Supply of Services

As per section 2(102) of CGST Act, Services means anything other than goods, money and securities but includes activities relating to the use of money or its conversion by cash or by any other mode, from one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged.



  1. Sale of land has been excluded from the definition of goods or service.
  2. Sale of completed building after receiving completion certificate from competent authority or after first occupation (whichever is earlier) has been excluded from the definition of goods or service.  


Characteristics of service:

  1. Economic activity
  2. Value addition
  3. Intangible
  4. Instantly perishable
  5. Service availed cannot be returned or transferred to another.


Services include:

  1. Importation of service:
    For a consideration, whether or not in the course or furtherance of business, is supply.
    By a taxable person, from a related person or from any other establishments outside India, in the course or furtherance of business will be treated as supply.
  2. Sim cards are service, not goods.
  3. Development of software: development, design, programming, customisation, adaptation, upgradation, enhancement, implementation of information technology software is supply of service.
  4. Software in physical form is goods.
  5. Any lease, tenancy, easement, licence to occupy land is service.
  6. Construction of a complex, building, civil structure or a part thereof, including a complex or building intended for sale to a buyer, wholly or partly, except where the  entire consideration has been received after issuance of completion certificate, or after its first occupation, whichever is earlier.
  7. Temporary transfer or permitting the use or enjoyment of any Intellectual Property Right is supply of service.
  8. Refrain from Act of tolerating an act (eg. fines, charges, penalties).
  9. Works contract is service.
  10. Transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration is supply of service. This clause covers operating lease.
  11. Supply of food or drinks (other than alcoholic liquor for human consumption) as part of service, is supply of service.
  12. Interest, dividend, loans, borrowings, profit distribution among partners, not taxable under GST.