GST Theory

CH.SUDHEER C.A, C.M.
A GST INDEX
GST INDEX
CHAPTER TITLE No.of Pages

1 Introduction & Definitions 20
2 Supply under GST 12
3 Charge of GST 20
4 Exempted Services (Detailed Analysis) 38
5 Place of Supply 14
6 Time of Supply 4
7 Value of Supply 24
8 Input Tax Credit 27
9 Registration 22
10 Tax Invoice, Debit Notes and Credit Notes 16
11 Accounts and Records 8
12 Tax payment, TDS, TCS 13
13 Returns 27
14 Refunds 22
15 Job work 6
16 E-Way Bill 9
17 Assessment & Audit 10
18 Inspection, Search, Seizure and Arrest 11
19 Demands & Recovery 20
20 Liability to pay tax in certain cases 8
21 Offences and penalties 20
22 Appeals and Revision 17
23 Advance Ruling 6
24 Miscellaneous Provisions 27
25 Real Estate Sector under GST 7
26 Import & Export Under GST 5
SUDHEER TAX CLASSES, CONTACT: 8688398888 - 9491780817

CH.SUDHEER C.A, C.M.A GST INDEX

CH.SUDHEER C.A, C.M.A Chapter 1 INTRODUCTION OF GST
Chapter 1 INTRODUCTION &

DEFINITION
 Goods & Service Tax or GST is an Indirect Tax levied on the supply of goods and
services.
 It has replaced various indirect taxes and brought them under one umbrella to make
compliance easier.
 Article 246A of the Constitution empowers the Centre and the States to levy and
collect the GST
Central Excise Duty & Additional State surcharges and cesses in so far as they
Excise Duties relate to supply of goods & services
Central levies to be subsumed
State levies to subsumed

Service Tax Entertainment Tax (except those levied by
local bodies)
Excise Duty under Medicinal &
Toilet Preparation Act Tax on lottery, betting and gambling
CVD & Special CVD Entry Tax (All Forms) & Purchase Tax
Central Tax VAT / Sales Tax
Central surcharges and Cesses in so Luxury Tax
far as they relate to supply of goods
Taxes on advertisements
& Services
Taxable event - is the supply of goods or services or both
SUDHEER TAX CLASSES CONTACT: 8688398888, 9491780817 1.1

Broadly there will be 2 forms of GST in India.
At the intra-state level (when goods travel within a state) and at the inter-
state level (when goods travel between states).
At the intra-state level two types of GST shall be levied CGST (Central
Goods and Services Tax) and SGST (State Goods and Services Tax).
At the inter-state level IGST (Or Integrated Goods and Services Tax) shall be
levied.
Imports shall be considered as inter-state supply.
Exports shall be zero rated.
Supplies to SEZ will be Zero-rated
India has adopted a Dual GST model in view of the federal structure of the
country. Centre and States will simultaneously levy GST on taxable supply of goods
or services or both which, takes place within a State or Union Territory. Thus, tax is
imposed concurrently by the Centre and States, i.e. Centre and States
simultaneously tax goods and services. Now, the Centre also has the power to tax
intra-State sales & States are also empowered to tax services. GST extends to
whole of India including the State of Jammu and Kashmir
Similarly, Integrated GST (IGST) will be levied and administered by Centre on every
inter-state supply of goods and services.
Supply of Goods or Services
Within the State Within Union Outside the State or

Territories Union Territory
CGST+ SGST CGST+ UTGST IGST (Equal to

CGST+SGST)

INVOICES UNDER EARLIER AND CURRENT SYSTEMS
Before Introduction of GST After Introduction of GST
1. Issue of invoice by Manufacturer
Sales Value 1,00,000

Sales Value 1,00,000
(+) Excise duty @ 12.5% 12,500
(+) CGST @ 9 % 9,000
Price Cum Duty 1,12,500
(+) SGST @ 9 % 9,000
(+) VAT @ 14.5% 16,313
1,18,000
1,28,813
2. Issue of Invoice by Traders/ Merchants/ Dealers
Suppose if a Trader has purchased the goods specified in 1st point and needs a profit margin of
Rs.8500 then calculation of Tax shall be as follows
Here Trader can claim VAT as ITC Under GST even trader can claim CGST
but cannot claim Excise duty as & SGST as Input Tax Credit (ITC), So
Cenvat credit, So Purchase price 1,00,000
Purchase price 1,12,500 (+) Profit 8,500
(+) Profit 8,500 Sales Value 1,08,500
Sales Value 1,20,000 (+) CGST @ 9 % 9,765
(+) VAT @ 14.5% 17,400 (+) SGST @ 9 % 9,765
Invoice Value 1,37,400 Invoice Value 1,28,030
Note: However if sale is made out of Note: If sale is made out of the state
the state then CST shall be levied then IGST shall be levied equal to
CGST+SGST i.e, 18%
3. Issue of Invoice by Service Providers
Service Value 1,00,000 Sales Value 1,00,000

(+) Service Tax @ 14% 14,000 (+) CGST @ 9 % 9,000
(+) SBC @ 0.5% 500 (+) SGST @ 9 % 9,000
(+) KKC @ 0.5% 500 1,18,000
1,15,000
Article 265
Article 265 of the Constitution of India prohibits arbitrary collection of tax. It states
that “no tax shall be levied or collected except by authority of law”.The term
“authority of law” means that tax proposed to be levied must be within the
legislative competence of the Legislature imposing the tax

Article 246 It gives the respective authority to Union and State

Governments for levying tax. Whereas Parliament may
make laws for the whole of India or any part of the
territory of India, the State Legislature may make laws for
whole or part of the State.
Article 246A (Newly Inserted)
(1) Notwithstanding anything (2)Parliament has exclusive power

contained in Articles 246 and to make laws with respect to goods
254, Parliament, and, subject to and services tax where the supply
clause (2), the Legislature of of goods, or of services, or both
every State, have power to takes place in the course of inter-
make laws with respect to goods State trade or commerce.
and services tax imposed by the
Union or by such State.
Article 269A: Levy and collection of GST on inter-State supply (newly inserted)
Where an amount
Goods and services tax on The amount Where an amount collected as SGST Where an amount
supplies in the course of apportioned collected as tax has been used for collected as IGST
inter-State trade or to a State levied under clause payment of the has been used for
commerce shall be levied under clause (1) has been used IGST, such amount payment of SGST,
and collected by the (1) shall not for payment of the shall not form part such amount shall
Government of India and form part of
such tax shall be tax levied by a State of the Consolidated not form part of
the under article 246A, Fund of the State. the Consolidated
apportioned between the Consolidated
Union and the States in such amount shall (i.e., will be Fund of the India.
Fund of not form part of the transferred to (i.e., will be
the manner as may be
provided by Parliament by
India. Consolidated Fund Consolidated Fund transferred to State
law on the of India. of India) Fund)
recommendations of the
Goods and Services Tax
Council.
Explanation — For the purposes of this clause, supply of goods, or of services, or both in
the course of import into the territory of India shall be deemed to be supply of goods, or
of services, or both in the course of inter-State trade or commerce.
(i.e, in case of Import of goods, IGST shall be levied)

Rates for levy of GST
The CGST and SGST would be levied at rates to be jointly decided by the Centre and
States. The rates would be notified on the recommendations of the GST Council
GST Council
Article 279A of the Constitution empowers the President to constitute a joint

forum of the Centre and States namely, Goods & Services Tax Council (GST
Council).
A GST Council would be constituted comprising the Union Finance Minister (who
will be the Chairman of the Council), the Minister of State (Revenue) and the State
Finance/Taxation Ministers to make recommendations to the Union and the States
on
1 The taxes, cesses and surcharges levied by the Centre, the States
and the local bodies which may be subsumed under GST
2 The goods and services that may be subjected to or exempted

from the GST
3 The date on which the GST shall be levied on petroleum crude, high
speed diesel, motor sprit (commonly known as petrol), natural gas and
aviation turbine fuel;
4 Model GST laws, principles of levy, apportionment of IGST and

the principles that govern the place of supply
5 The threshold limit of turnover below which the goods and

services may be exempted from GST
6
The rates including floor rates with bands of GST
7 Any special rate or rates for a specified period to raise additional

resources during any natural calamity or disasters
8 Special provision with respect to the North East States, J&K,

Himachal Pradesh and Uttarkhand; and
9 Any other matter relating to the GST, as the Council may decide.

