Supply under GST: the taxable event

Scope of supply in Section 7

• All forms of supply such as sale, transfer, barter, exchange, licence, rental, lease or disposal, made or agreed to be made for a consideration in the course or furtherance of business.
• Activities by a club, association or society to its members for consideration.
• Import of services for consideration, whether or not in the course of business.
• Activities in Schedule I, made without consideration.

Goods or services, and what is excluded

Schedule II decides whether certain activities are supplies of goods or of services. For example, transfer of title in goods is a supply of goods, while transfer of right to use goods without title is a supply of services. Works contracts and restaurant services are treated as services.

Schedule III lists activities that are not supply at all, such as employee services to an employer and sale of land. Section 7(2) also excludes activities of governments and local authorities as public authorities, as notified.

Why it matters

If there is no supply, no GST is payable, and if there is, every later question follows: time of supply, place of supply, value and rate. Disputes often arise on free supplies between group entities, liquidated damages, and reimbursements. Check Schedule I and III before concluding.

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This guide explains the law in general terms as of October 2026. Time limits and requirements can depend on the facts of your case and on the notice you received.