CAF_GST_Booster_M1_M20 tools for the laymann

INDEXINDEX
Note:- Students are strongly recommended to refer latest edition of GST and Custom Questioner for
referring important questions given at the end of each topic
1 Basic Concept of Supply
Levy and Collection of GST2
3
4
5
6
7
8
9
10
11
12
Reverse Charge and ECO
Composition Scheme
Exemption under GST
Time of Supply
Value of Supply
Input Tax Credit
Place of Supply
Registration
Tax Invoice Debit and Credit note
E-way Bill, Accounts and Records
1
4
13
23
30
37
44
48
59
74
79
84
Note:- Student who are referring only Booster notes without video lectures are strongly recommended to
refer amendment lectures uploaded on for Blank Space. YouTube
Sr. No. Chapter Name Page No.

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Chapter 1
Basic Concept of GST
GST
REVISION
1
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Basic Concept and Constitutional Authority
1
2
3
4
5
6
Principle of GST
Constitutional Authority (Article 246 A)
Taxes Subsumed in GST
GST Council
Beneﬁts of GST
Credit System in Dual model of GST
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Framework of GST
Name Governing Act Levied byEvent of Levy
CGST Central Goods and Services
Tax Act, 2017
Central
Government
On ofIntra State supply
Goods and Services
SGST State Goods and Services
Tax Act, 2017
State
Government
UTGST Union Territory Goods and
Services Tax Act, 2017
Union
Territories
On ofIntra State supply
Goods and Services
IGST Integrated Goods and
Services Tax Act, 2017
Central
Government
On ofInter State supply
Goods and Services
On ofIntra State supply
Goods and Services
CONCEPT & PRINCIP AL OF GST
Ü GST is a Broad-based Value added tax
Ü GST is a Destination based tax
Ü GST is technically but it is actually paid by suppliers borne by consumers.
Ü GST is of production and distribution of goods collected at multiple stage
and services in which taxes paid on inputs are allowed as set off against
taxes payable on output.
Ü GST is a tax on the consumption of products from business sources,
and not on personal or hobby activities.
Ü Under GST, is provided throughout the value chain for input tax credit
creditable acquisition.
GST
CESS
GST Compensation Cess
Act, 2017
Central
Government
On Intra/Inter State supply
of notiﬁed Goods and Services
Note:- Students are strongly recommended to refer latest
edition of GST Questioner for referring important questions
given at the end of each topic

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Constitutional Amendments
Article 366 (12A)
Beneﬁts of GST
1) Creation of Uniﬁed National market
2) Mitigating Cascading Effect
3) Elimination of multiple taxes and double taxation
4) Make in India Initiative
5) Increase in Revenue
Central Taxes
Central Excise duty
Additional duties of
excise
Excise duty levied
under Medicinal &
Toiletries preparation
Act
Additional duties of
Customs
(CVD & SAD)
Service Tax
Surcharges & Cesses
State Taxes
State VAT/Sales Tax
Central Sales Tax
Purchase Tax
Entertainment Tax
(other than those
levied by local bodies)
Luxury Tax
Entry Tax (All forms)
Taxes on lottery,
betting & gambling
Surcharges & Cesses
Taxes to be Subsumed in GST
Property Tax & Stamp Duty1.
2. Electricity Duty
Excise Duty on Alcohol3.
4.Basic Custom Duty
5.Excise Duty on Petrol Diesel
Taxes not subsumed under GST
TAX ON TOBACCO AND TOBACCO PRODUCTS
In the case of tobacco and tobacco products, the Centre alone would have the power to levy
excise duty in addition to the GST
WHOLESALER RETAILER
Value
Excise
1,00,000
10,000
CGST @ 14%
SGST @ 14%
1,10,000
15,400
15,400
1,40,800
Particulars ` Value
Excise
2,00,000
CGST @ 14%
SGST @ 14%
28,000
28,000
2,56,000
Particulars `
The Goods and Services Tax Council shall make recommendations to the Union and the States on—
(a) Taxes to be subsumed in GST (b) Exemption in GST
(c) model Goods and Services Tax Laws, principles of levy, apportionment of Goods and Services
Tax levied on supplies in the course of inter-State trade or commerce under article 269A and the
principles that govern the place of supply;
(d) the threshold limit of turnover for Exemption (e) the rates of GST
(f) any other matter relating to the goods and services tax, as the Council may decide.
RECOMMEND ATION OF GST COUNCIL
SPECIAL CATEGORY OF STATE
1) Arunachal Pradesh 2) Assam 3) Jammu and Kashmir 4) Manipur 5) Meghalaya
6) Mizoram 7) Nagaland 8) Sikkim 9) Tripura 10) Himachal Pradesh 11) Uttarakhand
2)It should be noted that CGST cannot be used against SGST/UGST or vice-versa
INWARD SUPPLY OUTWARD SUPPLY
MANNER OF UTILIZA TION OF ITC IN GST
GST means “Any tax on supply of Goods or Services or both except taxes on
Supply of the Alcoholic Liquor for human Consumption
Article 246A Concurrent powers to both, Parliament and State Legislatures is given to make
laws with respect to GST
Article 269A Provides exclusive power to the Parliament to legislate with respect to inter-State
trade or commerce i.e. integrated tax (IGST)
GST
REVISION
2
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2. CGST
CGST IGST
Any Any
3. SGST
SGST IGST
Any Any
1. IGST
IGST CGST
First Any
SGST
Any
Taxes on Opium, Indian Hemp and other Narcotic Drugs and Narcotics:
These are within the purview of GST. However, State Governments have also retained the power to levy
excise duties on such products manufactured in India. Resultantly, Opium, Indian hemp and other narcotic
drugs and narcotics are subject to GST as well as State excise duties.
F Refer Q. 2 from Questioner
F Refer Q. 10,15,19& 21 from Questioner

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Law of GST
CGST SGST UTGST IGST
Constitutional of
India
Article 246-A(2):
Exclusive powers of
Parliament
Article 246-A(1):
Concurrent powers of parliament and state legislature
Act CGST Act, 2017
SGST Act, 2017
29 states- 29 states Acts
2 UTs deemed to be state as
they also having legislative
body - Delhi and puduchery
UTGST Act, 2017
5UT + OT (Other territory
of India) - Single Act
covering all
IGST Act, 2017
Total sections Sec 1 to 174
Sec 1 to 26 Sec 1 to 26
Extent of Applicability
Sec 1 : 1st July , 2017
(In J & K - 8th July, 2017)
------------------------------------
Sec 1 : 5 UT + OT Sec 1: Whole of India
(Including J & K)
Date of commencement
Sec 1 : Whole of india
(Including J & K)
Sec 1 : 1st July, 2017 Sec 1 : 1st July, 2017
[In J & K - 8th July, 2017]
Deﬁnition Sec 2 : Sec 2(1) to 2(121)Sec 2 : Sec 2(1) to 2(121) Sec 2 : Sec2 (1) to 2(10)Sec 2 : Sec2 (1) to 2(25)
Rules
CGST Rule, 2017
Single set of rule
SGST Rules, 2017 UTGST Rules, 2017 IGST Rules, 2017
5 set of rules-each for
each UT
Single set of rule
Total No. of Rules Rule 1 to 162
Rule 1 to 2
(in all 5 set of rules)
Rule 1 to 2
GST
REVISION
3
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All Important Clariﬁcations are given at the end of Module 2

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Chapter 2
Levy and Collection GST
INDEX
Section Content
Sec 1
Sec 2
2(56)
Title, Extent
Important Deﬁnitions
2(103)
2(114)
India
State
Union Territory
CGST Act, 2017
Section Content
Sec 9Levy & Collection of CGST
Section Content
Sec 5Levy & Collection of IGST
IGST Act, 2017
Sec 7Concept of Suppy
Sec 8Composite and Mixed Supply
SEC 2(103) “STATE”
Means - A Union territory with Legislature.
SEC 2(114) “UNION TERRITORY”
Means
the territory of -
(a) the Andaman and Nicobar Islands
(b) Lakshadweep
(c) Dadra and Nagar haveli (d) Daman and Diu
(e) Chandigarh and (f) Jammu& Kashmir
(g) Ladakh (h) Other territory
Explanation - For the purposes of this Act, each of the territories speciﬁed in clauses (a) to (f) shall be
considered to be a separate Union territory
Sec 3 : Hierarchy of ofﬁcers - The Government shall, by notiﬁcation, appoint the following classes
of ofﬁcers for the purposes of this Act, namely:
Principal Chief Commissioners of Central Tax or Principal Directors General of Central Tax(a)
Chief Commissioners of Central Tax or Directors General of Central Tax,(b)
Principal Commissioners of Central Tax or Principal Additional Directors General of Central Tax,(c)
Commissioners of Central Tax or Additional Directors General of Central Tax,(d)
Sec 4 : Power of CBIC to notify other ofﬁcers for execution
Sec 5 : Power of CBIC to decide scope & duties of ofﬁcers
Sec 6 : Authorisation to the ofﬁcers of SGST/UTGST
(i)
Additional Commissioners of Central Tax or Additional Directors of Central Tax,(e)
Joint Commissioners of Central Tax or Joint Directors of Central Tax,(f)
Deputy Commissioners of Central Tax or Deputy Directors of Central Tax,(g)
Deputy Commissioners of Central Tax or Assistant Directors of Central Tax,
(h)
any other class of ofﬁcers as it may deem ﬁt
Proviso
Provided that the ofﬁcers appointed under the Central Excise Act,1944
shall be deemed to be the ofﬁcers appointed under the of this Act.
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Delhi & Puducherry
SGST Act is applicable
GST
REVISION
4
Section 7 - Meaning and scope of supply
Supply includes -1
(a)
All forms of such as supply of goods and/ or services or both
Ü sale transfer, barter, exchange, licence, rental, lease or disposal
Ü made or agreed to be made
Ü for a consideration by a person
Ü in the course or furtherance of business.
(b)
(c)
The activities speciﬁed in Schedule I, made or agreed to be made without a
consideration.
(d)
The activities to be treated as supply of goods or supply of services as referred to in
Schedule II.Omitted
1A
Importation of services,Whether or not in the course or furtherance of business
and
Where certain activities or transaction constitute a supply in accordance with the provisions of
subsection (1), they shall be treated either as supply of goods or supply of services as referred to
in Schedule II.
F Refer Q. 10 & 15 from Questioner

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Rate
Collection
Person Liable to Pay Tax
6%9% 14%
CGST
Rate
0%0.125%1.5%2.5%
6%9% 14%
SGST
Rate
0%0.125%1.5%2.5%
Total 12%18%28%0%0.25%3% 5%
Forward
Charge
Sec 9(1)/ 5(1) Taxable Person making
Intra State- Supply
Taxable person means - a person who
is registered or liable to be registered
under section 22 or section 24
Reverse
Charge
Sec 9(3)/9(4)
Sec 5(3)/5(4)
Recipient of Supply
(Detail discussion in subsequent
chapter)
E-Commerce
Sec 9(5)
Sec 5(5) E-Commerce Operator
(Detail discussion in subsequent
chapter)
in such manner as may be prescribed
(Detail discussion in subsequent chapter)
Levy of GST on Imported Goods : - As per proviso to Sec 5(1) of IGST Act
Levy & Collection
shall be levied and collected in
accordance with the provisions of
section 3 of the Customs Tariff Act,
1975 (i.e. ACD 3(7)& ACD 3(9)
Value
on the as value
determined under the
Custom Act, 1962 (i.e. as
per Sec 14)
Collection
at the point when duties of customs are
levied on the said goods under section
12 of the Customs Act, 1962. (i.e. as per
Sec 15 of Custom Act,1962)
CUSTOMS
PORT
US
PORT
IMPORTATION OF GOODS
CHARGING SECTION
Sec 9 - CGST Act, 2017 Sec 5 - IGST Act, 2017
Levy
9(1) - Intra-State Supply of Goods and Services5(1) - Inter-State Supply of Goods and Services
45:30
TELEVISIONWASHING
MACHINE
45:30
45:30
45:30
45:30
45:30
45:30
Maharashtra
Gujarat
Dealer
45:30
TELEVISIONWASHING
MACHINE
45:30
45:30
45:30
45:30
45:30
45:30
Maharashtra
Gujarat
Dealer
Goods not Subject to Levy of GST - alcoholic liquor for human consumption
Levy on Petroleum Products from Notiﬁed date : - Supply of petroleum crude, high speed diesel, petrol,
natural gas and ATF shall be levied from the notiﬁed date.
Note : Still levy of GST on such products is not notiﬁed
Analysis: The type of levy existing or to be continued after GST
(Supply)
GST
(Production)
ED
(Sale)
VAT CST
1. Alcoholic Liquor for Human Consumption
2. Petroleum crude,High speed Diesel,Motor
spirit (Petrol), Natural gas, AviationTurbine fuel
3. Tobacco & Tobacco products
5. All other Products
üüü
üüü
üü
ü
x
x
x xx
xx
Inter State Supply - Sec 7 of IGST Act, 2017
Supply of goods/services shall be treated as inter-state
supply Where the location of the supplier and the place
of supply are in-
(a) two different States
(b) two different Union territories; or
(c) a State and a Union territory
Intra-State Supply - Sec 8 of IGST Act, 2017
Supply of goods/services shall be treated as intra-state
supply Where the location of the suppler and the
place of supply are in
(a) same State
(b) same Union territory
BCD
ACD 3(7) = IGST
Sticky Notes
GST
REVISION
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4. Opium, Indian Hemp and other Narcotic Drugs
üü xx

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(a) Ü any trade, commerce, manufacture,
Ü profession, vocation,
Ü adventure,
Ü wager or
Ü any other similar activity,
whether or not it is for a pecuniary beneﬁt (it means
intention to earn the proﬁt is not a criterion in determining
the states of business.)
(b) any activity or transaction in connection with or
incidental or ancillary to sub-clause (a)
(c) any activity or transaction in the nature of sub-clause (a),
whether or not there is volume, frequency, continuity
or regularity of such transaction
Examples : Even occasional transactions are also subject to GST e.g. Trader
of computer also providing consultancy for “how to set up Computer
Shop” to his friend for consideration.
(d) supply or acquisition of goods including capital goods
and services in connection with commencement or
closure of business
Examples : If covers purchase of capital asset or material before
commencement of business or sale of stock or ﬁxed asset at the closure
of business.
(e) provision by a club, association, society, or any such body
(for a subscription or any other consideration) of the
facilities or beneﬁts to its members
Examples : Facilities or beneﬁts provided by club etc. are i)Sports
facilities like swimming pool, table tennis, cricket etc.
(f) for a consideration, of persons to any admission,
premises
Examples : Entry tickets to amusement park, diwali mela, cinema
theater etc.
(g) services supplied by a person as the holder of an ofﬁce
which has been accepted by him in the course or
furtherance of his trade, profession or vocation
Examples : i) An advocate get appointed as member of the Arbitration
Tribunal.
Totalisator : A device showing the number and amount of bets staked
on a race, to facilitate the division of the total among those
backing the winner.
(i) any undertaken by the Central activity or transaction
Government, a State Government or any local authority in
which they are engaged as public authorities
Notes : This clause makes it clear that even the supplies of goods or
services or both undertaken by the Central Government, a State
Government or any local authority shall also get covered in the
deﬁnition of business.
IMPORTANT DEFINITIONS
Sec 2(17) “Business” includes-
General Activities Special Activities
Sec 2(84) “Person” - includes
Sec 2(107) “Taxable person”
A person who is registered or liable to
be registered under sec22 or sec 24
Sec 2(94) “Registered person”
A person -
Ü who is registered under section 25
Ü but does not include a person having
a Unique Identity Number
(a) An Individual
(b) A hindu undivided family
(c) A Company
(d) A Firm
(e) A limited Liability
Partnership
(f) An association of persons
or a body of individuals,
whether incorporated or not,
in India or outside India
(g) Any corporation established
by or under any Central Act,
State Act or Provincial Act or a
Govt. company as deﬁned
in clause (45) of section 2
of the Companies Act, 2013
(h) any body corporate
incorporated by or under
the laws of a country
outside India
(i) A co-operative society
registered under any law
relating to co-operative
societies
(j) A local authority
(m) Trust
(n) Every artiﬁcial juridical
person, not falling within any
of the above
(k) Central Government or a
State Government
(l) Society as deﬁned
under the Societies
Registration Act, 1860
Sec 2(105) “Supplier”
The person supplying the goods or
services or both. It includes an Agent
Sec 2(93) “Recipient”
Situation Recipient
Where a consideration is payablePerson liable to pay that consideration
Where no consideration is payable
for the supply of goods
Person to whom the goods are delivered or
made available, or to whom possession or
use of the goods is given or made available
Where no consideration is payable
for the supply of a service
Person including his agent to whom the
service is rendered
Territorial Water
12 NM24 NM
The High Seas
Contiguous Zone
Continental Shelf
Seabed & Subsoil
Exclusive
Economic zone
200 NM
1 NM = 1.85km
Oil Extraction
SEC 2 (56) “INDIA" Means
GST
REVISION
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a) Territory of India as referred to in article 1 of Constitution
(The territory of the Union of India viz., state and the
union territories.)
b) Its Ü Territorial Water, Ü seabed and
Ü Sub-soil underlying such waters, Ü continental shelf,
Ü exclusive economic zone or
Üany other maritime zone
c) The air space above its territory and territorial waters
(h) of a race club by way of totalisator or Activities including
a licence to book maker or activities of a licensed book
maker in such club and
Examples :
i)Sale of old furniture or scrap by a trader of mobile shop.
ii) Sale of old machinery by manufacturer.

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Sec 25 (4): A person who has obtained or is
required to obtain more than one registration.
Ü whether in one State or Union territory
or
Ü more than one State or Union territory
shall,
in respect of each such registration, be
treated as distinct persons for the purposes
of this Act.
Concept of Deemed Distinct Persons : Sec 25 CGST Act
In the given pictorial image of the Business unit 1 & 2
obtains separate registration then such units will be
treated as ‘Deemed distinct person’ & any stock
transfers amongst them will be covered ambit of supply.
Business
Unit 2
Business
Unit 1
Head
Oﬃce
GST
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Sec 25 (5): Where a person who obtained or
is required to obtain registration in a State or
Union territory in respect of an establishment,
has an establishment in another State or
Union territory, then such establishment
shall be treated as establishment of distinct
persons for the purposes of this Act.
Establishment in Diﬀerent State
H.O.
In the given pictorial image, If the business unit
has obtained a single registration for all its units
located in same state then it will be treated as
‘single Person’
The given pictorial image is of separate
Business under same PAN, Taxable person at
his option can taken a separate registered for
each such business. In such a case, they will be
treated as deemed distinct person & supply
among then will be liable GST.
In the given pictorial image as the business unit
located in different state and such establishment
is to be treated as distinct person.
Single Registration
Separate Establishment
Establishment in another country -
Explanation to Sec 8 of IGST Act
Establishment in non-taxable Territory
One person
SBI Ltd
[Bank]
Another Person
Branch
[Branch of Bank]
SBI BANK
JAMMU KASHMIR
SBI BANK
MUMBAI
SBI BANK
CHENNAI
SBI BANK
DUBAI
For the purpose of IGST Act
where a person has establishment in India
and any other establishment outside
India.
Then such establishment shall be treated
as establishment of distinct person
Concept of “Casual Taxable person” (CTP) and “Non-Resident Taxable Person” (NRTP)
Casual Taxable Person (CTP) - Sec 2(20)
Ü Compulsory registration u/Sec 24 of
CGST Act
ÜRegistration before commencement of
business and with advance payment of
tax
Ü Normal Registration Application :
GST REG-01
Ü PAN based GST Registration granted
Ü It is not available to Casual taxable
person
Normal Monthly Returns : GSTR-1,
GSTR-2 and GSTR-3
However, Annual Return is not required to
be ﬁled
ÜCan claim ITC of all inward supplies
(be it domestic/imported inputs, capital
goods or input services)
Non-Resident Taxable Person (NRTP)- Sec 2(77)
ÜCompulsory registration u/Sec 24 of CGST Act
Ü Registration before commencement of business and
with advance payment of tax
Ü Separate simpliﬁed Registration Application: GST
REG-09
Ü GST Registration granted without PAN
It is not available to Non-Resident taxable person
Ü GSTR-5Separate Simpliﬁed Return :
Ü Also, Annual Return is not required to be ﬁled
Ü Can claim ITC only in respect of goods - imported by
him [All other credits blocked for him- Sec 17(5) of CGST]
Registration
provisions
Threshold
Exemption
Not available Not available
Composition
Scheme
Return
provisions
ITC
provisions
Casual Taxable Person (CTP) [Sec 2(20)]: means
a person who occasionally undertakes transactions
Üinvolving supply of goods or services or both
Üin the course or furtherance of business,
Üwhether as principal, agent or in any other capacity,
Üin a State/UT where he has no ﬁxed place of business
Non-Resident Taxable Person (NRTP) :[Sec 2(77)] means
any person who occasionally undertakes transactions
Üinvolving supply of goods or services or both,
Üwhether as principal or agent or in any other capacity,
Übut who has no ﬁxed place of business or residence in
India .
AUTO EXPO
Important Comment
1) CTP or NRTP will apply for Registration at least 5 days prior to commencement of business
2) Advance deposit of tax at the time of Submitting the registration application.
3) Registration is valid for 90 days (further extension for 90 days)
GST
REVISION
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F Refer Q. 18 & 19 from Questioner
Deemed Distinct Persons

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Sec 7(1)=Supply Includes
Sec 7 - Supply
Supply of goods / Services with consideration
Sec 7(1) (a) All forms of supply of goods / services
Sec 7(1) (b) Import of Services
Made or Agreed to
be made
Sec 2(31) for consideration
Any payment
made or agreed
to be made whether
in money or otherwise a b
The monetary
value of any act or
forbearance
Supply
of goods/
services
-Inrespect of
-Inresponse to
-For inducement -Inrespect of
-Inresponse to
-For inducement
excludes
1) Any subsidy given by central or state govt.
2) Deposit unless applied such deposit
as consideration for the said supply.
In the course or furtherance
of Business [Sec 2(17)] Import of service for consideration
whether or not in the course or
furtherance of business
OLD CAR
DEALER
Such as For consideration
Sale of old Jewellery
Sale of old Car
Sale of car for personal use by an individual-
Not a supply in course or furtherance of business
Sale of old jewellery which was used personally-
Not a supply in course or furtherance of business
Prasadam supplied by religious places like temples,
mosques etc.- Not a supply in Course of furtherance of
business
No Particulars Explanation
1MadeGoods are already delivered or Service
is already provided to the recipient
2Agreed to
be Made
This is split up in two parts namely: (i)
There is an agreement for supply of
goods or provision of service
(ii) An advance has been received
against the supply of goods or
provision of service
Furniture House sold furniture to Mr. Ganesh. Sale
TransferTransfer between branches, between factory
and warehouse , factory premise to depot.
BarterMr. A trades his motorcycle with Mr B’s second hand
car without cash exchange between the two parties
ExchangeWhere a new phone is supplied for ` 20000 along
with an exchange of an old phone and if the price of the
new phone without exchange is ` 24000 the open
market value is ` 24000
DisposalSale of Machinery after the completion of its life as a
scrap sale
LicenceMr. Shaw a developer of information technology
software and holder of licence thereon. License to use
software was given to different clients : ` 18 ; hence, Mr.
Shaw is liable to pay GST whether he transfer such right
permanently or temporarily as the case may be.
RentalMr. Ranjit owns a Large vacant land in the backyard is
given on rent of ` 1,80,000 per month to a parking
contractor. It is a taxable supply of service and hence,
Mr. Ranjit is liable to pay GST.
LeaseM/s DCB Bank Ltd., given an asset under ﬁnancial lease
to M/s Gili Ltd. Repayment of ﬁnancial lease made by
the customer to the bank ` 80 lakhs which includes a
principal amount of ` 50 lakh. Financial leases shall be
taxed as supply of services. M/s DCB Bank Ltd., is liable
to pay GST
Import of GoodsGoverned by Custom Act
Import of
Service
Governed by IGST Act
Analysis
Import of
Services for
Business
Taxable
Import of
Services
other than
to business
Import by
Individual,
Govt.,
Charitable
Trust
Exemption
(detail discussion
under Exemption
Import by
others
Taxable
GST
REVISION
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Goods Sec 2 (52)Services Sec 2(102)
MEANS
Any kind of movable property Anything other than goods
Money
Securities
EXCLUDES
Separate consideration is charged Use of
Money orConversion of money
INCLUDES INCLUDES
Actionable Claims, Growing Crop,
grass & things attached to or forming
part of land agreed to be severed
before/under a contract of supply Explanation:- For removal of doubts, it is hereby
clariﬁed that the expression “services” includes
facilitating or arranging transactions in securities.
Newly Inserted by CGST
Amendemnt Act, 2018
F Refer Q. 28 from Questioner
F Refer Q. 22 & 23 from Questioner
F Refer Q. 51 from Questioner

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Supply of goods / service without consideration [Deemed supply]
Sec 7(2)(a)=Supply Excludes
Schedule III (Transaction not be treated as supply)
1.
Permanent transfer or disposal of business assets
where input tax credit has been availed on such assets.
2.
Supply of goods or services or both
Ü between related persons or
Ü between distinct person as speciﬁed in section 25,
3.Supply of goods
(a)
by an agent to his principal where the agent undertakes
to receive such goods on behalf of the principal
by a principal to his agent where the agent
undertakes to supply such goods on behalf of the
principal; or
(b)
4.Import of Service without consideration
Import of Services by a taxable person
Üfrom a related person outside India or
Ü from any of his other establishments outside India,
in the course or furtherance of business
Services by an employee to the employer in the course of or in relation to his employment.
1
Services by any court or Tribunal established under any law for the time being in force.2
The functions performed by the Members of Parliament, Members of State
Legislature, Members of Panchayats, Members of Municipalities and Members of
other local authorities
3(a)
The duties performed by any person who holds any post in pursuance of the
provisions of the Constitution in that capacity
(b)
(c)The duties performed by any person as a Chairperson or a Member or a Director in a
body established by the Central Government or a State Government or local authority
Services of funeral, burial, crematorium or mortuary including transportation of the
deceased.
4
Sale of land and, subject to clause (b) of paragraph 5 of Schedule II, sale of building5
Schedule I
Example : Vsmart Pvt. Ltd. had purchase new projectors. The existing old
projectors are donated to Trust on which ITC was taken at the time of
purchase. It treated as supply and liable to GST.
Provided that gift not exceeding ﬁfty thousand rupees in value
in a ﬁnancial year by an employer to an employee shall not be
treated as supply of goods or services or both.
Example : When Mr. Sagar [the Principal] located in Maharashtra supplies
certain goods to his agent Mr. Mayur [located in Delhi] and Mr. Mayur
undertakes to supply the said goods in Delhi on behalf of Mr. Sagar.
In the aforesaid case, supply of goods by Mr. Sagar to Mr. Mayur shall fall
within the ambit of the term ‘supply’ even if made without consideration and
shall be liable to GST (i.e.IGST)
Example : Mr.Atul works as an agent and is located in Maharashtra. Mr
Rajesh is a manufacturer and located in Maharashtra. Mr. Atul agrees to
purchase certain goods from New Delhi market on behalf of Mr. Rajesh
every month and supply the same to Mr. Rajesh. Supply of goods by Mr. Atul
to Mr. Rajesh shall fall within the ambit of term ‘supply’ even if made without
consideration.
1) Compensation for premature termination - Non Taxable as it is in relation to
employment.
2) Non compete fees received by an employee from employer -Taxable as it is not in
the course of or in relation to employment.
3) Casual labour appointed on daily basis for wages - Non Taxable as it is also as
employment contract.
Actionable claims, other than lottery, betting and gambling.6
Sale of land and Building Not treated as supply as per sch III , No GST
Rental , Leasing licensing of Land & BuildingTreated as Supply GST Payable
Sale of Building before completion
certiﬁcate or 1st occupancy whichever earlier
treated as supply para 5(b), Sch II GST
payable
Lottery, Betting, GamblingTaxable supply liable to GST
Other Actionable Claims Not treated as supply
Analysis
Import of Service (Analysis)
With consideration Without consideration
In the
course or
furtherance
of business
Not in
the course or
furtherance
of business
Related/ distinct
person
+
In the course or
furtherance of
business
Other
cases
Non
Taxable
Related Person (as per explanation to Sec 15) of CGST Act
(i) such persons are ofﬁcers or directors of one another’s
business
(ii) such persons are legally recognized partners in
business
(iii) such person are employer and employee
(iv) an person directly or indirectly owns, controls or holds
twenty-ﬁve per cent or more of the outstanding voting
stock or shares of both of them
(v) one of them directly or indirectly controls the other
(vi) both of them are directly or indirectly controlled by a
third person
(vii) together they directly or indirectly control a third person
(viii) they are members of the same family
Explanation: Persons who are associated in the business of
one another in that one is the sole agent or sole distributor or
sole distributor or sole concessionaire, howsoever described,
of the other, shall be deemed to be related.
Taxable
Difference between related person & Distinct Person u/s 25
Related Person Distinct Person
A separate entity under different PAN, but falling in the
relationship as per explanation to sec. 15
Separate branch / establishment of same Entity under same PAN.
Such branch/ establishment is separately registered under GST Act.
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Services by way of any activity in relation to a function entrusted to a
Panchayat under article243G or to a Municipality under
article 243W of constitution shall be treated neither as a supply of goods
nor a supply of service.
As per N/N 14/2017 - Central Tax (Rate)
Sec 7(2)(b)= Notified activities by Government
Omitted
Supply of goods from a place a non-taxable territory to a another place in the non-taxable
territory without such goods entering in India
7
Supply of warehoused goods to any person before clearance for home consumption 8a)
b)
Supply of goods by the consignee to any other person, by endorsement of document of
title to the goods, after the goods have been dispatched from the port of origin located
outside India but before clearance for home consumption
Newly Inserted by N/N 20/2019 CT (R) 20/09/02019
Service by way of grant of alcoholic liquor licence, against consideration in the form of
licence fee or application fee or by whatever name called by theState Government
in which they are engaged as public authorities, shall neither be treated as a supply of
goods nor a supply of service.”
Newly Inserted
F Refer Q. 38,41,53,61 & 64 from Questioner
F Refer Q. 71, 72 & 73 from QuestionerGST
REVISION
9

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Schedule II : Activities or transactions to be treated as supply of goods or services
Para 1 : Transfer of goods
1) Transfer of title in goods
2) Transfer of Title in
Goods on future date
(Ex. Hire Purchase)
Note : Sale of land & building not treated
as supply as per schedule 3 other than
construction intended for sale
[of para 5(b)]
Para 4 : Transfer of business asset
Note : If any person ceases to be a
taxable person then goods forming
part of business asset shall be deemed
to be supply unless :-
Business is transferred as going(i)
concern to another person.
Business is carried on by personal(ii)
representative who is taxable person.
Transfer of business Assets without Note :
consideration
ÜIf ITC taken supply as per schedule I

Supply of
goods
Transfer of right in goods
or undivided share in goods
without transfer of title in
goods
Supply of
Service
Any lease, tenancy,
easement, license to
occupy land Supply of
Service
Any lease, letting of building
including commercial,
industrial complex for
business / commerce
Supply of
Service
Any treatment or process
which is applied to another
person goods Supply of
Service
Permanent transfer of
Business Asset If goods as
a part of the asset are
permanently transferred
or disposed off with or
without consideration
Supply of
goods
Temporary transfer of
business assets If goods
as a part of business
asset are put to any private
use or are used for any
purpose other than
business with or without
consideration
Supply of
Service
Charges
Interest
10L
1L
Charges
Interest
10L
1L
Charges
Interest
10L
1L
Charges
Interest
10L
1L
Charges
Interest
10L
1L
1 2 3 4 5
Lessor Lessee
Hire Purchase Sale
GOA
Bike Rent
service
Bike Rental Service
Supply of Services
Residential House Rented for
Residential Use
Hotel
Is covered under the ambit of supply
but given an exemption beneﬁt
Supply liable to GST
as renting of
immovable property
Process of Job worker
Job Charges
GAC xxx
_______________

Dispatch
to Owner
Polishing
Job worker
BIKE SHOP
Renting of immovable propertya
b
c
d
e
f
Construction of complex, building,
civil structure of complex, building
intended for sale to buyer. But in
following case it shall not be treated
as supply. When entire consideration
has been received
- after completion certificate /
- It’s 1st occupation
whichever is earlier.
Temporary transfer of IPR
Development, design, programming,
customisation etc. of information
Tech. Software
Agreeing to the obligation to refrain
from an act or to tolerate an act.
Transfer of right to use any goods for
any purpose for cash, deferred
payment or other consideration.
SITE OFFICE
Flat Booking
Under Construction
building
Construction of Service intended for sale
before completion
Flat Value 80,00,000/-
1) 1 2 3
before CompletionAfter Completion
40,00,00020,00,000 20,00,000
2) 1 2
` 1 79,99,999
Taxable value for
GST = `80 Lacs
Taxable Value
= `80 Lacs
1
After Completion
80,00,000
Not taxable
As per Sch - III
3)
Works contracta Restaurant, catering or any
supply of service where food/
drink is supplied for consideration.Supply of
Service
SP
- Bread
- eggs
- milk
Catering Restaurant
Chandulal Builders
Labour + Material = Works Contract (construction)
Contractor
Supply of
Service
Sec 2(119) : Works contract
Building,
Construction,
Fabrication,
Completion,
Erection,
of any immovable property

wherein transfer of property in
goods (whether as goods or in
some other form) is involved in
the execution of such contract
}
Installation,
Fitting Out,
Improvement,
Modiﬁcation,
Repair,
Maintenance,
Renovation,
Alteration or
Commissioning
Para 7 : Unincorporated
AOP / BOI &
their members
supply of goods
by UAOP/BOI to
their members
for consideration
Supply of
goods
Para 2 : Land & BuildingPara 3 : Treatment or process Para 5 : Following activities always
treated as supply of service under GST
Para 6 : Composite supply treated as supply of service
Customized Software
Sale of Pre-packed Software
License to use prepacked
Software
Supply of Service
Supply of Service
Supply of Goods
GST
REVISION
10
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Sec 7(1A):- Where certain activities or transaction constitute a supply in accordance with the provisions of subsection (1), they shall be treated either as supply of goods or supply of services as referred to in Schedule II.
Inserted by CGST
Amendment Act 2018
F Refer Q. 44, 59 & 66 from Questioner

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Sec 8 : Composite Supply & Mixed Supply
Composite Supply as per Sec 2 (30) : means a supply made by a taxable person
to a recipient consisting of
Ü two or more taxable supplies of goods or services or both or
any combination thereof
Ü which are naturally bundled and
Ü supplied in conjunction with each other in ordinary course of
business one of which is a principal supply
The tax liability on a composite or a mixed supply shall be determined in the
following manner, namely:
(a) a composite supply comprising two or more supplies, one of which is a principal
supply, ; andshall be treated as a supply of such principal supply
Deﬁnition - Composite Supply
Illustration.— Where goods are packed and transported with insurance, the supply of (Goods + Service)
goods, packing materials, transport and insurance is a composite supply and supply of goods is a principal
supply;
(b) a mixed supply comprising two or more supplies shall be treated as a supply of that
particular supply which attracts the highest rate of tax.
Supply of Goods or Services by Employer to Employee
Read with Para 2 of Sch I and Para 1 of Sch III
Transaction which are excluded from any of tax for
transactions between employee are
Ü Supply of services by employee to employer incourse
of employment (Para 1 of Sch III)
Ü Gifts by employes to employee not exceeding ` 50,000
in a ﬁnancial year.(Proviso to Para 2 of Sch I)
Analysis
Reimbursement of expenses - on goods procured from
registered supplier & if GSTN of employer is quoted then
treated as supply
Allowances : - As a part of company policy allowances like
transport, education etc forming part of employment
contract hence same will not be liable to GST.
Deduction at concessional rate from salary toward
amenities provided : - If meal coupons/food provided to
employees at concessional rate & such amount is
recovered from salary. then it's a supply.
The term ‘gift’ has not been deﬁned in the GST law.
In common parlance, gift is made without
consideration, is voluntary in nature and is made
occasionally. It cannot be demanded as a matter of right by the
employee and the employee cannot move a court of law for
obtaining a gift.
Perquisites are not liable to GST : Services by an
employee to the employer in the course of or in relation to
his employment is outside the scope of GST (neither supply
of goods or supply of services).
Hence, supply by the employer to the employee in terms of
contractual agreement entered into between the employer
and the employee, will not be subjected to GST.
Example : VSmart Pvt. Ltd. on occasion of Independence
Day distributes gift hamper to its employee worth `
3,00,000. Does it qualify as supply? Would your answer be
different if gifts of ` 42,000 have been given to employee?
Solution: As per proviso to para 2 of sch - I, if gift exceeding
` 50,000 in value in a ﬁnancial year given by an employer -
employee, then it will be treated as supply & liable to GST.
So in given case, if gift value is ` 3,00,000 then, on such
total value GST is payable.
But it value of gift is ` 42, 000 in a ﬁnancial year, then it
would not be treated as supply and no GST is payable.
Gift by employer to employee
Sch. I provides that gifts not exceeding ` 50,000 in
value in a F.Y by an employer to an employee shall not
be treated as supply of goods or services or both.
However, gifts of value more than ` 50,000 made
without consideration are subject to GST, when made in
the course or furtherance of business.
However, services provided by an employee to the
employer in the course of or in relation to his
employment shall not be treated as supply of services
[Schedule III (discussed in subsequent paras)]
How to determine whether the supply are naturally bundled in the ordinary course of business?
Following factors to be considered
Concept-
1. Large number of recipient reasonablely expect
such supply to the provide as a package
Example : Breakfast with hotel room booking

4. Elements are normally advertised as a package
Example : Dosa pan with wooden spoon

2. Majority of Supplier in a particular area or
business provide such supply in bundle
Example : Television Set with warranty and
servicing

3. Nature of various supply of goods or services
in a bundle
Example : Stay in a Hotel with Laundering Free

5. The different elements are integral to one overall
supply. If one or more is removed, the nature of
the supply would be affected.
Example : Spects with glass and frame

Example : When a consumer buys a television set and he also gets warranty and a maintenance contract
with the TV, this supply is a composite supply. In this example, supply of TV is the principal
supply, warranty and maintenance services are ancillary.
Sec 2(90) Principal Supply - means the supply of goods or services which constitutes the predominant
element of a composite supply and to which any other supply forming part of that composite supply is
ancillary
GST
REVISION
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Mixed Supply as per Sec 2 (74) : means
Ü Two or more individual supplies of goods or services or
any combination thereof
Ü Made in conjunction with each other by a taxable person for
a single price
Ü Where such supply does not constitute a composite supply
Illustration.— A supply of a package consisting of canned foods, sweets, chocolates, cakes, dry fruits,
aerated drinks and fruit juices when supplied for a single price is a mixed supply. Each of these items can be
supplied separately and is not dependent on any other. It shall not be a mixed supply if these items are
supplied separately
Deﬁnition - Mixed Supply
Concept
How to determine if a particular supply is a mixed supply?
In order to identify if the particular supply is a mixed supply, the ﬁrst requisite is to rule out that the supply is a
composite supply.
A supply can be a mixed supply only if it is not a composite supply. As a corollary it can be said that if the
transaction consists of supplies not naturally bundled in the ordinary course of business then it would be a
mixed supply.
Example : A Shopkeeper selling storage water bottles along with refrigerator. Bottles and the refrigerator can
easily be priced and sold independently and are not naturally bundled. So, such supplies are mixed supplies.
F Refer Q.56, 58, 62 & 75 from Questioner

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Student Try to Make your own summary
GST
REVISION
12
All Important Clariﬁcations are given at the end of Module 2