Decisions be taken by GST Council
Every decision of the GST Council shall be taken at a meeting by a majority

of not less than 3/4th of the weighted votes of the Members present and
voting. The vote of the Central Government shall have a weightage of
1/3rd of the votes cast and the votes of all the State Governments taken
together shall have a weightage of 2/3rd of the total votes cast in that
meeting.
Quorum: One half of the total number of members of the GST Council
shall constitute the quorum at its meetings.
Goods and services be classified under GST regime
Classification of
Goods Services
HSN (Harmonized System Services Accounting Code

of Nomenclature) code (SAC)
BENEFITS OF GST
GST is a win-win situation for the entire country. It brings benefits to all the stakeholders
of industry, Government and the consumer. It will lower the cost of goods and services,
give a boost to the economy and make the products and services globally competitive.
The significant benefits of GST are discussed hereunder
Creation of unified national  GST aims to make India a common market with common tax
market rates and procedures and remove the economic barriers thus
paving the way for an integrated economy at the national level.
Mitigation of ill effects of  By subsuming most of the Central and State taxes into a single
cascading tax and by allowing a set-off of prior-stage taxes for the
transactions across the entire value chain, it would mitigate the
ill effects of cascading, improve competitiveness and improve
liquidity of the businesses.

Elimination of multiple taxes  GST will subsume majority of existing indirect tax levies both at
and double taxation Central and State level into one tax i.e., GST which will be
leviable uniformly on goods and services. This will make doing
business easier and will also tackle the highly disputed issues
relating to double taxation of a transaction as both goods and
services.
Boost to ‘Make in India'  GST will give a major boost to the ‘Make in India' initiative of the
initiative Government of India by making goods and services produced in
India competitive in the national as well as international market.
Buoyancy to the Government  GST is expected to bring buoyancy to the Government Revenue
Revenue by widening the tax base and improving the taxpayer
compliance.
GENESIS OF GST IN INDIA
• It has now been more than a decade since the idea of national Goods and Services Tax (GST)
was mooted by Kelkar Task Force in 2004. The Task Force strongly recommended fully integrated
‘GST’ on national basis.
• Subsequently, the then Union Finance Minister, Shri P. Chidambaram, while presenting the
Central Budget (2007-2008), announced that GST would be introduced from April 1, 2010. Since
then, GST missed several deadlines and continued to be shrouded by the clouds of uncertainty.
• The talks of ushering in GST, however, gained momentum in the year 2014 when the NDA
Government tabled the Constitution (122nd Amendment) Bill, 2014 on GST in the Parliament
on 19th December, 2014. The Loksabha passed the Bill on 6th May, 2015 and Rajyasabha on 3rd
August, 2016. Subsequent to ratification of the Bill by more than 50% of the States, Constitution
(122nd Amendment) Bill, 2014 received the assent of the President on 8th September, 2016
and became Constitution (101st Amendment) Act, 2016, which paved the way for introduction
of GST in India.
• In the following year, on 27th March, 2017, the Central GST legislations - Central Goods and
Services Tax Bill, 2017, Integrated Goods and Services Tax Bill, 2017, Union Territory Goods and
Services Tax Bill, 2017 and Goods and Services Tax (Compensation to States) Bill, 2017 were
introduced in Lok Sabha. Lok Sabha passed these bills on 29th March, 2017 and with the receipt
of the President’s assent on 12th April, 2017, the Bills were enacted. The enactment of the
Central Acts is being followed by the enactment of the State GST laws by various State
Legislatures. Telangana, Rajasthan, Chhattisgarh, Punjab, Goa and Bihar are among the first
ones to pass their respective State GST laws.
• Government is endeavoring to roll out GST by 1st July, 2017, by achieving consensus on all the
issues relating thereto. It is geared to attain July 1 deadline for implementation of GST across
India.
• GST is a path breaking indirect tax reform which will create a common national market by
dismantling inter-State trade barriers. GST has subsumed multiple indirect taxes like excise duty,
service tax, VAT, CST, luxury tax, entertainment tax, entry tax, etc. France was the first country to
implement GST in the year 1954. Within 62 years of its advent, about 160 countries across the
world have adopted GST because this tax has the capacity to raise revenue in the most
transparent and neutral manner.

COMMODITIES PROPOSED TO BE KEPT OUTSIDE THE PURVIEW OF GST
Five petroleum products

3. Real estate
Alcoholic liquor viz petroleum crude,
sector- GST is not
for human motor spirit (petrol), high
levied on sale or
consumption speed diesel, natural gas
purchase of
and aviation turbine fuel
Immovable
have temporarily been
properties
kept out and GST Council
shall decide the date from
which they shall be
included in GST.
Note:Tobacco:Tobacco is within the purview of GST, i.e. GST is leviable on tobacco. However,
Union Government has also retained the power to levy excise duties on tobacco and tobacco
products manufactured in India. Resultantly, tobacco is subject to GST as wellas central
excise duty.
Why is Dual GST required?
India is a federal country where both the Centre and the States have been assigned the powersto
levy and collect taxes through appropriate legislation. Both the levels of Government have distinct
responsibilities to perform according to the division of powers prescribed in the Constitution for
which they need to raise resources. A dual GST will, therefore, be in keeping with the Constitutional
requirement of fiscal federalism.
FEATURES OF GST
Value added Continuous Burden borne No cascading

Tax chain of Tax by Final of Taxes
credits consumer

NEED FOR GST IN INDIA
Non-inclusion of several local Cascading of taxes on account of (i) levy of Non-VAT

levies in State VAT such as luxury able CST and (ii) inclusion of CENVAT in the value for
tax, entertainment tax, etc imposing VAT
No CENVAT after Double taxation of a

Non-integration of VAT &
manufacturing stage transaction as both goods
Service Tax
and service
Compensation Cess
A GST Compensation Cess at specified rate has been imposed under the Goods and Services Tax
(Compensation to States) Cess Act, 2017 on the specified luxury items or demerit goods, like
pan masala, tobacco, aerated waters, motor cars etc., computed on value of taxable supply.
Compensation cess is leviable on intra-State supplies and inter-State supplies
How to avail INPUT TAX CREDIT UNDER GST
IGST Payable (i.e., Output IGST) CGST Payable(i.e., Output CGST) SGST Payable(i.e., Output SGST)
(-) IGST Input (1st) (-) IGST Input (2nd) (-) IGST Input (2nd)
(-) CGST Input(5th) (-) CGST Input(4th) (-)SGST Input (6th)
(-) SGST Input (7th)
3rd- ITC on account of IGST to be completely exhausted mandatorily
Order of Setoff
ITC on account of IGST Payable CGST Payable SGST Payable

IGST I II- In any order in any proportion
(III) ITC on account of IGST to be completely exhausted mandatorily

CGST V IV Not Permitted
SGST VII Not permitted VI

Changes in Availment of ITC-New section 49B & New rule 88A
1 ITC of IGST should first be utilized towards payment of IGST.
Remaining ITC of IGST, if any, can be utilized towards the payment of CGST and
SGST/UTGST in any order, i.e. ITC of IGST can be first utilized either 2
against CGST or SGST.
ITC of CGST, SGST/UTGST can be utilized towards payment of IGST, CGST,

SGST/UTGST only after the ITC of IGST has first been utilized fully.
3
[Notification No. 16/2019 CT dated 29.03.2019 read with Circular
No.8/17/2019 GST dated 23.04.2019]
Illustration
Head Output tax liability ITC
IGST 1000 1300
CGST 300 200

SGST 300 200
Total 1600 1700
Option 1
ITC of Discharge of output Discharge of Discharge of output Balance of ITC

