Meaning



In this article, meaning of the term ‘Supply’ and the various types of supply are discussed for the information of the readers.

Supply of goods or services or both is defined as sale, transfer, barter, exchange, license, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business.


Types of Supply

1. Based on locationtypes of supply

Intra-State supply

Intra-State is a type of supply of goods or services where the location of the supplier and the place of supply of goods are in the same State or same Union Territory.

 Exceptions –

  • Supply of goods to or by a Special Economic Zone developer or a SEZ unit; or
  • Goods imported into the territory of India; or
  • Supplies made to a tourist (section 15)

Territorial waters

  • Where the location of the supplier is in the territorial waters; or
  • Where the place of supply is in the territorial waters;

The place of supply will be in the nearest Coastal State or Union Territory.

Inter-State supply

It is a supply of goods or services, where the location of the supplier and place of supply are in-

  • Two different States;
  • Two different Union territories; or
  • A State and a Union territory

It also includes import of goods or services into the territory of India.

Further, the following shall be treated as an inter-state supply of goods or services:

  • When the supplier is located in India and the place of supply is outside India;
  • To or by a Special Economic Zone (SEZ) developer or a SEZ unit; or
  • In the taxable territory, not being an intra-state supply and not covered elsewhere.

2. Based on combinationtypes of supply

Composite Supply

It means a supply made by a taxable person to a recipient consisting of two or more taxable supplies of goods or services or both, or any combination thereof, which are naturally bundled and supplied in conjunction with each other in the ordinary course of business, one of which is a principal supply.

Mixed Supply

It means two or more individual supplies of goods or services, made in conjunction with each other by a taxable person for a single price where such supply does not constitute a composite supply.

Continuous Supply

Continuous supply is of two types viz., continuous supply of goods and continuous supply of services.

types of supply

3. Based on Recipienttypes of supply

Inward Supply

It means receipt of goods or services or both whether by purchase, acquisition or any other means with or without consideration.

Outward Supply

It means a supply of goods or services or both, whether by sale, transfer, barter, exchange, license, rental, lease or disposal or any other mode, made or agreed to be made by such person in the course or furtherance of business.

4. Based on Tax treatment types of supply

Exempt Supply

Exempt Supply of any goods or services is one which attracts nil rate of tax or which may be wholly exempt from tax. It includes non-taxable supply. In the case of exempt supply in respect of any goods and/or services, the taxable person shall not be required to pay tax.

Zero-Rated Supply

It means export or supply of goods or services to a Special Economic Zone developer or a Special Economic Zone unit.

Non-Taxable Supply

Non-taxable supply is the sale of any good or service which attracts nil rate of tax and is similar to exempt supply.

Taxable Supply

Supply on which tax shall be paid under GST.

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