While clarifying issues regarding the treatment of supply by an artist in various States and supply of goods by artists from galleries, The Central Board of Excise and Customs (CBEC) said that when an art work sent to the gallery is purchased by a person, Integrated Goods and Services Tax (IGST) would be applicable.
The Board said that as per Rule 55 of the CGST Rules, the art work for supply on approval basis can be moved from the place of business of the registered person (artist) to another place within the same State or to a place outside the State on a delivery challan along with the eway bill wherever applicable and the invoice may be issued at the time of actual supply of art work.
In a circular issued last day, the Board clarified that the supplies of the art work from one State to another State will be inter-State supplies and attract integrated tax in terms of section 5 of the Integrated Goods and Services Tax Act, 2017.
It is further clarified that in case of supply by artists through galleries, there is no consideration flowing from the gallery to the artist when the art works are sent to the gallery for exhibition and therefore, the same is not a supply. It is only when the buyer selects a particular art work displayed at the gallery, that the actual supply takes place and applicable GST would be payable at the time of such supply.
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