IGST liability output CGST SGST/UTGST
liability liability
IGST 1000 200(our wish) 100 (our wish) 0
ITC of IGST has been completely exhausted
CGST 0 100 - 100
SGST 0 - 200 0
Total 1000 300 300 100
Our wish means in any order or Proportion

Option 2

liability liability
IGST 1000 100 (our wish) 200(our wish) 0
CGST 0 200 - 100
SGST 0 - 100 0
Total 1000 300 300 100
Option 3

liability liability
IGST 1000 150 (our wish) 150 (our wish) 0
CGST 0 150 - 50
SGST 0 - 150 50
Total 1000 300 300 100
Accounting Entries under GST
Example 1 Intra-state
1. Mr. X purchased goods Rs. 1,00,000 locally (intrastate)

2. He sold them for Rs. 1,50,000 in the same state
3. He paid legal consultation fees Rs. 5,000
4. He purchased furniture for his office for Rs. 12,000
Assuming CGST @9% and SGST@9%

A) For Purchases Purchases a/c .......Dr 1,00,000

Input CGST A/c ......Dr 9,000
Input SGST A/c ......Dr 9,000
To Creditor A/c 1,18,000
B) For Sales
DebtorsA/c ......Dr 1,77,000
To Sales 1,50,000
To Output CGST A/c 13,500
To Output SGST A/c 13,500
C) Input Service Legal fee A/c ......Dr 5,000

Input CGST A/c ......Dr 450
Input SGST A/c ......Dr 450
To Bank 5,900
D) For Purchase of Furniture
Furniture A/c ......Dr 12,000

To Bank 14,160
Total Output CGST 13,500

(-) Total Input CGST (9000+450+1080) 10,530
Net CGST Payable 2970
Total Output SGST 13,500
(-) Total Input SGST (9000+450+1080) 10,530
Net SGST Payable 2970
E) For CGST Payable
Output CGST A/c ......Dr 13,500

To Input CGST A/c 10,530
To Electronic cash Ledger a/c 2,970
F) For SGST Payable
Output SGST A/c ......Dr 13,500

To Input SGST A/c 10,530

Example 2 Inter-state
1. Mr. X purchased goods Rs. 1,50,000 from outside the State

2. He sold Rs. 1,50,000 locally
3. He sold Rs.1,00,000 outside the state
4. He paid telephone bill Rs. 5,000
5. He purchased an air cooler for his office for Rs. 12,000 (locally)
Assuming CGST @9% and SGST@9%
A) For Purchases (Outside the state)
Purchases a/c .......Dr 1,50,000

Input IGST A/c ......Dr 27,000
To Creditor A/c 1,77,000
B) For Sales (within the state)
DebtorsA/c ......Dr 1,77,000

To Sales 1,50,000
To Output SGST A/c 13,500
C) For Sales (Outside the state)
DebtorsA/c ......Dr 1,18,000

To Sales 1,00,000
D) For Input Service

Telephone exp A/c ......Dr 5,000
Input CGST A/c ......Dr 450
Input SGST A/c ......Dr 450
To Bank 5,900
E) For Purchase of Office equipment
Office equipment A/c ......Dr 12,000

To Bank 14,160

Particulars IGST CGST SGST

Output Liability 18,000 13,500 13,500
Less: Input Tax credit
a) Input CGST 450+1080=1530 -
B)Input SGST - 450+1080=1530
C)Input IGST 18,000 9000 -
Net Tax Liability - 2,970 11,970
F) For IGST Payable Output IGST A/c ......Dr 18,000

To Input IGST A/c 18,000
G) For CGST Payable Output CGST A/c ......Dr 13,500

To Input CGST A/c 1,530
To Input IGST A/c 9,000
H) For SGST Payable Output SGST A/c ......Dr 13,500

To Input SGST A/c 1530
GSPs/ASPs
1. GSTN has 2. They facilitate 3. They

selected certain the tax payers in customize
IT, ITeS and uploading products that
financial invoices as well address the
technology needs of
as filing of
companies, to be different
called GST returns and act segment of users.
Suvidha as a single stop GSPs may take
Providers (GSPs). shop for GST the help of
GSPs develop related services Application
applications to Service Providers
be used by (ASPs) who act as
taxpayers for a link between
interacting with taxpayers and
the GSTN. GSPs

SOME IMPORTANT DEFINITIONS UNDER GST
1. Aggregate Means the aggregate value of all taxable supplies, exempt supplies, exports of goods
turnover or services or both and 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)].
2. Capital Means goods, the value of which is capitalized in the books of account of the person
goods claiming the ITC and which are used or intended to be used in the course or
furtherance of business [Section 2(19)].
3. Business
Includes Any activity
Any trade/commerce, incidental/ancillary to it
manufacture, profession,
vocation etc. even if there Any activity of same nature
is no monetary benefit even if no volume
/continuity/frequency
Supply/acquisition of In connection with

goods including capital commencement closure of
goods & services business
Provision of facilities by To its members for

club/association/society consideration
etc
Admission to any premises For a consideration
Accepted in
Services as holder of an
office course/furtherance of
trade, profession/vocation
Services by race club by Totalisator or a license to

way of book maker in such club
Any activity by Govt/local Government includes both

authority as public Central and State Govt.
authorities

4. Consideration
Payment in money Monetary value of any

or otherwise for the act for forbearance for
supply the supply
By recipient or any
Deposit to be other person
considered as
payment
Excluding subsidy
given by Central /
Only State Governments
When the supplier applies such

deposit as consideration for the
said supply
5. Continuous Means [Section 2(32): a supply of goods which is provided, or agreed to be

supply of provided, continuously or on recurrent basis under a contract
goods
6. Continuous Means [Section 2(33)]: a supply of services which is provided, or agreed to be
supply of provided, continuously or on recurrent basis, under a contract, for a period
services exceeding three months with periodic payment obligations and includes supply of
such services as the Government may, subject to such conditions, as it may, by
notification, specify
7. Educational Means an institution providing services by way of,-
institution  Pre-school education and education up to higher secondary school or equivalent;
 Education as a part of a curriculum for obtaining a qualification recognised by any
law for the time being in force;
 Education as a part of an approved vocational education course.
8. Exempt
supply Exempt supply
Means Includes
Supply Supply wholly Non-taxable supply

attracting NIL exempt from
rate of tax
CGST IGST

9. Export of Means the supply of any service when

services
(a) The supplier of service is located in India,
(b) The recipient of service is located outside India,
(c) The place of supply of service is outside India,
(d) The payment for such service has been received by the supplier of service in
convertible foreign exchange, and
(e) The supplier of service and recipient of service are not merely establishments of a
distinct person in accordance with explanation 1 of section 8 [Section 2(6)].
10. Goods
GOODS
MEANS
All kind of movable

EXCLUDES Money & Securities
property
INCLUDES
Actionable claim,
Growing Crops, Grass &
Things forming part of
land agreed to be
severed before supply or
under a contract of
supply
11. Govt. “Governmental Authority” means an authority or a board or any other body––
authority (i) Set up by an Act of Parliament or a State Legislature; or
(ii) Established by any Government, with 90% or more participation by way of equity
or control, to carry out any function entrusted to a municipality under article 243W
of the Constitution
12. Import of With its grammatical variations and cognate expressions, means bringing goods into
goods India from a place outside India [Section 2(10)].
13. Import of
services (a) The supplier of (b) The recipient of (c) The place of
service is located service is located in supply of service is
outside India, India, and in India [Sec 2(11)].