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Chapter 3
Reverse Charge & ECO
Supplier Recipient
C.G.
Invoice
Value 1,00,000
GST 18000
@ 18%
Invoice
Value
1,00,000
Forward Charge Reverse Charge
GAR 7
` 18000
C.G.
GAR 7
` 18000
Supplier Recipient
Supplier has to assess the tax & transfer to Recipient
Supplier is liable to make payment to Govt.
Supplier has to register under GST
Monthly [In some cases quarterly]
Payment
to C.G.
Registration
Due date of
Payment
Recipient has to assess the tax and Supplier will not charge GST in invoice.
Recipient is liable to make payment to Govt.
Recipient has to register under GST
Monthly [In some cases quarterly]
Assessment
Goods- Sec 12(2) of CGST
Service - Sec 13(2) of CGST
by using
- Electronic credit ledger
- Electronic Cash ledger
Time of
Supply
Mode of
Payment
By using electronic cash ledger Recipient cannot use his electronic credit ledger for
payment of GST on such supply, but after payment of GST under RCM, he can take input
tax credit as per the provision of ITC.
Goods- Sec 12(3) of CGST
Service - Sec 13(3) of CGST
Supplier and Recipient both does not assess the liability.
ECO will assess the liability like supplier
ECO is liable to make payment to Govt.
ECO has to register under GST
Monthly [In some cases quarterly]
by using
- Electronic credit ledger
- Electronic Cash ledger
Goods- Sec 12(2) of CGST
Service - Sec 13(2) of CGST
A person
involving an ECO
in anymanner
Any person
SP
SR
GPS
System
Payment of GST
Payment by ECO
CGST Act, 2017
Sec 9(3) Reverse Charge in
notiﬁed cases
Sec 9(4) Reverse Charge in case of supply by
Unregistered to Registered
Sec 9(5) Electronic Commerce Operator
Sec 2(98) : Reverse Charge
the liability to pay tax by the recipient of supply of goods means
or services or both instead of the supplier of such goods or
services or both under section 9(3) or 9(4), or under section
5(3) or 5(4) of the Integrated Goods and Services Tax Act.
The Government may, on the recommendations of the Council,
Ü by notiﬁcation, specify categories of supply of goods or services or both,
Ü the tax on which shall be paid on reverse charge basis by the recipient of such goods or services or both and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax
in relation to the supply of such goods or services or both.
Sec 9(3) : Reverse Charge under notiﬁed cases
Legal Provision
GST
REVISION
13
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1 Supply of Services in relation to transportation of goods by road GTA:-
By To
Goods Transport Agency
who has not paid
central tax at the rate
of 6% (CGST 6% & SGST 6%)
(inserted by N/N 22-2017
C.T. (Rate)
Where a isperson liable to pay freight
a) registered under or governed by factories Any factory
Act, 1948
b) under Societies Registration Act, Any society registred
1860 or under any other law for time being in force in any
part of India
c) Any established by or under any; co-operative society
d) Any person registered under CGST Act, under IGST
Act, under SGST Act or UTGST Act
e) established, by or under any law; or Any body corporate
f) (Including LLP) whether Any partnershipfirm
registered or not under any law including association of
persons
g) Any Casual Taxable Person
u factory
uSociety registered
uCo-operative Society
u Any registered person
under GST
uBody Corporate
uPartnership Firm or
AOP
uCTP
Deﬁned in para 2(ze) of N/N
12/2017 means any person who
provides service in relation to
transport of goods by road AND
issues Consignment Note, by
whatever name called.
Goods Transport Agency (GTA)
Person in taxable territory
Mentioned in (a) to (g) i.e.
Payment of GST@ 12% (6%+6%)
with full ITC of GTA
GTA Services to
Any Registered
person under GST
Payment of GST@ 5% (2.5%+2.5%)
without ITC to GTA
GTA Service
GTA services to
any unregistered Person
GST is payable
under normal
charge by
GTA
GTA Service provided to
notified person
above (a to g)
GST is payable
under normal
charge by GTA
Service provided
to any other
unregistered
person.
Exempt
Service provided
to registered
person
Service provided
to unregistered person
Reverse charge
is applicable &
recipient who
pays the freight is
liable to GST
If services
provided to
notified person
(above a to g)
located in
taxable Territory
If services
provided
to other
unregistered
person
Exempt
Reverse charge is
applicable above notified
person is liable to pay GST
Exemption:- Sl.No. 21A (of notiﬁcation 12/2/2017) :- Service provided by GTA to an unregistered person
Exemption is available for Services provided by a goods transport agency to an unregistered person, including an
unregistered casual taxable person, other than the following recipients, namely: -
(a) any factory
(b) any Society
(c) any Co-operative Society
(d) any body corporate
(e) any partnership ﬁrm whether registered or not under any law including AOP
(f) any casual taxable person registered under the GST Act.
Analysis of GTA services & options available to it
“Provided that nothing contained in this entry shall apply to services provided by a goods
transport agency, by way of transport of goods in a goods carriage by road, to, -
(a) a Department or Establishment of the Central Government or State Government or Union
territory; or
(b) local authority; or (c) Governmental agencies,
Which has taken registration under the Central Goods and Services Tax Act, 2017 only for the
purpose of deducting tax under section 51 and not for making a taxable supply of goods or
services. (N/N 29/20180CT (R) dt 31/12/2018)
Amended
Sector :- Transportation and Renting of Motor Vehicle
Person liable to pay Tax
2 Services Renting of a motor vehicle:-
provided by way of renting of a motor vehicle
By
To
Any person other than a body corporate,
(paying CGST @ 2.5% &SGST @ 2.5 % on
renting of motor vehicles with input tax credit
only of input service in the same line of business)
Anybody corporate
located in the taxable
territory.
Person liable to pay tax : Anybody corporate
located in the taxable territory.
Newly Inserted by N/N 22/2019
CT-(R) dt 30/09/2019
RCM Notiﬁed Services
N/N 13/2017-CT (Rate)
N/N 4/2017-UTT (Rate)
N/N 4/2017-IT (Rate)
Dated 28th June, 2017
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REVISION
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3 Service Supplied by way of legal service Legal Service:-
directly or indirectly
By To
Person liable to pay
tax : Any business
entity located in the
taxable territory.
Üan Individual advocate including a senior
advocate or
Üﬁrm of advocates
to any business entity
located in the taxable
territory
Explanation.- means any service provided in relation to advice, consultancy or "legal service"
assistance in any branch of law, in any manner and includes representational services before any court,
tribunal or authority.".
“Senior advocate” [para 2(zzd)N/N 12/2017] has the
meaning assigned to it in section 16 of the Advocates Act,
1961”.
As per Section 16 of the Advocates Act, 1961 an advocate may, with
his consent, be designated as senior advocate if the Supreme Court
or a High Court is of opinion that by virtue of his ability of standing at
the Bar or special knowledge or experience in law] he is deserving of
such distinction.
Sector :- Legal
Representation By Senior Advocate
B.E (Vsmart)
liable to pay tax
“Business Entiry” [para 2(n)N/N 12/2017] means any person carrying out business.
“LLP” [explanation (e)N/N 22/2017 C.T. (Rate) ] A "Limited Liability Partnership" formed and registered
under the provisions of the Limited Liability Partnership Act, 2008 shall also be considered as a
partnership ﬁrm or a ﬁrm.
Arbitral Tribunal Business entity in taxable territory
4 In respect of services provided to agreed Arbitral Tribunal:-
to be provided
Note :
1) Arbitral Tribunal is a private tribunal constituted by parties in disputes where one or more person ( Arbitrator)
are refered by the parties to resolve the dispute in themselves and by who's decision they agreed to bound
By To
Person liable to pay tax :
Business entity in Taxable
territory is liable
ARBITRATOR
Reliance Industries
GST
REVISION
15
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5 Any Services supplied by
Sector :- Government
Business
entity in
taxable
territoryÜ Ü Central Govt. State Govt.
Union Territory Local authority Ü Ü
except
(a) Renting of immovable property, and
(b) (i) Services by the department of
post by way of speed post, express
parcel post, life insurance and agency
services provided to
a person other than Central
Government State Government
or Union Territory or local authority.
(ii) Services in relation to an aircraft or a
vessel, inside or outside the precincts
of a port or an airport
(iii) Transport of goods or passengers
By To
Person liable to pay tax : Business entity
in Taxable territory is liable
6 Services supplied by renting of immovable property
Explanation :- “renting of immovable property”
means allowing, permitting or granting access,
entry, occupation, use or any such facility, wholly
or partly, in an immovable property, with or
without the transfer of possession or control of
the said immovable property and includes
letting, leasing, licensing or other similar
arrangements in respect of immovable
property.'. (N/N 15/2018 - CT (Rate) dt
26/06/2018)Newly Inserted
Service provided by Govt. /LA
Normally all services provided to
Business entity in a taxable
territory
RCM is applicable & under reverse
charge Business Entity is liable to
pay tax
Note:
1) Also refer Exemption chapter for
details
2) If business entity is in Non-
taxable territory, then under normal
change Govt./LA is liable to pay
tax.
1 ) Service by department of
post like speed post, etc.
2) service in relation to vessel
/aircraft at port/airport
3) Goods/Passenger
Transportation service
Above services fall under
Normal change & Govt. or local
authority is liable to pay tax.
Renting of immovable
property
Service provided
to person registered
RCM is Applicable,
registered person is
liable to pay tax
Service to
unregistered
person
Normal charge
is applicable
*LA - Local Authority
Any registered person under
GST
By To
Ü Ü Central Govt. State Govt.
Union Territory Local authority Ü Ü

Services supplied by way of transfer of development
rights or Floor Space Index (FSI) (including additional FSI) for
construction of a project .
By
To
Any Person Promoter
Person liable to pay
tax :- Promoter
7
Long term lease of land (30 years or more) against
consideration in the form of upfront amount (called as
premium, salami, cost, price, development charges or
by any other name) and/or periodic rent for
construction of a project
By To
Any Person Promoter
Person liable to pay
tax :- Promoter
8
Sector :- Construction
Person liable to pay tax
: Any registered person
in taxable territory
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10 Service Supplied Recovery Agent:- Person liable to pay tax : Banking company or
financial Institution or Non- banking financial
Institutions located in taxable territory
11 Direct selling Agent :-
Services supplied
Person liable to pay tax : A banking company or
a non-banking financial company, located in the
taxable territory.
To
Individual Direct Selling Agents (DSAs)
other than a body corporate, partnership
or limited liability partnership ﬁrm.
A banking company or a non-banking ﬁnancial
company, located in the taxable territory.
By
12 Supply of Services
By To
Members of Overseeing committeeReserve Bank of India (RBI)
Person liable to pay
tax : Reserve Bank of
India (RBI)
Note : Overseeing Committee formed by RBI which aimed to vet resolution of all types of loans
would harm customers as well as banks
13
Person liable to pay
tax : A banking company
located in the taxable
territory.
To
Business Facilitator
A banking company located
in the taxable territory.
By
Services supplied
“2(o) “business facilitator or business correspondent” means an intermediary appointed under the business
facilitator model or the business correspondent model by a banking company or an insurance company under
the guidelines issued by the Reserve Bank of India;”
- Thus the role of business facilitators is to ensure greater ﬁnancial inclusion and increasing the outreach of
banking sector as they are appointed by Banks as an intermediary.
Sector :- Banking and Insurance
9 Insurance Agent:-
Service Supplied
By To
Insurance Agent
Any person carrying
insurance business
Person liable to pay tax : Any person carrying any insurance
business located in taxable territory e.g. LIC or GIC
“Insurance Agent” means an insurance agent licensed under section 42
who receives or agrees to receive payment by way of commission or other
remuneration in consideration of his soliciting or procuring insurance
business [including business relating to the continuance, renewal or revival of
policies of insurance.]
Insurance
Agent
Mr. S
Policy
Holder
Carrying Insurance Business
Comment :- Many insurance companies who are selling their policies through
ECO operator not being licensed as Insurance agent under sec 42 of
Insurance Act, for them reverse charge shall not be applicable.
By To
Recovery Agent
Ü a Banking company or
Ü a Financial Institution or
Ü NBFC
RECOVERY VAN
Mr. X is
recovery agent
Just For Knowledge:-
1. Types of services supplied by Business Facilitators - Business Facilitators provide various services which
includes:-
a. Identiﬁcation of borrowers and ﬁtment of activities
b) Collection and preliminary processing of loan applications including veriﬁcation of primary informtion/data
c) creating awareness about saving and other products and education and advice on managing money and debt
counselling
d) processing and submission of application of banks
e) promotion and nurturing Self-Help Groups/Joint Liability groups
f) Post -sanction monitoring
g) Monitoring and hand holding of Self-Help Groups/Joint Liability Groups/Credit Groups/Other, and
h) Follow up for recovery
2. The bank pays to business facilitation in form of commission for providing such services, so as per amendment bank
are liable for payment of GST as receiver of service on commission paid by them
14
Person liable to pay tax : A
business correspondent, located in
the taxable territoryTo
An agent of Business
Correspondent (BC)
A business correspondent,
located in the taxable territory
By
Services supplied
Analysis:-
1. Business correspondent - Are appointed by bank after conducting thorough due diligenceBusiness correspondents
can be NGOs/MFIs set-up under Societies/Trust Acts, Societies registered under Mutually Aided Co-operative
Societies Acts or the Cooperative Societies Acts of States, registered NBFCs not accepting public deposits and post
ofﬁcers
2. Business correspondent supplies all types of services which are provided by business facilitator and in addition they are
also engaged into providing small value credit and recovery of the same.
3. The bank pays them in the form of commission or fees for providing such services. These business correspondent have
also appointed their agents and paying them commission or fees
As per the amendment, business correspondents will be liable for the payment of GST as receivers of services on
commission paid by the business correspondents to their agent.
GST
REVISION
17
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Lyrics of SongPainting by Painter}
ArtisticMusical
Acting by Actor
Dramatic
15 Supply of Services by way of transfer or permitting use or
enjoyment of a copyright covered under sec 13(1)(a) of
Copyright Act,1957 relating to original literary, dramatic,
musical or artistic works
By To
An author, music composer,
photographer, artist
A publisher, music company, producer
or the like, located in the taxable territory
Person liable to pay tax : A
publisher, music company,
producer or the like, located in
the taxable territory
(Covered by Separate entry in 9A)
16 Supply of services by way of transfer or permitting the use or
enjoyment of a copyright covered under section 13(1)(a) of
the Copyright Act, 1957 relating to original literary works
By To
An Author A Publisher located in the taxable
territory
Books by Author
Literary
Person liable to pay tax :
A Publisher located in the
taxable territory
Conditions:- (Reverse charge is not applicable in following cases)
Provided that nothing contained in this entry shall apply where, -
(i) the within the time limit with the jurisdictional GST author has taken registration ,and ﬁled a declaration,
commissioner that
Ü he exercises the option to pay central tax on the service under forward charge and
Ü to comply with all the provisions as they apply to a person liable for paying the tax in relation to the supply of any goods
or services or both and
Ü that he shall not withdraw the said option within a period of 1 year from the date of exercising such option;
(ii) the author makes a declaration, on the to the publisher. invoice issued by him in Form GST Inv-I
Note:-Thus, where the author is registered and he make a declaration to pay the tax to proper ofﬁcer then publisher is not
required to pay tax & Author will pay tax under forward charge.
Newly Inserted
Sector:- Copyright & Development right
17 Person liable to pay tax : A registered
person, located in the taxable territory
Security Services supplied by way of
supply of security personnel
Sector:- Security Services
To
any person other than a body corporatea registered person
Provided that nothing contained in this entry shall apply to, (Exceptions) –
(I) (a) a Department or Establishment of the Central Government or State Government or Union territory; or
(b) local authority; or
(c) Governmental agencies; which has taken registration under the Central Goods and Services Tax Act, 2017 (12
of 2017) only for the purpose of deducting tax under section 51 of the said Act and not for making a taxable
supply of goods or services; or
(ii) a registered person paying tax under section 10 of the said Act.
By
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By To
Said Company or Body
Corporate
Director of a Company or Body
Corporate

18 Services supplied Director of company:-
Director of Company
Note 1
Person liable to
pay tax : Company or
Body Corporate is liable
Employee of the CompanyWhole time director
Non-Executive directorCan’t be called as employee of Company. Hence sitting fees, commission is taxable
Explanation
By
Any person
To
Any body corporate or partnership
ﬁrm located in taxable territory
Person liable to pay tax :
Body Corporate or
partnership firm in
taxable territory is liable
19 - Service Supplied in relation to sponsorship service Sponsorship Service:
Sector:- Miscellaneous
Directors
Company
In the pictorial image director is providing
services to a company and this is covered
under the ambit of reverse charge.
Sponsored By
Sponsored BySponsored By
Sponsored By
V’Smart
AcademyNOKIA
V’Smart Academy
TATA Motors
Brook Bond
Lakme
20 Services of Lending of securities:-lending of
securities under Securities Lending Scheme,
1997 of SEBI
Person liable to pay tax :
Borrower i.e. a person who
borrows the securities
By To
Lender
( i.e. a person who deposits the securities registered in
his name or in the name of any other person duly
authorised on his behalf with an approved intermediary
for the purpose of lending under the Scheme of SEBI)Borrower
( i.e. a person who borrows the securities under
the Scheme through an approved intermediary
of SEBI).
Newly Inserted by N/N 22/
2019 CT-(R) dt 30/09/2019
GST
REVISION
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RCM Notiﬁed Services (Notiﬁed in IGST)N/N 10/2017-IGST (Rate)Dated 28th June, 2017
16 Any service supplied Import of Services:-
By To
Any person from a non
taxable territory
Any person other than non taxable
online recipient (NTOR)
Note 1:- When any service provided by a person in non taxable territory to a person in a taxable territory then it
amounts to import of services (Inter-State Supply) and subject to IGST
Note : Non taxable online recipient (NTOR) is discussed in the chapter of place of supply under IGST
Act, 2017
Person liable to pay tax :
Any person located in
taxable territory
In respect of services provided or agreed to be provided by way of
transportation of goods by a vessel from a place outside India up to
the customs station of clearance in India
By To
Person located in
non-taxable territory
Importer
17
Reverse Charge under IGST
Person liable to pay tax :
Importer as defined in
clause (26) of Section 2 of
the Customs Act, 1962
located in the taxable
territory
Transportation by Vessel
F Refer Q. 14, 20, 26, 28 & 30 from Questioner
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GST
REVISION
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The central tax in respect of the
Sec 9(4) (CGST) Reverse Charge - when supply of goods or services by unregistered
person to registered person
Legal Provision
supply of speciﬁed
category of goods or
services or both by a
supplier, who is not
registered,
a speciﬁed
class of
registered
person
toAmended
shall be paid by such person on reverse charge basis as the
recipient of such supply of goods or services or both and
all the provisions of this Act shall apply to such recipient
as if he is the person liable for paying the tax in relation to the supply
of such goods or services or both.
Real Estate Sector
1
Person liable to pay
tax:- Promoter
By
value of inputs and input services purchased from
registered supplier is less than 80%
Newly Inserted N/N 07/2019-CT
(R) dt 29/03/2019 & N/N 7/2019-
IT(R) dt29/03/2019
Purchase from unregistered person
N/N 07/2019 CT(R) dt 29/03/2019
Note:- Reverse Charge is applicable only to the extent of shortfall to make it 80%
Promoter
To
2 Person liable to pay
tax:- Promoter
To
Supplied by unregistered person Promoter
By
In case of Cement
Newly Inserted N/N 07/2019-CT
(R) dt 29/03/2019 & N/N 7/2019-
IT(R) dt29/03/2019
3 Person liable to pay
tax:- Promoter
To
Promoter
By
In case of Capital Goods
Newly Inserted N/N 07/2019-CT
(R) dt 29/03/2019 & N/N 7/2019-
IT(R) dt29/03/2019
Supplied by unregistered person
Note : Above reverse charge is applicable in a case
(i) Promotor is opting for 1% or 5% scheme of N/N 11/2017
(ii) Promoter has to pay GST under section 9(4) of the CGST Act, at the rate of 18% on all such inward supplies
(to the extent short of 80% of the inward supplies from registered supplier).
(iii) Where cement is received from an unregistered person, the promoter shall pay tax on supply of such cement
on, under section 9(4) of the CGST Act, at the applicable rate which is 28% (CGST 14% + SGST 14%) at
present.
(iv) Moreover, GST on capital goods shall be paid by the promoter on reverse charge basis, under section 9(4)
of the CGST Act at the applicable rates.
F Refer Q. 32 & 33 from Questioner

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Proviso
Proviso
Provided that where an electronic
commerce operator does not have a
physical presence in the taxable territory,
any person representing such electronic
commerce operator for any purpose in the
taxable territory shall be liable to pay tax
Provided further that where an electronic
commerce operator does not have a
physical presence in the taxable territory
and also he does not have a
representative in the said territory,
such electronic commerce operator shall
appoint a person in the taxable territory for the
purpose of paying tax and such person shall
be liable to pay tax.
The Government may, on the recommendations of the Council,
Ü by notiﬁcation, specify categories of services
Ü the tax on intra-State supplies of which shall be paid by the electronic commerce operator if such services
are supplied through it, and
Ü all the provisions of this Act shall apply to such electronic commerce operator as if he is the supplier liable
for paying the tax in relation to the supply of such services:
Sec 9 (5) - CGST liability of E-commerce operator
Legal Provision
It has notiﬁed the following categories of services supplied
through ECO for this purpose -
(a) Transportation of Passengers by Cab etc.:
Services by way of transportation of passengers by a
radio-taxi, motorcab, maxicab and motor cycle.
Notiﬁed ECON/N 17/2017 - CT (Rate)- 28th June, 2017
A person
involving an ECO
in anymanner
Any person
SP
SR
GPS
System
Payment of GST
Sec 2(45) : E Commerce Operator - means any person who owns, operates or manages
digital or electronic facility or platform for electronic commerce
Deﬁnition

(b) Renting of Accommodation by unregistered Hotels :
Services by way of providing accommodation in hotels,
inns, guest houses, clubs, campsites or other commercial
places meant for residential or lodging purposes,
except where the person supplying such service
through electronic commerce operator is liable for
registration under section 22(1) of the CGST Act.
involving an ECO
in anymanner
Any person
Payment of GST
9(5) ECO
Passenger transport by
cab/motor cycle
All supplies made through
ECO (Whether supplier is
registered or not ECO is liable
to Pay 100% tax.)
Renting by rooms by Hotels,
Inns, etc.
Supplier is registered under GST
Supplier himself is liable to pay
tax.
Housekeeping services
Supplier is not registered
under GST
ECO is liable to pay tax on all
supplier made through it.
}
Analysis :
Note: The reverse charge provisions as discussed in this chapter are also applicable under IGST Act,
UTGST Act & SGST Act.
(c) Service by Unregistered Plumber,
Housekeeper etc :
services by way of house-keeping, such as
plumbing, carpentering etc,
except where the person supplying such
service through electronic commerce operator is
liable for registration under sub-section (1) of
section 22 of the said Central Goods and Services
Tax Act. (Inserted by N/N 23/2017)
house-keeping,
plumbing, carpentering
services provider
F Refer Q. 24 & 25 from Questioner
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REVISION
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All Important Clariﬁcations are given at the end of Module 2

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Chapter 4
Composition Scheme (Sec 10)
Aggregate Turnover
means the aggregate value of
Ü all taxable supplies (excluding the value of inward supplies on which tax is
payable by a person on reverse charge basis),
Ü exempt supplies,
Ü exports of goods or services or both and
Ü inter-State supplies of persons having the same Permanent Account Number,
to be computed on all India basis
but excludes central tax, State tax, Union territory tax, integrated tax and cess
Section
2(6)
Example 1 : XYZ ltd is a manufacturing company located in Bangalore.
During the ﬁnancial year 2018-19 total value of supplies including
inward supplies taxed under reverse charge basis are as follows :
i) Intra state supplies of goods chargeable to Nil rate of GST - `
15,00,000
ii) Intra state supplies made under forward charge - `88,50,000
(including GST@18%)
iii) Intra state supplies of goods exempted under section 11 of CGST
act - ` 9,00,000
iv) Inward supplies of goods on which tax is payable under RCM - `
5,00,000
v) Inter-State supply to various buyers `16,80,000 (including IGST
@ 12%)
vi) Inter-State supply to own establishment under same PAN `
11,20,000 (including IGST @ 12%)
Calculate aggregate turnover.
Particulars `
Intra-state supplies Nil rate
Intra State (88,50,000 x 100)
118
Exempted supply
Inward Supply
Inter Supply
Own Establishment
Aggregate Turnover
15,00,000
75,00,000
9,00,000
-
15,00,000
10,00,000
1,24,00,000
1.
2.
3.
4.
5.
6.
Solution: Calculation of aggregate turnover:
Important Comments :
Q. What does “Aggregate”
means?
uIt covers all the supplies effected
by a person having same PAN all
over India basis.
Q. Why Inward Supplies under
RCM is excluded from aggregate
turnover?
uAs per Sec 9(3) & 9(4) for
liability under RCM all provision
of this act are applicable to
recipient as a supplier & taxable
in the hands of recipient as a
supplier & taxable in the hands
of recipient.
uIt can be misunderstood that the
value of inward supply under
RCM to be included in aggregate
Turnover of receipient.
uDeﬁnition speciﬁcally excluded
value of inward Supplies subject
RCM.
Turnover in State” or “Turnover in Union Territory
Section
2(112)
2(108) : Taxable Supply
2(78) : Non-Taxable
Supply
means a supply of goods or services or both which is leviable to tax under this Act
means a supply of goods or services or both which is not leviable to tax under this Act
(i.e. CGST Act) or under the Integrated Goods and Services Tax Act
2(47) : Exempt
Supply
means a supply of any goods or services or both
Ü which attracts or nil rate of tax
Ü which may be under section 11, or under section 6 of the wholly exempt from tax
integrated Goods and Services Tax Act, and
includes non-taxable supply
Example 4 : On the basis of following , determine Total value of exempt supply
a) Supply of goods @12% but fully exempted by notiﬁcation
b) Supply of goods/services where rate in GST tariff is NIL
c) Supply of goods/ services for exports where rate is zero rate
d) Supply of petrol & diesel
e) Supply of goods @ 18% but partly exempted by notiﬁcation
f) Supply of goods/Services @ 5% where ITC is not available
Particulars
Total value of supply
Value of exempt supply
g) Supply of goods under composition scheme 1%
1,50,000
56,000
1,75,000
95,000
48,000
86,000
Value of Supply (`)Exempt supply or not
6,30,000
20,000
Exempt
Exempt
Not Exempt
Exempt
Not Exempt
3,01,000
Not Exempt
Not Exempt
“turnover in State” or “turnover in Union territory” the aggregate value of means
Ü all taxable supplies (excluding the value of inward supplies on which tax is payable
by a person on reverse charge basis) and
Ü exempt supplies made within a State or Union territory by a taxable person,
Ü exports of goods or services or both and
Ü inter-State supplies of goods or services or both made from the State or Union
territory by the said taxable person
but excludes central tax, State tax, Union territory tax, integrated tax & cess.
Note: Same as aggregate but difference is only of that state means interstate with same PAN
not included
IMPORTANT DEFINITIONS
GST
REVISION
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S.N.Categories of registered personCentral
Rate
State/UT
GST Rate
Total
Rate
1
Manufacturers other than manufacturers of such
goods as may be notiﬁed by the government
0.5%0.5%1%
3Other Suppliers 0.50%0.50%1%
2
Suppliers making supplies referred to in Clause (b)
of para 6 of schedule II
2.50%2.50%5%
Example - Restaurant, Catering, Mess or any
other service contract where goods as food
or drink is supplied for human consumption
Basis of
Calculation
Turnover in
State
Turnover
in State
Turnover of
taxable supplies
of goods &
services in State
Objective of
the Scheme
To bring simplicity and reduce the compliance cost for the small tax payers.
Eligibility
A Registered Person, whose aggregate turnover in the preceding FY does not exceed ` 1.5
Cr. [Incase of Special Category States, the turnover limit is ` 75 Lakhs except state of
Assam, Himachal Pradesh and Jammu & Kashmir as the limit is 1.5 Cr. ]
Rate of Tax[N/n 8/2017-CT, dt: 27.06.2017]
¡ Concessional tax rate is applicable for persons opting for Composition Levy.
¡ Person opting for Composition levy is not eligible to collect GST on the supplies
Conditions
for
Composition
Scheme
Registered person shall be eligible to opt Composition Scheme, if he is not engaged in-
(a) Save as provided in subsection (1), he is not engaged in the supply of services
(b) Supply of goods are not leviable to tax
(c) making inter-State outward supplies
(d) making supply of goods through an ECO who is required to collect tax at source
(e) He is not a manufacture of notiﬁed goods such as Ice Cream, Pan Masala, Aerated
water and Tobacco and manufactured Tobacco Substitute
Conditions
and
restriction
for
composition
Levy
Supplier Opting for composition scheme, shall-
1. Not to be engaged in manufacture of Speciﬁed goods [Ice Cream, Pan masala, Aerated
water and Tobacco]
2. Not to be a Casual Taxable Perso/ Non Resident
3. Not eligible for Input Tax Credit
4. Not to issue a Tax Invoice and Collect GST [instead issue Bill of Supply]
5. Mention the details and status of Composition Dealer on Bills and Boards
Turnover
Limit of
Composite
Tax in
Current
year
The option availed of by a registered person under sub-section (1) with effect from shall lapse
the day on which his aggregate turnover during exceeds the limit speciﬁed a ﬁnancial year
under sub-section (1). (i.e. 1.5 Cr.)
Once the aggregate turnover of a registered person exceeds the limit he shall immediately
liable to pay tax @ normal rates as speciﬁed by GST Act & therefore all the regular provisions
of Act shall become applicable from then.
Following are few examples wherein we have assumed that aggregate turnover of Previous
ﬁnancial year does not exceeds ` 1.5 Cr.
Inward Supply Intra-State outward supply
Supplier
Input & inputs services
Ü used in Nil Rated `18,00,000
Ü used in other Supply `10,00,000
A Nil rated Supply ` 15,00,000
B Exempted Supply ` 20,00,000
C Other Taxable Supply ` 15,00,000
Example 1 : If supplier does not opt for composition
Calculate net tax payable. If Input & output rate of GST is 12%
Solution:
1) Outward Supply
Ü Nil Rated
Ü Exempted
Particulars Value of supply GST
2) ITC
Ü Nil
Ü Other
20,00,000
15,00,000
18,00,000
10,00,000
15,00,000
-
1,80,000
-
(1,20,000)
-
Therefore net liability 60,000
Inward Supply Intra-State outward supply
Supplier
Input & Inputs services
Ü used in Nil Rated `18,00,000
Ü used in other Supply ` 10,00,000
A Nil rated Supply ` 15,00,000
B Exempted Supply ` 20,00,000
C Other Taxable Supply ` 15,00,000
Example 2 : If supplier opt for composition
Calculate net tax payable. If Input Tax rate of GST is 12% & Composite Rate is 1%
Solution: -
Ü Nil Rated Supply
Ü Exempted Supply
Ü Other Taxable
Turnover
GST @ 1%

Particulars Manufacturer Trader
20,00,000
15,00,000
-
-
15,00,000
50,00,000
50,000
15,00,000
15,00,000
15,000
Provided further that a person who opts to pay tax under sec 10(1) may supply services (other than
those referred to in clause (b) of paragraph 6 of Schedule II), of value not exceeding 10% of turnover in a
State or Union territory in the preceding ﬁnancial year or 5 lakh rupees, whichever is higher.
Inserted by N/N 3/2019 dt
29/01/2019
COMPOSITION SCHEME
Permissible
limit of supply
of service
with supply
of goods
Newly Inserted
Newly Inserted
GST
REVISION
24
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Refer Q.32,36
& 41 from
Questioner
Refer Q.27 & 28 from Questioner

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Inward Supply Intra-State outward supply
Supplier
Ü Legal Service from `18,00,000
individual Advocate
Other Taxable Supply ` 25,00,000
Example 3 : If supplier opt for composition & inward supply under RCM
Calculate net tax payable. If Input Tax rate of GST is 18% & Composite Rate is 1%
Solution:
Particulars Value
Tax on outward supply (1% of 25,00,000)
Tax on Inward Supply under RCM (18% of 18,00,000)
25,000
3,24,000
Note : Inward supply cannot be under composition levy, also credit of such GST is not available for
payment of tax under composition
Scheme
applies to all
registered
persons with
same PAN
Where more than one registered persons are having the same Permanent Account Number
(issued under the Income-tax Act, 1961), the registered person shall not be eligible to opt for
the scheme under sub-section (1) unless all such registered persons opt to pay tax under
that sub-section.
Intimation
for
Composition
Levy
Validity of Composition Levy
Effective
date for
Composition
Levy
1. Electronic Filing of Intimation for Composition Levy :
(a) Option for availing composition is available to both migrated and new taxpayers up to
31.03.2018
(b) Persons already granted registration on a provisional basis wanting to opt Composition
Scheme shall electronically ﬁle an intimation on the Common Portal.
2. Time Limit : Intimation to be made electronically within 60 days of the date of opting for
composition levy.
3. Furnishing Details : Details of Stock, including the inward supply of goods received from
unregistered Person, held by him on the day preceding the date of opting Composition
Scheme.
as long as the prescribed conditions are met, the option exercised by a Registrered Person to pay
tax u/s 10 shall remain valid.
(a) Liable to pay tax under normal scheme
(b) Shall issue tax invoice for every taxable supply
(c) within 7 days of occurrence of such event, shall ﬁle an intimation for withdrawal in FORM GST
CMP-04
Proper Ofﬁcer if he believes that the Registered Person was not eligible to pay tax u/s 10 or has
contravened the provisions of the Act Response to this notice should be furnished by taxable
person within 15 days.
Upon receipt of reply to the show cause notice from the registered person, the Proper Ofﬁcer shall
issue an order in within 30 days of receipt of such reply, either accepting the reply, or denying the
option to pay tax u/s 10. taxable person is liable to a penalty.
Persons who has furnished an intimation, or Filed an application for withdrawal, or order of
withdrawal of option has been passed by the proper ofﬁcer shall ﬁle a statement containing details
of the stock within 90 days, from the date from which the option is withdrawn or from the date of
order passed
Situation Effective from
provisional Registration assesses
when the intimation is ﬁled to opt for the scheme.
Option for the Scheme once exercised shall
become operational from
from the appointed day
effective from the beginning of F.Y
the ﬁrst day of the month immediately
succeeding the month
Valid of the
Scheme
Duties of the
Person when
Scheme
becomes
invalid :
Show Cause Notice shall be given by the
Acceptance/ Refusal by the Proper Ofﬁcer
Details of Stocks to be furnished by :
Rule 3(4) has been amended to increase the said time period of 60 days to [Notiﬁcation No. 22/2017 90 days.
CT dated 17.08.2017
GST
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Special Discussion
Provided further that a person who opts to pay tax under clause (a) or clause (b) or clause (c) may
supply services (other than those referred to in clause (b) of paragraph 6 of Schedule II), of value not
exceeding 10% of turnover in a State or Union territory in the preceding ﬁnancial year or 5 lakh rupees,
whichever is higher.
2nd proviso to Sec 10 (1)
Question
Mr. Tushar, a trader registered under GST Act & has opted for composition scheme engaged in
supply of goods & services. The details of transactions carried out by him in the preceding
ﬁnancial year (PFY) i.e. 2018-19 and current ﬁnancial year 2019-20 are given as follows. Determine
the aggregate turnover and GST liability of 1st quarter of current ﬁnancial year (CFY) i.e. 2019-20
from the given information.
PFY 2018-19
S. No.State
Goods
(Taxable+ Exempt+ Nil
rated)
Service
(Taxable+
Exempt)*
Turnover in
State
1. Kerela `15 lakhs `3 lakhs `18 lakhs
2. Maharashtra `10 lakhs `2 lakhs ` 12 lakhs
F Refer Q. 38 from Questioner

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* The service provided is within the limit of 10 % of turnover in state or ` 5 lakhs whichever is higher.
CFY 2019-20
S. No.State Goods
(Taxable+ Exempt+
Nil rated)
Service
(Taxable+ Exempt)
1. Kerela
-Taxable supply
- Exempt supply
` 20 lakhs
`10 lakhs
` 2 lakhs
` 1 lakh
2. Maharashtra
-Taxable supply
- Exempt supply
`40 lakhs
`15 lakhs
` 3 lakhs
`0.5 lakh
3. Madhya Pradesh
-Taxable supply
- Exempt supply
` 40 lakhs
` 5 lakhs
`10 lakhs
` 2 lakh
Total ` 130 lakhs ` 18.5 lakhs
Answer: Determination of aggregate turnover and tax liability of Mr. Roshan for the 1st quarter of CFY 2019-20
CFY 2019-20 – April to June 2019
S. No. State Goods
(Taxable+
Exempt+
Nil rated)
Service
(Taxable+ Exempt)
Allowed
Limit *
Actual
Tax payable
(`)
Refer
Note
below
1.Kerela
-Taxable
Supply
- Exempt
Supply
`20 lakhs
`10 lakhs
5 Lakhs
(Higher of
5 lakhs or
10% of
12 lakh
i.e.`1.2 lac)
`2 lakhs
` 1 lakh
CGST=11,000
SGST=11,000
i.
Total
`30 lakhs `3 lakhs` 22,000
2.
Maharashtra
-Taxable
Supply
- Exempt
Supply
`40 lakhs
`15 lakhs
Total
` 55 lakhs
` 3 lakhs
` 0.5 lakh
` 3.5 lakhs
CGST=21,500
SGST=21,500
`43,000
ii.
5 Lakhs
(Higher of
5 lakhs or
10% of
18 lakh
i.e.`1.8 lac)
3.Madhya Pradesh:
-Taxable
Supply
- Exempt
Supply
`40 lakhs
`5 lakhs
`10 lakhs
` 2 lakhs
CGST=25,000
SGST=25,000
iii.
Total ` 45 lakhs ` 12 lakhs` 50,000
12 Lakhs
(Higher of
5 lakhs or
10% of
120 lakh
i.e.`12 lac)
Aggregate turnover = ` 148.5 lakhs =` [30+3+55+3.5+45+12] lakhs & Tax liability = ` 1.15 lakhs
[(11,000*2)+(21,500*2)+(25000*2)]
* The Allowed limit for service is 10% of turnover in State in PFY or 5 lakhs whichever is higher.`
Note:- As per section 10(1), tax will be leviable at the rate of half percent of the turnover of taxable supply of
goods & services in State or in Union Territory in case of other suppliers i.e. traders
Hence, CGST and SGST @ 0.5% each will be leviable on taxable supply of goods or services supplied in a
State which are as follows:
3. Madhya Pradesh `110 lakhs `10 lakhs `120 lakhs
Total `135 lakhs `15 lakhs `150 lakhs
Total Aggregate Turnover `150 lakhs
S. No. State Calculation of CGSTCalculation of SGST
i.
Maharashtra: 0.5% on 22 lakhs [20
lakhs + 2 lakhs]=
` 11,000
0.5% on 22 lakhs [20
lakhs + 2 lakhs]=
` 11,000
ii.
Kerela 0.5% on 43 lakhs [40
lakhs + 3 lakhs] =
` 21,500
0.5% on 43 lakhs [40
lakhs + 3 lakhs] =
` 21,500
iii.Madhya Pradesh
0.5% on 50 lakhs [40
lakhs + 10 lakhs] =
` 25,000
0.5% on 50 lakhs [40
lakhs + 10 lakhs] =
` 25,000

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Regarding applicability of composition scheme to a registered person supplying services upto a limit
(Removal of Difﬁculties Order no 1/2019 - CT dt 01/02/2019 supersedes Removal of Difﬁculties Order
No. 1/2017 - Central Tax dated 13.10.2017 )
(I) a registered person engaged in the supply of services, other than supply of service referred to in clause (b)
of paragraph 6 of Schedule II to the said Act, may opt for the scheme under the sec 10(1) of CGST Act
(ii) a person who opts for the said scheme may supply services (other than those referred to in clause (b) of
paragraph 6 of Schedule II to the said Act), of value not exceeding ten per cent. of turnover in a State or
Union territory in the preceding ﬁnancial year or ﬁve lakh rupees, whichever is higher;
Issue:- A person rendering services as part of the savings and investment practice of business, by way of
extending deposits, loans or advances, in so far as the consideration is represented by way of interest or
discount, is resulting in their ineligibility for the aforesaid scheme, causing hardships to a lot of small
businesses and because of that, certain difﬁculties have arisen in giving effect to the provisions of section 10.
Legal Provision – In exercise of the powers conferred by section 172 of CGST Act & in supersession of the
CGST (Removal of Difﬁculties) Order, 2017, No. 01/2017-CT, dated the 13.10.2017
Clariﬁcation – As per the above stated provisions, it is hereby clariﬁed that the value of supply of exempt
services by way of extending deposits, loans or advances in so far as the consideration is represented by way
of interest or discount, shall not be taken into account –
(I) for determining the eligibility for composition scheme under second proviso to sub-section (1) of section 10;
(ii) in computing aggregate turnover in order to determine eligibility for composition scheme.
Analysis: - Earlier as per Removal of Difﬁculties Order No. 1/2017 - Central Tax dated 13.10.2017 this
clariﬁcation was only regarding to restaurant service provider who wanted to opt for composition scheme but
now this has been extended to all eligible persons under composition scheme if they are providing such exempt
services and this is for the purpose of computing aggregate turnover and also for determining eligibility criteria
to opt for composition scheme.
Question
Giridhar Foods is engaged in supplying restaurant service in Maharashtra. In the preceding ﬁnancial
year, it has a turnover of ` 90 lakh from the restaurant service and ` 10 lakh from the supply of farm
labour in said State. Further, it has also earned a bank interest of ` 10 lakh from the ﬁxed deposits.
Giridhar Foods wishes to opt for composition scheme in the current year. You are required to advise
Giradhar Foods on the same.
Would your answer be different if Giridhar Foods is engaged in milling of paddy into rice on job work
basis instead of supply of farm labour and the turnover from the said activity is 9 lakh?`
Answer: As per section 10(1) of the CGST Act, 2017, a registered person, whose aggregate turnover in the
Order No. 1/2019
preceding ﬁnancial year did not exceed ` 1.5 crores, may opt to pay, to pay tax under composite
rate,provided he is not engaged in the supply of services other than restaurant services.
Provided further that In case of manufacturer, trader or restaurant service provider may supply services
(other than restaurant services, of value not exceeding 10% of turnover in state or union territory in the
preceding ﬁnancial year or 5 lakh rupees, whichever is higher.
As per Order no 1/2019, any person rendering services as a part of the savings and investment practice,
by way of extending deposits, loans or advances, in so far as the consideration is represented by way of
interest and discount will not be ineligible to opt for composition scheme.
The above stated order also clariﬁed that the value of supply of exempt services by way of extending
deposits, loans or advances, in so far as the consideration is represented by way of interest and discount
shall not be taken into account –
i. For determining the eligibility for composition scheme under second proviso to sub-section
(1) of section 10;
ii. In computing aggregate turnover in order to determine eligibility for composition scheme.
In the given case, Giridhar Foods is engaged in supplying restaurant service in Maharashtra. In the
preceding ﬁnancial year, it has a turnover of ` 90 lakh from the restaurant service, 10 lakh from the supply
of farm labor in said State and it has also earned a bank interest of ` 10 lakh from the ﬁxed deposits. Since
its turnover from supply of service is Rs. 10 lakh which is within the limit prescribed i.e. 10% of turnover in
state or union territory in the preceding ﬁnancial year (i.e. 10 lakh (90+10)x 10% ) or 5 lakh rupees,
whichever is higher, therefore it is eligible to opt for composition scheme.

