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The CBIC has clarified that businesses with head offices in one State and warehouses in another must obtain GST registration for each location. Warehouses, including those run by third parties, are considered distinct places of business, and movement of goods from the principal office to these warehouses is treated as taxable supply. Goods supplied within the same State attract CGST/SGST, while inter-State movement attracts IGST. The decision increases compliance obligations, requiring separate registrations, invoicing, and return filings, ensuring businesses operating in multiple States adhere to GST regulations.
The Central Board of Indirect Taxes & Customs (CBIC) has clarified that businesses with head offices in one State and warehouses in another must obtain GST registration in both locations. The board noted that the term "place of business," as defined under Section 2(85) of the GST Act, includes any location where business is regularly conducted, such as warehouses and storage facilities. Advertisement
This guidance comes following a representation by the Kirana Committee of Delhi, which sought clarification on whether businesses based in Delhi would need to register in Haryana if their goods were stored in cold storage facilities there before being supplied to retailers or customers with pre-orders. The CBIC emphasized that under Section 22 of the GST Act, any person making taxable supplies from a State must register in that State if turnover exceeds the prescribed threshold. Since taxable supplies are made from the Haryana facilities, that State is considered a place of business, and registration is required.
Even if the warehouse is operated by a third party, it is considered the taxpayer's place of business for that location. Businesses must maintain detailed records of goods sent to such third-party facilities. The CBIC also highlighted that when goods are stored in multiple States for onward supply, each location is treated as a separate taxable entity. Movements of goods from the principal office to these warehouses will be treated as "supply" covered by a waybill, with GST charged accordingly.
Further, once goods are placed in a storage facility, that location becomes the place of business. Movement of goods within the State for supply to customers there will attract CGST and SGST. Supplies to other States will be considered inter-State, attracting IGST. If goods are moved to a warehouse but ultimately supplied directly to customers in another State, IGST will apply, along with CGST/SGST for the State of delivery.
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