14. Location of
Means
the
recipient of
Place of business for Location of
services
which registration is such place
obtained of business
Location of recipient of services Supply received at Fixed establishment Location of

elsewhere such fixed
establishmen
More than one
establishment, Location of
whether place of the
business or fixed establishmen
establishment t most
In absence of such directly
places Usual place of concerned
residence of the with the
recipient of
recipient
supply
Same definition for location of supplier of service also but replace supplier in place of
receipient
15. Location of
Supplier
Place of business for Location of
which registration is such place
obtained of business
Location of supplier of services
Supply made from Fixed establishment Location of

elsewhere such fixed
establishment
More than one
establishment, Location of
whether place of the
business or fixed establishmen
establishment t most
In absence of such directly
places Usual place of concerned
residence of the with the
provision of
supplier
supply
16. Quarter Shall mean a period comprising three consecutive calendar months, ending on the
last day of March, June, September and December of a calendar year [Sec 2(92)].
17. Non- Means any person who occasionally undertakes transactions involving supply of
resident goods or services or both, whether as principal or agent or in any other capacity, but
taxable who has no fixed place of business or residence in India [Section 2(77)].
person

NON-RESIDENT TAXABLE PERSON
Means Principal
Any person supplying goods and Agent

as
/ or services occasionally
In any other
Having NO fixed place of capacity
business/residence in India
18. Place of
A place feom where the business is ordinarily,
business 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
Includes a palce where a taxable person maintains his

[Section books of account; or
2(85)]
a place where a taxable person is engaged in

business through an agent, by whatever
name called.
19. Person
(2 (84))

20. Recipient
Recipient
If consideration is Person liable to pay the

payable for supply of consideration
goods and / or services
Person to whom goods are
If no consideration is delivered/made available or
payable for supply of to whom possession/use of
goods the goods is given/ made
available
If no consideration is
Person to whom the
payable for the supply of
services is rendered
services
21. Services
SERVICES
MEANS
Activities relating to
use of money or its
Anything INCLUDING of conversion for a
consideration
EXCLUDING
Goods Money Securities
Mere transaction in money is not a service. But if it is done for a consideration

then it is a service
22. Works Means a contract for building, construction, fabrication, completion, erection,
contract 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 [Section 2(119)].
23. Zero rated As per section 16(1) of IGST Act, “zero rated supply” means any of the following
supply supplies of 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 developer or a
Special Economic Zone unit.

CH.SUDHEER C.A, C.M.A Chapter 2 Supply – Sec 7 of CGST Act
SUPPLY-Sec 7 of
CGST Act
1. SUPPLY Definition – SEC 7 OF CGST ACT
2. Schedule-I (Supply even without Consideration)
3. Schedule – II: Activities to be treated as Supply of

Goods or Services
TOPICS
4. Schedule – III: NEGATIVE LIST OF UNDER SERVICES
5. EXAMPLES FOR VARIOUS CASES IN DEFINITION OF

SUPPLY
6. COMPOSITE AND MIXED SUPPLIES (SECTION 8)
7. CLARIFICATIONS ON DEFINITION OF SUPPLY

Chapter 2
1. SUPPLY – SEC 7 OF CGST ACT Question 1-5
Supply include Excludes Govt by notification specify

transactions to be treated as
All forms of Activities Activities to Activities or

sale, transfer specified be treated as Activities or Supply of Supply of
transactions
transactions service not goods & not
barter, Importation in supply of undertaken
exchange schedule- I goods or specified in as a supply as a supply of
of service by CG/SG/LA
licence, rental services as Schedule – III of goods service
as may be
lease or referred to in notified by
disposal Schedule- II Govt
Made or Made or Refer page Refer page

agreed to be agreed to 2.3 2.4
made be made
For For Without

consideration consideration consideration
In the course Whether or not

of business In the course of
or business or
furtherance furtherance of
of business business

Chapter 2
2. Schedule-I (without Consideration) Question 6-14
In these cases, even though consideration is not charged, it shall be regarded as supply
Permanent Supply b/w Supply of Supply

transfer/ distinct goods or Principal & between
disposal of persons services by Agent related
business assets employer to persons
employee
Eg: A person having Any goods

Outside the
reg.est in one supplied to
 Transfer of assets state and
course of Shall be
Import of
agent shall be
by H.Co to S.Co employment regarded as
another reg.est regarded as service
 Donate old in other state supply
supply
laptop to Schools shall be distinct
 A cloth retailer persons
giving clothes Gifts not exceeding
free to his friend 50,000 in year are not
Stock transfers by a supply Refer page Only if made in the course
one unit to other 2.10 (CASE 7) of Business
This provision will
unit of other state
apply only when ITC Employer gives dussera
is a supply
has been availed by gift of 55,000 - treated as
Transferor supply for levy of GST

Chapter 2
3. Schedule – II: Activities to be treated as Supply of Goods or Services Question 15-19
Transfer Land or Building Transfer of Business Assets
Supply of supply of Supply of service Supply of goods Supply of Service

goods service
Lease, tenancy,
easement, licence Goods forming part When the business is Goods held for
-Title in goods Right in goods without to occupy land of business assets ceased, then stock left business but put to
-Tiltle in goods under transfer of goods are disposed whether shall be deemed to be private use with or
agreement at future date or not for consideration supplied and liable to GST without consideration
Exception
1. Business transferred as Going concern A director using car
2. Business carried on by personal representative provided by co. for
who is deemed to be a taxable person personal travels
Treatment or process Certain specified service Composite supplies Supply of service by unincorporated
AOP/ BOI to its members for cash or
Supply of service 1.Renting of Immovable properties Supply of services deferred payment
2. Construction of civil structure, complex etc..,
Treatment of process 3.Temporary transfer or permitting use of IPR
applied to other person's 4.Development, design, upgradation etc., of IT s/w 1. Works contract services 1. Club membership fees-service
goods 5.Agreeing to obligation to refrain from an act or 2. Supply being food or drink 2. A local club supplies snacks
tolerance of an act or situation or to do an act or any article for human during monthly meeting for
Eg:- 6. Transfer of right to use any goods for any purpose consumption nominal payment.-service
Jobwork performed by
jobworker on goods
supplied by Principal Treated as supply of services
Manufacturer

4. Schedule – III: NEGATIVE LIST OF UNDER SERVICES Question 20
Services by Services by Services of a) Sale of land Actionable Functions performed by

Employee to District
b) Sale of claims 1) Members of
employer in court/ HC/SC a) Funeral Building other than a) Parliament b) State Legislature
or Tribunal b) Burial where entire
the course of consideratio lottery, c) Panchayats d) Municipalities
Services by established c) Crematorium n is paid
employment under any after betting & e) Other local authorities
d) Mortuary Completion
(i.e salary) law for time gambling
e) Transportation of 2) Duties performed by any person
being in of deceased construction who holds any post in pursuance of
force the provisions of the Constitution in
that capacity
In case payment to directors 3) Duties performed by any person as
a) Chairperson or
b) Member or
TDS u/s 192 TDS u/s 194J
c) Director
In a body established by the
No GST GST chargeable (but under RCM)
CG/SG/LA
NEGATIVE LIST OF UNDER GOODS
Supply of goods from outside Supply of goods by the consignee to any other
Supply of warehoused goods to
India to Outside India without person by endorsement of documents of title to
any person before clearance for
such goods entering into India home consumption the goods after the goods have been dispatched
from the port of origin located outside India but
before clearance for Home Consumption (i.e.,
High sea sales)