However, if Giridhar Foods is engaged in milling of paddy into rice instead of supply of farm labor, and the
turnover from the said activity is Rs. 9 Lakhs which is within the limit prescribed i.e. 10% of turnover in
state or union territory in the preceding ﬁnancial year (i.e. 10 lakh) or 5 lakh rupees, whichever is
higher, then also it is eligible to opt for composition scheme.
Author’s Opinion :- As per Order No. 1/2019, Interest on loan is to be excluded only from Aggregate
turnover & not from turnover in state, But as there is no clariﬁcation regarding the same hence, it is not
considered in calculating prescribed limit.
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Composition Scheme for Service: (Effective from 1 st April, 2019) [N/N 2/2019 – CT(R) dt 7/3/2019]
Eligibility Criteria : -
1)Supplies are made by registered person whose aggregate turnover in Preceding ﬁnancial year was `50Lakh
or below.
2)Supply is not eligible to pay tax u/s 10(1) of CGST Act
Composite Tax rate & Levy in current year : - (i.e. CGST 3% & SGST 3%)GST rate 6% on ﬁrst supply of
goods or services or both upto an aggregate turnover of `50 lakh made on or after the ﬁrst day of April in any
ﬁnancial year, by a registered person
Explanation - shall, “ﬁrst supplies of goods or services or both”
the supplies from the ﬁrst day of April of a ﬁnancial year to the date from which he include
becomes liable for registration under the said Act
but for the purpose of determination of tax payable under this notiﬁcation shall not include the
supplies from the ﬁrst day of April of a ﬁnancial year to the date from which he becomes liable for
registration under the Act.
Question
Mr. Ajay is engaged in providing architectural services in Pune, Maharastra. He started his Business
from 1st April, 2020 and he does not seeks registration immediately as he intends to avail exemption
from registration upto the threshold limit of Rs. 20 Lakhs under section 22. On 30th June his turnover
crosses Rs. 20Lakhs, hence he is liable to obtain registration from that date. For the second quarter
ending September his further turnover was Rs. 50 Lakhs.
I. State whether he can opt to pay tax at concessional rate speciﬁed under N/N 2/2019?
ii. Also, determine the amount of tax payable by Mr. Ajay for ﬁrst 2 Quarters?
Answer
i. In given case, Mr. Ajay is engaged in supply of services and his aggregate turnover in the preceding ﬁnancial
year is nil as FY 19-20 is his ﬁrst year of operation, therefore he can opt to pay tax at concessional rate under
N/N 2/2019, as his aggregate turnover in the preceding Financial year does not exceed Rs. 50 Lakhs.
ii. Registered person opting to pay tax under N/N 2/2019, are required to pay tax at the rate of 6% (i.e. CGST 3%
and SGCT 3%) on ﬁrst supply of goods or services or both upto aggregate turnover of Rs. 50 Lakh made on or
after the ﬁrst day of April in any ﬁnancial year
“ﬁrst supplies of goods or services or both” shall, for the purposes of determining eligibility of a
person to pay tax under this notiﬁcation, include the supplies from the ﬁrst day of April of a ﬁnancial year to
the date from which he becomes liable for registration under the said Act
but for the under this notiﬁcation shall not include the purpose of determination of tax payable
supplies from the ﬁrst day of April of a ﬁnancial year to the date from which he becomes liable for registration
under the Act.”
As per the above given explanation two views are possible, for calculation of GST liability
First View, for calculation of ﬁrst supplies of goods or services or both upto Aggregate Turnover of Rs. 50
Lakhs the turnover under threshold i.e. 20 Lakhs to be included but tax at the rate 6% is payable on
remaining 30 Lakhs
Calculation of GST liability for ﬁrst 2 Quarters of CFY
Particulars Turnover (`) CGST (`) SGST (`)
Turnover from 1st April to 30th June 20,00,000- -
Remaining Turnover under N/N 2/2019 @
CGST @3%, SGST@ 3%
Turnover in excess of 50Lakh chargeable under
normal scheme @ 18%
Total
30,00,000
20,00,000
70,00,000
90,000
1,80,000
2,70,000
90,000
1,80,000
2,70,000
For Calculate of ﬁrst supplier of goods or supplier turnover under threshold shall be excluded aggregate
turnover upto 50 lakh in addition to 20 lakh of threshold is subject to concessional rate @ 6% under N/N
2/2019
Therefore, calculation of GST liability
Particulars Turnover (`) CGST (`) SGST (`)
Turnover from 1st April to 30th June 20,00,000- -
Remaining Turnover under N/N 2/2019 @
CGST @3%, SGST@ 3%
Total
50,00,000
70,00,000
1,50,000
1,50,000
1,50,000
1,50,000
Note:- Author is in favor of 1st View
2nd View:-
1st View:-
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Other condition for availing composition scheme:-
a) The supplier should not be engaged in the business of making any supplies on which GST is not leviable
under this Act(i.e., petro products or alcoholic liquor).
b) The supplier should not be making any interstate supply of goods or services or both.
c) The supplier should not be a casual taxable person, non-resident taxable person and
d) The supplier should (ECO) on which TCS applies. not making any supply through e-commerce operator
e) Shall from the recipient on supplies made by him not collect any tax nor shall he be entitled to any credit of
input tax.
f) Shall be liable to pay central tax on inward supplies on which he is liable to pay tax under Section 9(3) or 9(4) of
CGST Act at the applicable rates.
g) as referred to in section 31(3)(c) of the CGST Act with Shall issue, instead of tax invoice, abill of supply
particulars as prescribed in rule 49 of CGST Rules.
The registered person shall mention the following words at the top of the bill of supply, namely: –
'taxable personpaying tax in terms of notiﬁcation No. 2/2019-Central Tax (Rate) dated 07.03.2019, not
eligible to collect tax on supplies’
h) The supplier should not be engaged in business of ice cream, Pan Masala, , Tobacco and Aerated water
tobacco substitutes. Newly Inserted
Removal of ITC :- Where any registered person who has availed of input tax credit opts to pay tax under this
notiﬁcation,
he shall pay an amount, by way of debit in the electronic credit ledger or electronic cash
ledger,
equivalent to the credit of input tax in respect of inputs held in stock and inputs contained in
semi-ﬁnished or ﬁnished goods held in stock and on capital goods as if the supply made under this
notiﬁcation of the said Act and the rules made there-under attracts the provisions of section 18(4)
and
after payment of such amount, the balance of input tax credit, if any, lying in his
electronic credit ledger shall lapse.”; (Newly Inserted by N/N 9/2019 CT (R) dt 29/03/2019)
Applicability of CGST Rules related to composition levy :- The Central Goods and Services Tax Rules, 2017,
as applicable to a person paying tax under section 10 of the said Act shall, mutatis mutandis, apply to a person
paying tax under this notiﬁcation.”. (Newly Inserted by N/N 9/2019 CT (R) dt 29/03/2019)
Intimation of option to pay tax under Notiﬁcation:- (Circular no. 97/16/2019 -GST dt 05/04/2019)
1. a registered person who wants to opt for payment of central tax @ 3% by Intimation by a registered person:
availing the beneﬁt of the notiﬁcation, may do so by ﬁling intimation in the manner speciﬁed in rule 3(3) of the
CGST rules in FORM GST CMP-02 by selecting the category of registered person as “Any other supplier
eligible for composition levy”.
Such person shall also furnish a statement in FORM GST ITC03 in accordance with the
provisions of rule 3(3) of the CGST rules. The option to pay tax by availing the beneﬁt of the notiﬁcation
would be effective from the beginning of the ﬁnancial year.
2. any person who applies for registration and who Intimation by person applying for registration:
wants to opt for payment of central tax @ 3% by availing the beneﬁt of the said notiﬁcation, if eligible,
may do so by indicating in the FORM GST REG-01 at the time of ﬁling of application for registration
The option to pay tax by availing the beneﬁt of the notiﬁcation would be effective from the
date of registration in cases where new registration has been obtained during the ﬁnancial year.
The option of payment of tax by availing the beneﬁt of the said notiﬁcation
in respect of any place of business in any State or Union territory shall be deemed to be applicable in
respect of all other places of business registered on the same Permanent Account Number.
Note:-In computing aggregate turnover in order to determine eligibility of a registered person to pay central
tax at the rate of three percent under this notiﬁcation, value of supply of exempt services by way of
extending deposits, loans or advances in so far as the consideration is represented by way of interest or
discount, shall not be taken into account.
GST
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F Refer Q. 26 & 33 from Questioner
All Important Clariﬁcations are given at the end of Module 2

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Chapter 5
Exemption
CGST Act, 2017
Sec 11 Exemptions

IGST Act, 2017
Sec 6 Exemptions

PointsGeneral Exemption Special Exemption
It is given by Govt. in the public interest
by notiﬁcation in ofﬁcial gazzate
It is given by govt. in public interest by
special order
It is applicable to all members of a
particular section
It is applicable in each case i.e. applicable to
that person to whom the order is given
It is generally in public interest
It is given in exceptional nature (charitable
purpose goods of strategic nature etc.) which
is necessary in public interest.
1 Covered under Sec. 11(1) Covered under Sec. 11(2)
What do you mean by Mandatory Exemption
Answer :
Where an exemption in respect of any goods or services or both from the whole or part of the tax leviable
thereon has been granted absolutely, without any condition the registered person supplying such goods or
services or both shall not collect the tax, in excess of the effective rate, on such supply of goods or services
or both.
2
3
4
Difference between General Exemption & Special Exemption
GOODS EXEMPT FR OM TAX
A list of items have been notiﬁed under section 11(1) of the CGST Act, 2017/section 6(1) of the IGST Act,
2017. These items have been exempted from whole of the tax. Since GST is a tax for common man,
everyday items used by the common man have been included in the list of exempted items.
Items such as unbranded atta/maida/besan, unpacked food grains, milk, eggs, curd, lassi and fresh
vegetables are among the items exempted from GST.
Some of the examples of the goods exempted from tax have been provided herein:
Live Fish (0301) Fresh Milk (0401) Potatoes (0701)
Grapes (0806) Indian National Flag (63)Plastic Bangles (3926)
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EXEMPTIONS on Ser vices (N/n 12/2017, 21/2017, 25/2017, 26/2017, 30/2017 & 32/2017)
Legal Services by arbitral tribunal, advocate etc.Sl.No. 45
Exemption in Legal Sector
To Business Entity To Non
business
Entity
Exempt
Exempt
Taxable
[Under RCM business
Entity is liable]
Service provided by arbitral Tribunal
To Business Entity To Non
business
Entity
Exempt
Exempt
Taxable
[Under RCM business
Entity is liable]
Service provided by individual advocate or firm of
advocate other than Sr. Adv.
To Another
individual
advocate
or firm of
advocate
Exempt
Cntr. Govt.
State Govt.
UT
Local
Authority
Govt.
Entity
Cntr. Govt.
State Govt.
UT
Local
Authority
Govt.
Entity
Exempt
Exempt
To Business Entity To Non business
Entity
Exempt
Exempt
Taxable
[Under RCM business
Entity is liable]
Service provided by senior advocate
To Another
individual advocate
or firm of advocate
Taxable but Advocate/Firm can
take exemption upto turnover
such amount in PFY make it eligible
for exemption from registration
Cntr. Govt.
State Govt.
UT
Local Authority
Govt. Entity
Exempt
Sl.No. 14
Renting of residential dwelling for use of residenceSl.No. 12
RENTING OF IMMOVABLE PROPERTY
Circus
Dance or theatrical
performance including drama or ballet Recognised
sporting event
Planetarium
where the consideration for admission is not more than ` 500 per person.
Award function Concert Pageant
Musical performance or any sporting event
other than a recognised sporting event,
Training or coaching in recreational activities
a) Arts or culture
b) Sports by charitable entities registered u/s 12AA of Income tax
Sl. No. 80
Classical or Folk Artist - By a In folk or classical art forms of -artist
(i) Music, or (ii) Dance, or (iii) Theater, if the consideration charged for such performance is not
more than ` 1,50,000/-
Excluding - Services provided by such artist as a brand ambassador;
Sl.No. 78
Services by way of admission to a museum, national park, wildlife sanctuary, tiger reserve or zooSl.No. 79
Exemption Related to Entertainment, Museum etc.
Admission to Entertainment eventSl. No. 81
Admission to protected Monument under Ancient Monument & Archaelogical site & Remains
Act,1958
Sl. No. 79A
► a clinical establishment,
► an authorized medical
practitioner or
► paramedics. Mean any service by way of
diagnosis or treatment or
care for illness, injury,
deformity, abnormality or
pregnancy in any recognized
system of medicines in India
and
(Eg. Allopathy, Yoga,
Naturopathy, Ayurveda,
Homeopathy, Siddha, Unani)
by way of
transportation
of the patient
to and from a
clinical
establishment,
hair transplant or cosmetic
or plastic surgery, except
when undertaken to restore
or to reconstruct anatomy
or functions of body
affected due to congenital
defects, developmental
abnormalities, injury or
trauma.
HEALTH CARE SERVICES
MEANS INCLUDESBUT SHALL NOT INCLUDE
Health Care Services bySl.No. 74
Exemption Related to Health Care
Preservation of by Cord Stem Cell
blood banks
Sl. No. 73
Treatment of disposal of bio-medical waste
of clinical establishment by operators
Sl.No. 75
Health Care or Animal or Birds
Service by Veterinary Clinic
Sl.No. 46
Charitable Activities - Provided by entity registered under sec 12AA of Income Tax Act 1961Sl.No. 1
Exemption Charitable and Religious Sector
Religious Activities
a) Conduct of Religious Ceremony
Sl.No.13
Services provided by speciﬁed organization with respect to Kailash Mansarovar and Haj Pilgrimage exemptedSl.No. 60
Important Comments:
Taxable Services: Hair Transplant or Cosmetic or Plastic Surgery,
b) Renting of precincts of a religious place meant
for general public, owned or managed by an
entity registered as a charitable or religious trust
Renting
Renting of Rooms
Exemption not available
where charges are ` 1000 or more per day
Renting of Premises, Community halls,
kalyanmandapam or open area and the like
where charges are ` 10,000 or more
per day
Renting of Shops or other spaces for business
or commerce
where charges are ` 10,000 or more per
month
Exemption is not available in following cases
Service provided by rehabilitation
professional recognized under
Rehabilitation Council by way of
rehabilitation therapy or counseling at
Medical Establishment, etc.
Sl. No. 74A
Renting of hotel, inn, guest house, club or composite for residential or lodging purpose having value
of supply below ` 1000/- per day or equivalentor equal to
ZOO
BACKGROUNDZOO
T/O of Business
Entity up to such
amount in PFY
make it eligible
for exemption
from registration
T/O of Business
Entity such
amount make
it liable for
registration
T/O of Business
Entity up to such
amount in PFY
make it eligible
for exemption
from registration
T/O of Business
Entity such
amount make
it liable for
registration
T/O of Business Entity up to such amount in PFY
make it eligible
for exemption
from registration
T/O of Business
Entity such amount make
it liable for registration
Newly Inserted
F Refer Q. 5 and Q. 6 from Questioner
F Refer Q. 9 and Q. 10 from Questioner
F Refer Q. 12 from Questioner
F Refer Q. 24 and Q. 26 from Questioner
F Refer Q. 28 from Questioner
GST
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PASSENGER TRANSPORT SECTOR
Road
Railway Water Air
Stage Carriage Contract Carriage
Taxable
Bus
Meter Cab, Auto Rickshaw, Motor Cabs, etc.
Non AC BusAC Bus
Taxable
Tourism
conducted tour
charter or hire
Taxable
All other purposes
(point to point
transport)
exempt
Meter
Cab,
Auto
Rickshaw
Covered
in
Exemption
Motor
Cabs (AC
or non AC)
Taxable
Radio Taxi
(AC or non
AC) Taxable
Non AC Stage Carriage - Exempt
TaxableAC Stage Carriage -
Railway Metro,
Monorail,
Tramway
First class or
A.C. Coach
Other
Exemption
Exemption
Inland
waterway
Vessel
Pre-dominatly
use
for tourism
Other
Purpose
Exemption
Taxable
Exemption
If passenger
embarking or
terminating In state
of Arunachal
Pradesh, Assam,
Manipur, Meghalaya,
Mizoram,
Nagaland,etc.
Other
Case
Taxable
Exempt
TRANSPORTATION OF GOODS OR SERVICES
Road Railway Inland
Waterways
Air/Vessel
GTA
Courier
Taxable
Other
road
transport
Exempt
Fully
taxable Exempt
If following goods are transported by GTA/Rail or vessel then exempted from payment of tax :
1) Agriculture produce 2) Milk, Salt, food grains, flours, pulses or rice
3) Organic manure 4) Newspaper or Magazines
5) Relief material for victims 6) Defense or military equipments.
From
outside
India
TO
Customs
Station
in India
By Air By Vessel
Exempt Taxable
From
Custom
Station
in India
TO
Custom
Station
in India
}
Taxable
From
Custom
Station
in India
TO
By Air}
Exempt upto 30 Sept. 2020
Pipelines
or
Conduit
Fully
taxable
A place
outside
India
By Vessel
MUMBAI
PORT
CHENNAI PORT
MUMBAI AIR PORT
Goods Transport Service by Rail
Taxable
Goods Transport Service by Road
Taxable
Taxable
Exempt
Exempt
Goods Transport Service by Vessels/Aircraft from outside/into India
USA
Taxable
Taxable
Taxable
Taxable
CHENNAI
AIR PORT
Goods Transport by Inland waterways
River
Exempt
Taxable
Road Transport
Rail Transport
Air Transport
Taxable Taxable Taxable
Exempt Exempt Exempt
Taxable Taxable
ExemptExempt
Exempt
Exempt
Taxable
Exempt
Exempt
Taxable
Public
Transport
Tourism
Contract
Carriage
Stage
Carriage
FOR HIRE
Taxable
Cable Car or Rope Way Transport
Inland Waterway Vessel Transport
Pipeline
Taxable

Transportation of the following goods by a goods transport agency have been exempted from service tax

Basic exemptions to GTA
(a) goods, where consideration charged for the transportation of goods on a consignment transported in a
single carriage does not exceed ` 1500
(b) goods, where consideration charged for transportation of all such goods for a single consignee does not
exceed ` 750
Or
Illustration :
1) V’Smart Academy book complete truck for delivery of notes to its
one of the franchisee in Nagpur. GTA has charge freight as follows:
Case 1` 1100Exempt
Case 2` 1700Taxable
2) V’Smart Academy book complete truck for delivery of notes to its
various franchisee. GTA has charge freight as follows:
Jaipur` 600Exempt
Pali` 700Exempt
TaxableJodhpur
Kota
` 900
` 1200Taxable
Taxable
Sl. No. 19A
Sl. No. 19B
Service provided by GTA to department or establishment of Government or local authority or government
agency who taken registration for the perpose of deducting TDS u/s 51.
Sl.No. 21B
Services by way of transportation of goods by a vessel from customs station of clearance in India to a place outside India.
Services by way of transportation of goods by an aircraft from customs station of clearance in India to a place outside India.
Services by way of giving on hire-
(a) to a state transport undertaking, a motor vehicle meant to carry more than twelve passengers; or
(aa) to a local authority, an Electrically operated vehicle (EOV) meant to carry more than 12 passengers;
(b) to a goods transport agency, a means of transportation of goods.
Sl. No. 22
(c) to students, faculty & staff of an edu. inst. providing services by way of pre-school education upto
higher secondary school
F Refer Q. 18 and Q. 19 from Questioner
F Refer Q. 21 and Q. 22 from Questioner
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REVISION
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Newly inserted

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EXEMPTION IN BANKING AND FINANCIAL SECTOR
Sl. No. 27
Services by way of—
(a) extending deposits, loans or advances in so far as the consideration is represented by way
of interest or discount (other than interest involved in credit card services);
(b) inter se sale or purchase of foreign currency amongst banks or authorised dealers of
foreign exchange or amongst banks and such dealers.
Services by an acquiring bank, to any person in relation to settlement of an amount upto two
thousand rupees in a single transaction transacted through credit card, debit card, charge
card or other payment card service.
Exemptions in Education Sector
Exemption
1) Any service supplied bysuch
education institutional to its student
and faculty or staff. (e.g. education
fees lab charge, lab charges,
transportation, catering etc.
2) Service by way of Conduct
examination against entrance fees
Taxability
Any Service supplied to any person
other than student faculty or staff by
such educational institutional then it is
taxable e.g.
1) Auditorium of school given to other
for seminar
2) Placement services to corporate
3) franchisees fees to various
franchisees.
Pre-school or Higher
or Secondary school
Educational institution
1) Transportation of students, faculty or staff
2) Catering
3) Security, cleaning or house keeping
4) Supply of online education as
Journal or periodicals
Colleges, universities or
Institution providing
education for
qualiﬁcation recognized
by law.
Approved Vocational
courses of NCVT or
SCVT
Exempt only if
supplied to School
Service Taken by Educational Institution
Service supplied by
Educational Institution
}
5) Service relating to admission to or
Conduct of examination
Exempt only if
supplied to
Collages etc.
Exempt if supplied
to all 3
education Institute
Important Comment : The above exemption is available only for
supply of services. If educational Institute (i.e. School, colleges)
supplied the goods to their student like stationery, uniform etc. then
exemption is not available
Service Provided to recognized Sport Body by
a) An individual as a player, referee, umpire, coach or team manager for participation in a sporting
event organized by a recognized sports body
b) Another recognised sports body;
Sl. No. 68
EXEMPTION IN SPORT SECTOR
Sponsorship of Certain Sport Events (Read from Notes)Sl. No. 53
Admission to events organised under FIFA world cup 2017Sl. No. 82
Agricultural Extension: means application of
scientific research and knowledge to agricultural
practices through farmer education or training;
Ü food,
Ü fibre,
Ü fuel,
Ü rawmaterial
or
Ü other similar
products, for
a) Agricultural operations directly related to production of any
agricultural produce including cultivation, harvesting, threshing, plant
protection or seed testing;
b) Supply of farm labour;
c) Processes carried out at an agricultural farm including tending,
pruning, cutting, harvesting, drying, cleaning, trimming, sun drying,
fumigating, curing, sorting, grading, cooling or bulk packaging and
such like operations which do not alter essential characteristics of
agricultural produce but make it only marketable for the primary
market;
d) Renting or leasing of agro machinery or vacant land with or without a
structure incidental to its use;
e) Loading, unloading, packing, storage or warehousing of agricultural
produce;
f) Agricultural extension services;
g) Services by any Agricultural Produce Marketing Committee or Board
or services provided by a commission agent for sale or purchase of
agricultural produce.
h) Services by way of fumigation in a warehouse of agricultural
produce
Agriculture:
1) cultivation of
plants and
2) Rearing of all life-
forms of animals,
except the rearing
of horses
Agricultural Produce: means any produce of
agriculture on which
Ü either no processing is done or
Ü such processing is done as is usually done by a
cultivator or producer
which does not alter its essential
characteristics but makes it marketable for
primary market.
Sl. No.54 - Exemption in Agriculture Sector
Tomato
Tomato
Ketchup
Potato
Potato
Chips
Sugar
Cane
Sugar &
jaggery
Grams
Pulses
Paddy
Cow
Grains Wheat
Flour
Milk Pasteurization
Pasteurized
Milk
Raw CottonRaw CottonRaw Cotton
Ginned Ginned
CottonCotton
Ginned
Cotton
CottonCotton
Bailed Bailed
Cotton
Bailed
Agriculture ProduceNon-Agriculture Produce
DunkDunkDunk
Agriculture Produce Non-Agriculture Produce
Rearing of Animals Agriculture Produce Processing
Note : Usually not done
by producer
Non-Agriculture Produce
Processing Processing Agriculture Produce Non-Agriculture Produce
Note : Usually done
by producer & does not
essential character
Note : Usually not done
by producer
Services of Loading, Unloading warehousing packing storage of RiceSl.No. 24
Services by way of pre-conditioning, pre-cooling, ripening, waxing, retail packing, labelling of fruits and vegetables. Sl.No. 57
Exemptions on intermediate production processes
Carrying out an intermediate production process as job work in relation to agriculture
Sl.No. 55
Fumigation in warehouseSl.No. 53A
Note : Para 2(h) "approved vocational education course" means, -
(i) a course run by an industrial training institute or an industrial training centre afﬁliated to the National Council for
Vocational Training or State Council for Vocational Training offering courses in designated trades notiﬁed under the
Apprentices Act, 1961 or
(ii) a Modular Employable Skill Course, approved by the National Council of Vocational Training, run by a person
registered with the Directorate General of Training, Ministry of Skill Development and Entrepreneurship
(iii) education as a part of an approved vocational education course
Sl.No. 24AServices by way of warehousing of minor forest produce
Sl.No. 55A
Services by way of artificial insemination of livestock (other than horses).
Services provided by a banking company to - Basic Saving Bank Deposit account holders
under Pradhan Mantri Jan Dhan Yojana
Sl. No. 34
Sl. No. 27A
Sl. No. 9AServices provided by and to FIFA and its subsidiaries directly or indirectly related to any of the
events under FIFA U-17 World Cup 2017 to be hosted in India.
Sl.No. 24BWarehousing or storage of cereals, pulses, fruits, nuts, vegetables, spices, sugarcane, jaggery, fibers etc. Newly Inserted
Sl. No. 9AA
Services provided by and to FIFA and its subsidiaries directly or indirectly related to any of the
events under FIFA U-17 Women’s World Cup 2020 to be hosted in India.
Sl. No. 82AAdmission to events organised under FIFA U-17 Women’s world cup 2020
F Refer Q. 15 from Questioner
Newly Inserted
Newly Inserted
F Refer Q. 29 from Questioner
F Refer Q. 53 & 60 from Questioner
F Refer Q. 40 & 41 from QuestionerGST
REVISION
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Services provided by Government to Business Entity
All Services by Reserve Bank of India All services provided by a foreign
diplomatic mission located in India
Sl. No. 26: SERVICES BY RESERVE BANK OF INDIA Sl. No. 59 : SERVICES BY FOREIGN DIPLOMATIC MISSIONS IN INDIA
Important Comments: Taxable Service:
Services provided to Reserve Bank of India.
Important Comments:
Taxable Service: Services provided by office or
establishment of an international organization.
Service Provided by Govt. Service Provided by Govt. (chapter 99)(chapter 99)Service Provided by Govt. (chapter 99)Sl. No.6Sl. No.6Sl. No.6
of notiﬁcation
37
Services by the Central Government, State Government, Union territory or local authority excluding the following services—
(b) services in relation to an aircraft
or a vessel, inside or outside the
precincts of a port or an airport; (c) transport of goods
or passengers; or
(d) any service, other than services covered
under entries (a) to (c) above, provided to
business entities. (a) services by the Department of Posts by
way of
Ü speed post,
Ü express parcel post,
Ü life insurance, and
Ü agency services provided to a person
other than the Central Govt.
State Government, Union territory
Service provided by Govt/Local Authority to Business
Entity where its Aggregate T/O less than such amount
in PFY make it eligible for exemption from registration
Exception : above exemption not applicable to
(a) Services covered under above clause (a) to (c)
(b) Renting of immovable property
Sl. No. 7
Service provided by Govt/Local Authority
Where GAC per service (per invoice) does not
exceeds ` 5000
in case where continuous supply of servicethe
exemption shall apply only where the
consideration charged for such service does not
exceed 5000 in a ﬁnancial year.`
Exception : above exemption not applicable to
(a) Services covered under above clause (a) to (c)
Sl. No. 9
2) Turnover or Value based 3) Certification or Registration based
Service provided by Govt/Local Authority
by way of Issuance of passport, visa
driving licence, Birth Certificate or
Death Certificate
Service provided by Govt/Local
Authority by way
(a) Registration required under any law
(b) Testing, calibration, safety, check
for protection or safety of worker,
consumer or public at large
Sl. No. 61
Sl. No. 47
Access to Road or bridge on Payment of toll Sl. No. 23 Access to Road or bridge on
Payment of Annuity
Sl. No. 23A
Sl. No. 47A
Services by way of licensing, registration
and analysis or testing of food samples
supplied by the Food Safety and
Standards Authority of India (FSSAI) to
Food Business Operators
4) Transfer of rights based
Sl. No. 63 Assignment of right to use natural
resources to an Individual farmer
for the purpose of Agriculture.
Sl. No. 64 Assignment of rights to use
natural resources given before
1-4-16
Sl. No. 42 Allowing to operate as telecom
service provider or use radio
frequency spectrum prior to 1-4-16
5) Others
Sl. No. 8 Service provided by
Govt. or local authority
to another Govt. or
local authority.
Sl. No. 62 Fines or liquidated
damage for tolerating
non performances of
Contract
Sl. No. 65 Merchant overtime
charges for inspection
of import container by
custom officers.
Services Provided by an old age
home run by Government (upto
`25000 per month per member)
Sl. No. 9D
Service Provided by Govt. Entity
against consideration in form of
grants to another Govt. or local
authority SI.No. 9C
Services by way of
providing information
under the Right to
Information Act, 2005
Sl. No.65A
Services Supplied by a State Government to Excess Royalty Collection Contractor (ERCC) (Heading 9991)
Services supplied by a State Government to Excess Royalty Collection Contractor (ERCC) by way of assigning the right to collect royalty on behalf of the State Government on the mineral dispatched by the
mining lease holders.
Explanation.- “mining lease holder” means a person who has been granted mining lease, quarry lease or license or other mineral concession under the Mines and Minerals (Development and Regulation)
Act, 1957, the rules made thereunder or the rules made by a State Government under sub-section (1) of section 15 of the Mines and Minerals (Development and Regulation) Act, 1957
Condition : - Provided that at the end of the contract period, ERCC shall submit an account to the State Government and certify that the amount of goods and services tax deposited by mining lease holders
on royalty is more than the GST exempted
of notiﬁcation
Sl. No.65B
F Refer Q. 42, 44 & 47 from Questioner
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Services supplied by Central Government, State Government, Union territory to their
undertakings or Public Sector Undertakings(PSUs) by way of guaranteeing the loans taken by
such undertakings or PSUs from the financial institutions. Banking Companies &
on the service provided by State Government to the ERCC of assignment of right to collect royalty and
where such amount of GST paid by mining lease holders is less than the amount of GST exempted, the
exemption shall be restricted to such amount as is equal to the amount of GST paid by the mining
lease holders and
the ERCC shall pay the difference between GST exempted on the service provided by State
Government to the ERCC of assignment of right to collect royalty and GST paid by the mining lease
holders on royalty.
Sl. No.34 A
Services provided to Government
Service provided by under Public Distribution System (PDS) against Fair Price Shops
commission/margin.
11A
Services provided under any for which total premium is paid by CG/SG/UT insurance scheme
Services provided under any for which total expenditure is borne by CG/SG/UT training programme
administration.
72
Services provided by GSTN for implementation of GST.
40
51
• Pure services
• Composite supply of goods and services in which the value of supply of goods constitutes not more
than 25% of the value of the said composite supply
provided by way of any activity in relation to any function entrusted to a Panchayat / Municipality
under articles 243G/243W of the Constitution:
3 &
3A
Passenger transport Service by air where boarding or termination at a regional connectivity scheme,
Airport avails the consideration in the form of viability gap funding.
16
Sl. No Description of services
30
Sl. No Description of services
Other Government Sector
Services by the to persons governed under the Employees’ State Insurance Corporation
Employees’ State Insurance Act, 1948.
Services provided by the to the persons governed under Employees Provident Fund Organisation
the Employees Provident Funds and the Miscellaneous Provisions Act, 1952
31
31A
Services by to persons governed by the Coal Mines Coal Mines Provident Fund Organisation
Provident Fund and Miscellaneous Provisions Act, 1948.
Services by Trust to its members against consideration in the form National Pension System (NPS)
of administrative fee.
31B
32Services provided by the to insurers under IRDAI Act, 1999. IRDAI
Services provided by the by way of protecting the interests of investors in securities and to SEBI
promote the development of, and to regulate, the securities market.
33
37Services by way of collection of contribution under the Atal Pension Yojana.
Services by way of of the State collection of contribution under any pension scheme
Governments.
38
43Services of (rolling stock assets including wagons, coaches, locos) by the leasing of assets
Indian Railways Finance Corporation to Indian Railways.
Service by Upfront amount in State Government Industrial Development Corporations
respect of service by way of granting of long term lease of 30 years, or more) of industrial plots or
plots for development of infrastructure for financial business,
41
25 by an electricity transmission or distribution utility Transmission or Distribution of Electricity
Services of by the Directorate General of Training, assessing bodies empanelled centrally
Ministry of Skill Development and Entrepreneurship by way of assessments under the Skill
Development Initiative Scheme
70
71Training Service under Deen Dayal Upadhyaya GrameenKaushalya Yojana
Service Provided by upto to total turnover of 50 lakhs in a FY Incubatee
44
Exemption in Construction Sector
10
Sl. No Description of services
Pure labour contracts of construction, alteration etc., of a civil structure or any other original works
pertaining to the beneﬁciary-led individual house construction or enhancement under the
Housing for All (Urban) Mission/Pradhan Mantri Awas Yojana
10A
Services supplied by for extending electricity distribution Electricity Distribution Utilities
network upto the tube well of the farmer/agriculturalist for agricultural use.
11
Pure labour contracts of construction, erection, etc., of original works pertaining to a single
residential unit otherwise than as a part of a residential complex.
Exemption in Life or General Insurance Sector
28
Sl. No Description of services
Services provided by way of annuity under the National Pension System regulated by the
Pension Fund Regulatory andDevelopment Authority of India (PFRDA)
29
Services of life insurance business by the Army, Naval and Air Force Group Insurance Funds
to members of the Army, Navy and Air Force, respectively, under the Group Insurance Schemes
of the CG.
29A
Services of life insurance by the to personnel of Coast Guard Naval Group Insurance Fund
under the Group Insurance Schemes of the CG.
36
Services of life insurance business provided under various schemes such as Janashree Bima
Yojana; Aam Aadmi Bima Yojana; Life micro-insurance product etc.
36AServices by way of of the insurance schemes speciﬁed in sl.no 35 or 36.reinsurance
41A/41BSupply of TDR, FSI, long term lease (premium)Newly Inserted
29B
Services of Life Insurance Business by the Central Armed Police Forces Group
Insurance Funds to their members Newly Inserted
GST
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Exemption in Miscellaneous Sector
Sl. No Description of services
Transfer of a going concern, as a whole or an independent part thereof.2
Services by an organiser to any person in respect of a business exhibition held outside India.52
Services by to its own members as reimbursement/share of unincorporated body/ non- proﬁt entity
contribution:
(I) As a trade union (ii) for providing exempt activity
(iii) up to an amount of for sourcing of goods/services from a 3rd person for ` 7,500 p.m. per member
common use in a housing society/residential complex
77
77AServices provided by such entity/body to its own members against membership fee upto ` 1000/- per
member per year
39
39AServices by an located in a multi services SEZ with IFSC status to intermediary of ﬁnancial services
a customer located outside India for international ﬁnancial services in foreign currencies
48
49Services by way of by an independent journalist, Press Trust of India or collecting or providing news
United News of India
Taxable services, by a TBI/STEP recognised by NSTEDB or bio- incubators recognised by the
Biotechnology Industry Research Assistance Council, under Department of Biotechnology,
Government of India (BIRAC)
50
56Services by way of slaughtering of animals
Services of by way of lending of books, publications or any other knowledge- public libraries
enhancing content or material.
76Services by way of such as provision of facilities of bathroom, washrooms, public conveniences
lavatories, urinal or toilets.
9BSupply of services associated with transit cargo to Nepal and Bhutan
Certain supplies to NPCIL
Sl. No Description of services
10
Exemption Notiﬁcation No. 9/2017-Integrated Tax (Rate)
Service received from service provider located in non taxable territory to a) Government/ Cetntral
Govt./ Union Territory , a local authority, a governmental authority or an individual in relation to any
purpose other han commerce, industry or any other business or profession b) An entity registered
under section 12AA of the Income tax Act, 1961 for the purposes of providing charitable activities or
c) A person located in a non-taxable territory.
10F
Services supplied to any own establishment outside India, provided the place of supply is
outside India.
Import of services by UN or a speciﬁed international organisation for ofﬁcial use. 10G
Import of services by Foreign diplomatic mission or consular post in India, or diplomatic agents
or career consular ofﬁcers posted therein subject to speciﬁed conditions.
10H
Services received by the RBI, from outside India in relation to management of foreign
exchange reserves.
42
Services provided by a in relation to a tour conducted wholly tour operator to a foreign tourist
outside India..
54
12AA
Services Provided by Intermediary when both LOS and LOR of goods outside the taxable
TerritoryNewly Inserted
F Refer Q. 45 & 48 from Questioner
Services provided by
(a) or a to a banking company with respect to accounts in business facilitatorbusiness correspondent
its rural area branch
(b) with respect to any person as an intermediary to a business facilitator or a business correspondent
services mentioned in entry (a); or
(c) in a rural area. business facilitator or a business correspondent to an insurance company
Provided that the exemption shall not apply to –
(i) online information and database access or retrieval services received by persons speciﬁed in
clause (a); or
(ii) services by way of transportation of goods by a vessel from a place outside India up to the
customs station of clearance in India
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REVISION
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All Important Clariﬁcations are given at the end of Module 2
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Chapter 6
Time of Supply
Table of Content
SectionsDescriptions SectionsDescriptions
2(66)Invoice
2(96)Removal
2(118)Voucher
2(32)Continuous Supply
2(33)
12
13
14
Continuous supply of services
Time of supply of Goods
Time of supply of service
Change in rate of tax
DON'TDON'T
WATCH THEWATCH THE
CLOCK;CLOCK;
DO WHATDO WHAT
IT DOESIT DOES
KEEP GOINGKEEP GOING
DON'T
WATCH THE
CLOCK;
DO WHAT
IT DOES
KEEP GOING
Invoice by supplier of the goods
As per Sec 31 a registered person supplying taxable goods invoice shall be issued , before
or at the time of
(a) for supply to the recipient, removal of goods where the supply involves movement
of goods; or
(b) thereof to the recipient, delivery of goods or making available in any other case
Supplier shall issue an Invoice
Invoice by supplier of the Service
As per Sec 31 a registered person supplying taxable services invoice shall be issued,
before or after the provision of service
but not beyond 30 days (in case of banks or ﬁnancial institution within 45
days) from the date of supply of service shall issue the Invoice
GST
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TOS of Supply of Goods (Normal Charge)
Example :Determine the Time of Supply in the following cases-
1. M/s. ABC Ltd. removed the goods valuing ` 10 lakh on 15.6.2018 & issued invoice thereof
on 12.6.2018.The payment is received on 1.8.2018 (book entry and bank realization is on same
date).
2. M/s. A Ltd. removed the goods valuing ` 12 lakh on 15.6.2018 & issued invoice thereof on
15.6.2018.The payment is received on 21.9.2018 (book entry and bank realization is on same
date).
3. Mr. A removed the goods valuing ` 14 lakh on 15.7.2018 & issued invoice thereof on
20.7.2018.The payment is received on 21.9.2018 (book entry and bank realization is on same
date).
4. M/s. MNL AOP removed the goods on 1.5.2018. An invoice towards value of ` 2 lakh was issued
on 1.5.2018. The payment is received by cheque and entered in books on 10.4.2018. It is realized
in bank by 13.4.2018.
5. M/s. AB HUF removed the goods valuing ` 12 lakh on 19.6.2018 & part payment ` 4,00,000
received on 21.6.2018 & balance payment received on 2.7.2018 (book entry and bank realization
is on same date).The invoice thereof is issued on19.6.2018.
6. M/s. XYZ Ltd. removed the goods valuing ` 12 lakh on 19.6.2018 & part payment ` 5,00,000
received on 21.5.2018 (book entry is on 21.5.2018 and bank realization is on 19.5.2018) &
balance payment received on 2.8.2018 (book entry and bank realization is on same date).The
invoice thereof is issued on 2.7.2018.
Solution: Monthly Payment
Assessee
Date of
Invoice
Date of
removal
of
goods
Date
of
TOS
Due date
of
Payment
Time of
Supply
read
with N/No.
66/2017
Date of receipt
of Payment
Last Date
of
Invoice
Book
entry
Credit in
Bank
ABC Ltd. 12/6/1815/6/18 1/8/18 1/8/18 20/7/18 12/6/18 12/6/1815/6/18
MR. A 20/7/1815/7/1821/9/1821/9/18 20/8/1815/7/18 15/7/1815/7/18
AB HUF 19/6/1819/6/1819/6/18
A. Ltd. 15/6/1815/6/1821/9/1821/9/18 20/7/1815/6/18 15/6/1815/6/18
MNLAOP 1/5/181/5/1810/4/1813/4/18 20/5/1810/4/18 1/5/18 1/5/18
XYZ Ltd. 2/7/18 19/6/1819/6/18
21/6/1821/6/18 20/7/1819/6/18 19/6/18
2/7/18 2/7/18 20/7/18 19/6/18 19/6/18
21/5/1819/5/18 20/6/1819/5/18 19/6/18
2/8/18 2/8/18 20/7/18 19/6/18 19/6/18
Note : Here when we are applying N/N 66/2017 to determine the time of supply the columns relevant shall
be only 2 & 3 as per sec 12(2) (a) of CGST Act.
1 2 3 4 5 6 7
Time of Supply u/s 12 & 13
Cases Sec 12 : TOS for supply of goodsSec 13 :- TOS for Supply of Service
Forward charge
or
outward supply

