GST applicability for supply made by cold storage facility

GST applicability for supplies made from cold storage facilities

The Central Board of Indirect Taxes and Customs has issued a clarification on GST applicability for supplies made from cold storage facilities.

GST Registration Requirement:

• If goods are stored in a cold storage located in another state (e.g., Haryana) and supplied from there, then such a warehouse is considered a “place of business” under Section 2(85) of the CGST Act. The business must obtain a separate GST registration in that state, even if the cold storage is operated by a third party. Cold storage must Obtain separate GST registration in each state where goods are stored in cold storage and supplied from there (as per Sec. 22 & Sec. 25(4) of CGST Act). Cold storage location is treated as a “place of business” even if operated by a third party. Each registration is a distinct person : requires separate compliance.

Movement of Goods & GST Payment:

• Goods moved from Delhi to Haryana cold storage must be accompanied by a valid tax invoice and e-way bill, with GST discharged as applicable. Supplies from Haryana cold storage to customers in Haryana are treated as intra-State supplies (CGST + SGST of Haryana). Supplies from Haryana cold storage to another state are inter-State supplies and attract IGST. How goods move and what GST treatment applies in the cold storage scenario :
• Delhi : Haryana Warehouse: Stock transfer:  IGST payable (distinct persons).
• In case Haryana Warehouse: Haryana Customer: Supply :  CGST + SGST (Haryana).
• Haryana Warehouse: Other State Customer: Supply :

As far as cold storage Invoicing is concerned

• Stock Transfer (Delhi: Haryana warehouse): Issue a Tax Invoice from Delhi GSTIN to Haryana GSTIN (distinct persons). & Pay IGST on the transfer.
• In case Sales from Haryana warehouse to Haryana customers: Issue Tax Invoice under Haryana GSTIN. & Charge CGST + SGST (Haryana).
• Sales from Haryana warehouse to another state customer: Issue Tax Invoice under Haryana GSTIN. & Charge IGST.
• cold storage must Maintain separate invoice series for each state registration.

As far as cold storage E-Way Bills is concerned: Required for all movements of goods (value > ₹50,000);

• Delhi: Haryana (Stock Transfer): Generate e-way bill (supply between distinct persons).
• Haryana warehouse: Haryana customer: Generate e-way bill (intra-state supply).
• In case Haryana warehouse: Other state customer: Generate e-way bill (inter-state supply).
• cold storage must ensure proper vehicle number & delivery challan details are updated.

Distinct Person Status :

• As per Section 25(4) of the CGST Act, establishments in different states under the same PAN are treated as distinct persons. Movement of goods between such registrations is treated as a supply and requires issuance of a tax invoice and payment of GST.

Place of Supply Determination :

• For goods, the place of supply is the location where movement of goods terminates for delivery [Section 10(1)(a), IGST Act]. Thus, supplies from Haryana warehouse to Haryana customers attract CGST + SGST (Haryana), while interstate supplies attract IGST.

Cold Storage Services (as a service) :

• Indian Cold storage services are considered services related to immovable property. As per Section 12(3) of the IGST Act, the place of supply is the location of the property (i.e., the cold storage). Accordingly, if the cold storage is in Haryana, CGST + SGST (Haryana) will apply on storage service charges.
• The Cold storage operator charges GST on rental/storage services. Cold storage Place of supply is the location of warehouse (Sec. 12(3), IGST Act). Cold storage Business must claim ITC under the same state GST registration (e.g., Haryana GSTIN).

GST Returns Filling & GST Reporting:

• The Cold storage must have each state registration must file independent returns. GSTR-1: Outward supplies from that state’s GSTIN, GSTR-3B: Monthly tax payment return (CGST+SGST for intra-state, IGST for inter-state), GSTR-2B / GSTR-2A reconciliation: For ITC matching, Stock Register maintenance at each warehouse as per Sec. 35 CGST Act

Conclusion:

Businesses storing goods in a cold storage located in another state must obtain GST registration in that state. Supplies made from that warehouse are treated as taxable supplies from that state, and GST (CGST+SGST or IGST) is determined accordingly. Cold storage services themselves also attract GST at the location of the warehouse. Cold Storage must Maintain separate books of accounts for each GST registration. Cold Storage must Cross-check stock reconciliation between principal place & warehouses. Align  invoicing system (ERP) with multi-GSTIN setup. Ensure timely filing of returns in all states to avoid penalties & ITC mismatch. Cold Storage must Conduct monthly reconciliation of e-way bills vs GSTR-1 vs GSTR-3B.

The CEBC has issued a clarification on GST applicability for supplies made from cold storage facilities i.e. Cold storage Register in the state of cold storage.  cold storage Treat stock transfers as supplies between distinct persons. cold storage Maintain separate invoicing, e-way bills, and returns per GSTIN. cold storage must Claim ITC correctly for cold storage services in that state.

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