5. EXAMPLES FOR VARIOUS CASES IN DEFINITION OF SUPPLY
1) Exchange 2) Barter
When a new car worth ₹ 5,00,000 is purchased in exchange of an old car Doctor provides medical consultancy Barber cuts doctor’s hair Medical
along with the monetary consideration of ₹ 4,00,000 paid for the said consultancy is a SUPPLY of services by doctor. It is a consideration for the
purchase. hair cut by the barber.
3) In course or furtherance of Business 4) Business includes Vocation
Rishabh buys a car for his personal use and after a year sells it to a car Sundaram Acharya, a famous actor, paints some paintings and sells them.
dealer. Sale of car by Rishabh to car dealer is not a supply under CGST Act The consideration from such sale is to be donated to a Charitable Trust –
because supply is not made by Rishabh in the course or furtherance of ‘Kind Human’. The sale of paintings by the actor qualifies as supply even
business. though it is a one-time occurrence.
5) Services by Club or association 6) Import of service
A Resident Welfare Association provides the service of depositing the Ramaiyaa, a proprietor, has received the architect services for his house
electricity bills of the residents in lieu of some nominal charges. Provision of from an architect located in New York at an agreed consideration of $
service by a club or association or society to its members is treated as supply 5,000. The import of services by Ramaiyaa is supply u/s 7(1) (b) though it is
as this is included in the definition of ‘business’. not in course or furtherance of business.
7) Transfer without consideration on which ITC is availed 8) Distinct persons
A dealer of air-conditioners permanently transfers an air conditioner from Mohan, a Chartered Accountant, has a registered head office in Delhi. He
his stock in trade, for personal use at his residence. The transaction will has also obtained registration in the State of West Bengal in respect of his
constitute a supply as it is a permanent transfer/ disposal of business assets. newly opened branch office. Mohan shall be treated as distinct persons in
The only condition is that input tax credit should have been availed on such respect of registrations in West Bengal and Delhi.
assets.
9) Stock Transfer 10) Principal and agent
Raghubir Fabrics transfers 1000 shirts from his factory located in Lucknow to ABC Manufacturers Ltd. engages Raghav & Sons as an agent to sell goods
his retail showroom in Delhi so that the same can be sold from there. The on its behalf. For the purpose, ABC Manufacturers Ltd. has supplied the
factory and retail showroom of Raghubir Fabrics are registered in the States goods to Raghav & Sons located in Haryana. Supply of goods by ABC
where they are located. Although no consideration is charged, supply of Manufacturers Ltd. to Raghav & Sons will qualify as supply even though
goods from factory to retail showroom constitutes supply Raghav & Sons has not paid any consideration yet.
11) Import of service without consideration 12) Import of service without consideration
ABC Associates received legal consultancy services from its head office Sumedha, a proprietor registered in Delhi, has sought architect services
located in Malaysia. The head office has rendered such services free of cost from his brother located in US, with respect to his newly constructed
to its branch office. Since ABC Associates and the branch office are related house in Delhi. Although services have been received by Sumedha without
persons, services received by ABC Associates will qualify as supply even consideration from a related person, yet it will not qualify as supply since
though the head office has not charged anything from it. the same has not been received in course or furtherance of business.

Question 21-23
6.COMPOSITE AND MIXED SUPPLIES (SECTION 8)
Composite Supply Mixed Supply
Naturally bundled in the ordinary course of business Artificially bundled and not in the ordinary course of Business
Comprising two or more supplies one of which is principal Comprising of two or more supplies
supply
Shall be treated as supply of that particular principal supply Treated as supply of such supply that attracts highest rate of tax
Example
Example
S Ltd. Manufacturers entered into a contract with XYZ Ltd. for supply
of readymade shirts packed in designer boxes at XYZ Ltd.’s outlet. Supply of package consisting of food, sweets, chocolates,
Further, S Ltd Manufacturers would also get them insured during cakes, dry fruits for a single price is mixed supply. Each
transit. So, supply of goods, packing materials, transport & insurance is of these items can be supplied independently. Hence it is a
a composite supply wherein supply of goods is principal supply mixed supply.
A shopkeeper selling storage water bottles along with
When a consumer buys a television set and he also gets warranty and refrigerator. It is a mixed supply
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

7.CLARIFICATIONS ON DEFINITION OF SUPPLY
1. Whether supply of books, pamphlets, brochures, envelopes, annual reports, leaflets, cartons,
boxes etc., printed with design, logo, name, address or other contents supplied by the recipient
of such supplies, would constitute supply of Goods or supply of Services ?
In both below cases it involves both Goods and service in the ordinary course
of business. Hence we can consider it is a composite supply. Classification
should be done as per principal supply
In the case of printing of Question 24 In case of Printed envelopes,

books, pamphlets, brochures letter cards printed boxes,
annual reports, and the like tissues, napkins etc
Here is principal supply is supply of Here the principal supply is supply

Information of above Items.
Hence it is a Supply of Service Hence it is a supply of Good
2. Interstate movement of goods in conveyance among distinct persons under section 25
If goods are transported to

If goods are If the good is the distinct person u/s 25, then
transferred among vehicle which is whether GST is charged on
distinct persons being transported Transportation cost in own
to distinct person vehicle
Generally as per definition

It is supply as per Sch-I to It is also supply as per Sch – I of supply should be
the definition of supply to the definition of supply considered as supply But
even though consideration even though consideration is Circular No. 1/1/2017 states
is not charged not charged it is not as supply of good or
a service
However, applicable CGST/SGST/IGST, as the case may be, shall be leviable on repairs and
maintenance done for such conveyance

3. Clarification on inter-State movement of rigs, tools and spares, and all goods on wheels
(like cranes) among distinct persons under section 25
Same as point no.2 above
4. ‘Cash calls’ are raised by an operating member of the joint venture on other members in
proportion to their participate interests in the joint venture (unincorporated) to meet the
expenditure on the operations to be carried out as per the approved work programme and budget.
Taxability of cash calls can be further explained by the following illustrations:
Illustration A: There are 4 members in the JV Illustration B: There are 4 members in the JV
including the operating member and each one including the operating member and each one
contributes ₹ 100 as part of their share. A total contributes ₹ 100 as part of their share. A total
amount of ₹ 400 is collected. The operating amount of ₹ 400 is collected. The operating
member purchases machinery for ₹ 400 for the JV member thereafter uses its own machine and
to be used in oil production. performs exploration and production activities
on behalf of the JV.
Illustration A will not be the subject matter of ‘ST/GST’ for the reason that the operating member is
not carrying out an activity for another for consideration. In Illustration A, the money paid for
purchase of machinery is merely in the nature of capital contribution and is therefore a transaction in
money.
On the other hand, in Illustration B, the operating member uses its own machinery and is therefore
providing ‘service’ within the scope of supply of CGST Act. This is because in this scenario, the
operating member is recovering the cost appropriated towards machinery and services from the other
JV members in their participating interest ratio.
[Circular No. 35/09/2018 GST dated 05.03.2018]
5. Whether a Del credere commission Agent (DCA) falls under the ambit of agent under Para 3 of
Schedule I of the CGST Act? (Circular No. 73/47/2018 dt.05.11.2018)
As already clarified vide circular No. 57/31/2018-GST dated 4thSeptember, 2018,

whether or not the DCA will fall under the ambit of agent under Para 3 of Schedule I of
the CGST Act depends on the following possible scenarios :
In case where the invoice for supply of goods is issued by the supplier to the customer, either
himself or through DCA, the DCA does not fall under the ambit of agent.
In case where the invoice for supply of goods is issued by the DCA in his own name, the DCA
would fall under the ambit of agent.

6. Clarification on treatment of sales promotion schemes (C.No.92/11/2019 dt.07/03/2019)
Free samples and gifts If ITC is taken- then distribution of Free samples and gifts should be
treated as supply as per Sch-I
If ITC is not taken- transaction made without consideration shall not be
regarded as supply
Buy one get one free offer Sometimes, companies announce offers like ‘Buy One, Get One
free‟ For example, „buy one soap and get one soap free‟ or „Get
one tooth brush free along with the purchase of tooth paste‟. As
per definition of supply any goods or services which were supplied
at free of cost cannot be considered as supply. In fact, it is not an
individual supply of free goods but a case of two or more
individual supplies where a single price is being charged for the
entire supply. It can at best be treated as supplying two goods for
the price of one
Taxability of such supply will be dependent upon as to whether
the supply is a composite supply or a mixed supply and the rate of
tax shall be determined section 8 of the said Act.
It is also clarified that ITC shall be available to the supplier
Discounts including ‘Buy Sometimes, the supplier offers staggered discount to his
more, save more’ offers customers (increase in discount rate with increase in purchase
volume). For example-Get 10 % discount for purchases above Rs.
5000/-, 20% discount for purchases above Rs. 10,000/-and 30%
discount for purchases above Rs. 20,000/-. Such discounts are
shown on the invoice itself.
Some suppliers also offer periodic / year ending discounts to their
stockiest, etc. For example-Get additional discount of 1% if you
purchase 10000 pieces in a year, get additional discount of 2% if
you purchase 15000 pieces in a year. Such discounts are
established in terms of an agreement entered into at or before
the time of supply though not shown on the invoice as the actual
quantum of such discounts gets determined after the supply has
been effected and generally at the year end. In commercial
parlance, such discounts are colloquially referred to as “volume
discounts”. Such discounts are passed on by the supplier through
credit notes.
Secondary Discounts These are the discounts which are not known at the time of
(i.e., credit notes) supply or are offered after the supply is already over. For
example, M/s A supplies 10000 packets of biscuits to M/s B at Rs.
10/-per packet. Afterwards M/s A re-values it at Rs. 9/-per packet.
Subsequently, M/s A issues credit note to M/s B for Rs. 1/-per
packet.
It is hereby clarified that financial / commercial credit note(s) can
be issued by the supplier even if the conditions mentioned in
clause (b) of sub-section (3) of section 15 of the said Act are not
satisfied. In other words, credit note(s) can be issued as a
commercial transaction between the two contracting parties.