Ü Date of issue of Invoice or
Ü Last Date of issue of Invoice
Whichever is earlier
Note : As per N/N 66/2017 TOS is not
on date of Receipt
(a) If Invoice is issued
within time
(b) If Invoice is not issued
within time
(c) If TOS cannot be
determined as
per (a) or (b)Date when Recipient
shows receipt of
service in his books
RCM
or
Inward Supply
Sec 12(3) : TOS is on
(a) Date of Receipt of goods, or
(b) Date of Payment, or
(c) 31st Day from Supplier's Invoice
Whichever is earlier
Note : If (a) (b) or(c)is not possible then
date of Entry in Books of Accounts
Sec 13(3) : TOS is on
(a) Date of Payment, or
(b) 61st Day from Supplier's Invoice
Whichever is earlier
Note : If (a) (b) or (c) is not possible then date
of Entry in Books of Accounts
Payment upto
Rs 1000 in
excess of Invoice
Proviso to Sec 12(2) and 13(2) :
TOS is on at the option of Supplier, on the date of issue of next invoice in which such
payment is adjusted
Vouchers
Residual
Cases
Sec 12(4) and 13(4) : TOS is on
Date of Issue of Vouchers(a) If Supply is identiﬁable -
Date of Redemption of Vouchers(b) In Other Cases -
Sec 12(5) and 13(5) : TOS cannot be determined in any of the above section, then
Date on which such return is ﬁled (a) In case Periodical returns is to be ﬁled -
Date of Payment of Tax (b) In Other Cases -
Interest/ Late
Fees or Penalty
for delay payment
of considerstion
Sec 12(6) and 13(6) : TOS is on
ÜDate on which Supplier receives the addition in value
Note:
I) Date of Payment received FDate of book entry, or
F Credited to Bank
ii) Date of Payment (RCM)= F Date of Payment entered in
books of accounts, or
F Date of debit to bank
Sec 12(2)(a) : TOS Sec 13(2) :TOS
}
Whichever is earlier
}
Whichever is earlier
GST
REVISION
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(Refer Q.13, 36,
39, 42, 65 & 78 from
Questioner)
(Refer Q.23,49,51,56
from Questioner)
(Refer Q.16 from Questioner)
(Refer Q.27,29,58,& 59
from Questioner)
(Refer Q.32 & 64 from Questioner)
Date of invoice or Date
of Receipt,
whichever is earlier
Date of Completion
or Receipt whichever
is earlier

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Case : Where reverse charge is applicable as per section 9(3) & 9(4) of CGST act
Sr.
No.
Date of
receipt
of goods
1.
2.
22.10.2017
22.10.2017
Date of
issue of
Invoice by
supplier
20.10.201720.11.2017
15.10.201715.11.2017
Date of
Payment in
books of
recipient Payment
debited
in bank a/c
23.10.201725.10.201722.10.2017
17.10.201718.10.201717.10.2017
Time of
Supply
Comments
3.22.10.201715.10.201715.11.201720.10.201718.10.201718.10.2017
4.22.10.201710.10.201710.11.201723.11.201725.11.201722.10.2017
31st day
after
invoice
As per Sec. 12 (3),
earlier of
- Date of Receipt of
Goods or
- Date of Payment or
- 31st Day from Supplies
Invoice.
Example 2:Determine the Time of Supply in the following cases-
1. M/s. ABC Ltd. provided taxable services valuing ` 10 lakh on 15.6.2018 & issued invoice thereof on 12.6.2018.The
payment is received on 1.8.2018 (book entry and bank realization is on same date).
2. M/s. A Ltd. provided taxable services valuing ` 12 lakh on 15.6.2018 & issued invoice thereof on 15.6.2018.The
payment is received on 21.9.2018 (book entry and bank realization is on same date).
3. Mr. A provided taxable services valuing ` 14 lakh on 15.7.2018 & issued invoice thereof on 20.7.2018.The payment
is received on 21.9.2018 (book entry and bank realization is on same date).
4. M/s. MNL AOP provided taxable services on 1.5.2018. An invoice towards value of ` 2 lakh was issued on 1.5.2018.
The payment is received by cheque and entered in books on 10.4.2018. It is realized in bank by 13.4.2018.
5. M/s. AB HUF provided taxable servicess valuing ` 12 lakh on 19.6.2018 & part payment ` 4,00,000 received on
21.6.2018 & balance payment received on 2.7.2018 (book entry and bank realization is on same date).The invoice
thereof is issued on19.6.2018.
6. M/s. XYZ Ltd. provided taxable services valuing ` 12 lakh on 19.6.2018 & part payment ` 5,00,000 received on
21.5.2018 (book entry is on 21.5.2018 and bank realization is on 19.5.2018) & balance payment received on
2.8.2018 (book entry and bank realization is on same date).The invoice thereof is issued on 2.7.2018.
Solution:
Assessee Date of
Invoice
Date of
provision
of service
Date of TOSDate of receipt of Payment
Book entryCredit in Bank
ABC Ltd.
MR. A
A. Ltd.
MNLAOP
15/6/18
15/7/18
15/6/18
1/5/18
12/6/18
20/7/18
15/6/18
1/5/18
01/8/18
21/9/18
21/9/18
10/4/18
01/8/18
21/9/18
21/9/18
13/4/18
12/6/18
20/7/18
15/6/18
10/4/18
AB HUF
XYZ Ltd.
19/6/18
19/6/18
19/6/18
2/7/18
21/6/18
02/7/18
21/5/18
2/8/18
21/6/18
02/7/18
19/5/18
02/8/18
19/6/18
19/6/18
19/5/18
02/7/18
Sr.no Date of Date of Last date Date of Time of
of services Invoice by section Payment in Payment supply
provision issue of issue as per
by supplier of 13(3)(b ) books of debited in
supplier i.e.61 days recipient bank a/c
(1) (2) (3)
1 01.10.2017 01.10.2017 01.12.2017 03.10.2017 04.10.2017 03.10.17

2 01.08.2017 01.08.2017 01.10.2017 21.10.2017 20.10.2017 01.10.17
12% 12%
12%
12%
12%
12% 12%
12%
18% 18%
18%
18%
18%
18% 18%
18%
If completion
before CERT
then
If completion
after CERT then
(iii)
(iii)
(ii)
(ii)
Sec 14 (a)
In case of
supply of
taxable
Goods or
service has
ben supplied
before the
change in
effective rate
Sec 14(b)
In case of
supply of
taxable
Goods or
service has
been supplied
after the
change in
effective rate
of tax
Sec 14- Change in Rate of Tax (CRT) (applicable to both supply or goods & services)
S
S
S
S
S
S
S
S
TOS
TOS
TOS
TOS
TOS TOS
TOS
TOS
TOS is on date
of invoice or
receipt
whichever is
earlier.
TOS is on date of
invoice or receipt
whichever is
later. But if
invoice & receipt
occurred before
CRT then TOS is
on invoice or
receipt whichever
is earlier.
Proviso to
Date of
Payment Date of Payment shall be date of credit in book in following cases
i)Entry in books Credit in BankCRT/First
I) Credit in bank after 4 working days from date of CRT
ii) Payment is made by way of an instrument
Date of payment = Date of
credit in bank
CRT CRT
CRT
CRT
CRT
CRT CRT
CRT
TOS of Supply of Goods (Reverse Charge)
TOS of Supply of Service (Normal Charge)
TOS of Supply of Service (Reverse Charge)
GST
REVISION
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F Refer Q. 72,73 & 74 from Questioner

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Sr.
No.
Date of
Supply
Date of
Invoice
Date of
receipt of
payment
Time of
Supply as
per 14(a)
Applicable
Rate
1. 1-7-2017 11-7-2017 20-7-2017
Sec. 14 NOT
Applicable
12%
3. 21-8-2017 03-9-2017 15-9-2017
3. 25-8-2017 28-8-2017 15-9-2017
4. 22-8-2017 15-9-2017 29-8-2017
5. 20-8-2017 3-9-2017 15-11-2017
03-9-2017 18%
28-8-2017 12%
29-8-2017 12%
03-09-2017 18%
2. 4-8-2017 20-9-2017 10-9-2017 10-9-2017 18%
Sec 14(a): Date of CERT- 1st Sept 2017 (Supply of Service)
Change in Rate 12% to 18%
GOODS OR SERVICES SUPPLIED BY XYZ LTD BEFORE CERT
Sec 14(b) : Date of CERT- 1st Sept 17 (Supply of Service)
Change in Rate 12% to 18%
GOODS OR SERVICES SUPPLIED BY XYZ LTD AFTER CERT
Sr.
No.
Date of SupplyDate of InvoiceDate of receipt
of payment
TOS as per
Sec 14/13
Applicable
Rate
1. 25-9-2017 10-9-2017
2. 25-9-2017 21-8-2017 15-11-2017
3. 25-9-2017 01-8-2017 14-8-2017
21-8-2017 10-9-2017 18%
15-11-2017 18%
01-8-2017 12%
4. 25-9-2017 30-9-2017 12-8-2017 30-9-2017 18%
5. 25-10-2017 30-10-2017 6-11-2017 Sec. 14 N.A. 18%
GST
REVISION
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CONTINUOUS SUPPL Y OF GOODS OR SER VICES
Section
2(32)
Continuous
Supply
of Goods
“Continuous Supply of Goods” means a supply of goods which is provided, or
agreed to be provided,
Ü continuously or on recurrent basis,
Ü under a contract,
Ü whether or not by means of a wire, cable, pipeline or other conduit, and
Ü for which the supplier invoices the recipient on a regular or periodic basis and
Ü includes supply of such goods as the Government may, subject to such
conditions, as it may by notiﬁcation, specify.
“Continuous Supply of Goods”
In case of continuous supply of goods, where successive statements of accounts or
successive payments are involved, the invoice shall be issued before or at the time
each such statement is issued or, as the case may be, each such payment is received.
Issue of Invoice Sec 31(4)
Section 2(33)
Continuous
Supply
of Services
“Continuous Supply of Services” means a supply of services which is provided, or
agreed to be provided,
Ücontinuously or on recurrent basis,
Ü under a contract,
Ü for a with periodic payment obligations and period exceeding three months
Ü includes supply of such services as the Government may, subject to such
conditions, as it may by notiﬁcation, specify.
Continuous Supply of Services
in case of continuous supply of services
where the due date of payment is ascertainable from the contract, the invoice shall be
issued on or before the due date of payment
(a)
where the due date of payment is not ascertainable from the contract, the invoice shall be
issued before or at the time when the supplier of service receives the payment
(b)
where the payment is linked to the completion of an event, the invoice shall be issued on
or before the date of completion of that event.
(c)
Issue of Invoice Sec 31(5)
Goods Sent on Return Basis (Date of Issue of Invoice Section 31(7))
Where Goods are being sent for approval on Sale/Return are removed before Supply taken place, Invoice
shall be issued.
(a) Before or at the time of Supply or (b) 6 months from the date of Removal, Whichever is earlier
(Refer Q.18 from
Questioner)
(Refer Q.47 from
Questioner)
F Refer Q.33 from Questioner

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Determination of Time of Supply in different Situations
Supply Time of Supply Normal case Continuous Supply
Goods sent for sale on approval
or return basis
Supply
of
Goods
Sec 12(2)(a) :- Tos is earlier of the
following

a) Date of issue of invoice
b) Last Date of issue of invoice
If invoice is issued on or before
Ü Removal for supply (if movement involved),
or
Ü Delivery of goods or made available
If invoice is issued on or before, the date of
successive statement of accounts or
successive payment
a) If acceptance is given before 6 months and invoice is issued on or before acceptance b) If acceptance is not given before 6 months and invoice is issued on or before the date when 6 months expires
If invoice is not issued on or before
Ü Removal for supply (if movement involved),
or
Ü Delivery of goods or made available
TOS = Date of removal of goods or
Date of delivery
If invoice is not issued on or before, the date of
successive statement of accounts or
successive payment
TOS = Date of successive statement of
a/c or Date of Payment received
a) If acceptance is given before 6 months
but invoice is not issued on or before
acceptance
TOS = Date of Acceptance
b) If acceptance is not given within 6 months
and invoice is also not issued on or before
acceptance
TOS = Date on which 6 months expires
Supply
of
Services
Sec 13(2):-
a) If invoice is issued
within prescribed
time
TOS is on :-
Ü Date of issue
of invoice or
Ü Date of receipt
Whichever is earlier
If invoice is issued on or before 30 days or
45 days (In case of banking or FI)
a) If due date is ascertainable and invoice is
issued on or before due date
b) If due date is not ascertainable and invoice
is issued on or before receipt of payment
c) If invoice is issued on or before completion
of event
b) If invoice is not
issued within
prescribed time TOS is on :-
Ü Date of provision
of service or
Ü Date of receipt
Whichever is earlier
If invoice is not issued within 30 days or
45 days (In case of banking or FI) then,
TOS = Date of provision of service or
Receipt, , WIE
a) If due date of payment is ascertainable and
invoice is not issued on or before due date
b) If due date of payment is not ascertainable
and also invoice is not issued on or before
receipt of payment
c) If service is linked to completion of event
and invoice is not issued on or before
completion of event
TOS = Due Date of payment or
Date of Receipt, whichever is earlier
Note:- As per ICAI’s interpretation date of
completion is the due date of payment in
contract
TOS = Date of receipt of payment
TOS = Date of completion of event or
Date of receipt, , WIE
TOS = Date of issue of invoice
TOS = Date of issue of invoice
TOS = Date of issue of invoice
TOS = Date of issue of invoice or receipt
, WIE
TOS = Date of issue of invoice or
receipt, WIE
GST
REVISION
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Time of Supply as per Sec 12 (Continuous supply of goods)
Date of Receipt
of Payment
Statement
of A/C
Successive
Payment
25.10.201728.10.2017
25.10.201728.10.2017
Date of
issue
of Invoice
Time of
Supply
Comments
25.10.2017
23.10.2017
Last date
of issue of as
per Sec 31(4)
invoice
25.10.201725.10.2017
25.10.201723.10.2017
25.10.201720.10.201720.10.201720.10.201720.10.2017
TOS shall be
determined as
per Sec. 12(2)
read with N/No.
66/2017
Date of
removal
of goods
20.10.2017 to
25.102017
20.10.2017 to
24.10.2017
20.10.2017 to
24.10.2017
Sr.
No.
1.
2.
3.
Continuous supply of services
Section 13(2) r/w Section 31(5)
Invoice dateDate as per
contract
Receipt of
payment
Entry of
provision of
services in books
Section 31(5)(a) Contract provides
for payments monthly on the 10th of
succeeding month
02-Nov-17
17-Dec-17
10-Jan-18 10-Nov-17
10-Dec-17
10-Jan-18 15-Nov-17
15-Dec-17
06-Jan-18 31-Oct-17
30-Nov-17
31-Dec-171
Section 31(5)(c) Contract provides
for payments on completion of
event. Recipient to pay within 1
month from date of completion
12-Nov-17
24-Apr-18
10-Nov-17
24-Apr-18
25-Nov-17
20-Apr-18
12-Nov-17
24-Apr-18
2
Determine the Time of Supply for the following case: (ICAI BGM)
Answer :
Continuous SupplyInvoice
Date
Date of
Contract
Receipt
Date
Entry
Date
TOS
U/S 31(5)(a) Due
Date is 10th of
Succeeding Month
U/s 31(5)(c)
Compilation of
Event
02/11/17
17/12/17
10/01/18 10/11/17
10/12/17
10/01/18 15/11/17
15/12/17
06/01/18 32/10/17
30/11/17
31/12/18
02/11/17
10/12/17
06/01/18
12/11/17
24/04/18
10/11/17
24/04/18
25/11/17
20/04/18
12/11/17
24/04/18
10/11/17
20/04/18
Time of Supply as per Sec 13 (Continuous supply of service)
Illustration :-
1) In case goods are sent for sale on Approval / Return Basis, last day of invoice is date of acceptance by
recipient OR
Completion of 6 month if acceptance not given within 6 month. So, Invoice issued after last date i.e.
15/11/18. Hence, TOS is on 15/11/18.
2) TOS as per Sec. 12(2) is the date of Receipt i.e. 12/11/18 but if we apply notiﬁcation No. 66/2017, then
TOS is on Invoice OR Last Date of Invoice whichever is earlier.
3) If acceptance is not given within 6 months from the date of removal, then last date of Invoice is the date
when 6 month is completed. TOS is 01/04/19.
Sr.
No.
Removal
of Goods
Sale as App.
Basis
Issue of
invoice for
goods
Accepted
by
Receipient
Receipt
of
Payments
Time of
Supply
1.
2.
3.
Acceptance Communicated
Within 6 month of Removal
Amt. paid to Supplier before
informing acceptance
Acceptance Not
Communicated Within
6 month of Removal
01/11/18
01/11/18
01/10/18
15/11/18
15/11/18
15/05/19
25/11/18
25/11/18
15/05/19
25/11/18
12/11/18
2/05/19
15/11/18
(a) U/s 12(2) -12/11/18
(b) N/No.66/2017 -
15/11/18
01/04/19 (i.e. 6 month
from Removal)
Goods sent on Sale on Approval / Return Basis
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GST
REVISION
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In case of continuous Supply of Services, Time of Supply shall be determined as per Sec. 13(2), and
invoice shall be issued on the date prescribed under sec 31(5) i.e.
where the due date ascertainable Invoice shall be issued on or before the due date
of payment
where the due date is not ascertainable Invoice shall be issued before or at the time when
the supplier receives the payment
where the payment is linked to the completion
of an event
Invoice shall be issued on or before the date of
completion of that event.
Note:- Criteria of invoice to be issued within 30 or 45 days is not applicable here.
Time of Supply is only on invoice basis
N/n - 40/2017 C.T. dated 13 Oct. 2017 Superseded by dated 15 Nov.2017 N/n 66/2017
who shall pay the central tax
on the at the time of supply as speciﬁed in outward supply of goods clause (a) of sub-section (2) of
section 12 of the said Act Only for Goods i.e. on Invoice Basis only & Not Receipt Basis.
including in the situations attracting the provisions of section 14 of the said Act, and
shall accordingly furnish the details and returns as mentioned in Chapter IX of the said Act and the
rules made thereunder and
the period prescribed for the payment of tax by such class of registered persons shall be such as
speciﬁed in the said Act.
Any registered person who did not opt for the composition levy under section 10 of the said Act as the
class of persons

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With effect from 01.04.2019, supply of services by a landowner to a developer by way of –
(i) transfer of transferable development rights (TDR) or ﬂoor space index (FSI);
(ii) granting of long term lease,
for construction of residential apartments have been exempted subject to the condition that the constructed ﬂats
are sold before issuance of completion certiﬁcate or ﬁrst occupation of the project, whichever is earlier, and tax
is paid on them.
Such exemption for TDR, FSI, long term lease (premium) shall not be available in case of ﬂats which remain un-
booked on the date of issuance of completion certiﬁcate or ﬁrst occupation of the project, whichever is earlier.
The promoter (developer) shall be liable to pay tax at the applicable rate, on reverse charge basis, on such
proportion of
(i) value of development rights and/or FSI, or
(ii) upfront amount paid for long term lease, as is attributable to such un-booked residential apartments.
In view of the above change, with effect from 01.04.2019, a special procedure for payment of tax has been laid
down for following classes of registered persons, namely-
(i) a promoter who receives development rights or FSI (including additional FSI) on or after 1st April, 2019
for construction of a project against consideration payable or paid by him, wholly or partly, in the form of
construction service of commercial or residential apartments in the project or in any other form including
in cash;
(ii) a promoter, who receives long term lease of land on or after 1st April, 2019 for construction of residential
apartments in a project against consideration payable or paid by him, in the form of upfront amount*,
. * Such upfront amount is called as premium, salami, cost, price, development charges or by any other name
For such persons, the liability to pay tax on, -
(a) the consideration paid by him in the form of construction service of commercial or residential apartments in
the project, for supply of development rights or FSI (including additional FSI);
(b) the monetary consideration paid by him, for supply of development rights or FSI (including additional FSI)
relatable to construction of residential apartments in project;
(c) the upfront amount paid by him for long term lease of land relatable to construction of residential apartments
in the project; and
(d) the supply of construction service by him against consideration in the form of development rights or FSI
(including additional FSI), shall arise on the date of issuance of completion certiﬁcate or ﬁrst occupation of
the project, whichever is earlier. [Notiﬁcation No. 6/2019 CT (R) dated 29.03.2019/ Notiﬁcation No.
6/2019 IT (R) dated 29.03.2019]
Special procedure for determining the time of supply of services in certain cases
GST
REVISION
36
F Refer Q.80 from Questioner
GST
REVISION
43
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Chapter 7
Value of Supply
Table of Content
SectionDescription
Sec 15 Value of Taxable Supply
RulesDescription (CGST Rules 2017)
27
28
29
30
31
32
33
34
Value of supply of goods or services where the
consideration is not wholly in money
Value of Supply of Goods or services or both between
distinct or related persons, other than through an agent
Value of supply of goods made or received through an agent
Value of supply of goods or services or both based on cost
Residual method for determination of value of supply of goods
or services or both
Value of Supply in case of lottery, Betting & Gambling and Horse
racing
Determination of value in respect of certain supplies
Value of supply of services in case of pure agent
Rate of exchange of currency, other than Indian rupees,
for determination of value
Value of supply inclusive of integrated tax, central tax,
State tax, Union territory tax
35
Index
Excellence is not
a Skill.
It is an
Attitude..
31A
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GST
REVISION
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Section 15 - Valuation
Value of =
Taxable
Supply
Transation value
Price actually
paid or payable
for Supply
Conditions:
1) Not related party
2) Price is sole consideration
Inclusion to Transaction Value Deduction
of discount
Sec 15(2)
Sec 15(3)Sec 15(1)
Duties & Taxes All
taxes levied under
any law
for time being in
force other than
GST Acts if
charged separately
a b c d e
3rd party payment
Any payment
incurred by the
recipient for
which supplier is
liable to pay
Incidental expenses:
Any incidental
expenses charged by
supplier & any amount
charged for anything
done by the supplier
at the time of supply or
before delivery
Interest, late
fee penalty for
delay
payment of
consideration Subsidy
Subsidy
directly
linked to price
by person
other than
govt.
Any discount
given before
or at the time of
Time of Supply
Deductible
from value
Any discount
given after supply
Agreed at the
Time or before
supply
Not Agreed
Deduction
not allowed
Deduction allowed
i) linked to the invoice
ii) ITC reversed by recipient
Examples of additional
recoveries by supplier
Ü Packing, labeling, designing etc
Ü Excise duty, Customs duty or
other taxes except GST
Ü Royalty, warranty charges, etc.
ÜInsurance charges if goods are
insured by the seller.
ÜDharmada collected by the
dealer
ÜWeightment charges.
ÜAll expenses before the delivery
(loading, weighing, coolie)
ÜFreight shown separately in
invoice
ÜSalesman commission
ÜRental charges for durable and
returnable packing
Ü Erection installation charges
Ü Pre Delivery Inspection Charges
Tobacco & Tobacco Products
Invoice
Basic Price
Ex. Duty@30%
Total
GST@28%
Subsidy
Given by Govt.
Not to be added
to the value
of supply
Given by others
Subsidy linked to the price of supply
it would be
to added
value of
supply
Not linked to the price
it will not
be added to
the value
of supply
Analysis :
Example : Isha Time Gallery has been appointed as an authorized center
of Sony electronics, On sales of worth ` 20,00,000 electronic items. Sony
electronics is liable to pay commission @ 10 % on such sale i.e. ` 2,00,000
but such selling commission to be paid by Sony electronics has been paid
by Isha Time Gallery for the month of August. In this case such expense
shall be included in transaction value.
F Refer Q. 25,34,74 & 78 from Questioner
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If value of supply cannot be determined u/s 15(1) i.e
Ü Supply without price Ü Related party transaction
Ü Supply without consideration or any other considerations then apply

Sec 15(4)
Rule 27
When consideration is not
wholly in money
(a) Open market value (OMV)
(b) If (a) is not available
value = consideration in
money + FMV of
consideration not in money
(c) If (a) & (b) not determinable
Value = value of like kind &
quality
(d) If (a) (b) or (c) not
determinable then apply
Rule 30 or 31 in that order
Rule 28
Supply between distinct or
related person
(a) Open Market Value (OMV)
(b) If (a) is not available
value = value of like kind & quality
© If (a) & (b) not determinable then
apply Rule 30 or 31 in that order
Proviso 1: If further supply of goods is
as such by recipient at option of
supplier
Value = 90% of price charged for like
kind &
quality by recipient.
Proviso 2 : If recipient is eligible Full
ITC then OMV = Value declared in
invoice for supply of goods or services.
Rule 29
Supply between
principle & agent
(a) Open Market
Value (OMV )
OR
90% of price of like
kind & quality by the
recipient.
Where such
goods are
intended for further
supply.
(b) If (a) is not
available then Rule
30 or 31 in order.
Rule 30 & 31 are applicable in order in following cases
1) If situation covered in rule 27,28,29 but Valuation can not be done by applying the principles Stated in rules
2) If situation not covered in a fore said rules.
Rule 30: Value of supply
based on Cost
Value = 110% of
Cost of production
Cost of acquisition
Cost of provision of
service
Rule 31: Residual method
or Best judgement by using
reasonable means
– Consistent with the principles &
general provision of Sec 15
– Provision of this chapter (i.e. earlier rules)
Note:In case of supply of services supplier may option for rule 31 instead of rule 30
CGST Rules 2017
Valuation in special cases [Rule 32]
Option 1
(a) Exchange value up to `
1,00,000.
Value = 1% of gross amount
exchange value but min ` 250
(b) Exchange value more than 1
Lac but below 10Lac
Value = 1000+0.5% of (E.V. -
1,00,000)
(c) Exchange Value above 10 L
Value = 5500+0.1% of (E.V. -
10,00,000) but max 60,000
FC to ` FC to FC
RBI Ref. rate
is availabe
RBI Ref. rate
not available
Value =1% of
gross amount
of currency
exchanged in `
Value = Dealers
buying or
selling rate
–
RBI
base
rate
convert both the
currencies in
Indian ` by
applying RBI rate
Value = 1% of
lower of above
amount
Rule 32 (3) : Value of the supply of Services in relation to booking of tickets for travel by air
Value = 5% of basic fare(a) Domestic Booking -
(b) International Booking - Value = 10% of basic fare
Basic fare means airfare on which commission is payable to air travel agent. i.e. It doesn’t includes other Note:
charges & taxes.
Rule 32 (4) : Life insurance business
Saving policy
Risk Policy
value shall be determined as per
Sec15(1) i.e. gross premium charged
Single Annual Policy
Value =10% of single
premium charged
Investment or saving
intimated to policy holder
Investment not intimated to policy holder -
value = 25% of premium charged (a) 1st year
(b) 2nd year value = 12.5% of premium charged
Value = gross Premium
-InvestmentNote : If this option is exercised it can’t withdrawn in the same financial year
Rule 32(2) :Purchase or sale of foreign currency
(a) The value of
supply of
lottery run by
State Govt.
face value of ticket
or
price as notiﬁed in the Ofﬁcial
Gazette by the organising State,
whichever is higher.
(b) The value of
supply of
lottery
authorised by
State Govt.
(b) Value of betting, gambling and horse racing = Face Value of Bet or Amount paid to totalisator
100/112
of the
Value shall be deemed to be
Option 2
Rule 31 A : Value of Supply in case of lottery, betting Gambling & Horse racing
Lottery run byValue
face value of ticket
or
price as notiﬁed in the Ofﬁcial
Gazette by the organising State,
whichever is higher.
100/128
of the
Lottery run byValue
Value shall be deemed to be
Amendment

Notwithstanding anything contained in sec 15(1)/15(4) Value of supply notified by the govt.shall be determined
as per Rules
Sec 15(5)
Note :
FC= Foreign currency
EV = Exchange Value

