general provision of section 12, i.e., section 12(2) of the IGST Act, 2017,

“The place of supply of services, except the services specified in sub-sections (3) to (14), ––

    (a) made to a registered person shall be the location of such person;

    (b) made to any person other than a registered person shall be, ––

            (i) the location of the recipient where the address on record exists; and

            (ii) the location of the supplier of services in other cases.”

And as per the general provision of section 13, i.e., section 13(2) of the IGST, 2017,

The place of supply of services except the services specified in sub-sections (3) to (13) shall be the location of the recipient of services:

Provided that where the location of the recipient of services is not available in the ordinary course of business, the place of supply shall be the location of the supplier of services.”

Therefore, on the assumption that training/coaching service provider is located in India and such service is provided to an unregistered person (Student) located in India, as per section 12(2) of the IGST Act 2017, the place of supply of such service shall be the location of the recipient (Student) if the address of the student is known to the training/coaching service provider. If the address is not known, the place of supply shall be the location of training/coaching service provider.

Similarly, when training/coaching service provider is located in India and such service is provided to an unregistered person (Student) located outside India, as per section 13(2) of the IGST Act 2017, the place of supply of such service shall be the location of the recipient (Student) if the address of the student is known to the training/coaching service provider. If the address is not known, the place of supply shall be the location of training/coaching service provider.





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