7. Principal & Agent- Deemed supply & Mandatory Registration- Clarification (Circular No.
57/31/2018-GST)
Scenario 1
Mr. A appoints Mr. B to procure certain goods from the market. Mr. B identifies various suppliers
who can provide the goods as desired by Mr. A, and asks the supplier (Mr. C) to send the goods
and issue the invoice directly to Mr. A. In this scenario, Mr. B is only acting as the procurement
agent, and has in no way involved himself in the supply or receipt of the goods. Hence, in
accordance with the provisions of this Act, Mr. B is not an agent of Mr. A for supply of goods in
terms of Schedule I.
Scenario 2
M/s XYZ, a banking company, appoints Mr. B (auctioneer) to auction certain goods. The auctioneer
arranges for the auction and identifies the potential bidders. The highest bid is accepted and the
goods are sold to the highest bidder by M/s XYZ. The invoice for the supply of the goods is issued
by M/s XYZ to the successful bidder. In this scenario, the auctioneer is merely providing the
auctioneering services with no role played in the supply of the goods. Even in this scenario, Mr. B
is not an agent of M/s XYZ for the supply of goods in terms of Schedule I.
Scenario 3
Mr. A, an artist, appoints M/s B (auctioneer) to auction his painting. M/s B arranges for the
auction and identifies the potential bidders. The highest bid is accepted and the painting is sold to
the highest bidder. The invoice for the supply of the painting is issued by M/s B on the behalf of
Mr. A but in his own name and the painting is delivered to the successful bidder. In this scenario,
M/s B is not merely providing auctioneering services, but is also supplying the painting on behalf
of Mr. A to the bidder, and has the authority to transfer the title of the painting on behalf of Mr. A.
This scenario is covered under Schedule. A similar situation can exist in case of supply of goods as
well where the C&F agent or commission agent takes possession of the goods from the principal
and issues the invoice in his own name. In such cases, the C&F/commission agent is an agent of
the principal for the supply of goods in terms of Schedule I. The disclosure or non-disclosure of the
name of the principal is immaterial in such situations.
Note: In scenario 1 and scenario 2, Mr. B shall not be liable to obtain registration in
terms of clause (vii) of section 24 of the CGST Act. He , however, would be liable for
registration if his aggregate turnover of supply of taxable services exceeds the threshold
specified in sub-section (1) of section 22 of the CGST Act. In scenario 3, M/s B shall be liable
for compulsory registration in terms of the clause (vii) of section 24 of the CGST Act

8. Import of service
Import of Service
With consideration Without

Consideration
In course of Not in course of Related person/distinct

futherance of furtherance of person + in course or Other Cases
business business furtheraance of business
Not a Supply
Supply
9. Transaction that are neither supply of good nor a service (Section 7)
Central Government, on the recommendations of the Council hereby notifies

that the following activities or transactions undertaken by the State
Governments, in which they are engaged as public authorities, shall be treated
neither as a supply of goods nor a supply of service, namely:-
“Service by way of grant of alcoholic liquor license, against consideration in the
form of license fee or application fee or by whatever names it is called
(Notification No.25/2019-Central Tax (Rate) dt.30.09.2019)
Exception: GST shall be levied on license fee charged by the any person other
than SG for grant of Liquor licenses to vendors (i.e., sub lease liable to GST)
(Circular No. 121/40/2019 dt.11.10.2019)
Amendment
10. No Levy of GST on the service of display of name or placing of name plates of the
donor in the premises of charitable organizations receiving donation or gifts from individual
donors (Circular No. 116/35/2019 dt.11/10/2019)
Amendment

CH.SUDHEER C.A, C.M.A Chapter 3 Charge of GST
Chapter 3
CHARGE OF GST
1. Extent &Commencement of CGST Act/SGST Act/ UTGST act

2. Inter State Supply (Sec 7 of IGST Act)
3. Intra State Supply (Sec 8 of IGST Act)
4. Establishments of Distinct Persons (Section 25)
TOPICS 5. Supply in Territorial Waters (Section 9 of IGST Act)

6. Charging section 9 of CGST act/ section 5 of IGST Act
7. Reverse Charge Mechanism (Section 9(3) & 9(4))
8. Composition Levy (Section 10 of CGST Act)
9. IGST- Reverse charge on import of Services
10. OIDAR services [section 14 of the IGST Act]
SUDHEER TAX CLASSES, CONTACT: 8688398888 - 9491780817 3.1

1. EXTENT & COMMENCEMENT OF CGST ACT/ SGST ACT/ UTGST ACT
(i) CGST ACT ,2017extends to the whole of India [Section 1]including J & K
India means
State GST lawof the respective State/Union Territory

with State Legislature [Delhi and Pondicherry]
(ii) State GST law
extends to whole of that State/Union Territory.
(iii) UTGST ACT,2017
Extends to the following Union territories
The
Andaman Dadra and Daman and Chandigarh
Lakshadweep
and Nagar Haveli Diu
NicobarIslan

2.Inter State Supply (Sec 7 of IGST Act)
Location of the supplier &place of supply are in two

different States / UTs
Goods / services imported into the territory of India

Inter – State Supplies
Supplier located in India & the place of supply is

outsideIndia Zero rated
Supplies
u/s 16 of
Supply to / by an SEZ developer or SEZ unit; or
IGST Act
Supply of Goods to a Tourist (Section 15 of IGST Act)
Supply of goods
made to a tourist
[section 15 of the
IGST Act
Eg: A tourist from USA visits India

Tourist means , a person not and purchases a shawl in Delhi.
normally resident in India, who In this case, even though the
enters India for a stay of not more place of supply and location of
than 6 months for legitimate non- supplier are in the same State, it
immigrant purposes. will be treated as inter-State
transaction and will be exigible to
IGST.

3.Intra State Supply (Sec 8 of IGST Act)
a
Location of Supplier Place of Supply
a)
Intra State Supply
(One state/UT) (Same State/UT)
b) Such supplies are eligible to CGST and SGST.

Eg
Location of supplier Place of supply Whether Intra state supply or not
Punjab Punjab Yes
London Delhi No
Delhi Gujarat No
Puducherry Puducherry Yes
4.Establishments ofDistinct Persons (Section 25)
Establishments of same entity shall be considered as establishments of distinct persons where a

person has:
(i) An (ii) An (iii)An establishment

establishment in establishment in a in a State or Union
State/UT and any territory and any
India and any (or)(or)
Or other Or
other other establishment
establishment having multiple
establishment
outside India outside that registrations within
State/UT that State or Union
territory.
 Establishment means person carrying on a business through a branch or an agency or a

representational office
 Any supply between any of the Distinct Persons shall qualify as supply even though
consideration is not charged (Schedule I)

5.Supply in Territorial Waters (Section 9 of IGST Act)
Where the location of the supplier is in the territorial waters, it

shall be deemed that location of such supplier is in the coastal
State or Union Territory where the nearest point of the
appropriate baseline is located.
6.CHARGING SECTION 9 of CGST Act/ Section 5 of IGST Act
A
General
Levy Exception Value Rate Paid by
CGST/SGST is Supply of Transaction As may be Taxable

levied on alcoholic value u/s 15 notified by person
Intra state liquor for of the CGST CG(not
supplyof human Act exceeding
goods or consumption 20%)
services or
both
Notes:-
The tax on the supply of petroleum crude, high speed diesel, motor spirit (commonly
known as petrol), and natural gas and aviation turbine fuel shall be levied with effect
from such date as may be notified by the Government on the recommendations of the
Council.