(c) “Organising State” has the same meaning as assigned to it in clause (f) of sub-rule (1) of rule 2 of the Lotteries (Regulation) Rules, 2010.
(Refer Q.39,40 & 81 from Questioner) (Refer Q.44 & 79 from Questioner) (Refer Q.47 from Questioner)
F Refer Q.49 from Questioner
(Refer Q.51 & 80 from Questioner)
(Refer Q.68 from Questioner)
(Refer Q.55 & 82 from Questioner)
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32 (6) : Value of token, voucher,
coupon.
Value = money value of goods /
services / both redeemable against
such coupon, token, voucher, stamp
32 (7) : Value of supply of service to
distinct person.
In case of notified supply of services
by govt. the value of supply made to
distinct person where ITC is available
shall be Nil
Rule 32 (5) : Buying & Selling of 2nd hand goods.
If ITC is not taken on
purchase of such goods
Value = selling price -
purchase price
If ITC is taken on purchase of
such goods
Value = Transaction value U/S 15(1)
or outward supply of such goods
In case of reposed goods from defaulting borrowers.
Purchase =
price
Purchase price
of defaulting
borrower 5% of each qtr or part there of
between date of purchase of defaulting
borrower & date of disposal by person–
Notwithstanding anything contained in the provisions of this Chapter, the expenditure or
costs incurred by a supplier as a pure agent of the recipient of supply shall be excluded
from the value of supply, if all the following conditions are satisﬁed, namely,-
(i) when he makes the payment the supplier acts as a pure agent of the recipient of the supply,
to the third party on authorisation by such recipient;
(ii)the payment made by the pure agent on behalf of the recipient of supply has been separately
indicated in the invoice issued by the pure agent to the recipient of service; and
Rule 33 - Value of supply of services in case of pure agent
(iii) the supplies procured by the pure agent from the third party as a pure agent of the
recipient of supply are in addition to the services he supplies on his own account.
Explanation For the purposes of this rule, the
expression “pure agent” means a person who-
(a) with the recipient of supply to act as his pure agent enters into a contractual agreement
to incur expenditure or costs in the course of supply of goods or services or both;
(b) to the goods or services or both so procured neither intends to hold nor holds any title
or supplied as pure agent of the recipient of supply;
(c) interest such goods or services so procured; anddoes not use for his own
(d) to procure such goods or services in addition receives only the actual amount incurred
to the amount received for supply he provides on his own account.
Example 1: X contracts with Y, a real estate agent to sell his house and thereupon Y gives an
advertisement in television. Y billed X including charges for Television advertisement and paid service
tax on the total consideration billed.
In such a case, consideration for the service provided is what X pays to Y. Y does not act as an agent behalf of X
when obtaining the television advertisement even if the cost of television advertisement is mentioned separately
in the invoice issued by X.
Advertising service is an input service for the estate agent in order to enable or facilitate him to perform his
services as an estate agent.
(1)Supply of Goods : the rate of exchange for determination of value of taxable goods shall be
Ü the applicable rate of exchange as notiﬁed by the Board under section 14 of the Customs Act, 1962
Ü for the of the Act.date of time of supply of such goods in terms of section 12
Sr.
No.
Date of
Removal
of goods
Date of
Invoice
Last date of
Invoice
as per
Section 31(1)
Date of Receipt
of Payment
Time of
supply as
per
N/N 66/2017
Applicable
Exchange
Rate
(CBIC)
In suppliers
book
Credit in
Bank a/c
1.20.10.201710.10.201720.10.201728.10.201730.10.2017
2.20.10.201720.10.201720.10.201728.10.201730.10.2017
3.20.10.201720.10.201720.10.201710.10.201713.10.2017
Example : Exchange Rate
CBIC RBI GAAP
upto 15th Oct.
15th Oct.& onward
1$ = 63.20
1$ = 63.80
1$ = 62.80
1$ = 63.30
1$ = 63.80
1$ = 64.30
Normal Charge (As per Sec 12)
TOS provisions here are relevant as based on that the liability for charging GST shall aries
Rule 34: Rate of exchange of currency, other than Indian rupees, for determination of value
10.10.2017
20.10.2017
20.10.2017
63.20
63.80
63.80
Exchange Rate
CBIC RBI GAAP
upto 15th Oct.
15th Oct.& onward
1$ = 63.20
1$ = 63.80
1$ = 62.80
1$ = 63.30
1$ = 63.80
1$ = 64.30
Sr.
No.
Date of
Supply
of Service
1.
2.
22.10.2017
22.10.2017
Date of
issue of
Invoice by
supplier
20.10.2017
15.10.2017
Date of
Payment in
books of
recipient Payment
debited
in bank a/c
23.10.201725.10.2017
17.10.201718.10.2017
Time of
Supply
as per
sec 13(3)
4.22.10.201710.10.2017 23.11.201725.11.2017
61st day
after
invoice
Applicable
Exchange
Rate (GAAP)
(2)Supply of Service : The rate of exchange for determination of value of taxable services shall be
Ü the applicable rate of exchange determined as per the generally accepted accounting principles
Ü for the of the Act. date of time of supply of such services in terms of section 13
Example :
Where the value of supply is inclusive of integrated tax or, as the case may be, central tax, State tax,
Union territory tax, the tax amount shall be determined in the following manner, namely,-
Tax amount = (Value inclusive of taxes X tax rate in % of IGST or, as the case may be, CGST, SGST or UTGST)
÷ (100+ sum of tax rates, as applicable, in %)
Example of
Goods
Question: M/s BMR pvt ltd purchased goods worth ` 220000 inclusive of GST of 18% of which CGST is 9% and
SGST is 9%. What will be the amount of tax included in the value of supply?
Ans:- The tax amount paid by BMR pvt ltd shall be computed as per provisions of rule 35 i.e. Tax amount =
220000*18/118 i.e. ` 33560 of which amount of CGST will be ` 16780 & SGST will be ` 16780.
Rule 35: Value of supply inclusive of integrated tax, central tax, State tax, Union territory tax
In case of reverse charge
20.12.2017
15.12.2017
10.12.2017
23.10.2017
17.10.2017
23.11.2017
64.30
64.30
64.30
(Refer Q.58 & 59 from Questioner)
(Refer Q.60 from Questioner)
(Refer Q.65 & 75 from Questioner)
(Refer Q.84 from Questioner)
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Chapter 8
Input Tax Credit
Table of Content
Section Description
Section 16 Eligibility & conditions for taking input tax credit
Section 17 Apportionment of credit & blocked credits
Section 18 Availability of credit in special circumstances
Section 19 Taking input tax credit in respect of inputs & capital goods for job work
Section 20 Manner of distribution of credit by Input Service Distributor
Section 21 Manner of recovery of credit distributed in excess
Rule No.Description
CGST rules pertaining to Input tax credit
36 Documentary requirements and conditions for claiming input tax credit
37 Reversal of input tax credit in case of non-payment of consideration
38 Claim of credit by a banking company or a ﬁnancial institution.
39 Procedure for distribution of input tax credit by Input Service Distributor
40 Manner of claiming credit in special circumstances
41 Transfer of credit on sale, merger, amalgamation, lease or transfer of a business
42 Manner of determination of input tax credit in respect of inputs or input services and
reversal thereof
43 Manner of determination of input tax credit in respect of capital goods and reversal
thereof in certain cases
44 Manner of reversal of credit in special circumstances
45 Conditions and restrictions in respect of inputs and capital goods sent to the job
worker
Sec 2(59) Input : Means used other any goods
than capital goods used or intended to be used
by supplier in course of furtherance of business.
Sec 2(60) Input Service : Means any service
used or intended to be used by a supplier in
the course or furtherance of business
Sec 2(19) Capital Goods : Means goods, the value of which is capitalised in the books of account
of the person claiming the input tax credit and which are used or intended to be used in the course
or furtherance of business
Sec 2(46) Electronic Credit Ledger: means the electronic credit ledger as referred in Sec 49(2) i.e. the
input tax credit as self assessed in return of registered person shall be credited to electronic credit ledger
in accordance with section 41, to be maintained in the manner as may be prescribed.
Sec 2(67) Inward Supply : in relation to a person, shall mean receipt of goods or services or both
whether by purchase acquisition or any other with or without consideration.
Sec means an of the following supplies of 16(1) of IGST Act “Zero-rated supply”:
goods or services or both namely-
(a) export of goods or services or both; or
(b) Supply of goods or services or both to a Special Economic Zone (SEZ) developer or a Special
Economic Zone unit
Detailed discussion in Chapter IGST Act.
Sec “Output tax” in relation to a taxable person, 2(82) “Output Tax”:
means the tax chargeable under this Act on
Ü taxable supply
Ü of goods or services or both
Ü made by him or by his agent
but excludes tax payable by him on reverse charge basis.
Important Deﬁnitions
Important Explanation:- For the purpose of this chapter
The expressions “capital goods” shall include “plant and machinery” as deﬁned in the
Explanation to sec 17;
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Sec 16 : Eligibility & Conditions & Time limit
Sec. 16(1) :
Eligibility
criteria : 1) Person should be registered person to take ITC
2) Goods or Services are used/intented to be used in the course or Furtherance
of business.
3) Amount should have Credited to Electronic Ledger of such person.
Sec. 16(2) :
Conditions for
Availment of ITC a) Tax invoice /Debit note or other Tax Paying documents is
in possession
b) Should have received the goods or services or both.
Analysis of above Clause (a) & (b)
Situation Invoice Receipt of G/S ITC Eligibility
A ü ü Yes
B û ü No
C ü û No
Exception : Bill to ship to
i) If goods are supplied on direction of third person then goods are deemed to
be received by third person when supplied by supplier to the recipient
ii) Where by the supplier to any person on the the services are provided
direction of and on account of such registered person
Supplier
Invoice 1
‘A’ ‘B’
Third person
In the given image, Mr. B is
eligible of ITC even though
goods are not received as
per the above explanation
given for built to ship model
Recipient
‘C’
c) the tax charged in respect of such supply has been
actually paid to the Government
Example : Mr Vishal purchased spare parts worth ` 75000 as on 01/8/2017 on
which CGST @ 9% i.e. ` 6750 & SGST @ 9% i.e. ` 6750 were charged, thus
total amount payable against such purchases is `88500/-. The consignment is
received on same date explain the eligibility of ITC of Mr Vishal if supplier is
failed to make the payment of GST to Government within due date.
Solution As pers Sec 16 (2), ITC is available on inward supply only if tax on
such supply has actually been paid to the Govt. In given case, it supplier fails to
make payment of GST to Govt within due date then Mr. Vishal is not eligible for
ITC.
d) Should have furnished the periodical Returns
Jan, 2018
Filed
ITC allowed
Feb, 2018
Not ﬁled
ITC not allowed
Mar, 2018
Cannot be ﬁled unless return
for tax period is ﬁled Sec 39(10)
ITC not allowed
Status of
GSTR-3
ITC if Goods
are received in
Lot (Proviso to
Sec 16)
Where the goods against an invoice are received in lots or instalments, the
registered person shall be entitled to take credit upon receipt of the last lot or
instalment
Payment for the
invoice to be
made within 180
days (Proviso to
Sec 16)
1. Default : Failure by Recipient to pay to the supplier the within 180 days from
Invoice date.
2. Consequence : Amount equal to the ITC availed by the recipient + Interest @
18% P.A. shall be added to the output tax liability.
3. Details to be furnished : Details of defaulted supply, value not paid, ITC availed
to be mentioned in FORM GSTR-2 for the month immediately after the expiry of
180 days from Invoice date.
4. Regain of Credit : Regain when payment is made (below time limit not applicable
for regaining of ITC
5. Non Applicability : This provision not applicable
a) Tax payable under RCM b) Deemed supplies without consideration [Sch.I]
c) Value of supplies on account as per sec 15(2)(b)
No ITC if
depreciation is
claimed on Tax
component of
Capital Goods
(Sec 16(3))
Where the registered person has claimed depreciation on the tax component of
the cost of capital goods and plant and machinery under the provisions of the
Income-tax Act, 1961,
the input tax credit on the said tax component shall not be allowed.
Time limit to
avail ITC-Debit
Note (Sec 16(4))
No ITC for any invoice or debit note (pertaining to Invoice in F.Y.) for supply of goods
or services or both after -
(a) The due date of furnishing of the return for the month of September following the
end of F.Y. to which invoice/ debit note pertains or
(b) The date of furnishing of the relevant annual return,
whichever is earlier
Provided that for any invoice relating to such debit note for supply of goods or services or both
made during the financial year 2017-18. The details of which have been uploaded by the
supplier till the due date for the month of March, 2019. Registered person is eligible to take
ITC till the due date of furnishing of the return for the month of March, 2019
(Refer Rule 36 in Next page)
F Refer Q.8, 9, 12, 16 & 21 from QuestionerGST
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Rule 36 of the CGST Rules
(a) an of goods or services or both. invoice issued by the supplier
(b) an (receiving goods and/or services invoice issued by recipient
from unregistered supplier) along with proof of payment of tax
(in case of reverse charge)
(c) a issued by a supplier debit note
(d) a or any similar document prescribed under the bill of entry
Customs Act, 1962 for the assessment of integrated tax on
imports;
(e) Revised invoice
(f)Documents issued by input service distributor.
Document required for claiming ITC
Rule 36(2):- Necessary Particulars that are required
to be included in documents for claiming ITC
Mandatory Optional
i) Details of the amount of tax charged,
ii) of goods or services, Description
iii) of goods or Total value of supply
services or both,
iv) GSTIN of the supplier and recipient
and place of supply in case of inter-
State supply,
v) may be availed by Input tax credit
such registered person
Particulars other than
those mentioned in (I)
to (v) (mandatory
column )
Rule36(3)&(4):- Restriction for claiming ITC
(4) Input tax credit to be availed by a registered person in respect of
invoices or debit notes, the details of which have not been uploaded
by the suppliers under section 37(1),
shall not exceed of the eligible credit available in 20 %
respect of invoices or debit notes the details of which have been
uploaded by the suppliers under section 37(1).
Case Amount of ITC to be claimed by recipient
Where invoice/debit note has been uploaded
by the supplier in his GTSR-1
Full ITC, if all other conditions of availing ITC are
fulﬁlled
Where invoice/debit note has not been
uploaded by supplier in his GTSR-1
20% of the eligible ITC available in respect of the uploaded
invoices/debit notes. However, the ITC so claimed should
not exceed the actual eligible ITC available in respect of
the invoices not uploaded.
Newly Inserted by N/N 49/2019
CT dt 09/10/2019
Rule 36(1):-
Illustration 1
Mr. Vijay, a registered supplier, receives 100 invoices (for inward supply of goods/ services) involving
GST of Rs. 10 lakh, from various suppliers during the month of October 20XX.
Compute the ITC that can be claimed by Mr. Vijay in his GSTR-3B for the month of October 20XX to be
th
ﬁled by 20November 20XX in the following independent cases assuming that GST of Rs. 10 lakh is
otherwise eligible for ITC:
Case I
Out of 100 invoices, 80 invoices involving GST of Rs. 6 lakh have been uploaded by the suppliers in their
respective GSTR-1s ﬁled on the prescribed due date therefor.
Case II
Out of 100 invoices, 75 invoices involving GST of Rs. 8.5 lakh have been uploaded by the suppliers in their
respective GSTR-1s ﬁled on the prescribed due date therefor.
(3) No input tax credit shall be availed in respect of any tax that has been
paid in pursuance of any order where any demand has been conﬁrmed
on account of any fraud willful misstatement or suppression of facts
Detailed Discussion on newly inserted sub-rule (4) of Rule 36
Summary of Rule 36(4) :-
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Total 10 Lakh
Notes:
(1) In respect of invoices uploaded by the suppliers in their GSTR-1, full ITC can be availed.
(2) The ITC in respect of invoices not uploaded has to be restricted to 20% of eligible ITC in respect of
invoices uploaded in GSTR-1. However, since in this case, the actual ITC [Rs. 1.5 lakh] in respect of 25
invoices not uploaded in GSTR-1 does not exceed 20% of the eligible ITC in respect of invoices
uploaded in GSTR-1s [Rs. 1.7 lakh (20% of Rs. 8.5 lakh)], actual amount of ITC can be availed.
10 Lakh
Invoice
Amount of ITC involved
in the invoices (`)
Amount of ITC that can be
availed (`)
In respect of 75 invoices uploaded in
GSTR-1
In respect of 25 invoices not uploaded in
GSTR-1
8.5 Lakh
1.5 Lakh
` 8.5 lakh
[Refer Note 1 below]
`1.5 lakh
[Refer Note 2 below]
Answer
As per sub-rule (4) of rule 36, ITC to be availed by a registered person in respect of invoices or debit notes, the
details of which have not been uploaded by the suppliers in GSTR-1, cannot exceed 20% of the eligible credit
available in respect of invoices or debit notes the details of which have been uploaded by the suppliers in
GSTR-1.
Case I
th
ITC to be claimed by Mr. Vijay in his GSTR-3B for the month of October 20XX to be ﬁled by 20 November
20XX will be computed as under-
Invoice
Amount of ITC involved in the
invoices (`)
Amount of ITC that can be
availed (`)
In respect of 80 invoices uploaded in
GSTR - 1
6 Lakh
`6 lakh
[Refer Note 1 below]
In respect of 20 invoices not uploaded
in GSTR - 1
4 Lakh
`1.2 lakh
[Refer Note 1 below]
Total 10 Lakh 7.2 Lakh
Notes:
(1) In respect of invoices uploaded by the suppliers in their GSTR-1, full ITC can be availed.
(2) The ITC in respect of invoices not uploaded has to be restricted to 20% of eligible ITC in respect of invoices
uploaded in GSTR-1. Thus, in respect of 20 invoices not uploaded in GSTR-1s, the ITC has been
restricted to Rs. 1.2 lakh [20% of Rs. 6 lakh].
Case II
th
ITC to be claimed by Mr. Vijay in his GSTR-3B for the month of October 20XX to be ﬁled by 20 November
20XX will be computed as under-
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Sec - 17(5) Blocked Credit
(B)Transportation of passengers or
Non eligibility of Credit : Input tax credit shall not be available in respect of the following, namely
(a)
(A)Further supply of such motor vehicles or
(C)Imparting training on driving, such motor vehicles
Motor vehicles for transportation of persons having approved seating capacity of not more than 13
persons (including the driver), except when they are used for making the following taxable supplies namely :
Amended by CGST
Amendment Act, 2018
(ii)for transportation of goods
Example 1
Katraj dairy uses tempo service for delivery of its milk products. In this case as supply
of milk products is in course of business, Thus here ITC will be allowed.
(aa)Vessel & aircraft except when they are used -
(i)For making the following taxable supplies namely
(B)
(A)
(C)
(D)
Further supply of such vessels or aircraft or
Transportation of passengers or
Imparting training on navigating such vessels or
Imparting training on ﬂying such aircraft
Newly Inserted by CGST
Amendment Act, 2018
(ab)
Services of general insurance, servicing, repair & maintenance in so far as they relate to
motor vehicle, vessel or aircraft referred to in clause (a) or (aa).
Proviso - Provided that the input tax credit in respect of such services shall be available
i) Where the motor vehicles, vessels or aircraft referred to in clause (a) or clause (aa) are used for the
purpose speciﬁed therein ;
Newly Inserted by CGST
Amendment Act, 2018
Determine whether in the following cases, ITC shall be available or not and also
State reasons for it?
Manufacturer
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
ice cream ice cream ice cream
As in the given case, motor vehicle is
used for transportation of goods which is
in course of Business & it falls in the
exceptional clause of the given sec
17(5)(aa) (ii)
Case
ITC
Eligibility
ReasonsSI.No.
1
Yes
Truck used for Goods Transportation in factory
Authorised Dealer
Motor Vehicle purchased by authorised dealer
for further supply
2
As in the given case, motor vehicle is
used for further supply of such vehicles
& it falls in the exceptional clause of the
given sec 17(5)(a)
Yes
Contract
Carriage
1. Bus used by travel company for transportation
of Passenger
2. Motor car used by supplier of taxi service
3. Aircraft purchased by Indigo for passenger
transportation
Yes
3
As in the given case, motor vehicle is
used for transportation of passengers &
it falls in the exceptional clause of the
given sec 17(5)(a) and (aa)
DRIVING
SCHOOL
1. Aircraft used by Institute imparting navigation
training to pilots
2. Motor vehicle used by motor driving school
Yes
As in the given case, motor vehicle is
used for imparting training on driving &
ﬂying thus it falls in the exceptional
clause of the given sec 17(5)(a) and (aa)
4
5
GOODS TRANSPOR T CO.
Goods Transport
PROMOTER
&
BUILDER
1. Truck used by GTA for transportation of goods
2. Truck used by builder contractor for
transportation of goods
Yes
As in the given case, motor vehicle is
used for Transportation of goods thus it
falls in the exceptional clause of the
given sec 17(5)(aa)(ii)
ii) Where received by a taxable person engaged -
I) In the manufacture of such motor vehicles, vessels, or aircraft or
II) In the supply of general insurance services in respect of such motor vehicles, vessels or
aircraft insured by him.
Motor vehicles
Transformation of Passenger Transformation
of Goods
Seating capicity is
13 person or less
Seating capicity is
more than13 person
No restriction on ITC
ITC availed
to all registered
person
Normally Special Case
ITC of such motor
vehicle is not
available even
though use
in the business
But if used for
a) further supply of
such motor vehicle
b)Transportation of passenger
c) Imparting training on
driving, such motor vehicles
Then ITC is available
U/s 17(5) i.e. ITC is
available to all
registered person
(Manufacturer, trader
or Service provider)
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(b) the following supply of goods or services or both
(i)Ü food and beverages,
Ü outdoor catering,
Ü beauty treatment,
Ü health services,
Ü cosmetic and plastic surgery
Ü Leasing, renting or hiring of motor vehicles, vessels or aircraft referred in clause (a) or (aa)
except when used for purposes speciﬁed therein,
Ü life insurance & health insurance
Proviso -
Provided that the input tax credit in respect of such goods or services or both shall be
available where in inward supply of such goods or services or both is used by a
registered person for
ðmaking an outward taxable supply of the same category of goods or services or both or
ðas an element of a taxable composite or mixed supply
Amended by CGST
Amendment Act, 2018
Case ITC
Eligibility
S.N.
1 Inward Supply of
Food& Beverages
by Reliance Fresh
who is further
supplying Food &
Beverages
Inward Supply of
Food&
Beverages to a
supplier is
providing
restaurant service
Café & Restaurant Service2
Yes
Yes
As in the given case, it is used by the
registered person for making outward supply
of same category of goods & it falls in the
exceptional clause of the given sec 17(5)(b)
As in the given case, it is used by the
registered person for making outward
supply of same category of goods as an
element of composite supply & it falls in the
exceptional clause of the given sec 17(5)(b)
Inward supply of food
packets to Airline. The
packets are used for in-
ﬂight catering
Inward supply of
Health care service
to a Hospital who is
providing
healthcare services
Factory
Inward supply of
Health care service
to a Manufacturer/
Trader/ Service
Provider
3
4
5
Inward Supply of
outdoor catering to a
manufacturing
company for
celebrating its 25
years of success
Factory
Yes
Yes
No
No
Inward Supply of
beauty treatment
services by a Film
Production Company.
No
6
7
As in the given case, it is used by the
registered person for making outward
supply of same category of goods & which
is considered as a part of the composite
supply of air travel services & it falls in the
exceptional clause of the given sec 17(5)(b)
As in the given case, it is used by the registered
person for making outward supply of same
category of services & it falls in the exceptional
clause of the given sec 17(5)(b)
As in the given case, it is not used by the
registered person for making outward supply
of same category of services
As in the given case, it is not used by the
registered person for making outward
supply of same category of services & is
used for its own company
As in the given case, it is not used by the
registered person for making outward
supply of same category of services & is
used for its own company
(c)works contract services when supplied for (other construction of an immovable property
than plant and machinery)
except where it is an input service for further supply of works contract service
As per section 2(119) of CGST act 2017 works contract means a contract for building, construction,
fabrication, completion, erection, installation, ﬁtting out, improvement, modiﬁcation, repair,
maintenance, renovation, alteration or commissioning of any immovable property wherein transfer of
property in goods (whether as goods or in some other form) is involved in the execution of such contract
(ii)membership of a club, health and ﬁtness centre
Example 1:- Smart pvt ltd takes an annual membership of a ﬁtness centre, Hi Fi, for the
use of its employees. Here, Smart pvt ltd cannot avail ITC on the GST paid on
membership charges.
(iii)travel beneﬁts extended to employees on vacation such as leave or home travel
concession
Proviso - Provided that the input tax credit in respect of such goods or services or both shall be
available, where it is obligatory for an employer to provide the same to its employees under any law
for the time being in force.
Example 1 :- VB Ltd reimburses its senior employees on travel expenses as part of LTA
(Leave Travel Allowance). VB Ltd cannot avail ITC on the GST component of the travel fare
reimbursed.
Works ContractorLabour &
Material
Construction of
Buildings
Case : 1
Works Contract Service used construction of
building of manufacturer/trader or service
provider
Works ContractorLabour &
Material
Construction of
Plant & Machinery
Case : 1
Works Contract Service used construction of
Plant & Machinery of manufacturer/trader or
service provider
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(d)goods or services or both received by a taxable person for construction of an immovable
property (other than plant or machinery)
Ü on his own account
Ü including when such goods or services or both are used in the course or furtherance
of business.
Explanation 1:- For the purposes of clauses (c) and (d), the expression “construction”
includes re-construction, renovation, additions or alterations or repairs, to the extent of
capitalisation, to the said immovable property
Explanation 2:- For the purposes of this Chapter and Chapter VI, the expression “plant
and machinery”
means apparatus, equipment, and machinery
Ü ﬁxed to earth by foundation or structural support
Ü that are used for making outward supply of goods or services or both and
includes such foundation and structural supports
but excludes
(i) Land, building or any other civil structures
(ii) Telecommunication towers; and
(iii) Pipelines laid outside the factory premises
Used for
Factory building
Construction
Labour
Construction Service & Construction Material
used construction of building of
manufacturer/trader or service provider
Used for
Plant & Machinery
Construction
Labour
Construction Service & Construction Material
used construction of plant & machinery of
manufacturer/trader or service provider
(e)
goods or services or both on which tax has been paid under section 10
(f)goods or services or both received by a non-resident taxable person except on goods
imported by him.
A Registered person who has opted for composition scheme not eligible to claim
input tax credit it's an absolute restriction.
Non resident taxable person used following
goods or services
(a) Imported Toolkit
(b) Hotel service in India
(g)goods or services or both used for personal consumption
BIKE SHOP
Bike of showroom
is used for personal
purpose
Contractor
Construction Service & Construction Material
used construction of tele-communication tower
Construction Service by Contractor
Labour & Construction
done by contractor
Construction Service & Construction Material
used builder for further supply intended for
sale.
(h)
goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples; and
Example 1 :- ABC pvt ltd is an electronic goods dealer. On 1st Nov, 2018, purchased 20 computers
@ 25,000 each from the manufacturer. GST charged is 90,000 @ 18%. On 2nd Nov, 2018, While
on transit 1 of the computer gets destroyed completely and cannot be used any more. Thus ABC pvt
ltd cannot avail the ITC on a computer which is destroyed in transit i.e., `4,500.
ice creamice creamice cream
ice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
ice creamice creamice cream
Destroyed
Lost
Gift
Stolen
(i)any tax paid in accordance with the provisions of sections 74, 129 and 130.
Sec 74
IT deals with recovery of tax not paid or short paid byreason of fraud,
willful misstatement or suppression of facts
Tax paid is not
eligible as ITC
Sec 129
It deals with detention, seizure and release of goods in transit which had
been removed in contravention of legal provisions
Tax paid is not
eligible as ITC
Sec 130It deals with conﬁscation of goods in certain circumstancesTax paid is not
eligible as ITC
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T
Total IT on I + IS
T
1 T
2 T
3 C
1
IT on I+IS used
exclusively for non-
business purposes
IT on I+IS used
exclusively for
exempt supplies
Blocked credit u/s
17(5)
Remaining ITC
credited to ECrL
C= T-(T + T +T)
1 1 2 3
(i) Exempt supplies include reverse charge
supplies, transactions in securities, sale
of building when entire consideration is
received after CC.
(ii) Aggregate value of exempt supplies and
total turnover exclude the CED, SED &
VAT
Credit attributable to I+IS
used exclusively in taxable
supplies including ZRS
Common credit
= C – T
1 4
C
3D
2D
1
Credit attributable to non-
business purpose if
common I + IS used partly
for business + non-business
purposes
D = 5% x C
2 2
Remaining eligible
Common credit
= C - (D + D)
2 1 2
Eligible ITC
attributable to
business &
taxable supplies
including ZRS
Ineligible credits
To be added to output tax liability
Ü C will be computed separately for ITC of CGST, SGST/ UTGST and IGST.
3
Ü Σ(D1 + D2) will be computed for the whole financial year, by taking exempted turnover and
aggregate turnover for the whole financial year.
If this amount is more than the amount already added to output tax liability of every month, the
differential amount will be added to the output tax liability in any of the month till September of
succeeding year along with interest @ 18% from 1st April of succeeding year till the date of
payment.
Ü If this amount is less than the amount added to output tax liability of every month, the additional
amount paid has to be claimed back as credit in GSTR 3 or any month till September of the
succeeding year.
Total input tax (IT) on capital goods (CG)
(a) (b) ‘A’
Not to be credited to
Electronic Credit Ledger
(ECrL)
Credited to ECrL
IT on CG used exclusively
for non-business/exempt
supplies
IT on CG used exclusively
for taxable supplies
including zero rated
supply (ZRS)
IT on CG not covered
under (a) & (b). Useful life
of CG – 5 years from date
of inovice
Credited to ECrL
Common credit on CG = T =Σ (A)
C
if CG under (a)/(b) subsequently get covered
under ‘A’, = (a)/(b) - 5% of IT for a quarter or part
thereof
Common credit at the beginning of a tax period
for all CG having useful life in that tax period
T= T of such CG
r m
Common credit towards exempted supplies
E – Aggregate value of exempt supplies during the
tax period; F — Total turnover during the tax
period.
If no turnover during the tax period/values not
available, values for last tax period may be used.
E
T = — x T
e r
F
Common credit of CG for a tax
period during their useful life
T = T/60
m c
Added to output tax liability along
with interest
T
c
T
m
T
r
T
e
Ü Te will be computed separately for ITC of CGST, SGST/UTGST and IGST.
Ü Exempt suppliies include reverse charge supplies, transactions in securities, sale of
land and sale of building when entire consideration is received after completion
certificate.
Ü Aggregate value of exempt supplies and total turnover excludes the central excise duty,
State excise duty & VAT.
Sec - 17(1), 17(2) & 17(3) Apportionment of Credit
Sec 17(4) : Special
option of ITC to banking
and F.I.
T
4 C
2
1. Availment of Tax Credit : Banking
Company/FI including NBFC’s have the
following options -
(a) Option 1 : To comply with the
provisions u/s 17(2), or
(b) Option 2 : To avail of, every month,
an amount equal to 50% of the
eligible ITC in that month and the
balance 50% shall lapse.
2. Conditions on choosing option of
50% availment :
(a) The said Company or Institutions
hall not avail the credit of -
(i) Inputs and Input Services that
are used for non-business
purposes, and
(ii) the credit attributable to blocked
Credits
3. Withdrawal : Option once exercised,
shall not be withdrawn during the
remaining part of F.Y.
4. No Restriction : 50% of ITC
Restriction shall not apply when
supplies are made between branches
(Rule 42) (Rule 43)
For determining the value of an exempt supply as referred to in section 17(3) –
(a) the value of land and building shall be taken as the same as adopted for the purpose
of paying stamp duty; and
(b)the value of security shall be taken as one per cent. of the sale value of such security.
Important Explanation:- For the purpose of this chapter
The Central Goods and Services Tax
(Fourth Removal of Difﬁculties) Order,
2019.(Order No. 4/2019-CT dt
29/03/2019)
For the removal of difﬁculties, it
is hereby clariﬁed that in case of supply of
services covered by para 5(b) of
Schedule II of the said Act, the amount of
credit attributable to the taxable supplies
including zero rated supplies and exempt
supplies shall be determined on the basis
of the area of the construction of the
complex, building, civil structure or a part
thereof, which is taxable and the area
which is exempt.
Detail discussion in Levy
of GST on construction
Credit attributable to exempt supplies -
E
D1 = — x C
2
F

E= Value of ES during tax period
F = Total turnover during tax period (if no
turnover during the tax period/values not
available, turnover for last period may be
used).
F Refer Q.117 from Questioner
F Refer Q.105 & 106 from Questioner
F Refer Q.31 & 32 from Questioner
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In case of
- Sale, Amalgamation,
Lease, Transfer of business
The Registered
person shall transfer his
unutilized ITC in Ecr ledger
or transferee
Sec 18 (3) Transfer of ITC
In case of
Demerger

Registered person
apportion his ITC in ratio of
Value of asset transfered to
demerged unit
Sec 18(1) Availment of Credit
(a)
Person applied or
registration within
30 days & becoming
liable for registration
Voluntary Registration
on the date immediately
preceding the date of
registration
(b)
Person obtaining
voluntary
Registration
(c)
Registered person switching from
composition levy to normal tax payment
(d)
Registered person is exempt
supplies becoming a taxable supply
Reversal of Credit
Sec 18(4) Reversal of credit in Special Cases
Registered person switching from normal scheme of
payment of tax to composition Scheme
Taxable supply becomes
exempt Supply
Cancellation of
Registration
1) Amt to be reversed is equivalent to ITC on
- as such held in stockInput
- contained in semi finished goods Inputs
- contained in finished goods held in stockInputs
- [reversal on prorata basis pertaining to Capital goods
remaining useful life in a month (taking useful life as 5 yrs.
After reversal balance if any in Ecr. ledger shall lapse
Sec 18 (6) : Reversal of credit on supply of Capital Goods/ Plant & Machinery on which ITC has been
taken
1) If capital goods or plant & machinery on which ITC has been taken are supplied [Removed as such by way of
sale transfer barter etc.] then registered person shall pay higher of the following
a) Payment = ITC - 5% per at or part thereof
OR
b) GST on transaction value
2) In case of refectories bricks, modules & die, jugs & fixtures supplied as a scrap then person may pay tax on
transaction value instead of above 2 options.
Sec 18 : Reversal of Credit
Conditions
1) There is a specific provision for transfer of liabilities
2) Conditions of Rule 41
(a) declaration of details in the form GST ITC 02 for transfer of
credit .
(b) Certification of transfer of liabilities from CA/CMA
(c) Acceptance of transferred credit by transferee on common
portal
(d) inputs & capital goods so transferred are duly accounted by
transferee in his books of A/c
Person entitled for ITC on
- as such held in stockInput
- contained in semi-finished goodsInputs
- contained in finished goods held in stcokInputs
No benefit
on Capital
goods
If person liable for registration
On the date immediately preceding
the date from which he becomes
liable to pay tax
Important Comment :
If person failed to apply for reg. within 30 days then he is not
eligible to take such ITC.
Person entitled for ITC on
- as such held in stockInput
- contained in semi finished goodsInputs
- contained in finished goods held instockInputs
- Capital goods
[ITC = Input tax - 5% per qtr. or part these of from the date of invoice.]
Composition to normal : on the date immediately
preceding the date from which person become
liable to pay tax under normal scheme Exempt to taxable : on the date
immediately preceding the date from
which such supply become taxable.
1) As per Sec 18(2) person is not entitled to take ITC if supply of input or capital goods is after
expiry of 1 year from the date of issue of tax invoice.
2) Imp provisions of rule 40 :
a) Declaration in form GST ITC of within 30 days (empower the commissioner to extend
the time period for submission of such declaration)
b) If the aggregate claim amt is more than ` 2,00,000 it should be duly certified by
practicing CA or CMA
c) ITC claimed under clause (c) & (d) of Sec 18(1) shall be cross verified by with details
furnished by supplier in form GSTR-1 & GSTR-4 on Common portal.
Rule 44 : Procedure & conditions
1) Reversal of inputs shall be determined with corresponding
invoices. If invoice is not available then reversal is based
on prevailing market price of inputs.
2) Reversal of ITC shall be calculated separately for CGST,
SGST & IGST.
3) Reversal amt. will be added in output tax liability & details to
be furnished in GST ITC 03
“Value of assets” means the value of the entire assets of the business,
whether or not input tax credit has been availed thereon
F Refer Q.75, 78, 79, 83 & 87 from Questioner
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Sec 19- Goods sent by principal for Job Work
Inputs sent for
Job work
Capital Goods sent
for Job work
Where inputs sent for job work –
> Are not received back by the principal
after completion of job-work or
otherwise or
> Are not supplied from the place of
business of the job worker as per sec
143
Within 1 year of being sent, it shall be
treated as deemed supply and ITC if
availed shall be reversed
Where capital goods sent for job
work –
> are not received back by principal
Within a period of 3 years of being
sent, it shall be treated as deemed
supply by principal to job worker
> Nothing contained in this section shall apply to moulds, dies, jigs &
fixtures or tools sent out for job work
For detailed discussion of this section refer chapter notes of Input tax credit
The principal shall be allowed input tax credit on inputs sent to a job-
worker for job-work.
As per sec 2(68) “job work” means any treatment or process undertaken by a person on goods belonging
to another registered person and the expression “job worker” shall be construed accordingly;
As per sec 2(88)“principal” means a person on whose behalf an agent carries on the business of supply or
receipt of goods or services or both
M.P.
Chattisgad
Maharashtra
Input Service Distributor
ISDISD ISD
Common
Input tax
Credit
Distribution
of ITC
The above pictorial image is designed to show the role of an input service distributor in an organisation
and how the common input tax credit is distributed amongst various units.
Unit 1
Unit 2
Unit 3
Manufacturing unit
Sec 20 – Distribution of credit by Input Service Distributor
Means an of the supplier of goods or ofﬁce
services or both
which receives tax invoices issued under
section 31 towards the receipt of input
services and
issues a prescribed document for the
purposes of distributing the credit of
Ü Central tax, Ü State tax,
ÜIntegrated tax or
Ü Union territory tax paid on the said services
to a supplier of taxable goods or
services or both having the same Permanent
Account Number as that of the said ofﬁce.
Sec 2(61) “Input Service Distributor”
The Input Service Distributor shall distribute the
credit of