B Reverse Charge
Supply of By Unregistered To Registered

(i) Notified Goods dealer dealer Sec 9(4)
or Services
Or
(ii) Supply of goods or services, notified by the Govt on the recommendations of the
Sec 9(3)
GST Council
In such cases Recipient is liable to pay tax under Reverse charge mechanism
Question 1, 2
C Electronic Commerce Operator (ECO)
Any person who owns, operates or manages digital or electronic facility or platform for
electronic commerce

E-Commerce Operator Not an Ecommerce Not an Ecommerce

Operator Operator
Amazon and Flipkart are Amazon and Flipkart will Titan supplying watches
e-commerce Operators not be treated as e- and jewels through its own
because they are commerce operators in website would not be
facilitating actual suppliers relation to those supplies considered as an
to supplygoods through which they make on their e-commerce operator for
their platform (popularly own account (popularly the purposes of this
called Market placemodel called inventory model) provision.
or Fulfillment Model)
Levy
If the ECO is located in taxable Person liable to pay tax is the ECO
territory
If the ECO does not have physical Person liable to pay tax is the
presence in the taxable territory person representing the ECO
Person liable to pay tax is the

person appointed by the ECO for
If the ECO has neither the physical presence nor
any representative in the taxable territory the purpose of paying the tax
The Government may notify specific categories of services the tax on intra-State supplies of which
shall be paid by the electronic commerce operator (ECO) if such services are supplied through it.
Such services shall be notified on the recommendations of the GST Council.

Notification No. 17/2017 CT& 14/2017 IT dated 28.06.2017as amended has notified
the following categories of services supplied through ECOfor this purpose
Services by way of providing Services by way of house-

Services by way of transportation accommodation in hotels, inns,
of passengers by a radio-taxi, keeping, such as plumbing,
motorcab, maxicab and motor guest houses, clubs, campsites carpentering etc, except where
cycle; or other commercial places the person supplying such
meant for residential or lodging service through electronic
purposes, except where the commerce operator is liable for
person supplying such service registration under subsection
through electronic commerce 22(1) of the CGST Act.
operator is liable for
registration under section 22(1)
of the CGST Act.
All the provisions of the CGST Act shall apply to such ECO as if he is the supplier
liable for paying the tax in relation to the supply of above services.
Question 3, 4
7.Reverse Charge Mechanism (Section 9(3) & 9(4)) of CGST ACT
Reverse charge means

However, in case of the liability to pay tax is
certain notified on the recipient of
Generally, the supplier supplies, the liability supply of goods or
of goods or services is may be cast on the services instead of the
liable to pay GST. recipient under the supplier of such goods
reverse charge or services in respect of
mechanism. notified categories of
supply.

Two types of Reverse charge
Section 9(3) Section 9(4)

(Appl. whether or not (Appl. if supplier is
supplier is registered or Unregistered & recipient
unregistered) is registered)
Applicable from Before 01.04.2019 w.e.f.01.04.2019

01/07/2017 to as of now
date
Applicable only
01.07.2017 to w.e.f.13/10/2017 for Real Estate
(Notification.13/2017) – Service sector
12.10.2017 to 31.03.2019
(Notification.14/2017) – Goods
(Refer Chapter 25)
If aggregate Not applicable

value of
taxable
Supplies in a
day
exceedsRs.5000

Section 9(3) - Supply of services taxable under reverse charge (i.e, Tax payable by Recipient)(Notification. 13/2017 CT (R) (updated))
Type of Service Supplier of Service Recipient of Service

1. Transportation of Goods through GTA GTA in respect of transportation of goods by where the person liable to pay freight is –
road who has not paid GST @12 % (a) any registered factory;
(b) any registered society;
(Detail clarification given in Note 1 below the (c) any co-operative society;
table)
(d) any registered dealer (except for CG,SG,LA regd for
the purpose of GST TDS)
(e) any body corporate
(f) any partnership firm (whether or not Regd)
(g) any casual taxable person
2. Legal Services Any Advocate or Firm of Advocates Any business entity located in the taxable territory.
3. Director of a company A director of a company or body corporate Company or the body corporate.
4. Sponsorship Service Any Person Sponsors being any body corporate or partnership firm
5. Security Services Any person other than a body corporate A registered person, located in the taxable territory
Exception :
a) service provided by CG,SG,LA, GA if they are
registered only for the purpose of GST TDS
b) a registered person paying tax under section 10 of
the said Act
6. Renting of Motor Vehicle a) Other than Body Corporate Any body corporate
(w.e.f. 01/10/2019) b) Charges GST @ 5%
c) cost of fuel is included in the
consideration
a) Actually if Supplier charges GST @ 12% (with full ITC to supplier) then concept of RCM is not applicable.
b) It is to be noted that in any case i.e., 5% or 12% , in the hands of Recipient it is a Blocked credit u/s 17(5) (Refer pg. )

7. Renting of Immovable Property Government or local authority Any person registered under GST Act
8. Any service other than Government or local authority Any person registered under GST Act
a) Speed Post, Express parcel Post, Postal
Life Insurance or Agency services
b) Service in relation to Aircraft or Vessel
inside or outside the precints of Port or
Air port
c) Transportation of Goods/Passengers
9. Transfer of
a) Development Rights or Land lord Promotor (i.e.,Builder)
b) Floor Space Index or
c) Long term lease of land for 30 yrs or more (Note : However taxability is restricted to unsold flats held by promoter upon completion of construction)
Insurance agent. Insurance Companies
10. Agency Services
Recovery agent Banks or NBFC
11. Arbitral Tribunal Arbitral Tribunal Any business entity located in the taxable territory
A music composer, photographer, artist or Music company, producer or the like
Transfer or permitting the use or enjoyment the like relating to original dramatic, musical
12. of a copyright covered Section 13(1)(a)of the or artistic works
Copyright Act
Relating to original literary works Publisher (Note 2- Exception)
13. Policy making Overseeing Committee members RBI
Individual Direct Selling Agents (DSAs)
14. Finding potential customers
Business facilitator(BF) Banks/ NBFC
15. Representative services Services provided by an agent of business To Business correspondent
correspondent(BC) (w.e.f.01/01/2019)
16. Lending of Securities under SEBI Scheme Any person who charges lending Fee Borrower i.e. a person who borrows the securities under
(w.e.f.01/10/2019 IGST shall only be paid) the Scheme through an approved intermediary of SEBI

Note 1: Clarification regarding GST ON GTA SERVICES
If GTA opts to pay Tax @ 12%(6%+6%) If GTA opts Tax @ 5% (2.5% +2.5%)
GTA can avail full ITC on GST paid on Any GTA cannot avail ITC on any Input, Input
Input, Input services & Capital Goods service & Capital goods
For services provided to For services provided to
Unregistered Registered persons Persons given in Other unregistered

persons under GST under GST pt.1 in table persons
Exempt Tax payable and entire tax is payable by GTA RCM is applicable Exempt
Note2: Forward charge applies on Author
Where, -
(i) The author has taken registration under GST Act, and filed a declaration with the jurisdictional CGST or SGST commissioner, as the case may be, that
he exercises the option to pay central tax on the service under forward charge and 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, as prescribed in Annexure II on the invoice issued by him in Form GST Inv-I to the Publisher.