Ü as or central tax
1 2
central tax integrated
and
tax
Ü as or integrated
1 2
integrated central ,
tax tax tax
Ü as or State tax
1 2
State tax integrated
tax
by way of issue of a document containing the amount of input
tax credit being distributed in such manner as may be
prescribed.
The Input Service Distributor may distribute the credit of central tax, integrated tax, and state tax subject to the following
conditions namely:-
a) The credit can be distributed to the recipients of credit against a document containing such details as may be prescribed
b) the amount of the credit distributed shall not exceed the amount of credit available for distribution
c) the credit of tax paid on input services attributable to a recipient of credit, shall be distributed only to that recipient
d) the credit of tax paid on input services attributable to more than one recipient, shall be distributed on pro rata basis of
- the turnover in state / union territory of such recipient during the relevant period to the aggregate of the turnover of all
such recipients to whom such input service is attributable & which are operational in the current year, during the said
relevant period
e) The credit of tax paid on input services attributable to all recipients of credit shall be distributed amongst such recipient
on pro rata on the basis of
- the turnover in state / union territory of such recipient during the relevant period to the aggregate of the turnover of all
such recipients to whom such input service is attributable & which are operational in the current year, during the said
relevant period
State
tax
3
Note:- 1) For inputs – The period of 1 year shall be counted from the date of receipt of inputs by the job worker
For Capital goods – The period of 3 years shall be counted from the date of receipt of capital goods by
the job worker
2) Provided further that the period of 1 year & 3 years may, on sufﬁcient cause being shown, be extended by the
commissioner for the further period not exceeding 1 year & 2 years respectively.
F Refer Q.92 & 94 from Questioner
F Refer Q.99 & 100 from Questioner
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Example 3 : VSmart Ltd. a registered supplier of goods having Head Ofﬁce at pune, also registered as ISD,
furnishes the following information for month of July, 2018 and asks you to distibute the credit to various units :
Input ServiceParticulars CGST SGST IGST Total
“Training”
“Advertisement”
“Auditing”
“Tour Operator”
Used exclusively in Unit-III
Used in Unit-I,II and III
Used in Unit-I,II,III and IV
Used in Unit-I (Input service
is availed for employee on
vacation during the month to
its Unit I)
29,000
—
14,600
1,280
44,880
29,000
-
14,600
1,280
73,880
—
48,000
—
—
48,000
58,000
48,000
29,200
2,560
Total Amount of Credit
Total Turnover of the units for year ending 31st March, 2018 are as under:
Unit-I
Unit -II
Unit - III
Unit- IV
Total Turnover of Vsmart Ltd.
—
----
Not registered as exclusively engaged in supply of
exempt goods
30,00,000
20,00,000
75,00,000
60,00,000
1,85,00,000
All units are operational during the current year.
Unit I is located in Pune whereas units II, III and IV are located in Mumbai, Delhi and Gujarat respectively
Compute credit attributable to each of the units.Solution: -
Units
CGST
SGST
IGST CGST
SGST
IGST
1
IGST
IGST
IGST
2 3
IGST
IGST
IGST
4
CGST
SGST
IGST
1) Distribution of Credit
2) Computable of ITC to be distributed :-
Particulars Total Credit Avail
CGST CGST IGST IGSTSGST SGSTIGST IGST
Unit 1 Unit 2 Unit 3Unit 4
Note :
1) Credit of Input tax attributable to input service to a particular unit to be distributed to only that unit even if it
is engaged in exempt supply.
2) Distribution of ITC is done as per formula : C1=(t1/T) x c
3) If T.O. of preceding F.Y. is available then relevant period for calculate of aggregate T.O. is such F.Y.
4) Tour operator service - not eligible for ITC U/S 17(5) but it should be distributed.
Total
1) Training
2) Advertisement
3) Auditing
4) Tour Operator
(Ineligible Credit)
-
48,000
-
-
29,000
-
14,600
1280
29,000
-
14,600
1280
CGSTSGSTIGST
-
-
2367
1280
3647
-
-
2367
1280
3647
-
11,520
-
-
11,520
-
-
1578
-
1578
-
-
1578
-
1578
-
7680
-
-
7680
58,000
28,800
11838
-
98638
-
-
9470
-
9470
SEC 21 : MANNER OF RECO VERY OF CREDIT
DISTRIBUTED IN EXCESS
Where the Input Service Distributor distributes the credit in contravention of the provisions contained
in section 20 resulting in excess distribution of credit to one or more recipients of credit, the excess credit
so distributed shall be recovered from such recipients along with interest, and the provisions of section 73
or section 74, as the case may be, shall, mutatis mutandis, apply for determination of amount to be
recovered.
1Every registered person shall, subject to such conditions and restrictions as may be prescribed,
be entitled to take the credit of eligible input tax, as self-assessed, in his return
and such amount shall be credited on a to his electronic credit ledgerprovisional basis
Sec 41: Claim of input tax credit and provisional
acceptance thereof
The credit referred to in sub-section (1) shall be utilised only for payment of self-assessed output
tax as per the return referred to in the said sub-section
2
F Comprehensive Questions - 68, 103, 107, 108, 110 & 112
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Section Description
Chapter 9
Place of Supply
Section 2 Important Deﬁnitions
Section 5&6 Levy and Collection of Tax
Section 7,8&9 Determination of nature of Supply
Section 10 Place of supply of goods other than supply of goods imported into, or exported from
India.
Section 11 Place of supply of goods imported into, or exported from India.
Section 12 Place of supply of services where location of supplier and recipient is in India.
Section 13 Place of supply of services where location of supplier or location of recipient is
outside India.
Section 14 Special provision for payment of tax by a supplier of online information and
database access or retrieval services.
Section 15 Refund of Integrated Tax to International Tourist
Section 16 Zero Rated Supply
Section 17&18 Apportionment of Tax and Settlement of Funds
Section 19 Tax wrongfully collected & paid
Section 20 Application of provisions of Central goods and Services
There is no more beautiful
life than that of a STUDENT.
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Important deﬁnitions as per Chapter I of IGST Act.
“Export of Goods” 2(5) : with its grammatical variations and
cognate expressions, means taking goods out of India to a
place outside India
“Export of Services” 2(6) : means the supply of any service
when,–
(i) the supplier of service is located in India.
(ii) the recipient of service is located outside India.
(iii) the place of supply of service is outside India.
(iv) the payment for such service has been received by the
supplier of service in convertible foreign exchange or
Indian rupees wherever permitted by Reserve Bank of
India
(v) the supplier of service and the recipient of service are not
merely establishments of a distinct person in accordance
with Explanation 1 in section 8 of IGST Act.
“Import of Service” 2(11) : means the supply of any service,
where––
(i) the supplier of service is located outside India
(ii) the recipient of service is located in India; and
(iii) the place of supply of service is in India
“Import of Goods” 2(10) : with its grammatical variations and
cognate expressions, means bringing goods into India from a place
outside India
Let’s ﬁrst understand relevant deﬁnitions before
moving ahead to the chapter
“Location of the recipient of Service” 2(14) : means,––
a
where a supply is received at
a place of business for which
the registration has been
obtained,
the location of such
place of business
b
where a supply is
received at a place other
than the place of
business for which
registration has
been obtained
(a ﬁxed establishment
elsewhere),
the location of such ﬁxed
establishment
c
where a supply is received
at more than one establishment,
whether the place of business
or ﬁxed establishment,
the location of the
establishment most
directly concerned with
the receipt of the supply
din absence of such places,
the location of the usual place
of residence of the recipient
“Location of supplier of Service” 2(15) : means,––
a
where a supply is made from a
place of business for which the
registration has been obtained, the location of such place
of business
b
where a supply is made from a
place other than the place of
business for which registration
has been obtained (a ﬁxed
establishment elsewhere),
the location of such ﬁxed
establishment
c
where a supply is made from
more than one establishment,
whether the place of business
or ﬁxed establishment,
the location of the
establishment most
directly concerned with
the provision of the supply
d
in absence of such placesthe location of the usual
place of residence
of the supplier
“Fixed Establishment” 2(7) :
means a place (other than the
registered place of business)
which is characterised by a
sufﬁcient degree of
permanence and suitable
structure in terms of human and
technical resources to supply
services or to receive and use
services for its own needs.
Important Deﬁnitions
Sec 7(b) : Import of service
for Consideration
Para 4 of Sch.I of CGST Act:
Import of service without
consideration from
Ü Related person
Ü Own establishment
Sec 2(11): Import of services
1) Recipient is located in India
2) Supplier is located outside India
3) Place of supply of services is in India
Case Study : Mr. X from India went to China for Business meeting. He
stayed in a Hotel Kingkong at China. He has taken a bill from hotel in
the name of his company XYZ ltd. State whether GST liability of XYZ
Ltd. will arise under reverse charge.
Ü As per sec 7(1)(b) of CGST Act, supply includes Import of
service for consideration whether on not in course of
Business.
u Location of supplier outside India
u Location of Recipient in India
u Place of supply in India
Thus, liability of GST will arise only if place of supply is in
India, its per sec 13 of IGST Act, 2017, in case of renting of
hotels, place of supply is a place whether hotel is located.
In given case, hotel is located in China. Hence, place of
supply is in China, i.e. Outside India
Therefore, service taken by XYZ Ltd. is not treated as import
service and no GST liability will arise under reverse charge
Mechanism.
Let’s analyse the concept of import of services
in detail via chart & a case study
Export of Service
Ü Location of supplier is in
India
Ü Location of Recipient as
outside India
Ü Place of Supply outside
India.
Ü Amount Received in
Convertible foreign
exchange or Indian
rupees wherever
permitted by Reserve
Bank of India
Export of Goods
Ü No such condition,
only requirement is
that goods are taken
out of India.
Ü Goods are taken to a
place outside India.
Ü No such condition.
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Leviabile of Integrated Goods
and Services Tax (IGST) on
High Sea Sales of imported
goods and
point of collection thereof.
High Sea Sales :
Inter-State Supply
Section 7 : Inter-State Supply
1
Subject to the provisions of section 10,
supply of goods, where the location of the
supplier and the place of supply are in
(a)two different States
(b)two different Union territories; or
(c)a State and a Union territory,
shall be treated as a supply of goods in the course of inter-State trade or commerce.
Inter-State Supply of Goods (within India)
45:30
TELEVISION
WASHING MACHINEMaharashtra
Gujarat
Dealer
INTER-STATE SUPPLY
2
Supply of goods imported into the territory of India, till they cross the customs frontiers of India,
shall be treated to be a supply of goods in the course of inter-State trade or commerce.
Inter-State Supply - Imported Goods
Sec 2(10)‘‘import of goods” with its grammatical variations and cognate expressions, means bringing goods into
India from a place outside India;
1) Crossing custom frontiers of India: means crossing the limits of the area of a customs station in which
imported goods or export goods are ordinary kept before clearance by custom Authorities.
2) Custom frontiers of India includes:
a) Custom Port b) custom Airport c) International courier terminal d) foreign post ofﬁce
e) Land custom stations f) Area in which imported goods for export are kept before clearance
g) Bonded Warehouse
Supply between Two Different states as shown in the Image
Subject to the provisions of section 12,
supply of services, where the location of
the supplier and the place of supply are in
(a)two different States
(b)two different Union territories; or
(c)a State and a Union territory,
3Inter-State Supply of Service (within India)
GST
INTER-STATE SUPPLY OF SERVICES
4
Supply of shall be treated to be a supply of services services imported into the territory of India
in the course of inter-State trade or commerce.
Inter-State Supply - Imported Service
GST
IMPORTED GOOD
CUSTOMS
PORT
US
PORT
CUSTOM DUTY - IMPORTATION OR EXPORTATION OF GOODS
shall be treated as a supply of services in the course of inter-State trade or commerce.
Supply of goods or services or both,
(a)when the supplier is located in India and the place of supply is outside India
shall be treated to be a supply of goods or services or both in the course of inter-State trade or commerce.
5
Inter-State Supply - Supply of Goods or Service outside India
(b)to or a Special Economic Zone developer or a Special Economic Zone unit; orby
(c)in the taxable territory, not being an intra-State supply and not covered elsewhere in this section,
Export
Domestic
clearance
Supply of Goods or Services to or by SEZ
Supply of goods
or services to
SEZ is treated
as Export
On domestic
clearance from
SEZ GST is
payable
The above pictorial image, is designed to show the supply of goods or services to or by SEZ
unit & its impact in GST as per sec 5(b) of IGST Act.
Analysis:-
Whether the High sea sales
of imported goods would
be chargeable to IGST
twice
Supply of warehouse
goods to any person
before clearance for home
consumption
Non - taxable
Non - taxable
By way of
clariﬁcastion
CBIC
By way of
clariﬁcastion
CBIC
From the date 1/2/2019 is
non-taxable As per para 8b of
Schedule III
From the date 1/2/2019 is
non-taxable As per para 8a of
Schedule III
Basis of provision
Clariﬁcation Amendment
Issue
Aplicability
of GST
Import
Warehouse
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Intra-State Supply
1
Subject to the provisions of section 10, supply of goods where the
location of the supplier and the place of supply of goods are in
Ü the same State or
Ü same Union territory
shall be treated as intra-State supply:
Comment: This section is to be read along with sec 10 of IGST Act,
As this speciﬁes the determination criteria for place of supply of goods
Subject to the provisions of section 12, supply of services
where the location of the supplier and the place of
supply of services are in
Ü the same State or
Ü same Union territory
shall be treated as intra-State supply
Comment: This section is to be read along with sec 12 of
IGST Act, As this speciﬁes the determination criteria for place
of supply of Services
2
Section 8 : Intra-State Supply
Supply
Supply
of
Goods
Supply
of
Service
Inter -State Supply Levy of IGST
Inter State within India Import Supply outside India
Sec 7(1) : Location of supplier & Place of Supply
ÜTwo different StatesÜState & UTÜUT & UT
Comments :
1) Location of supplier of goods is not defined, hence
normally it includes a place from where goods are
dispatched
2)Place of supply shall be determined as per Sec 10
Sec 7(2) : Imported into territory of India till it cross custom frontiers
Comments :
1) Import goods means bringing into India from aplace outside India.
2) IGST is payable as ACD 3(7) or ACD 3(9) under Customs Act
3) Value - As per provisions of Customs act [Refer circular for high sea sale]
4] Place of Supply shall be determined as per Sec 11 (i.e. location &
importer)
Sec 7(5)(a) : Supply of goods
where location of supplier is in
India & place of supply outside
India.
Comments :
1) As per Sec 11 POS for
export goods is location
outside India
When to say export for benefits u/s 16.
Export goods means taking out of India to a place outside
India.
Comment :
1) For supply of export goods there is no any specific
condition for receipt of amount in convertible foreign
exchange.
2) Supply is treated as export supply even though goods
are supplied to another establishment of a same person.
Sec 7(3) Location of supplier & place of supply
- Two different States
- State & UT
-Two different UT
Comments :
1) Location of supplier of service is defined u/s 2(15) :
2) Place of Supply Shall be determined as per Sec
12.
Sec 7(4) : Supply of Service imported into territory of India.
Comment :
1) As per Sec 2(11) import of service where (i) SS located outside India.
i)Recipient located in India
ii) Place of supply in India
2) Place of supply shall be determined as per Sec 13
3) If supplier in non-taxable territory & recipient in taxable territory then IGST
is payable under reverse charge, except OIDAR service to NTOR
4) Valuation as per Sec 15 of CGST Act.
Sec 7(5)(a) : Supply of
Services where location of
Supplier of Service is in India
& Place of Supply outside
India.
Comment :
1) Place of supply shall be
determined as per Sec 13
Export of service Sec 2(6)
1) Supplier of service located in India
2) Recipient of service located outside India
3) Place of supply is outside India.
4) Amount received in convertible foreign exchange or
Indian rupees wherever permitted by Reserve Bank
of India
5)Services not supplied to own establishment.
Notwithstanding anything contained in this Act,
a
Where the location of the supplier is in the territorial waters,
the location of such supplier
Where the place of supply is in the territorial waters, b
Section 9 : Supply in Territorial Water
the place of supply, shall for the purposes of this Act, be deemed
to be in the coastal State or Union territory where the nearest
point of the appropriate baseline is located.
OR
Oil Extraction
Territorial Water
12 NM
Location of
supplier will be
the nearest coastal point
The above pictorial image, is to show the supplies taking
place in territorial water as stated in above provision.
Analysis
Explanation
1
Explanation to Sec 7 & Sec 8 Establishment treated as separate person
(i)an establishment in India and any other establishment outside India
(ii)an establishment in a State or Union territory and any other establishment outside that State; or
(iii)
an establishment in a State or Union territory and any other establishment being a business vertical
registered within that State or Union territory,
For the purposes of this Act, where a person has-
Explanation
2
A person carrying on a business through a branch or an agency or a representational ofﬁce in any territory shall be treated as having
an establishment in that territory.
then such establishments shall be treated as establishment of distinct persons.
Omitted
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Nature of SupplyParties Involved Place of Supply
Involves
Movement
of Goods Supplier
Recipient
Any other person Location of the goods
when the movement of
goods terminates for
delivery to the recipient
Bill-to-
Ship-to Sale
Supplier
Recipient
(Shipping address)
Third Person
(Billing Address)
Principal place of
Business of Third
person, i.e. Location of
Billing Address
AgentSupplier
Recipient to deliver to
Vsmart Academy
(Maharashtra)POS As per
sec 10(1)(b)
Mr. A (Delhi) Instructs
Does not involve
Movement of
Goods Supplier
Recipient
Location of goods at
the time of delivery to
the recipient
Installation and
Assembly of
Goods
at Site
- Place of Installation or
assembly of Goods
SP
- Bread
- eggs
- milk
AC Plant
Goods are
supplied on board
a conveyance,
including a vessel,
an aircraft, a train
or a motor vehicle
- Location at which such
goods are taken on
board.
Boarding
Note : Where the place of supply of goods cannot be determined, the place of supply shall be determined
as per the prescribed Sec 10(2)
Place of Supply of Goods in Domestic Transactions,
i.e. within India [Sec 10(1)]
Sec 11 - Place of Supply Imported Goods or Export Goods
Place of Supply of Goods in International Transactions [Sec.11]
Nature of Supply Place of Supply
Import of Goods into India Location of the Importer
Export of Goods from India Location outside India
Cast Study 2: What will be your ans is above case, if Mr. B
has taken the delivery on Ex-factory basis (i.e. at factory
gate) and move the goods from Maharashtra to MP.
Ü In given case, movement of goods made by Recipient
Mr. B to his place in MP, movement of goods
terminated in MP. Hence, Place of supply to MP,
Case Study 1: Mr A of Pune supplied goods to Mr. B of
Nagpur for ` 1,00,000. Determine nature of supply and
place of supply of Mr. A delivered the goods at the place of
Mr. B. Would your answer different of Mr. B is located in
Jabalpur MP.
In given case, location of supplier is Pune Maharashtra
and movement terminates in Nagpur. Hence, Place of
Supply is therefore, transaction is Intra-state supply.
F Refer Q. 4,6,9,13,18,21,89 & 90 from Questioner
(refer Q. 22 From Questioner)
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Determination of Place of Supply of Service where Location of
Supplier & Location of Receipient is in India (Sec. 12)
SEC 12 (2) : PLACE OF SUPPLY GENERALLY ( THE DEFAULT RULE )
Description Place of supply
Supply of services(Except the services speciﬁed in
sub section (3) to sub section (14))
Registered Person - Location of such person
(I) location of the recipient where the address on
record exists; and
(ii) location of the supplier of services in other cases.
Sec 12(3) : PLACE OF SUPPLY OF IMMOVABLE PROPERTY SERVICES
Description Place of supply
Location of immovable
property or boat or vessel, as
the case may be (located or
intended to be located)
Provided that if the location of
the immovable property or
boat or vessel is located or
intended to be located outside
India, the place of supply shall
be the location of the
recipient.
(b) by way of by a hotel, inn, guest house, home lodging accommodation
stay, club or campsite, by whatever name called, and including a house
boat or any other vessel; or
(c) by property for organising way of accommodation in any immovable
any marriage or reception or matters related thereto, official, social,
cultural, religious or business function including services provided in
relation to such function at such property; or
(d) any services ancillary to the services referred to in clauses (a), (b) and (c)
The place of supply of services supplied
(a) directly in relation to an services immovable property, including
provided by architects, interior decorators, surveyors, engineers and
other related experts or estate agents, any service provided by way of
grant of rights to use immovable property or for carrying out or co-
ordination of construction work; or
Explanation.––Where the immovable property or boat or vessel is located in more than one State or Union
territory, in the supply of services shall be treated as made in each of the respective States or Union territories,
proportion to the value for services separately collected or determined in terms of the contract or agreement
entered into in this regard or, in the absence of such contract or agreement as per Rule 4.
Unregistered Person -
Rule 4:- The supply of services attributable to different States or Union territories, under
section 12(3) of the Integrated Goods and Services Tax Act, 2017, in the case of-
In case of service Basis of apportionment &Value of services
(I) by a hotel, inn, guest house, club or Accommodation
campsite, by whatever name called (except cases
where such property is a single property located in two
or more contiguous States or Union territories or both)
and to such servicesservices ancillary
The supply of services shall be treated as
made in each of the respective States or
Union territories, in proportion to the
number of nights stayed in such
property;
(Refer Q. 26 From Questioner)
(Refer Q. 30 From Questioner)
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Services specified under sec 12 (3) supplied in multiple states
The supply of service shall be treated as made in each respective state or
union territory
If value of service is separately
collected or determined
in terms of contract
In the absence of separate value for each
state i.e. single prizes charge for entire contract
then is applicable Rule 4
Place of supply shall be
determined for each state
in proportion to the value
Clause i Clause ii Clause iii
Lodging Accommodation
by a hotel, inn, guest house,
club or campsite, etc &
ancillary services
Supply of service in each state
based on number of Nights
stayed.
Note:- If property is single
property located in 2 or more
contagious state or UT then
clause (ii) will be applicable
All other services under sec
12 (3) in relation to Immovable
Property
Supply of service in each state
is in proportion to any of
Immovable Property lying in
each state.
Lodging Accommodation
by House Boat or Vessel &
ancillary services
Supply of service in each state
is in proportion to time spent
by boat or vessel in such
state or UT .

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A hotel charges sum of Rs.50,000/- for stay in its two
establishments in Delhi and Agra, where the stay in
Delhi is for 2 nights and the stay in Agra is for 1 night.
POS will be in both the Union territory of Delhi and in the
State of UP, service shall be deemed to have been
provided in the ratio 2:1 respectively.
The value of services provided will thus be apportioned
as Rs.30,000/- in the Union territory of Delhi and
Rs.20,000/- in the State of Uttar Pradesh .
Other services in relation to immovable property including
accommodation services for organising any marriage or
reception etc., in cases of accommodation by a hotel, and
inn, guest house, club or campsite, by whatever name
called where such property is a single property located in
two or more contiguous States or Union territories or both,
and services ancillary to such services
The supply of services shall be treated as
made in each of the respective States or
Union territories, in proportion to the area
of the immovable property lying in each
State or Union territory
(ii)
A piece of land of area 20,000 sq. ft. which is partly in
State S1 (12,000 sq ft) and partly in State S2, (8000
sq ft). Site preparation work has been entrusted to T.
The ratio of land in the two states works out to 12:8 or
3:2.
The POS is in both States S1 and S2. and service
shall be deemed to have been provided in the same
ratio. The value of the service shall be accordingly
apportioned between the States.
Eg.
Eg.
lodging accommodation by a house boat or any other
vessel and services ancillary to such services
The supply of services shall be treated as
made in each of the respective States or
Union territories,
Ü in proportion to the time spent by the
boat or vessel in each such State or
Union territory,
Üwhich shall be determined on the basis of
a declaration made to the effect by the
service provider.
(iii)
A Co. provides the service of 24 hours
accommodation in a houseboat, situated both in
Kerala and Karnataka. The guests stayed at house
boat in Kerala for 22 hrs but it also moves into
Karnataka for 2 hours (as declared by the service
provider). The POS will be in the States of Kerala and
Karnataka.
The service shall be deemed to have been provided in
the ratio of 22:2 or 11:1 (simpliﬁed) in the states of
Kerala and Karnataka, respectively. The value of the
service shall be accordingly apportioned between the
States
Eg.
Kerala
Karnataka
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SEC 12 (4) : PLACE OF SUPPLY BASED ON PERFORMANCE
Supply of
Ü restaurant and catering services,
Ü personal grooming, ﬁtness, beauty treatment,
Ü health service including cosmetic and plastic surgery
Location where the services are actually
performed.
Description Place of Supply
SEC 12 (5) : PLACE OF SUPPLY OF TRAINING AND PERFORMANCE SERVICES
Description Place of supply
Supply of services in relation to training
and performance appraisal
Registered Person:- Location of such person
Unregistered Person:- Location where the
services are actually performed.
SEC 12 (6) : PLACE OF SUPPLY FOR ADMISSION TO EVENTS
Place where the event is held or park is
located
Description Place of Supply
Supply of services provided by way of admission to a
cultural, artistic, sporting, scientiﬁc, educational,
entertainment event or amusement park or any other
place and services ancillary thereto
SEC 12 (7) : PLACE OF SUPPLY FOR ORGANISATION OF EVENTS
Description Place of Supply
(a) supply of services provided by way of organisation of a
cultural, artistic, sporting, scientiﬁc, educational or
entertainment event including supply of services in
relation to a conference, fair, exhibition, celebration
or similar events ; or
Registered Person:- Location of such
person
Unregistered Person :- Place where event
is actually held and if event is held
outside India, the place of supply
shall be the location of the recipient.
Explanation.– Where the event is held in more than one State or Union territory and a consolidated
amount is charged for supply of services relating to such event,
the place of supply of such services shall be taken as being in each of the respective States or Union
territories in proportion to the value for services separately collected or determined in terms of the contract or
agreement entered into in this regard or, in the absence of such contract or agreement, on such other basis as
prescribed in Rule 5.
(b) Ancillary services to clause (a) , or assigning of
sponsorship to such events
Rule 5 prescribed for supply of services attributable to different States or Union
territories, under subsection (7) of section 12 of the said Act, in the case of-
In case of service
Shall be determined by application
of the generally accepted
accounting principles.
Basis of apportionment
where the services are supplied to a unregistered person,
the event is held in India in more than one State or Union
territory and a consolidated amount is charged for supply
of such services, shall be taken as being in each of the
respective States or Union territories, and in the absence of
any contract or agreement between the supplier of service
and recipient of services for separately collecting or
determining the value of the services in each such State or
Union territory, as the case maybe,
An event management company E has to organise some promotional events in States S1
and S2 for a recipient R. 3 events are to be organised in S1 and 2 in S2. They charge a
consolidated amount of Rs.10,00,000 from R.
POS is in both the States S1 and S2. For the value of Supply, the proportion arrived at by the
application of generally accepted accounting principles is 3:2. The service shall be deemed to
have been provided in the ratio 3:2 in S1 and S2 respectively. The value of services provided
will thus be apportioned as Rs. 6,00,000/- in S1 and Rs. 4,00,000/- in S2 .
SEC 12 (8) : PLACE OF SUPPLY FOR TRANSPORTATION OF GOODS
Description Place of supply
supply of services by way of transportation
of goods, including by mail or courier
Registered Person : Location of such person
Unregistered Person : location at which such
goods are handed over for their transportation.
Provided that where the transportation of goods to a place outside India, the place of supply
shall be the place of destination of such goods Newly Inserted
SEC 12 (9) : PLACE OF SUPPLY FOR TRANSPORTATION OF PASSENGER
Description Place of supply
supply of passenger transportation service
Registered Person : Location of such person
Unregistered Person : Place where passenger
embarks on the conveyance for a continuous
journey
Provided that where right to passage is given for future use and the point of embarkation is not known at
the time of issue of right to passage, the place of supply of such service shall be determined in
accordance with the provisions of sub-section (2).
Explanation.––For the purposes of this sub-section, the return journey shall be treated as a separate
journey, even if the right to passage for onward and return journey is issued at the same time.
(Refer Q. 31 From Questioner)
(Refer Q. 32 From Questioner)
(Refer Q. 33 From Questioner)
(Refer Q. 35 & 36 From Questioner)
(Refer Q. 41 & 43 From Questioner)
Eg.
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Examples of issue of right to passage for future use-point of boarding not known at the time of issue of right
(i) An airline may issue seasonal tickets, containing say 10 leafs which could be used for travel between any
two locations in the country.
(ii) The card issued by New Delhi metro could be used by a person located in Noida, or New Delhi or
Faridabad, without the New Delhi metro being able to distinguish the location or journeys at the time of
receipt of payment.
SEC 12(10) : PLACE OF SUPPLY OF ON BOARD SERVICES
Description Place of supply
supply of services on board a conveyance, including a
vessel, an aircraft, a train or a motor vehicle,
location of the first scheduled point
of departure of that conveyance for
the journey.
SEC 12(11) : PLACE OF SUPPLY OF TELECOMMUNICATION SERVICES
Description Place of Supply
Fixed telecommunication line, Leased circuits, Internet
leased circuit, Cable or dish antenna
Ü Location where telecommunication
line, leased circuit or cable connection
or dish antenna is installed
Post-paid mobile connection for telecommunication and
internet services
Ü Recipient’s billing address in the
records of supplier
Ü Location of supplier of services if
address is not available
Pre-paid mobile
connection, internet
services and DTH
services (recharge
coupon, vouchers, net
pack etc.)
Ü Address of the selling agent/ re-seller/
distributor at the time of supply
Ü Location of supplier if address is not
available
Ü Location where such pre-payment is
received or such vouchers are sold
Other cases Ü Recipient’s address in the records of
supplier
Ü Location of supplier of services if
address is not available
(a)
(b)
(c)
(d)
(I) Services provided through a
selling agent, re-seller, distributor
of subscriber identity module
card or recharge voucher
(ii) Services provided by any
person to ﬁnal subscriber
The place of supply of telecommunication services including data transfer, broadcasting, cable and
direct to home television services to any person shall
ÜRecipient’s location records of
supplier
Proviso:- Pre-paid services, the payment for which is made
through internet banking/other electronic mode of payment
Explanation.––Where leased circuit is installed in more than one State or Union territory and a consolidated
amount is charged for supply of services relating to such circuit, place of supply shall be taken as being in
each of the respective States or Union territories in proportion to the value for services separately collected or
determined in terms of the contract or agreement entered into in this regard or, in the absence of such contract
or agreement, on such other basis as prescribed in Rule 6.
supply of services relating to a leased circuit
where it is installed in more than one State or
Union territory and a consolidated amount is
charged for supply of such services, shall be
taken as being in each of the respective States
or Union territories, and
In the absence of any contract or agreement
between supplier and recipient for separately
collecting or determining the value of the
services in each such State or Union territory, as
the case maybe
a. Number of points in a circuit shall be
determined in the following manner:
(i) in case of a circuit between two points or
places, starting point or place of circuit
and end point or place of circuit will
invariably constitute two points;
(ii) any intermediate point or place in the
circuit will also constitute a point provided
that beneﬁt of leased circuit is also
available at that intermediate point;
b. The supply of services shall be treated as
made in each of the respective States or
Union territories, in proportion to number of
points lying in the State or Union territory
Rule 6 is prescribed supply of services attributable to different States or Union territories,
under sub section (11) of section 12 of the said Act,
In case of service Basis of apportionment
.
A company T installs a leased circuit between
the Chennai, Bengaluru and Mysore ofﬁces of
a company C. The starting point of this circuit
is in Chennai and the end point of the circuit is
in Mysore. The circuit also connects
Bengaluru. Hence one point of this circuit is in
Tamil Nadu and two points in Karnataka. The
place of supply of this service is in the States
of Tamil Nadu and Karnataka.
The service shall be deemed to have been
provided in the ratio of 1:2 in the States of
Tamil Nadu and Karnataka, respectively.
Eg.
A company T installs a leased circuit between
the Kolkata, Patna and Guwahati ofﬁces of a
company C. There are 3 points in this circuit in
Kolkata, Patna and Guwahati. One point each
of this circuit is, therefore, in West Bengal,
Bihar and Assam. The place of supply of this
service is in the States of West Bengal, Bihar
and Assam.
The service shall be deemed to have been
provided in the ratio of 1:1:1 in the States of
West Bengal, Bihar and Assam, respectively.
Eg.
SEC 12(12) : PLACE OF SUPPLY OF BANKING AND FINANCIAL SERVICES
Description Place of supply
Supply of banking and other financial services,
including stock broking services to any person
Recipient’s location supplier’s record
Location of supplier if address is not available
(Refer Q. 46 From Questioner)(Refer Q. 48 From Questioner)
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SEC 12 (13) : PLACE OF SUPPLY OF INSURANCE SERVICES
Description Place of supply
supply of insurance services Registered person:- Location of such
person
Unregistered person:-
Recipient’s location supplier’s record
SEC 12 (14) : PLACE OF SUPPLY OF ADVERTISEMENT SERVICE TO GOVERNMENT
Description Place of supply
Advertisement service to the Central Government/
State Government/ Statutory body/ Local authority
meant for the State or Union Territory identiﬁed in
contract or agreement
Each of such States or Union territories
where the advertisement is broadcasted/
run /played
Advertisements in newspapers and
publications
Amount payable for publishing an advertisement in all the
editions of a newspaper or publication, which are
published in each State/Union territory
Advertisements through printed material
like pamphlets, leaﬂets, diaries,
calendars, T-shirts, etc.
Amount payable for the distribution of a speciﬁc number of
such material in each State/Union territory
Advertisements in hoardings (other than
those on trains)
Amount payable for the hoardings located in each State/
Union territory
Factor which determines the proportionate value of
service attributable to the dissemination in each
State/Union territory
Type of advertisement
Sl.
No.
1
2
3
Rules 3:- Place of Supply of Advertisement service to Government
Provisions introduced for computing proportionate value of advertisement services attributable to different
States or Union territories in the absence of any contract between the supplier of service and recipient of
services [Notiﬁcation No. 12/2017 IT dated 15.11.2017] (Refer Q. 52 to 58 From Questioner)
IGST Rules
Advertisements on radio stationsAmount payable to such radio station, which by virtue of its
name is part of each State/Union territory
Advertisement on television
channels
Value of service in each state/UT = Total Amount payable for
such services X Ratio of viewership of such channel in
concerned states or UTs.
Viewership shall be calculated in the following manner,
namely:
(i) state/UT-wise ﬁgure for that channel published by
broadcast Audience research Council
(ii) Figure published in last week of preceding quarter shall be
used for succeeding quarters.
(iii) If channel viewership ﬁgures relate to region comprising
of more than one state or UT then viewership ﬁgure for
region X Ratio of population of that State or Union
Territory, as determined in the latest Census.
Advertisements in cinema hallsAmount payable to a cinema hall or screens in a multiplex in
each State/ Union territory.
7
8
9
Advertisements on internet
shall be deemed to have been
provided all over India Service shall be deemed to have been provided all over India
Value of service in each state/UT - Total Amount payable for
such service X Ratio of No. of internet subscribers in
concerned States or Uts.
No. of internet subscribers shall be calculated in the following
manner, namely :-
(i) state/UT-wise ﬁgures published by Telecom Regulatory
Authority of India
(ii) ﬁgures published for last quarter preceding F.Y. shall be
used for succeeding F.Y. year
(iii) if ﬁgure of No. of internet subscribers related to a region
comprising of more than one State or UT, then No. of
internet subscribers in a State or UT - No. of subscribers
for region X Region of population of that State or UT, as
determined in the latest Census
Advertisements through SMSValue of service in each state/UT = Total Amount payable
for such services X Ratio of No. of telecom subscribers in
concerned States or Uts.
No. of telecom subscribers shall be calculated in the
following manner, namely :-
(i) state/UT-wise ﬁgures published by telecom regulatory
Authority of India on its website
(ii) Figures published for preceding quarter shall be used for
succeeding quarter.
(iii) if ﬁgure of no. of telecom subscribers related to telecom
circle comprising of more than one state or UT than of
telecom subscribers in a state or UT = No. if subscribers for
telecom circle X Ration of population of states/UTs, as a
determined in latest census
10
11
Advertisements on railway tickets Number of Railway Stations in each State/Union territory
6
Advertisements on trains Length of the railway track in each State/Union Territory,
for that train
Advertisements on the back of utility bills
of oil and gas companies, etc.
Amount payable for the advertisements on bills pertaining
to consumers having billing addresses in each
State/Union territory
4
5
(Refer Q. 50 From Questioner)
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Services on goods- made
physically available by SR
Place of Performance
POS
1. Service Provided by
electronic means
Location of goods at
the time of service
(a) Physical presence of goods for provision of Service
Repairing - Pune Warehousing- DelhiCourier - GoaCargo Handling - Surat
POS
Pune
POS
Delhi
POS
Goa
POS
Surat
Sec 13(3)
(a)
Exceptions
2. If goods are temporarily imported into India for
repair or for any other treatment or process
Sec 13(3)(a) not applicable
POPS — Sec 13(2)
Exceptions
- Exported after repairs
or treatment or process
without other use
Sec 13(3)(a) Place of
performance
2nd Proviso to Sec 13(3)(a) Goods imported Repairs
Place of Performance(b)
Service - in physical
presence of Individual
Sec 13(3)(b) Physical Presence of Individual
Invoice
xxxxx
xxxxx
xxxxx
xxxxx
health and ﬁtness services - Pune Model Agency - Mumbai Beauty Parlor Service - Delhi
POS
Pune
POS
Delhi
SP
SR
SP
SR
Sec 13(4): POP OF IMMOVABLE PROPERTY SERVICES
Description POS
services provided directly in relation to an
immovable property, including
Ü Services by experts and estate agents,
Ü provision of hotel accommodation by a hotel,
inn, guest house, club or campsite, etc.
Ü Renting of immovable property,
Ü Co-ordination of construction work, including
architects or interior decorators.
Place where the
immovable
property is
located or
intended
to be located

Sec 13(5): POS RELATING TO EVENTS
Description POS
Øservices provided by way
ofadmission to, or organization of a
cultural, artistic, etc. events
ØServices ancillary to such admission
or organization
Place
where the
event is
actually
held
1
2
Unload at Mumbai Port
3
67
CUSTOMS
PORT
Machine Imported
from Germany
for repair
Exported Export
Clearance
Customs
Clearance other
payment of duty

POS
Germany
Repairs
carried out in
India
Other Examples
1) cosmetic or plastic surgery
2) personal security service
3) photography service
4) internet café service
5) classroom teaching, etc.
Sec 13(3): Place of Supply of Performance Based Services
Sec 13(6): POS PROVIDED AT MULTIPLE TAXABLE TERRITORY
Sec 13(2) Place of Supply
Generally (The Default Rule)
Example :
1) Information Technology Service
2) BPO Service
3) Audit / Certiﬁcation / legal
Services by CA, CS, CMA,
Lawyers
4) Bank providing normal Banking
Service to non account holders
etc.
Sec 13 - Place of supply where LOS or LOR of services is outside India
The place of supply of services
except the services
speciﬁed in sub-sections (3) to (13)
shall be the location
of the recipient of services.
Provided that where the location of
the recipient of services is not
available in the ordinary course of
business, the place of supply shall
be the location of the supplier of
services.
Description
Where any service reffered in sub section (3), (4) or (5) is
supplied at more than one location, including a location in
the taxable territory,
location in the
taxable territory
POS
An Indian firm provides a 'technical inspection and certification
service' for a newly developed product of an overseas firm (say, for a
newly launched motorbike which has to meet emission standards in
different states or countries). Say, the testing is carried out in Maharashtra
(20%), and an international location (say, Colombo 80%).
Notwithstanding the fact that the greatest proportion of service is outside the
taxable territory, the place of supply will be the place in the taxable territory in this
case Maharashtra
Example
- Exported after repairs or
treatment or process after
other use
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Sec 13 (8): PLACE OF SUPPLY OF SPECIFIED SERVICES
Description POS
Speciﬁed services:
(a) Services provided by a banking company, or a ﬁnancial institution, or a
non-banking ﬁnancial company, to account holders
Intermediary services;
Service consisting of hiring of all means of transport other than,-
(i) aircrafts, and (ii) vessels except yachts, upto a period of one month.(b)
(c)
Location of
service
provider
Seller
Agent
Buyer
Seller
Agent
Buyer
Intermediary Services - Agent outside IndiaIntermediary Services - Agent in India
SP
SR
SP
SR
POS
Surat
POS
USA
Hiring of means of transport Air Craft and Vessel
1) If Hiring upto period of 1 month
POPS - location of SP ( 13(8))
2) If Hiring more than 1 month
POPS - location of SR ( 13(2))
Hiring of Vessel or Air Craft
POPS location of SR ( 13(2))
Location of
SP (13(8))
Location of
SR (13(2))
POSService consisting of hiring of
ü
ü
ü
ü
ü
ü
ü
ü
Example1- on hiring of means of transport
Yatch
(i)Aircraft upto a period of 20 days
(ii)Aircraft upto a period of 90 days
(iii)Vessels upto a period of 20 days
(iv)Vessels upto a period of 90days
(v)Yachts upto a period of 20 days
(vi)Yachts upto a period of 90days
(vii)Trucks upto a period of 20 days
(viii)Trucks upto a period of 90 days
Sec 13 (9) : PLACE OF SUPPLY OF GOODS TRANSPORT SERVICES
Service POS
1) Services of transportation of
goods, other than by way of-
a) mail or b) courier
Place of destination of the goods
Sec 13(10): PLACE OF SUPPLY OF PASSENGER TRANSPORT SERVICES
Description POS
Passenger Transportation
The place where passenger embarks on the conveyance for a
continuous journey
MUMBAI
PORT
CHENNAI
PORT
MUMBAI
AIR PORT
USA
CHENNAI
AIR PORT
POPS
Mumbai
POPS
Chennai
POPS
Mumbai
POPS
Chennai
NEPAL
SURA
T
MATHURA
INDORE
LUKHNOW
J&K
LUKHNOW
POPS
Surat
POPS
Mathura
POPS
J&K
POPS
Kathmandu
POPS
Lukhnow
POPS
Indore
MUMBAI

Sec 13(11) : PLACE OF SUPPLY OF ON BOARD SERVICES
Description POS
Services provided on boards a conveyance including
services consumed while on board
First scheduled point of departure of that
conveyance for the journey
Sec 2(3)
Continuous
journey
means a journey for which a
Ü single or more than one ticket or invoice is issued at the same time,
Üeither by one service provider or through one agent acting on behalf of more than one service provider and
Ü which involves no stopover between any of the legs of the journey for which one or more separate tickets or
invoices are issued;
Sec 2(13)
Intermediary
means a broker, an agent or any other person, by whatever name called, who arranges or facilitates
Ü a supply of goods or Ü a supply of services or both, or Ü Securities
between two or more persons,
but does not include a person who supplies such goods or services or both or securities on
his own account.
Value : The value of such supplies specific to each State or Union territory shall be in proportion to the value for services
separately collected or determined in terms of the contract or agreement entered into in this regard or, in the absence of such
contract or agreement, on such other basis as may be prescribed
SEC 13(12) : PLACE OF SUPPLY OF OIDAR SERVICE
Description The place of supply of Services
online information and database access or
retrieval services
location of the recipient
of services.
Discussion of this provision
has been taken in detail on
later part of this chapter
Description The place of provision of Services
Where any service reffered in sub section (3), (4) or (5)
are supplied at more than one State or Union Territory
POS : The place of supply of such services shall be
taken as being in each of the respective States or Union
territories and
SEC 13 (7) : Place Of Supply Of Services When Supplied In Multiple State Or Union Territory
SEC 13(13) : GOVERNMENT POWER TO NOTIFY SERVICE TO AVOID DOUBLE TAXATION
In order to prevent double taxation or non-taxation of the supply of a service, or for the uniform application
of rules, the Government shall have the power to notify any description of services or circumstances in
which the place of supply shall be the place of effective use and enjoyment of a service.
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Research and Development related to Pharmaceutical Sector
Description The place of supply of Services
Supply of research and development services related to pharmaceutical
sector as specified below in the Table by a person located in taxable
territory to a person located in the non-taxable territory.
Location of recipient of service
subject to the fulfillment of condition
Condition:-
(I) Supply of services from the taxable territory are provided as per a contract between the service provider
located in taxable territory and service recipient located in non-taxable territory.
(ii) Such supply of services fulﬁlls all other conditions in the deﬁnition of export of services, except provided at
Section 2 (6)(III) of Integrated Goods and Services Tax Act, (i.e. place of supply of service is outside India)
2017
Table:-
Sr. No.Nature of Supply General Description of supply
Integrated discovery
and development
Integrated development
This process involves discovery and development of molecules by
pharmaceutical sector for medicinal use.
The steps include designing of compound, evaluation of the drug
metabolism, biological activity, manufacture of target compounds, stability
study and long-term toxicology impact.
Evaluation of the
efficacy of new
chemical/ biological
entities in animal models
of disease
This is in vivo research (i.e. within the animal) and involves development of
customized animal model diseases and administration of novel chemical in
doses to animals to evaluate the gene and protein expression in response to
disease.
In nutshell, this process tries to discover if a novel chemical
entity that can reduce or modify the severity of diseases. The novel chemical
is supplied by the service recipient located in non-taxable territory.
Evaluation of biological
activity of novel
chemical/ biological
entities in in-vitro assays
This is in vitro research (i.e. outside the animal). An assay is first developed
and then the novel chemical is supplied by the service recipient located in
non-taxable territory and is evaluated in the assay under optimized
conditions
Drug metabolism and
pharma-cokinetics of
new chemical entities
This process involves investigation whether a new compound synthesized
by supplier can be developed as new drug to treat human diseases in
respect of solubility, stability in body fluids, stability in liver tissue and its toxic
effect on body tissues.
Promising compounds are further evaluated in animal experiments using rat
and mice
Safety Assessment/
Toxicology
Safety assessment involves evaluation of new chemical entities in
laboratory research animal models to support filing of investigational new
drug and new drug application.
Toxicology team analyses the potential toxicity of a drug to
enable fast and effective drug development
1.
2.
3.
4.
5.
6.
Newly Inserted N/N 04/2019
-IT dt 30/09/2019
Central Government has notiﬁed following services u/s 13(13) Stability Studies
Stability studies are conducted to support formulation, development, safety
and efficacy of a new drug.
It is also done to ascertain the quality and shelf life of the drug in
their intended packaging configuration
7.
Bio-equivalence
and Bio-availability
Studies
Bio-equivalence is a term in pharma-cokinetics used to assess the
expected in vivo biological equivalence of two proprietary preparations of a
drug. If two products are said to be bioequivalent it means that they would
be expected to be, for all intents and purposes, the same.
Bioavailability is a measurement of the rate and extent to
which a therapeutically active chemical is absorbed from a drug product
into the systemic circulation and becomes available at the site of action
The drugs that are developed for human consumption would undergo
human testing to confirm its utility and safety before being registered for
marketing.
The clinical trials help in collection of information related to
drugs profile in human body such as absorption, distribution, metabolism,
excretion and interaction. It allows choice of safe dosage.
Clinical trials
Bio analytical
studies
Bio analysis is a sub-discipline of analytical chemistry covering the
quantitative measurement of drugs and their metabolites, and biological
molecules in unnatural locations or concentrations and macromolecules,
proteins, DNA, large molecule drugs and metabolites in biological systems.
8.
9.
10.
Rule No.Section
services supplied
on the same
goods,
by equally dividing the value of the service in
each of the States and Union territories where
the service is performed;
in the case of
services supplied
on different
goods,
by taking the ratio of the invoice value of goods
in each of the States and Union territories, on
which service is performed, as the ratio of the
value of the service performed in each State or
Union territory;
in the case of
services supplied
to individuals,
by applying the generally accepted accounting
principles.
Sec 13(3),
Eg. 1. service supplied in
respect of goods which
are required to be made
physically available or
2. incase service is
supplied to an individual
and etc.
In case of service Basis of apportionment
Rule 7
Sec 13(4),
Supply of service directly in relation to
immovable property and etc.
Value of the services in each such State or
Union territory, as the case maybe, shall be
determined by applying the provisions of rule 4,
mutatis mutandis.
Rule 8
Sec 13(5),
Supply of service by way of admission to, or
organisation of a cultural, artistic, etc.
Value of the services in each such State or
Union territory, as the case maybe, shall be
determined by applying the provisions of rule 5,
mutatis mutandis.
Rule 9
The supply of service attributable to different States or Union Territory u/s 13(7) of the IGST Act.
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Sec 2(17) Meaning of OIDAR
Online information and database access or retrieval (OIDAR) services” means services
Ü Whose delivery is mediated by information technology over the internet or an electronic network ; and
ÜThe nature of which renders their supply essentially automated ; and
Ü Involving minimal human intervention, and
Ü Impossible to ensure in the absence of information technology ; and
Ü Includes electronic services such as:
i. advertising on the internet ii. providing cloud services
iii. provision of e-books, movie, music, software and other intangibles via telecommunication networks or
internet
iv. providing data or information, retrievable or otherwise, to any person, in electronic form through a
computer network
v. online supplies of digital content (movies, television shows, music, etc.)
vi. digital data storage and vii. online gaming
Special Discussion Online information and database access or retrieval [OIDAR] serviceson
online information and database access or retrieval serviceslocation of the recipient of services.
USA
SUBSCRIPE
Explanation.
For the purposes of this sub-section, person receiving such services shall be deemed to be located in
the taxable territory, if any two of the following non contradictory conditions are satisﬁed, namely:––
(a) the location of address presented by the recipient of services through internet is in the
taxable territory
(b) the credit card or debit card or store value card or charge card or smart card or any other card
by which the recipient of services settles payment has been issued in the taxable territory
(c) the billing address of the recipient of services is in the taxable territory
(d) the internet protocol address of the device used by the recipient of services is in the taxable
territory
(e) the bank of the recipient of services in which the account used for payment is maintained is
in the taxable territory
(f) the country code of the subscriber identity module card used by the recipient of services is of
taxable territory
(g) the location of the ﬁxed land line through which the service is received by the recipient is in
the taxable territory.
EXEMPTION :
Sl.No.10
Service Received from Service Provider located in Non Taxable TerritoryService Received from Service Provider located in Non Taxable TerritoryService Received from Service Provider located in Non Taxable Territory
1) Received from
a provider of
service located in a
non-taxable
territory
2) By - a) Central Government, State Government, Union Territory a local
authority, a governmental authority or
an individual in relation to any purpose other than commerce, industry or
any other business or profession;
b) An entity registered under section 12AA of the Income tax Act, 1961 for the
purposes of providing charitable activities; or
c) A person located in a non-taxable territory.
SP SR
Relevant extract from Exemption chapter relevant to the above provision
Provided that the exemption shall not apply to –
(i) online information and database access or retrieval services received by persons
speciﬁed in Entry (a) or Entry (b) or
(ii) services by way of transportation of goods by a vessel from a place outside India up to the
customs station of clearance in India
Any service supplied
By To
Any person from a non
taxable territory
Any person other than non taxable online recipient (NTOR)
Reverse Charge : relevant extract from Reverse charge chapter relevant to above provision
Sec 2(16) “Non-taxable online recipient”(NTOR)
Ü any Government, local authority, governmental authority,
Ü an individual or any other person not registered and
receiving online information and database access or retrieval services in relation to
any purpose other than commerce, industry or any other business or profession, located in taxable
territory.
Person liable to pay tax :
Any person located in
taxable territory
Further analysis of Sec 14 of IGST Act, 2017
(1) On supply of online information and database access or retrieval services(OIDAR)
Ü any and byperson located in a non-taxable territory
Ü a ,received bynon-taxable online recipient(NTOR)
the supplier of services located in a non-taxable territory shall be the person liable for
paying integrated tax on such supply of services
Supplier is liable to pay tax
OIDAR services through intermediary
Provided that in the case of supply of online information and database access or retrieval services
Ü any and byperson located in a non-taxable territory
Ü a ,received bynon-taxable online recipient(NTOR)an intermediary located in the non-taxable
territory,
who arranges or facilitates the supply of such services,
Ü shall be deemed to be the recipient of such services from the supplier of services in non-taxable territory
and
Ü supplying such services to the non-taxable online recipient
except when such intermediary satisﬁes the following conditions, namely
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(a) the invoice or customer’s bill or receipt issued or made available by such intermediary taking part in the
supply clearly identiﬁes the service in question and its supplier in non-taxable territory
(b) the intermediary involved in the supply does not authorise the charge to the customer or take part in its
charge which is that the intermediary neither collects or processes payment in any manner nor is
responsible for the payment between the non-taxable online recipient and the supplier of such services;
(c) the intermediary involved in the supply does not authorise delivery; and
(d) the general terms and conditions of the supply are not set by the intermediary involved in the supply but by
the supplier of services.
(2) The supplier of online information and database access or retrieval services referred to in sub-section (1)
shall, for payment of integrated tax, take a single registration under the Simpliﬁed Registration
Scheme to be notiﬁed by the Government:
Provided that any person located in the taxable territory for any representing such supplier
purpose in the taxable territory shall get registered and pay integrated tax on behalf of the supplier:
Provided further that if such supplier does not have a physical presence or does not have a
representative for any purpose in the taxable territory, he may appoint a person in the taxable territory for
the purpose of paying integrated tax and such person shall be liable for payment of such tax.
Registration and Payment
Sec 15 : REFUND OF INTEGRA TED TAX TO INTERNATIONAL TOURIST
The integrated tax paid by tourist leaving India on any supply of goods taken out of India by him shall be
refunded in such manner and subject to such conditions and safeguards as may be prescribed.
Explanation
For the purposes of this section, the term “tourist” means a person not normally
resident in India, who enters India for a stay of not more than six months for legitimate
non-immigrant purposes.
Supplier of OIDAR Services : can make payment through Easiest (old payment system) (Rule 87)
Provided further that a person supplying online information and database access or retrieval services from a
place outside India to a non-taxable online recipient referred to in section 14 of the IGST Act, 2017 may also do
so through the Boards payment system namely, Electronic Accounting System in Excise and Service Tax from
the date to be notiﬁed by the Board.
Supplier of OIDAR Services : can make payment through International Money Transfer through Society
for Worldwide Interbank Financial Telecommunication payment network (N/N 22/2017)
Provided further that a person supplying online information and database access or retrieval services from a
place outside India to a non-taxable online recipient referred to in section 14 of the Integrated goods and
Services Tax Act, 2017 may also make the deposit under sub-rule (2) through International Money Transfer
through Society for Worldwide Interbank FInancial Telecommunication payment network, from the date to be
notiﬁed by the Board
Payment
Sec 16 : ZERO RATED SUPPLY
1. “zero rated supply” means any of the following supplies of goods or services or both,
namely:––
(a)Export of goods or services or both; or
2. Credit of input tax may be availed for making zero-rated supplies, notwithstanding that such supply may
be an exempt supply. (except block credit)
3. A registered person making zero rated supply shall be eligible to claim refund under either of
the following options, namely
(a)He may supply goods or services or without payment both under bond or Letter of Undertaking,
of integrated tax and claim refund of unutilised input tax credit; or
(b)
he may supply goods or services or both, on payment of integrated tax and claim refund of
such tax paid on goods or services or both supplied,
(b)supply of goods or services or both to a Special Economic Zone developer or a Special Economic
Zone unit.
Annual Return :- Supplying online information and data base access or retrieval services from a place outside
India to a person in India, other than a registered person as the class of registered persons who shall follow the
special procedure as mentioned below.
The said persons under section 44(1)of shall not be required to furnish an annual return in FORM GSTR-9
the said Act read with rule 80(1) of the said rules.
The said persons under shall not be required to furnish reconciliation statement in FORM GSTR-9C
section 44(2) of the said Act read with rule 80(3)of the said rules.
Return
Newly Inserted N/N 30/2019
-CT dt 28/06/2019
GST
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F Comprehensive Questions Refer Q. 78, 83, 85 & 88
All Important Clariﬁcations are given at the end of Module 2

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Chapter 10
Registration
INDEX
Description
Section 22 Persons liable for registration
Section 23 Persons not liable for registration
Section 24 Compulsory registration in certain cases
Section 25 Procedure for registration
Section 26 Deemed registration
Section 27 Special provisions relating to casual taxable person & nonresident taxable person
Section 28 Amendment of registration
Section 29 Cancellation of registration
Section 30 Revocation of cancellation of registration
Description
CGST rules pertaining to Registration
Section
Rule No.
Important Deﬁnitions
Other Important Deﬁnition
2(26) : Common portal
means the common goods and services tax electronic portal
referred to in section 146
2(85) : Place of
business
a place from where the business is ordinarily carried on, and
includes a warehouse, a godown or any other place where a
taxable person stores his goods, supplies or receives goods or
services or both; or
a place where a taxable person maintains his books of account;
or
a place where a taxable person is engaged in business through
an agent, by whatever name called.
2(10) : Appointed daymeans the date on which the provisions of CGST Act shall
come into force
2(50) : Fixed
establishment
means a place (other than the registered place of business)
which is characterised by a sufﬁcient degree of permanence
and suitable structure in terms of human and technical
resources to supply services, or to receive and use services
for its own needs
2(89) : Principal place of
business
means the place of business speciﬁed as the principal place
of business in the certiﬁcate of registration
2(94) : Registered
person
means a person who is registered under section 25, but does
not include a person having a Unique Identity Number
2(106) : Tax period means the period for which the return is required to be
furnished
2(109) : Taxable territorymeans the territory to which the provisions of this Act apply
2(107) : Taxable personmeans a person who is registered or liable to be
registered under section 22 or section 24
8 Application for registration
9 Veriﬁcation of the application and approval
10 Issue of registration certiﬁcate
11 Separate registration for multiple business verticals within a State or a Union territory
12 Grant of registration to persons required to deduct tax at source or to collect tax at source
13 Grant of registration to non-resident taxable person
14 Grant of registration to a person supplying online information & database access or retrieval services from a
place outside India to a non-taxable online recipient
15 Extension in period of operation by casual taxable person & non-taxable person
16 Suo moto registration
17 Assignment of Unique Identity Number to certain special entities
18 Display of registration certiﬁcate & Goods & Services tax identiﬁcation number on the name board
19 Amendment of registration
20 Application for cancellation of registration
21 Registration to be cancelled in certain cases
22 Cancellation of registration
23 Revocation of cancellation of registration
24 Migration of persons registered under the existing law
25 Physical veriﬁcation of business premises in certain cases
26 Method of authentication
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Persons
liable for
Registration
[Sec.22]
1. Supplier shall be liable for registration in Based on Aggregate Turnover [Sec. 22(1)] :
the State or Union territory, from where taxable supplies are effected, if his aggregate
turnover in a ﬁnancial year -
(a) Other than special category States - exceeds ` 20 lakhs.
(b) Special Category States (except Jammu & Kashmir, Arunachal Pradesh, Assam,
Himachal Pradesh, Meghalaya, Sikkim, Uttarakhand ) - exceeds ` 10 lakhs
2. Every Registered Persons under the Existing Law
3. When business carried on by a Taxable person transferred, whether on account of
succession or otherwise then Transferee/Successors
4. In a case of transfer pursuant to sanction of a scheme or a arrangement for
amalgamation or, de-merger, then Amalgamated/De-merged Companies
Compulsory
Registration
[Sec 24] (i) Persons making any inter-State taxable supply
(iii) persons who are required to pay tax under reverse charge
Representation By Senior Advocate
(iv) person who are required to pay tax under sub-section (5) of section 9
A person
E-Commerce Operator
involving an ECO in any manner
Any person
SP
SR
GPS
System
Payment
of GST
casual taxable persons making taxable supply
(vi) persons who are required to deduct tax under section 51, whether or not
separately registered under this Act
(vii)
(viii)
(x)
persons who make taxable supply of goods or services or both on behalf
of other taxable persons whether as an agent or otherwise
(v) non-resident taxable persons making taxable supply
USA
Input Service Distributor, whether or not separately registered under this Act
every electronic commerce operator, who is required to collect tax at
source under sec 52
Buyer
Seller
Payment of GST
(ix) persons who supply goods or services or both, other than supplies speciﬁed
under Sec 9(5) through such electronic commerce operator who is required to
collect tax at source under section 52.
Exemption from registration (N/n 65/2017- CT date 15-11-2017) - Person making
supply of services, other than supplies speciﬁed under sec 9(5) of the said Act through E-
commerce operator who is required to collect TCS under Sec 52 of the said Act, and
having an aggregate turnover, to be computed on all India basis, not exceeding an
amount of ` 20 lakhs ﬁrst proviso to sec 22(1) of CGST Act read with clause (iii)
explanation to the sec 22 in F.Y. as the category of person exempted from obtaining
registration under the said Act.
(xi) every person supplying OIDAR services from a place outside India to a person in
India, other than a registered person; and
Persons not
liable for
Registration
[Sec.23]
1. Engaged in exclusive supply of goods or services or both that are not liable to tax or are wholly
exempt from tax.
2. An Agriculturist, to the extent of supply of produce out of cultivation of land.
3. Person who are only engaged in making supplies on which is tax liable to be paid on reverse
charge basis by the recipient u/s9(3)
4. Any person, who is engaged in exclusive supply of goods and whose aggregate turnover in the
ﬁnancial year does not exceed 40 lakh rupees, subject to exception speciﬁed in N/N 10/2019
As per sec 2(7) of CGST act “agriculturist” means an individual or a Hindu Undivided
Family who undertakes cultivation of land -
(a) by own labour, or (b) by the labour of family, or
(c) by servants on wages payable in cash or kind or by hired labour under personal supervision
or the personal supervision of any member of the family;
Exceptions : Following category of person not required to register for Inter-
State taxable supply eventhough aggregate T/O less than ` 20/10 lakhs
(a) Persons making inter-State supplies of taxable services
(b) Person making inter-State taxable supplies of handicraft goods
(c) Jobworker engaged in making inter-state supply of services
(ii)
(xii)Any other person notiﬁed by C.G.
1. Casual taxable person
making taxable supplies of
handicraft goods &
handmade shawls, stoles
etc.
Explanation - means –“handicraft goods”
Goods predominantly made by hand even though some tools or machinery may also have been used in the
process;
such goods are graced with visual appeal in the nature of ornamentation or in-lay work or some similar work
of a substantial nature; possess distinctive features, which can be aesthetic, artistic, ethnic or culturally
attached and are amply different from mechanically produced goods of similar utility.
Amended
GST
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(Refer Q. 18, 21,
22 & 24 from
Questioner)
(Refer Q. 26, 61
& 62 from
Questioner)
(Refer Q. 29, 30 &
33 from
Questioner)

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Advantages
of taking
registration
under GST
Ü Legal recognition
Ü Eligibility for ITC availment
Ü Legal Authorization to collect tax and to pass on the credit
Ü Getting eligible to avail various other beneﬁts and privileges under GST
Timeline for
application
for
Registration
[Sec.25 (1)]
1. Persons is liable to be registered from the date in which he is shall apply within 30 days
so liable.
2. to apply for registration A Casual taxable person or a Non-resident taxable person at
least 5 days prior to the commencement of business.
3. Person making supply from the territorial waters of India to obtain registration in the
coastal State or UT where the nearest point of the appropriate base line is located.
As per proviso to sec 25 (1) Provided further that a person having a unit, as deﬁned in the
Special Economic Zones Act, 2005, for a Special Economic Zone developer
shall have to apply for separate registration, as distinct from his place of
business located outside the Special Economic Zone in the same State or Union territory.
PAN-
mandatory
for
Registration
1. Person shall have a PAN in order to be eligible for grant of registration
2. Exceptions :
(a) A Person required to deduct TDS
(b) A Non-Resident taxable person
Procedure
for Application
for Registration
[Rule 8]
1. Applicability :
(a) every person seeking voluntary registration
(b) a person paying tax under composition levy
(c) casual taxable person
2. and Declaration of Information should be made in Application FORM GST REG-01.
3. in Common Portal, (PART - A) -Information to be furnished
u Permanent Account Number (PAN) u Mobile number
u e-mail address u State or Union territory
4. Person having a unit in a SEZ or SEZ developer to make separate application distinct
from his other units located outside the SEZ
5. Veriﬁcation of information declared shall be made by the Authorities
6. On successful veriﬁcation Temporary Reference Number shall be granted
7. Electronic Submission of Application in Part B of FORM GST Reg-01, duly signed or
veriﬁed through EVC
8. Acknowledgment shall be issued electronically to the applicant in FORM GST REG-02
Veriﬁcation of
Application
and approval 1. Proper Ofﬁcer after examination shall approve the grant of registration within 3 working
days from submission of application.
2. In case of deﬁciency, Notice shall be issued in within 3 working FORM GST REG-03
days from submission of application.
3. Applicant shall furnish required information in within 7 working FORM GST REG-04,
days from the date of receipt of notice
4. If proper ofﬁcer is satisﬁed with the response, he may approve the grant of registration
within 7 working days from the date of receipt of response
5. If no response is submitted by the applicant or if the proper ofﬁcer is not satisﬁed with
response, he shall, reject such application
6. Grant of registration shall be deemed to provided, if the proper ofﬁcer fails to take any
Issue of
Registration
Certiﬁcate
[Rule 10]
1. Applicant shall be issued with a certiﬁcate of registration in FORM GST REG-
06 and a Goods and Services Tax Identiﬁcation Number (”GSTN”) of 15 digit
number shall be assigned.
2. Display of Registration Certiﬁcate and GSTIN on the name board at the entry and in
a prominent location at his Principal place of business and additional place of
business.
3. Effective date of registration :
4. Singing and Communication : Certiﬁcate of Registration shall be signed or verﬁed
EVC by the proper ofﬁcer.
Application ﬁles from Liability dateRegistration Effective from
within 30 days Date on which the person becomes
liable to registration
Not within 30 days date of grant of registration
Voluntary
registration
[Section 25(3)] A person who is not liable to be registered under section 22 or section 24 may get
himself registered voluntarily. In case of voluntary registration, all provisions of
this Act, as are applicable to a registered person, shall apply to voluntarily
registered person.
Beneﬁts of Voluntary Registration-
1. In case of inverted tax structure [i.e. output tax rate is lower than in input tax rate], its beneﬁcial to get
registered and pay tax liability and avail ITC
2. Customers may prefer, or even insist on, dealing only with other registered business. This paritucularly
when customer is GST registred as such customer will fall under reverse charge if his vendor/supplier
is unregistered.
3. Some business such as contractors may decide to register to avoid an embarrassment caused by
revealing that their annual taxable supply is below the threshold (Threshold limit is 20 lakhs generally).
Omitted
action -
(a) within 3 working days from the date of submission of application, or
(b) within 7 working days from the date of receipt of response from the applicant.
Separate registration if multiple place of business within a State/UT may be
granted
1. (a) such person has more than one place of business as deﬁned in clause (85) of
section 2;
(b) such person shall not pay tax under section 10 for any of his places of
business if he is paying tax under section 9 for any other place of business;
(c) all separately registered places of business of such person shall pay tax under the
Act on supply of goods or services or both made to another registered
place of business of such person and issue a tax invoice or a bill of supply,
as the case may be, for such supply.
Multiple places of
business within
a State or a Union
territory may be
granted separate
registration for each
such place of
business
Suomoto
Registration
by Proper
Ofﬁcer
1. Proper Ofﬁcer ﬁnds that a person liable for registration has failed to apply for such
registration.
2. Temporary Registration shall be ordered in FORM GST Temporary Registration :
REG-12. It shall be effective from the date of order granting registration.
GST
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(Refer Q. 58 from
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(Refer Q. 34 &
39 from
Questioner)
(Refer Q. 40 from
Questioner)

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Persons liable
to obtain UIN
1. Notiﬁed Persons : Following Persons shall be granted a Unique Identity Number for
refund of taxes on the notiﬁed supplies.
(a) Any specialised agency of the UNO or any Multilateral Financial Institution and
Organisation notiﬁed under the United Nations (Privileges and Immunities) Act,
1947, Consulated or Embassy of Foreign Countries, and other notiﬁed persons.
2. Government Authories/PSUs : A unique identiﬁcation number (ID) would be given to
Government authorities/PSUs not making outwards supplies of GST goods but are
making inter-state purchases.
Grant of UIN
a. persons requiring UIN Application shall be submitted by
b. within 3 working days from the date of application, ofﬁcer shall assign UIN or reject the
application. Registration is deemed to have been granted after expiry of 3 days.
Amendment
of Registration
1. Intimation of any changes in the information furnished to be made to proper ofﬁcer
within 15 days.
2. Amendments in non core ﬁeld can be made directly on common portal but approval is
required for Amendments in core ﬁelds.
Permission of proper ofﬁcer required if change relates to core ﬁelds of nformation
Legal name
of business
Address of PPoB/
APoB - Principal
place of Business
Addition, deletion or retirement of partners or directors, Karta,
Managing Committee, Board of Trustees, Chief Executive Ofﬁcer or
equivalent, responsible for day to day affairs of the business
Change does not warrant cancellation of registration u/s 29
Change of such particulars shall be applicable for all registrations of a registered person
obtained under provisions of this Chapter on same PAN.
Cancellation of Registration
Circumstances
where registration
is liable to be
cancelled
[Section 29(1)
& (2)]
Ü Business discontinued
Ü Transferred fully for any
reason including death of
the proprietor
Ü Amalgamated with other
legal entity
Ü Demerged or
Ü Otherwise disposed of
Ü Change in the
constitution of the
business
Ü Taxable person (other
than voluntarily
registered person)
who is no longer
liable to be
registered under
section 22 or
section 24.
Procedure of
cancellation
Registration 1. Application for cancellation shall be submitted in FORM GST REG-16 within 30
days of occurence of the event warranting cancellation.
2. Details of inputs held in stock and of Capital Goods held in stock on the date from
which cancellation of registration is sought, its liability, details of the payment
made against such liability is to be disclosed.
3. The proper ofﬁcer either on his own motion or based on the cacncellation
application, cancel the registration.
4. The cancellation of registration shall be effective from a date to be determined by
the proper ofﬁcer.
As per proviso to sec 29(1)©), provided that during pendency of proceedings
relating to cancellation of registration ﬁled by the registered person, the registration
may be suspended for such period such manner as may be prescribed
Cancellation by
Proper Ofﬁcer
1. Following contraventions done by the registered person:
(i) He does not conduct any business from the declared place of business, or
(ii) He issues invoice/bill without supply of goods/ services in violation of the
provisions of this Act, or the rules made thereunder.
(iii) If he violates the provisions of section 171 of the CGST Act.*
(iv) Violates the provision of Rule 10A**
3. Voluntarily registered person has not commenced the business within 6
months from the date of registration
4. Registration by fraud etc. : Registration was obtained by means of fraud,
wilful misstatement or suppression of facts
* Section 171 of the CGST Act, 2017 contains provisions relating to antiprofeetering
measure.
2. Not ﬁling of Return :
Ü A registered person has not ﬁled returns for continuous 6 months.
: 3 consecutive tax periods in case of a person who opted for Note
composition levy
UIN granted under subrule (1) of the above section to person shall be applicable
to the territory of India ( )Notiﬁcation No. 75/2017 CT dated 29.12.2017
Foreign Diplomatic Mission/UN Organization to be granted centralized UIN [Notiﬁcation No. 75/2017 CT dated
29.12.2017]
Rule 17 of the CGST Rules has been amended to provide that the Unique Identity Number granted to any specialised
agency of the UN or any Multilateral Financial Institution and Organisation notiﬁed under the United Nations (Privileges and
Immunities) Act, 1947, Consulate or Embassy of foreign countries shall be applicable to the territory of India. Such
centralized UIN will lessen the compliance burden on Foreign Diplomatic Missions / UN Organizations.
Mobile no./e-mail address of authorised signatory can be amended only after online
veriﬁcation through GST Portal.
3. Proper ofﬁcer may Approve or Reject amendments in the registration particulars.
4. Any rejection or approval of amendments under SGST or UTGST Act, shall be deemed
to be a rejection or approval under CGST.
Effective date of amendment in registration details can be earlier than the date of submission
of the application for amendment only when the Commissioner orders the same for reasons
to be recorded in writing [Notiﬁcation No. 75/2017 CT dated 29.12.2017]
3. Application for Registration : to be made within 90 days from the date of the grant of
such registration. In case of appeal against the grant of temporary registration, then
the application for registration shall be submitted within 30 days from the date of
issuance of order upholding the liability to registration
Newly Inserted by N/N
31/2019 CT dt 28/06/2019
** Rule 10A Registered person shall furnish details of back account within 45 days from
the grant of registration certiﬁcate or due date of furnishing return u/s 39 whichever is
earlier.
GST
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(Refer Q. 52 from
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(Refer Q. 53 & 55
from Questioner)

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Question:-
How to transfer unutilised ITC to any or newly registered place of business
within a state?
Solution:- As per rule 41A inserted via N/N 3/2019-CT dt 29/01/2019

A registered person who has obtained separate registration for multiple places of business in accordance with
the provisions of rule 11 and
who intends to transfer, either lying in his wholly or partly, the unutilized input tax credit
electronic credit ledger to any or all of the newly registered place of business, shall furnish within a period of
thirty days from obtaining such separate registrations,
the details in electronically on the common portal, either directly or FORM GST ITC-02A
through a Facilitation Centre notiﬁed in this behalf by the Commissioner:
Provided that the input tax credit shall be transferred to the newly registered entities in the ratio of
the value of assets held by them at the time of registration.
Newly Inserted
As per proviso sec 29(2), provided that during pendency of proceedings relating
to cancellation of registration, the proper ofﬁcer may suspend the registration
for such period in such manner as may be prescribed.
Consequences
of cancellation
of Registration 1. Cancellation does not affect liability i.e. person to pay tax and other dues for any period prior to
the date of cancellation.
2. Deemed Cancellation under CGST Act, if Cancellation is made under the SGST or UTGST Act
3. ITC availed for stock and Capital Goods on the day immediately preceding the date of
cancellation should be reverse or paid.
Suspension of registration – (Rule 21A inserted via N/N 3/2019 –
CT dt 29/1/2019)
1. Where a registered person applies for cancellation of registration under rule 20, the
registration shall be deemed to be suspended from the date of submission of the application
or the pending the date from which the cancellation is sought, whichever is later,
completion of proceedings for cancellation of registration
2. In case of proceeding for cancellation initiated by dept, the proper ofﬁcer, may, after giving
hearing, suspend the registration w.e.f date to be determined by him
3. Shall not make any taxable supply can be made during suspension period & shall not be
required to ﬁle any returns under sec 39 of CGST Act
Explanation.-For the purposes of this sub-rule, the expression “shall not make any taxable
supply” shall mean that the registered person shall not issue a tax invoice and, accordingly,
not charge tax on supplies made by him during the period of suspension
4. The suspension of registration under sub-rule (1) or sub-rule (2) shall be deemed to be
revoked upon completion of the proceedings by the proper ofﬁcer under rule 22 and such
revocation shall be effective from the date on which the suspension had come into effect
5. Where any order having the effect of revocation of suspension of registration has been
passed, the provisions of section 31(3)(a) and section 40 in respect of the supplies
made during the period of suspension and the procedure speciﬁed therein shall
apply.
Newly Inserted
Newly Inserted by N/N
49/2019 CT dt 09/10/2019
Newly Inserted by N/N
49/2019 CT dt 09/10/2019
Explanation.-
(1) 'value of assets' means the value of the entire assets of the business whether or not input tax credit
has been availed thereon.
(2) The newly registered person (transferee) shall, on the common portal, accept the details so
furnished by the registered person (transferor) and, upon such acceptance, the unutilized input tax
credit speciﬁed in FORM GST ITC-02A shall be credited to his electronic credit ledger.”
Pending returns to be ﬁled before revocation of cancellation of registration [Rule 23 of
the CGST Rules][Notiﬁcation No. 20/2019 CT dated 23.04.2019 read with Circular No.
99/18/2019 GST dated 23.04.2019]
Rule 23 of the CGST Rules provides the procedure for revocation of cancellation of registration. First
proviso to section 23(1) provided that if the registration has been cancelled on account of failure of the
registered person to furnish returns, no application for revocation of cancellation of registration shall be
ﬁled, unless such returns are furnished and any amount in terms of such returns is paid.
Two newly inserted provisos provide as follows:
All returns due for the period from the date of the order of cancellation of registration till the date
of the order of revocation of cancellation of registration shall be furnished by the said person within a
period of 30 days from the date of order of revocation of cancellation of registration.
However, where the registration has been effect, the registered person cancelled with retrospective
shall furnish all returns relating to period from the effective date of cancellation of registration till the date
of order of revocation of cancellation of registration within a period of 30 days from the date of order of
revocation of cancellation of registration.
From the combined reading of aforesaid provisions, it can be inferred that where the
registration has been cancelled with effect from the date of order of cancellation of registration,
(i) all returns due till the date of such cancellation are required to be furnished before the application
for revocation can be ﬁled and
(ii) all returns required to be furnished in respect of the period from the date of order of cancellation till
the date of order of revocation of cancellation of registration have to be furnished within a period of
30 days from the date of the order of revocation.
However, where the registration has been cancelled with retrospective effect , the application for
revocation of cancellation of registration can be ﬁled,
subject to the condition that all returns relating to the period from the effective date of
cancellation of registration till the date of order of revocation of cancellation of registration shallbe ﬁled
within a period of 30 days from the date of order of such revocation of cancellation of registration.
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F Comprehensive Questions Refer Q. 43, 47, 63, 64 & 65 from Questioner
All Important Clariﬁcations are given at the end of Module 2

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Chapter 11
Tax Invoice, Credit & Debit Notes
Sec 31Description
(1)
(2)
(3)(a)
(3)(b)
(3)(c)
(3)(d)
(3)(e)
(3)(f)
(3)(g)
(4)
(5)
(6)
(7)
In normal case of supply of goods
In normal case of supply of services
Issue of a Revised Invoice
No Invoice or Bill of Supply to be Issued
Situations in which Bill of Supply shall be
issued instead of a Tax Invoice
Issue of a Receipt Voucher
Issue of a Refund Voucher
Issue of Invoice by a Registered person
liable to pay Tax Under Reverse Charge
Issue of a Payment Voucher by a Registered
Person Liable to Pay Tax Under Reverse Charge
In Case of continuous supply of goods
In case of continuous supply of Service
In case where the supply of services ceases under
a contract before the completion of supply
In case of Goods Sent or Taken on Approval
for Sale or Return
Sec 32Prohibition of unauthorised collection of Tax
Sec 33Amount of tax to be indicated in tax invoice and
other documents.
Sec 34Credit and Debit notes
Provision applicable to Supply of Goods Provision applicable to Supply of Services
Sec 31(1)
Sec 31 (4)
Sec 31 (7) In normal case of supply of goods
In Case of continuous supply of goods
In case of Goods Sent or Taken on Approval
for Sale or Return
Sec 31(2)
Sec 31 (5)
Sec 31 (6) In normal case of supply of services
In case of continuous supply of Service
In case where the supply of services ceases
under a contract before the completion of supply
Provision applicable to both Supply of Goods & Supply of Service
Sec 31(3) (a)
Sec 31 (3) (b) or
proviso to 31(3)(c)
Sec 31 (3) (c)
Issue of Revised Invoice
No Invoice or Bill of Supply to be Issued
Situations in Which Bill of Supply Shall be Issued Instead of a Tax Invoice
Sec 31 (3) (d) Issue of a Receipt Voucher
Sec 31 (3) (e) Issue of a Refund Voucher
Sec 31 (3) (f) Issue of Invoice by a Registered Person Liable to Pay Tax Under Reverse Charge
Sec 31 (3) (g) Issue of a Payment Voucher by a Registered Person Liable to Pay Tax Under Reverse Charge
RulesDescription
46
47
48
49
50
51
52
53
54
55
55A
Tax Invoice
Time limit of issuing tax invoice
For Supply of Service
Bill of Supply
Receipt Voucher
Refund Voucher
Payment Voucher
Revised Tax invoice
Tax invoice input service distributor
Transportation of goods without
issue of invoice
CGST Rules , 2017
Manner of issuing Invoice
Tax invoice or bill of supply to accompany
transport of goods
46 AInvoice cum Bill of supply
Newly inserted
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Note : 1) Once the invoice is issued as per aforesaid provisions GST is payable even if no payment is received from recipient
2) For all the above category of supply a ‘Tax Invoice’ should be issued.
3) In case of Value fo goods/ Services or both supplied is less than ` 200 then no need to issue a tax invoice in case of B2C transactions.
ParticularIssue of Invoice : Supply of goodsIssue of Invoice : Supply of Service
Normal caseSec 31(1) - On or before
a) If movement involved at
the time of removal
b) In other case At the time
delivery or made available Sec 31(2) - On or before
a) Provision of services (within 30 days from completion)
b) Bank/FI/NBFC/Insuror (within 45 days from Completion)
c)
Continuous Supply of goods / services Sec 31(4) - the invoice shall be issued
0before or at the time
Ü each such statement is issued or,
as the case may be,
Ü each such payment is received.Sec 31(5) - On or before
a) Due date ascertainable in contract on such date
b) If due date not ascertainable – date of payment received
c) If events are ﬁxed in contract
- Last date of completion of such event
Supply on
sale or return/
Approval
basis
Sec 31(7) -
a) Before/at the time of supply
[i.e. approval given by recipient]
b) 6 months from the date of removal,
whichever is earlier –
Cessation of
supply of
services —
Sec 31(6) - In a case where the supply of services ceases under a contract
before the completion of the supply, the invoice shall be issued at the time
when the supply ceases and such invoice shall be issued to the extent of
the supply made before such cessation.
Ü an insurer or
Ü a banking company or
Ü a ﬁnancial institution,
Ü a non-banking ﬁnancial company, or
Ü a telecom operator, or
Ü any other class of supplier of services as may be
notiﬁed by the Government on the
recommendations of the Council,
making taxable supplies of services between
distinct persons as speciﬁed in section 25
may issue the invoice before
or at the time
Ü such supplier records the
same in his books of
account or
Ü before the expiry of the
quarter during which the
supply was made.
Particulars
Normal Revised Bill of
SupplyTax invoice
a) Name, Address and GSTIN
b) Consecutive Number Series
c) Date of Issue
d) Name of address & GSTIN or UIN of
recipient
e) Other details of Unregistered recipient
f) HSN code
g) Description of goods or Services
h) Quantity of goods
i) Total value
j) Taxable value
k) Rate of tax
l) Amount of tax charged
m) Place of supply
n) Address of delivery
o) If reverse charge applicable
p) Signature of digital Signature
q) Nature of document
Tax invoice
Dr./Cr.
note
r) Sr. No.& date of Tax invoice/Bill of
Supply
Notes :
1) Consecutive serial number shall not exceed 16 characters for tax Invoice
in one/multiple series shall be maintained same for a financial year.
2) A consolidated revised tax invoice for all taxable supplies made to an
unregistered person
3) In case of inter-state supply – where value of supply does not exceed `
2.5 lacs a consolidated revised tax invoice may be issued separately in
respect of all unregistered recipient located in a state
Content of tax Invoice
Revised
Invoice
Sec 31(3)(a) i) person shall issue a revised invoice during the period begining with the effective
date of registration till the date of issuance of certiﬁcates of registration to him
ii) It shall be issued within 1 month from the date of issuance of certiﬁcates of
registration and in such a manner as prescribed.
iii) The expression “Tax Invoice” shall include any revised invoice issued by the
supplier in respect of supply made earlier
Consolidated revised tax invoice
Registered person may issue a consolidated revised tax invoice
1. in respect of all taxable supplies made to a recipient who is not registered
under the Act during such period:
2. In the case of inter-State supplies, where the value of a supply does not
exceed two lakh and ﬁfty thousand rupees, to unregistered person
As per sec 31(3)(b) of CGST Act, A registered person may not issue a tax invoice if the value of the goods or
services or both supplied is less than subject to such conditions and in such manner as may be prescribed`200
As per proviso to rule 46 of CGST Rules,
Provided also that a registered person other than the supplier engaged in making supply of services by way of
admission to exhibition of cinematograph ﬁlms in multiplex screens may not issue a tax invoice in accordance with
the provisions of clause (b) of sub-section (3) of section 31 subject to the following conditions, namely,-
(a) the recipient is not a registered person; and
(b) the recipient does not require such invoice,
Where the value of the goods or services or both supplied is less than `200 :-
Proviso Provided also that the signature or digital signature of the supplier or his authorized representative shall
not be required in the case of issuance of an electronic invoice in accordance with the provisions of
the Information Technology Act, 2000 (74/2018-CT dt 31/12/2018)
Provided also that the Tax Invoice shall have quick response (QR) code
Amended by N/N 33/2019
CT dt 18/07/2019
Newly inserted by N/N 31/2019
CT dt 20/06/2019
GST
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(Refer Q. 11
from questioner)
(Refer Q. 26, 27, 29 &
31 from questioner)
(Refer Q. 34 from questioner)
(Refer Q.13, 16 & 53
from questioner)
F Refer Q. 12 from Questioner

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Bill of Supply
(Sec 31(3)(c))
In the case of the export of goods or services, the invoice shall carry an endorsement
“SUPPLY MEANT FOR EXPORT/SUPPLY TO SEZ UNIT OR SEZ DEVELOPER FOR
AUTHORISED OPERATIONS ON PAYMENT OF INTEGRATED TAX”
or
“SUPPLY MEANT FOR EXPORT/SUPPLY TO SEZ UNIT OR SEZ DEVELOPER FOR
AUTHORISED OPERATIONS UNDER BOND OR LETTER OF UNDERTAKING WITHOUT
PAYMENT OF INTEGRATED TAX”
as the case may be, and shall, also contain the following details, namely, -
(i) name and address of the recipient (ii) address of delivery and
(iii) name of the country of destination.
Endorsement
for Export
Invoice
person is
supplying
taxable as well
as exempted
supply
Where a registered person is supplying taxable as well as exempted goods or services or
both to an unregistered person, a single may be issued for “Invoice-cum-bill of supply”
all such supplies.
Receipt
Voucher
(Sec 31(3)(d)
& Rule 50)
A registered person shall, on receipt of advance payment with respect to any supply of
goods or services or both, issue a Receipt Voucher evidencing receipt of such payment.
Where at the time of
receipt of advance
(i) rate of tax is not determinabletax shall be paid at the rate of 18%
(ii) nature of supply is not determinablesame shall be treated as inter-State supply
if, at the time of receipt of advance, rate of tax/nature of supply is not determinable
Refund
Voucher
(Sec 31(3)(e)
& Rule 51)
Where on receipt of advance payment with respect to any supply of goods or services or
both the registered person issues a Receipt Voucher, but subsequently
Ü no supply is made and
Ü no tax invoice is issued in pursuance thereof,
the said registered person may issue to the person who had made the payment, a
Refund Voucher against such payment.
Payment
Challan
(Sec 31(3)(f)/(g)
& Rule 46 & 52)
A registered person who is liable to pay tax under reverse charge [under section
9(3)/9(4) of the CGST Act] shall issue an Invoice in respect of goods or services or
both received by him from the supplier who is not registered on the date of receipt of
goods or services or both.
Thus, a recipient liable to pay tax by virtue of section 9(3) has to issue
invoice only when supplies have been received from an unregistered supplier.
Particulars
Payment
Voucher
a) Name, Address and GSTIN
b) Consecutive Number Series
c) Date of Issue
d) Name of address & GSTIN or UIN of recipient
e) Number & Date of Receipt voucher issued
g) Description of goods or Services
h) Amount of advance taken
i) Amount of refund made
j) Amount paid
k) Rate of tax
l) Amount of tax charged
m) Place of supply
o) If reverse charge applicable
p) Signature of digital Signature
q) Signature of Supplier
Receipt
Voucher
Refund
Voucher
VOUCHERS
Content of
Vouchers
Besides, a registered person who is liable to pay tax under reverse charge [under
section 9(3)/9(4) of the CGST Act] shall issue a Payment Voucher at the time of making
payment to the supplier.
Q : How to issue the Invoice, if register person is supplying taxable as well as exempted supply?
Ans.: Where a registered person is supplying taxable as well as exempted goods or services or both to an
unregistered person, a single “Invoice-cum-bill of supply” may be issued for all such supplies.
S.No.Annual Turnover in the Preceding
Financial Year
Number of
Digits of HSN
Code
(1) (2) (3)
1. Upto rupees one crore ﬁfty lakhs Nil
2.more than rupees one crore ﬁfty lakhs
and upto rupees ﬁve crores
2
3. more than rupees ﬁve crores 4
Above provisions are also applicable to Bill of Supply
No. of digits
of HSN code to
be mentioned
in Invoice
Registered Person having annual turnover in P.F.Y. shall mention HSN Code as
following
1.On Supply of Exempt Goods or Services
2. Paying tax under Composition Scheme.
Rule 49- Bill of Supply
Proviso Provided that the provisos to rule 46 shall, mutatis mutandis, apply to the bill of supply
issued under this rule:
Provided further that any tax invoice or any other similar document issued under any other Act for the
time being in force in respect of any non-taxable supply shall be treated as a bill of supply for the
purposes of the Act
Provided also that the signature or digital signature of the supplier or his authorised
representative shall not be required in the case of issuance of an electronic bill of supply in
accordance with the provisions of the Information Technology Act, 2000 (74/2018-CT dt 31/12/2018)
Provided also that the Bill of Supply shall have quick response (QR) code
GST
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(Refer Q.52
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Delivery Challan/Invoice for
Transportation of Goods (Rule 55)
Nature of supply
(1) Supply of liquid gas where the
quantity at the time of removal
from the place of business of
the supplier is not known,
(2) Transportation of goods for
job work,
(3) Transportation of goods for
reasons other than by way
of supply, or
(4) Such other supplies as
may be notiﬁed y the Board
Deliver challan to
be issued
Particulars of
Delivery Challan
• serially numbered
not exceeding
16 characters
• in one or multiple
series
• at the time of removal
of goods for
transpor- tation
Date and number of the delivery
challan
Name, address and GSTIN of
the consigner, if registered
Name, address and GSTIN or
UIN of the consignee, if registered
HSN code and description of
goods,
Quantity (provisional, where the
exact quantity being supplied is
not known)
Taxable value
Tax rate and tax amount – central
tax, state tax, integrated tax,
union territory tax or cess, where
the transportation is for supply to
the consignee
Place of supply, in case of inter-
state movement
Signature
Tax invoices in Special Cases (Rule 54)
Supplier of
taxable service
Insurer/Banking
company/Financial
institution,
including
NBFC
Document in lieu of the tax invoice
Optional information Mandatory information
• Serial number
• Address of the
recipient of
taxable service
Other information as prescribed
for a Tax Invoice, under rule 46
Such document may be issued/made
available, physically/electronically
Goods Transport
Agency (GTA)
supplying services
in relation to
transportation of
goods by road in
a goods carriage
Gross weight of the consignment
Name of the consignor and the consignee
Registration number of goods carriage in
which the goods are transported
Details of goods transported
Details of place of origin and destination
GSTIN of the person liable for paying tax
whether as consignor, consignee or GTA
Other information as prescribed for a tax
invoice, under rule 46
Supplier of
passenger
transportation
service
• Serial number
• Address of the recipient
of taxable service
Other information as prescribed for a tax
invoice, under rule 46
Tax invoice shall include ticket in any form,
by whatever name called.
Note : It is important to note here that keeping in view the large number of
transactions in banking, insurance and passenger transportation section, taxpayers
need not mention the address of the customer and the serial number in their invoices.
The said supplier may issue a consolidated tax invoice or any other
document in lieu thereof, by whatever name called(for supply of services
made during a month at the end month )
Rule 55A. Tax Invoice or bill of supply to accompany transport of goods.
The person-incharge of the conveyance shall carry a copy of the tax incoice or the bill of supply issued in
accordance with the provisions of rules 46,, 46A or 49 in a case where such person is not required to carry an e-
way bill under these rules.
Goods Transported in SKD/CKD/In batches or lots Condition (Rule 55)
Provided that the signature or digital signature of the supplier or his
authorised representative shall not be required in the case of issuance of
ticket in accordance with the provision of the Information technology act,
2000 (N/N 74/2018 CT dt 31/12/2018)
Provided that the signature or digital signature of the supplier or his authorised
representative shall not be required in the case of issuance of a consolidated tax
invoice or any other document in lieu thereof in accordance with the provisions of the
Information Technology Act, 2000 (N/N 74/2018 CT dt 31/12/2018)
Q.: Explain the provision of Goods transported in SKD/CKD condition?
Ans.: Where the goods are being transported in a semi knocked down or completely knocked down condition or
in batches or lots
(i) The supplier shall issue the complete invoice before dispatch of the ﬁrst consignment.
(ii) The supplier shall issue a delivery challan for each of the susequent consignments, giving reference fo the
invoice
(iii) Copies of the corresponding delivery challan shall accompany each consignment along wit a duly certiﬁed
copy of the invoice and
(iv) The original copy of the invoice shall be sent along with the last consignment.
Shall issue Electronic ticket and Electronic
ticket deemed to be Tax Invoice, even such
ticket does not contain Recipient details
Other information as prescribed for a tax
invoice, under rule 46
Provided that the supplier of such servce in a screen other than multiplex
screens may , at his option follow the above procedure (N/N 33/2019 CT
dt 18/07/2019)
Admission to Exhibition of
cinematograph ﬁlms in
multiplex screens
Newly inserted
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Rule 54. Tax invoice Input Service Distributor
(1) An Input Service Distributor invoice or, as the case may be, an Input Service Distributor credit note
issued by an Input Service Distributor shall contain the following details:-
(a) name, address and Goods and Services Tax Identiﬁcation Number of the Input Service
Distributor;
(b) a consecutive serial number not exceeding sixteen characters, in one or multiple series,
containing alphabets or numerals or special characters- hyphen or dash and slash
symbolised as- “-”, “/” respectively, and any combination thereof, unique for a ﬁnancial year;
(c) date of its issue;
(d) name, address and Goods and Services Tax Identiﬁcation Number of the recipient to whom the
credit is distributed;
(e) amount of the credit distributed; and
(f) signature or digital signature of the Input Service Distributor or his authorised representative:
Proviso Provided that where the Input Service Distributor is an ofﬁce of a banking company or a
ﬁnancial institution, including a non-banking ﬁnancial company, a tax invoice shall include
any document in lieu thereof, by whatever name called, whether or not serially numbered
but containing the information as mentioned above.
(1A) (a) A registered person, having the same PAN and State code as an Input Service Distributor, may
issue an invoice or, as the case may be, a credit or debit note to transfer the credit of common
input services to the Input Services Distributor, which shall contain the following details :
(I) name, address and Goods and Services Tax Identiﬁcation Number of the registered person
having the same PAN and same State code as the Input Service Distributor
(ii) a consecutive serial number not exceeding sixteen characters, in one or multiple series,
containing alphabets or numerals or special characters - hyphen or dash and slash
symbolised as “_” and “/” respectively, and any combination thereof, unique for a ﬁnancial
year;
(iii) date of its issue
(iv) Goods and Services Tax Identiﬁcation Number of supplier of common services and
original invoice number whose credit is sought to be transferred to the Input Service
Distributor
(v) Name, address and Goods and Services Tax Identiﬁcation Number of the Input Service
Distributor.
(vi) taxable value, rate and amount of the credit to be transferred and
(vii) Signature or digital signature of the registered person or his authorised representative.
(b) The taxable value in the invoice issued under clause (a) shall be the same as the value of the
common services
Newly inserted
Sec 34 - Credit Note & Debit Note (Refer Q. 36 & 37 from Questioner)
Section 32 : Prohibition on Unauthorised collection of Tax :
(i) : A person who is not registered shall not collect in respect of any goods/services/ Unregistered Person
both any amount by way of tax under this Act.
(ii) No Registered Person shall collect tax except in Provisions of this Act or Rules Registered Person :
made thereunder.
Section 33 : Amount of tax to be indicated in Tax Invoice & Other Documents
Notwithstanding to anything contained in this Act ro any other law for the time being in force, when any supply is
made for consideration, every person who is liable to pay tax for such supply shall prominently indicate in all
documents waiting to assessment, tax invoice ,etc. the amount of tax which shall form a part of price.
Credit Notes [Sec.34 (1)] Debit Notes [Sec. 34(3)]
Ü Taxable Value or Tax charged in One or more tax invoice for
that Tax Invoice is found to exceed the Taxable Value, or tax
payable in respect of such supply, or
Ü Where the goods supplied are returned by the recipient, or
Ü Where Goods supplied are found to be deﬁcient
Time Limit : Details of Credit in the Return for the month during
which such credit note has been issued, but not later than -
Ü September following the end of FY in which such supply was
made, or
Ü the date of ﬁling of the relevant annual return, whichever is
earlier
One or more tax invoice for Taxable Value or
Tax charged in that Tax Invoice is found to be
less than the Taxable Value or Tax payable in
respect of such supply.
Note : Debit note includes Supplementary
Invoice
Details of Debit in the Return for the month
during which such Debit Note has been
issued.
Q. 14: (N/N Explain the particulars to be stated in a credit or debit note [sec 34 read with rule 53(1A)]
3/2019-CT dt 29/01/2019) ?
Ans. :
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
name, address and Goods and Services Tax Identiﬁcation Number of the supplier;
nature of the document;
a consecutive serial number not exceeding sixteen characters, in one or multiple series, containing alphabets
or numerals or special characters-hyphen or dash and slash symbolised as “-” and “/” respectively, and any
combination thereof, unique for a ﬁnancial year;
date of issue of the document;
name, address and Goods and Services Tax Identiﬁcation Number or Unique Identity Number, if registered, of
the recipient;
name and address of the recipient and the address of delivery, along with the name of State and its code, if such
recipient is un-registered;
serial number(s) and date(s) of the corresponding tax invoice(s) or, as the case may be, bill(s) of supply;
value of taxable supply of goods or services, rate of tax and the amount of the tax credited or, as the
case may be, debited to the recipient; and
signature or digital signature of the supplier or his authorised representative.”
Newly inserted
Comment:- As earlier rule 53 was common for both tax invoice and incase of debit or credit notes as refer in
sec 34 but now as per N/N 3/2019 as new sub rule 1A of rule 53 has been inserted which is stated as above
in which all particulars to be given in relation to issue debit or credit note.
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Chapter 12
E-Way Bill, Accounts & Records
INDEX
Section Description
Section 35 Accounts and other records
Section 36 Period of retention of Accounts
Section 68 Inspection of Goods in movement (E-way Bill)
Rules Description
Rule 56 Maintenance of accounts by registered persons
Rule 57 Generation and maintenance of Electronic Records
Rule 58 Records to maintained by owner or operator of godown or warehouse and transporter
Rule 138 E-Way Bill
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Q.1: What is an E-way Bill?
Ans:- Electronic Way Bill (E-Way Bill) is basically a compliance mechanism
Ü wherein by way of a digital interface
Ü the person causing the movement of goods
Ü uploads the relevant information prior to the commencement of movement of goods and
Ü generates e-way bill on the GST portal
Sec 68 : E way Bill (Read with Rule 138)
Q. 2: Explain the relevance of E- Way bill in GST?
Ans:- E-way bill is an electronic mechanism to ensure that:-
Ü There is a hassle free movement of goods throughout the country
Ü Act as an effective tool to track movement of goods &
Ü To control tax evasion in the Country.
The e-way bill system is applicable for both interstate transport of goods, & Intra State Supply of Goods.
However the applicability of the e-way bills for intra-state movement can be deferred by respective state as per
rule 138(14)(d).
Q. 3: . Whether E-way bill may be generated if the consignment value is less than ` 50,000/-?
Ans:- Yes, the registered person or the transporter, as the case may be may generate E-way bill voluntarily even
if the value of consignment is less than ` 50,000/.
Q. 4: When & who is required to generate an e-way bill?
Ans:-
I) As per Rule 138(1) of CGST rules, Every registered person who causes movement of goods of
consignment value exceeding ﬁfty thousand rupees—
(i) in relation to a supply; or
(ii) for reasons other than supply; or
(iii) due to inward supply from an unregistered person,
II) E-Commerce Operator or courier agency:- A registered person liable to generate e-way bill can
authorize the transporter, e-commerce operator or courier agency to furnish the details in Part A (Form
GST EWB-01) of e-way bill.
III) Job Work:- As per proviso to the rule 138(1) where goods are being sent by a principal to the job worker
located in another state, Principal or the Job worker (if registered) shall generate an e-way bill, irrespective
of consignment value.
IV) Voluntary generation of e-way bill:- A registered supplier may voluntarily generate an e-way bill
even if consignment value is less than ` 50,000.
V) Handicraft Goods: - Where handicraft goods are transported from one State or Union territory to
another State or Union territory by a person who has been exempted from the requirement of
obtaining registration under clauses (i) and (ii) of section 24, the e-way bill shall be generated by the
said person irrespective of the value of the consignment.
Illustration 1:- A truck contains 3 consignments based on 3 invoices, Invoice 1 for Rs 55,000/, invoice 2 for
Rs 35,000/- and invoice 3 for ` 90,000/- , how many E-Way Bill (EWB) will be generated.
Solution:- E-Way Bill will be generated Bill/ Invoice wise , i.e. when value of invoice exceed ` 50,000/-
therefore, in this case E-Way bill will be generated for Invoice no 1&3 only.
Illustration 2:- Mr. Rishi sent goods for job work worth ` 25,000/- from Delhi to UP, whether EWB needs to
generate?
Solution:- In case of inter state movement of goods for job work, it is mandatory to generate EWB
irrespective of amount, therefore in this case EWB needs to generate.
Illustration 3:- Mr. Raj an unregistered person sent Handicraft goods worth ` 45,000/- from Delhi to
Punjab, whether EWB needs to generate?
Solution:- In case of movement of handicraft goods, it is mandatory to generate E-way bill irrespective of
amount, therefore in this case EWB needs to be generate even though Mr Raj is an unregistered person
he is required to generate an E-way bill.
Q. 5: . Explain the provisions relating to generation of E-way bill in case of 'Transshipment'?
Ans:- The consignor or the recipient, who has furnished the information in Part A of FORM GST EWB-01, or
the transporter, may assign the e-way bill number to another registered or enrolled transporter for updating
the information in Part B of FORM GST EWB-01 for further movement of the consignment:
Provided that after the details of the conveyance have been updated by the transporter in Part B of FORM
GST EWB-01, the consignor or recipient, as the case may be, who has furnished the information in Part A of
FORM GST EWB-01 shall not be allowed to assign the e-way bill number to another transporter.
Explanation:- For the purpose of this rule, the expression “handicraft goods” has the
meaning as assigned to it in the Government of India, Ministry of Finance(Notiﬁcation
No. 56/2018 - CT, dt 23/10/2018) Newly Inserted
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Q. 6: . Who is required to generate an E-way bill in the following cases:-
i. Goods transported by road
ii. Goods transported by railways
iii. Goods transported by air or vessel
Ans:-
i) Where the goods are transported by the registered person as a consignor or the recipient of supply as the
consignee,
Ü whether in his own conveyance or
Ü a hired one or a public conveyance, by road,
Ü the registered person as a consignor or the recipient of supply as the consignee, shall generate
the e-way bill in FORM GST EWB-01 electronically on the common portal after furnishing
information in Part B of FORM GST EWB-01.
ii) Where the goods are transported by railways, the e-way bill shall be generated by the registered person,
being the supplier or the recipient, who shall, either before or after the commencement of movement,
furnish, on the common portal, the information in Part B of FORM GST EWB-01:
Provided that where the goods are transported by railways, the railways shall not deliver the goods unless
the e-way bill required under these rules is produced at the time of delivery.
iii) Where the goods are transported by air or vessel, the e-way bill shall be generated by the registered
person, being the supplier or the recipient, who shall, either before or after the commencement of
movement, furnish, on the common portal, the information in Part B of FORM GST EWB-01:
Q. 7: . Explain the relevance of e-way bill in GSTR -1?
Ans:- As per the E-Way Bill Rules it appears that there is an option given to the supplier to utilize the details of E-
Way Bill for the purpose of ﬁling Form GSTR-1. The information furnished in Part A of FORM GST EWB-01 shall
be made available to the registered supplier on the common portal who may utilize the same for furnishing the
details in FORM GSTR-1.
Q. 8: . State the case wherein information in Part B of E-way bill is not required to be generated?
Ans:- As per proviso given to rule 138 (3) , where the goods are transported for a distance of upto ﬁfty kilometers
within the State or Union territory from the place of business of the consignor to the place of business of the
transporter for further transportation, the supplier or the recipient, or as the case may be, the transporter may not
furnish the details of conveyance in Part B of FORM GST EWB-01.
Q. 9: . What if the consignment value of goods carried in conveyance is more than Rs 50,000 & no e-
way bill is generated either by the consignor or the consignee?
Ans:- Where the consignor or the consignee has not generated the e-way bill in FORM GST EWB-01 and
the aggregate of the consignment value of goods carried in the conveyance is more than ﬁfty thousand
rupees, the transporter, except in case of transportation of goods by railways, air and vessel, shall,
in respect of inter-State supply, generate the e-way bill in FORM GST EWB-01 on the basis of invoice or bill
of supply or delivery challan, as the case may be, and may also generate a consolidated e-way bill in FORM
GST EWB-02 on the common portal prior to the movement of goods:
Q. 10: . Write a brief note on acceptance or rejection of E-way bill?
Ans:-
Ü As per rule 138(11), The details of e-way bill shall be made available to the supplier or recipient , if
registered. Such supplier or recipient should communicate his acceptance or rejection of the
consignment.
Ü Further, as per rule 138(12) , in case such supplier or recipient does not communicate his acceptance or
rejection within 72 hours or before delivery of goods whichever is earlier, it shall be deemed to be
accepted.
Q. 11: How will the consignment value of supply for the purpose of e-way bill generation be
computed?
Ans:- the consignment value of goods shall As per explanation provided to Rule 138(1) of CGST rules,
be the value, determined in accordance with the provisions of section 15,
Ü declared in an invoice, a bill of supply or a delivery challan, as the case may be,
Ü issued in respect of the said consignment and
Ü the central tax, State or Union territory tax, integrated tax and cess charged, if any, in also includes
the document and
Ü the value of exempt supply of goods where the invoice is issued in respect of both shall exclude
exempt and taxable supply of goods.
Problem:- Mr X a registered dealer under GST. He wants to transfer certain stock of goods from his factory
located in Pune (MH) to the location of buyer Mr S at Bangalore (Kar). For the goods supplied by Mr X he
has raised an invoice in the following manner:-
SI.No Items Value GST rate GST amount Total
1 A 40,000 12% 4,800 44,800
2 B 25,000 Nil (Exempt) - 25,000
69,800
Determine whether for the above case E-way bill is required to issued as per Rule 138 ?
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Q. 12: What are the details required to be furnished in e-way bill?
Ans:- E-way bill has been bifurcated in two parts as per Form GST EWB – 01
Part - A Part - B
GSTIN of Supplier Vehicle Number for Road
Place of Dispatch Transport Document Number/Defence
Vehicle No./ Temporary Vehicle
Registration No./Nepal or Bhutan
Vehicle Registration No
GSTIN of Recipient
Place of Delivery
Document Number
Document Date
Value of Goods
HSN Code
Reason for Transportation
Note:-
1. HSN Code in column shall be indicated at minimum two digit level for taxpayers having annual
turnover upto ﬁve crore rupees in the preceding ﬁnancial year and at four digit level for taxpayers
having annual turnover above ﬁve crore rupees in the preceding ﬁnancial year.
2. Document Number may be of Tax Invoice, Bill of Supply, Delivery Challan or Bill of Entry.
3. Transport Document number indicates Goods Receipt Number or Railway Receipt Number or
Forwarding Note number or Parcel way bill number issued by railways or Airway Bill Number or Bill
of Lading Number.
4. Place of Delivery shall indicate the PIN Code of place of delivery.
5. Place of dispatch shall indicate the PIN Code of place of dispatch.
6. Reason for Transportation shall be chosen from the table given in the portal.
Q. 13: Explain the validity of E-way bill?
Ans:- As per rule 138(10), an e-way bill shall be valid for a period as given in table below from the relevant
date, for the distance speciﬁed in table below
Note:-
1. For the purposes of this rule, the ―”relevant date” shall mean the date on which the e-way bill has
been generated and the period of validity shall be counted from the time at which the e-way bill has
been generated and each day shall be counted as the period expiring at midnight of the day
immediately following the date of generation of eway bill.
2. For the purposes of this rule, the expression ―”Over Dimensional Cargo” shall mean a cargo
carried as a single indivisible unit and which exceeds the dimensional limits prescribed in rule 93 of
the Central Motor Vehicle Rules, 1989, made under the Motor Vehicles Act, 1988.
Illustration 1:- Mr. Raghu generates EWB for transport goods from Delhi to Gujrat (distance 750 km
appx) on 5th Feb, 2018, what is the validity of EWB?
Solution:- E-Way bill is valid for 1 day up to 100 km of distance and it will increase 1 day each when
distance increased by 100km or part thereof , therefore in this case EWB is valid up to 8 days(For 700 km
7 days and for another 50 km another 1 day).
Solution:-
Type of Cargo Distance Validity period
Cargo other than Over Dimensional Cargo or
multimodal shipment in which at least one leg
involves transport by ship
Upto 100 kmOne day in cases
Cargo other than Over Dimensional Cargo or multimodal
shipment in which at least one leg involves
transport by ship For every 100 km
or part thereof
thereafter .
One additional day
Over Dimensional Cargo or multimodal shipment in
which at least one leg involves transport by ship
Upto 20 km One day in case
Over Dimensional Cargo or multimodal shipment in
which at least one leg involves transport by ship
For every 20 km
part thereof thereafter
One additional day
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Q. 14: Specify the cases where e-way bill is not required to be generated?
Ans:- E-way bill is not required to be generated in the following cases:
a) Transport of goods as speciﬁed in Annexure to Rule 138 of the CGST Rules, 2017
b) where the goods are being transported by a non-motorised conveyance
c) where the goods are being transported from the customs port, airport, air cargo complex and land customs
station to an inland container depot or a container freight station for clearance by Customs
d) in respect of movement of goods within such areas as are notiﬁed under of rule 138(14)(d) of the State or
Union territory GST Rules in that particular State or Union territory
e) where the goods [other than de-oiled cake], being transported, are exempt from tax vide Notiﬁcation No.
2/2017 CT(R) dated 28.06.2017
f) where the goods being transported are alcoholic liquor for human consumption, petroleum crude, high speed
diesel, motor spirit (commonly known as petrol), natural gas or aviation turbine fuel
g) where the supply of goods being transported is treated as no supply under Schedule III of the Act
h) where the goods are being transported -
a. under customs bond from an inland container depot or a container freight station to a customs port, airport,
air cargo complex and land customs station, or from one customs station or customs port to another
customs station or customs port, or
b. under customs supervision or under customs seal
i) where the goods being transported are transit cargo from or to Nepal or Bhutan
j) where the goods being transported are exempt from tax under Notiﬁcation No. 7/2017 CT (R) 28.06.2017
[Supply of goods by the CSD to the Unit Run Canteens or to the authorized customers and supply of goods
by the Unit Run Canteens to the authorized customers] and Notiﬁcation No. 26/2017 CT (R) 21.09.2017
[Supply of heavy water and nuclear fuels by Department of Atomic Energy to Nuclear Power Corporation of
India Ltd. (NPCIL)]
k) any movement of goods caused by defence formation under Ministry of defence as a consignor or consignee
l) where the consignor of goods is the Central Government, Government of any State or a local authority for
transport of goods by rail
m) where empty cargo containers are being transported
n) where the goods are being transported upto a distance of 20 km from the place of the business of the
consignor to a weighbridge for weighment or from the weighbridge back to the place of the business of the
said consignor subject to the condition that the movement of goods is accompanied by a delivery challan
issued in accordance with rule 55
o) where empty cylinders for packing of liqueﬁed petroleum gas are being moved for reasons other than
supply. [N/N 26/2018 CT dt 13/06/18]
Illustration 1:- Mr. Rajesh (supplier) sent goods worth ` 1,20,000 from hand Rickshaw from karol bagh to
Laxminagar (distance 12km approx), whether EWay Bill needs to be generated?
Solution:- E-Way Bill will be generated only for motorize vehicle only, therefore in this case no need generate
EWB because rikshaw is non-motorize vehicle.
Q. 15: How to enter invoice and who shall have to enter the details of e-way bills and how distance
must be computed in case of “Bill to” and “Ship to” transaction?
Ans:- As per the recent amendments in e-way bill rules and changes on e-way bill portal, now transporter
shall not be required to carry two e-way bills to be able to capture the movement of goods from the suppliers
to the Ship To party under Bill to Ship To transaction. Following ﬁelds have been added in Part-A of the
FORM EWB-01 to tackle the issue of raising e-way bill in Bill to-Ship to transactions:
1. Place of Dispatch: This includes the address of the place from where the goods are dispatched for the
movement to the recipient.
2. Bill To: This includes the details of the Bill To party on whose options the goods are to be transported at
the place of Ship To party.
3. Ship To: This allows the registered person to enter the address of Ship To party i.e. address where goods
are destined. Therefore, e-way bill can be generated for Bill To-Ship To transactions easily by providing
the above details in Part-A of the Form.
Q. 16: How should the e-way bill be generated in case of multiple consignments intended to be
transported in one conveyance?
Ans:- After e-way bill has been generated and where multiple consignments are intended to be
transported in one conveyance,
Ü the transporter may indicate the serial number of eway bills generated in respect of each such
consignment electronically on the common portal and
Ü a consolidated e-way bill in FORM GST EWB-02 maybe generated by him on the said common
portal prior to the movement of goods.
Q. 17: What all documents shall be carried by a person-in-charge of a conveyance? [Rule 138A]
Ans:- The person in charge of a conveyance shall carry—
(a) the invoice or bill of supply or delivery challan, as the case may be; and
(b) a copy of the e-way bill in physical form or the e-way bill number in electronic form or mapped to a
Radio Frequency Identiﬁcation Device embedded on to the conveyance in such manner as may
be notiﬁed by the Commissioner
Provided that nothing contained in clause (b) of this sub-rule shall apply in case of movement of goods by
rail or by air or vessel.
Consolidated EWB is like a trip sheet and it contains details of diﬀerent e-way bills in respect of
various consignments being transported in one vehicle and these e -way bills will have diﬀerent
validity periods. Hence, Consolidated EWB does not have any independent validity period.
Further, individual consignment speciﬁed in the Consolidated EWB should reach the destination
as per the validity period of the individual EWB.
Proviso:- Provided further that in case of imported goods, the person in charge of a conveyance shall also carry a
copy of the bill of entry ﬁled by the importer of such goods and shall indicate the number and date of the bill of
entry in Part A of FORM GST EWB-01. [N/N 39/2018 CT dt 04/09/18]Newly Inserted
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Q.18: Write a short note on - Invoice reference number
Ans:- An IRN is a number which a GST registered taxpayer may generate from the eway bill portal by uploading
an invoice in Form GST INV- 01. This will be valid for a period of 30 days and can be used instead of a physical
tax invoice.
Hence, IRN is a boon for transporters who transport multiple consignments, where otherwise the documentation
would have been burdensome. IRN tries to ease the process of documentation to a great level. IRN also serves
a dual purpose where on generating it, a taxpayer can get Part A of his E-way bill auto-populated.
Q. 19: When can an e-way bill be cancelled?
Ans:- Where an e-way bill has been generated however, goods are either not transported or are not transported
as per the details furnished in the e-way bill, the e-way bill may be cancelled electronically on the common portal,
either directly or through a Facilitation Centre notiﬁed by the Commissioner, within 24 hours of generation of the
e-way bill.
It is to be noted that an e-way bill cannot be cancelled if it has been veriﬁed in transit in accordance with the
provisions of rule 138B.
Q. 20: How should the veriﬁcation of the documents and conveyances be done by the Department?
Ans:- As per Rule 138(B) of CGST rules:-
(1) The Commissioner or an ofﬁcer empowered by him in this behalf may authorize the proper ofﬁcer to
intercept any conveyance to verify the e-way bill in physical or electronic form for all inter-state and
intrastate movement of goods.
(2) The Commissioner shall get Radio Frequency Identiﬁcation Device readers installed
Ü at places where the veriﬁcation of movement of goods is required to be carried out and
Ü veriﬁcation of movement of vehicles shall be done through such device readers where the eway bill
has been mapped with the said device.
(3) The physical veriﬁcation of conveyances shall be carried out by the proper ofﬁcer as authorised by the
Commissioner or an ofﬁcer empowered by him in this behalf:
Provided that on receipt of speciﬁc information on evasion of tax, physical veriﬁcation of a speciﬁc conveyance
can also be carried out by any other ofﬁcer after obtaining necessary approval of the Commissioner or an ofﬁcer
authorised by him in this behalf.
Q. 21: How should the report pertaining to inspection be uploaded by the Department?
Ans:- As per rule 138(C) of CGST rules:-
(1) A summary report of every inspection of goods in transit shall be recorded online by the proper ofﬁcer in
Ü Part A of FORM GST EWB-03 within twenty four hours of inspection and
Ü the ﬁnal report in Part B of FORM GST EWB-03 shall be recorded within three days of such
inspection.
(2) Where the physical veriﬁcation of goods being transported on any conveyance has been done during
Proviso
Explanation
“Provided that where the circumstances so warrant, the Commissioner, or any other ofﬁcer authorised
by him, may, on sufﬁcient cause being shown, extend the time for recording of the ﬁnal report in Part B
of FORM EWB-03, for a further period not exceeding three days.
The period of twenty four hours or, as the case may be, three days shall be counted
from the midnight of the date on which the vehicle was intercepted.”
Newly inserted
Q. 22: How should the information pertaining to detained vehicle be uploaded?
Ans:- As per rule 138(D) of CGST rules:-
Where a vehicle has been intercepted and detained for a period exceeding thirty minutes, the transporter
may upload the said information in FORM GST EWB-04 on the common portal.
Q. 23: Explain the legal consequences on Non- compliance of E-way bill
Ans:- i) If e-way bills, wherever required are not issued in accordance with the provisions contained in rule
138 of the CGST rules, the same will be considered as contravention of rules.
Ü As per sec 122 of the CGST act, 2017 a taxable person who transports any taxable goods without
the cover of speciﬁed documents ( e-way bill is one of the speciﬁed documents) shall be liable to a
penalty of Rs 10,000 or tax sought to be evaded (wherever applicable) whichever is greater.
ii) As per sec 129 of CGST act, 2017, where any person transports any goods or stores any goods while
they are in transit in contravention of the provisions of this act or the rules made there under , all such
goods and conveyances used as a means of transport for carrying the said goods and documents
relating to such goods and conveyance shall be liable to detention or seizure.
transit at one place within the State or Union territory or in any other State or Union territory, no further
physical veriﬁcation of the said conveyance shall be carried out again in the State or Union territory,
unless a speciﬁc information relating to evasion of tax is made available subsequently.
Summary of applicable rules for E- way bill
Rule No Particulars Relevant forms
138 Information to be furnished prior to FORM GST EWB-01:
commencement of movement of goods
and generation of e-way bill
138A Documents and devices to be carried by FORM GST INV-1
a person-in-charge of a conveyance.
138B Veriﬁcation of documents and -
conveyances
138C Inspection and veriﬁcation of goods FORM GST EWB-03
138D Facility for uploading information regarding FORM GST EWB-04
detention of vehicle
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ACCOUNTS AND RECORDS
ApplicabilityEvery registered person
Location
At the as mentioned in the certiﬁcate of registration. In case principal place of business,
of more than one place of business, the accounts relating each place of business shall be
kept at such places of business
Records
to be kept
(Sec. 35)
Registered person shall kept and maintain, account of - a true and correct
a) production or manufacture of goods
b) Inward and outward supply of goods or services or both,
c) Stock of goods
d) Input tax credit availed,
e) Output tax payable and paid and
f) Such other prescribed particulars
Shall also keep in electronic form authenticated by means of a digital signature
Till expiry of 72 months from month due date of furnishing of annual return
Situation Extended time Limit
If a registered person, is a party to -
c) an appeal or
d) revision or
e) any other proceedings before any
Appellate Authority or Revisional Authority or
Appellate tribunal of court, or
f) is under investigation for an offence
Shall retain the books of account and other
records pertaining to the subject matter
Ü for a period of 1 year after ﬁnal disposal
of such matter or
Ü for 72 months
whichever is later
Electronic
form
Period of
Retention
a) May permit to maintain in prescribed manner
b) May also notify a person to maintain additional accounts or documents
Power of
commissioner
In additional to the particulars mentioned in sec. 35(1), Every registered person shall keep and
maintain a True and Correct account of the following -
a) Advance received b) Imports & Exports
c) Stock Details d) Tax Collection & Remittance
e) Other Particulars
Person
covered for
mandatory
Maintained of
Records
1, Following person shall mandatorily records of consigner, Consignee and other prescribed details -
a) every owner or operator of warehouse or godown or any other place used for store of goods
and
b) every transporter
2. To enroll in GST common portal
3. Records to be maintained :
a) Persons engaged in the business of Transporting Goods: Records of goods transported,
delivered and goods stored in transit by him along with GSTIN of the registered consignor and
consignee for each of his branches.
b) Owner Operator of a warehouse or Godown : Books of accounts with respect to the period foe
which particulars goods remain in warehouse, including the particular relating to dispatch ,
movement, receipt and disposal of such goods
Records to be
maintained by
manufacturers a) Monthly production accounts, showing the quantitative details of raw materials
services used in the manufacture and
b) quantitative details of the goods so manufactured including the waste and by
product thereof
Records to be
maintained by
supplier if
services
a) the quantitative details of goods used in the provision of services,
b) details of input services utilised and
c) details of services supplied.
Persons executing Works contract shall keep separate accounts for r\each works
contract showing
Ø the names and addresses of the persons on whose behalf the work contract is
executed
Ø description, value and quantity of goods/services received. utilized for the
execution of works contract
Ø the details of payment received in respect of each works contract and
Ø the names and addresses of suppliers from whom goods/services received
Records to be
maintained by
persons
executing
works contract
Extended
Time
Limit
Records to be
maintained
[Rule 56]
Person shall maintain true and correct records in respect of goods haldled by him on
behalf of the such registered person and shall produce the details thereof as and
when required by the proper ofﬁcer Records to be
maintained by
clearing /
freight
forwarder
Records to be
maintained
by Agent To maintain accounts depicting the -
Ø particulars of authorization received by him from each principal to receive or
supply goods or services on behalf of such principal separately
Ø particulars including description, value and quantity of goods or services
received supplied on behalf of every principal
Ø details on accounts furnished to every principal and
Ø tax paid on receipts or on supply of goods or services effected on behalf of
every principal.
Proper ofﬁcer shall determine the of tax payable on the goods or services or both
that are not accounted for .Also Provisions regarding determination of tax not paid or
short paid due to Fraud or other reasons shall be equally apply for determination of
such tax.
Failure to
Account for
Goods or
Services
[Sec. 35 (6)]
Every registered person whose aggregate turnover during a ﬁnancial year exceeds
the ` 2 Cr. audited by a Chartered accountant or a cost must get his account
accountant. he shall submit a copy of the
Ø Audited Annual accounts and
Ø A Reconciliation statement u/s 44(2) [to reconcile the value of supplies declared
in the return with the audited annual ﬁnancial statements] and
Ø such other documents as may be prescribed
Requirement
for Audit
[sec. 35(5)]
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Q 1. : State the records to be maintained by owner or operator of godown or warehouse and transporters
[Section 35(2) read with rule 58]
Ans.:
Every owner or operator of warehouse or godown or any other place used for storage of goods and every
transporter, irrespective of whether he is a registered person or not, shall maintain records of the consigner,
consignee and other relevant details of the goods in such manner as may be prescribed.
Registration: If such persons are not already registered, they shall obtain a unique enrollment number by
applying electronically at the GST Common Portal.
The person so enrolled in any other State or Union territory shall be deemed to be enrolled in the State or Union
territory.
Such person may also amend the details furnished in the prescribed form.
Records to be maintained by a transporter
Records of goods transported, delivered and goods stored in transit by him alongwith GSTIN of the registered
consignor and consignee for each of his branches.
Records to be maintained by an owner/operator of a warehouse/ godown
Books of accounts with respect to the period for which particular goods remain in the warehouse, including the
particulars relating to dispatch, movement, receipt, and disposal of such goods.
The owner or the operator of the godown shall store the goods in such manner that they can be identiﬁed item-
wise and owner-wise and shall facilitate any physical veriﬁcation or inspection by the proper ofﬁcer on demand.
For the purposes of E-Way Bill rules, a transporter who is registered in more than one State or Union Territory
having the same Permanent Account Number,
he may apply for by submitting the details in a unique common enrolment number FORM GST
ENR-02 using any one of his Goods and Services Tax Identiﬁcation Numbers, and
upon validation of the details furnished, a unique common enrolment number shall be generated and
communicated to the said transporter:
Provided that where the said transporter has obtained a unique common enrolment number, he shall
not be eligible to use any of the Goods and Services Tax Identiﬁcation Numbers for the purposes of the said E-
way Bill Rules. [N/N 28/2018 CT dt 19/06/18]Newly Inserted
Q.2: What is the period of retention of accounts? [SECTION 36]
Every registered person required to keep and maintain books of account or other records in accordance with the
provisions of section 35(1)
shall retain them until the expiry of 72 months from the due date of furnishing of annual return
for the year pertaining to such accounts and records.
However, a registered person, who is a party to an appeal or revision or any other proceedings before any
Appellate Authority or Revisional Authority or Appellate Tribunal or Court, whether ﬁled by him or by the
Commissioner, or is under investigation for an offence,
shall retain the books of account and other records pertaining to the subject matter of such appeal or
revision or proceedings or investigation for a period of one year after ﬁnal disposal of such appeal or revision or
proceedings or investigation, or for the period speciﬁed above, whichever is later.
Ans.:
(I) Stock of goods: Accounts of stock in respect of goods received and supplied by him, and such
accounts shall contain particulars of the opening balance, receipt, supply, goods lost, stolen,
destroyed, written off or disposed of by way of gift or free sample and the balance of stock including
raw materials, ﬁnished goods, scrap and wastage thereof.
(II) Details of tax: Account, containing the details of tax payable (including tax payable under reverse
charge), tax collected and paid, input tax, input tax credit claimed, together with a register of tax
invoice, credit notes, debit notes, delivery challan issued or received during any tax period.
Q. 3 State the records which are not to be maintained by a supplier opting for composition levy
[Rule 56(2) and (4)]
“Provided that nothing contained in this sub-section shall apply to any
department of the Central Government or a State Government or a local
authority, whose books of account are subject to audit by the Comptroller
and Auditor-General of India or an auditor appointed for auditing the
accounts of local authorities under any law for the time being in force.”.
Proviso
Newly Inserted
Q.4 Write a short note on Audit of accounts [Section 35(5) read alongwith section 44(2) and rule
80]
Ans.:As persection 35(5) read alongwith section 44(2) and rule 80 of the CGST Rules, 2017 stipulates as
follows:
A. Every registered person must get his accounts audited by a Chartered Accountant or a Cost Accountant
if his aggregate turnover during a FY exceeds ` 2 crores.
B. Such registered person is required to furnish electronically through the common portal along with
Annual Return a copy of:
Ü Audited annual accounts
Ü A Reconciliation Statement, duly certiﬁed, in prescribed form
Reconciliation Statement will reconcile the value of supplies declared in the return furnished for the
ﬁnancial year with the audited annual ﬁnancial statement and such other particulars, as may be
prescribed.
GST
REVISION
91
V’Smart AcademyCA VISHAL BHATTAD 09850850800
www.vsmartacademy.com
All Important Clariﬁcations are given at the end of Module 2

COVID - 19
STAY HOME, STAY SAFE
GST
REVISION
92
V’Smart Academy CA VISHAL BHATTAD 09850850800
www.vsmartacademy.com

CAF_GST_Booster_M1_M20 tools for the laymann

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