Section 9(3)- Notification 04/2017- In case of goods
S. Tariffitem,sub- Description ofsupply Supplier Recipient

No. heading,headin ofGoods ofgoods ofsupply
g or Chapter
(1) (2) (3) (4) (5)

1. 0801 Cashewnuts, notshelled Agriculturist Anyregisteredperson
or peeled
2. 1404 90 10 Bidi Agriculturist Anyregisteredperson

wrapperleav
es (tendu)
3. 2401 Tobaccoleaves Agriculturist Anyregisteredperson
4. 5004 to 5006 Silkyarn Any personwho Anyregisteredperson
manufacturessilk
yarnfromrawsilkorsi
lkwormcocoonsfor
supply ofsilkyarn
5. 5201 Raw cotton Agriculturist Any registered

person
6. - Supplyoflottery. State Lotterydistributorors
Government,Union ellingagent.
Territory orany
localauth
ority
7. Any chapter Used vehicles, seized and Central Any registered
confiscated goods, old Government, State person
and used goods, waste Government, Union (If unregistered then
and scrap territory or a local Govt department
authority should get registered
and pay tax)
8. Any chapter Priority Sector Lending Any registered Any registered

Certificate person person

8.Composition Levy (Section 10 of CGST Act) Question 5-13
Section 10 Notification 2/2019 CT(R) dt. 07/03/2019
Aggregate Turnover during last year ≤ 1.5 Crores Aggregate Turnover during last year ≤ 50 Lakhs
Then, current year eligible for scheme upto 1.5 Crores
Then, current year eligible for scheme upto 50 Lakhs
SN Particulars CGST SGST % On

Particulars CGST SGST % On
1 Manufacturer 0.5% 0.5% Total Turnover
Any supply other than in 3% 3% Total
2 Hotels and 2.5% 2.5% Taxable Turnover
section 10 Turnover
Restaurants
(i.e., other than 1,2,3)
3 Traders 0.5% 0.5% Taxable Turnover
Eligible service Turnover for 1 & 3 Eligible service Turnover = No Limit

But goods + Services
10% of Total Turnover of P.Y But goods + Services Turnover should not
(or) Total Turnover should exceed 50 Lakhs
5 lakhs not exceed 1.5 Crores
Tax Rate on Service Turnover = above composition rates only
Tax Rate on Service Turnover = Above composition rates only (i.e., 6%)
(i.e,1% ,5%)
Assessee having unit in Special Category States = Limit reduced to Assessee having unit in Special Category States = Same of Limit 50
75 lakhs lakhs
Special Category States list is Arunachal Pradesh, Mizoram, Uttarakhand, Nagaland, Manipur, Sikkim, Meghalaya, Tripura

Common Points
1) Issue Bill of supply in place of Tax Invoice

2) Should not avail ITC & Should not collect tax from consumers
3) Should not Supply Goods/Services provided services in Negative list
4) Should not make any Inter State Outward supplies(There is no restriction on Composition Supplier to procure goods from inter-State suppliers)
5) Casual taxable person or Non resident taxable person are Ineligible to opt this scheme
6) Should not supply services through ECO who is required to collect TCS(Exception: Hotels & Restaurants)
7) Manufactures of Ice cream, Pan masala, Tobacco, Aerated Waters are Ineligible to opt this scheme
(It is to be noted that Traders of above items are eligible for Composition scheme)
8) More than one registration , then all units should opt this scheme (In same state or difference states)
9) The registered person shall mention thefollowing wordsat the top of the bill of supply, namely: -
a) In case of Section 10 : Ccomposition taxable person, not eligible to collect tax on supplies
b) In case of notn 2/2019 : ‘Taxable personpaying tax in terms ofnotn No. 2/2019-CT(Rate)dated 07.03.2019, not eligible to collect tax on supplies’
10) Mention the words “composition taxable person” on every notice or signboard displayed at a prominent place at his PPOB and at every APOB
11) They should also pay tax if any Inward Supply is covered in RCM u/s 9(3)
12) ‘Aggregate turnover’ for the previous year
Includes Excludes
 Taxable supplies --CGST
 Exempt supplies (except interest on --SGST
loans/deposit/advances) --UTGST
 Exports --IGST
 Inter-State supplies --Cess
of persons having the same PAN be computed on all India basis. --Value of inward supplies on which tax is payable under RCM

13) Intimation of opting for composition levy [Rules 3 & 4]
New Registration: Already registration person under

In Registration form GST REG-01 itself Regular scheme
File an So it is clear that The option to pay After conversion, It is to be noted

intimationin GST Composition tax under assessee should that a person
CMP-02 on the scheme cannot be composition levy file GST ITC-03 opting composition
GST Portal,prior to opted in the shall be effective within 60 days scheme can convert
the middle of year. It from the from the to Regular scheme
commencement has to be opted beginning of the commencement of at any time during
ofthe FYfor which for Entire year FY. the relevant FY the year. After
said option is where intimation regarding reversal conversion, file ITC
exercised. to be given before of ITC on Stock in -01 within 30 days
commencement of hand at beginning regarding ITC to be
year of the year availed on Stock in
hand at time of
conversion
14) Penalty u/s 73 or 74 as the case may be shall be levied on Irregular availment of Composition scheme
15)
Quarterly filing of Returns Yearly Filing
Furnish GST CMP-08 for every quarter containing the Furnish GSTR-4 yearly on or before the 30 th
details of Tax payment by 18 th of the month day of April following the end of such
succeeding such quarter financial year

9.IGST- REVERSE CHARGE on IMPORT OF SEVICES
Import of the following services shall be taxable under RCM

S.N Category of supply of Service Supplier of service Recipient of Service
17. Any service other than OIDAR Located in a non-taxable territory Any person located in the taxable territory
Exception :
a) Individual
b) CG/SG/UT for
c) Government Entity Non business
d) Government Authority use
e) Charitable trust u/s 12AA
If above persons utilises services for Business purpose, then
Taxable under RCM
Transportation of goods by a
vessel from outside India up to Importer
18. Located in a non-taxable territory
the customs station of
clearance in India

10.OIDAR Services [SECTION 14 OF THE IGST ACT]
Section 2(17) of the IGST Act defines OIDAR as services whose delivery is mediated by information technology over the internet or an electronic
network and the nature of which renders their supply essentially automated involving minimal human intervention.
These include electronic services such as:
Advertising on the internet, Eg: - Mobile apps advertisements, YouTube Advertisements, FACEBOOK etc..,
Providing cloud services, Eg: Refer Image
Provision of e-books, movie, music, software and other intangibles through telecommunication networks or internet,
Eg: You tube Premium

Providing data or information, retrievable or otherwise, to any person in electronic form through a computer network,
Eg: Telugu Matrimony
Online supplies of digital content (movies, television shows, music and the like) Eg: Amazon Prime, Hot star Premium
Online gaming, Eg: Rummy circle
A B
Services whose delivery is Services are automated and

mediated by information impossible to ensure in the
technology over the absence of information OIDAR Services
internet / electronic technology
network

SERVIECS BY SUPPLIER OF OIDAR
If supplier providing If supplier providing

ODIAR service located ODIAR service located
in India outside India
No special concept
If service receipt is a business entity If services receipt

Supplier is liable to is other than
pay GST business entity
Tax payable by
(i.e, Non taxable
online recipient
Under forward Business Entity i.e., B2C
charge in case of
B2B or B2C services Under RCM (B2B) OIDAR located outside
India should get
simplified registration
in REG-10 and pay
taxes in GSTR-5A
Registration
Person liable to pay tax is the ECO

If the OIDAR is located in taxable
territory
Person liable to pay tax is the person

If the OIDAR does not have physical representing the ECO
presence in the taxable territory
Person liable to pay tax is the person

appointed by the ECO for the
If the OIDAR has neither the physical presence nor
purpose of paying the tax
any representative in the taxable territory

CH.SUDHEER C.A, C.M.A Chapter 4 Service Wise Clarification
SERVICE WISE
Chapter 4 CLARIFICATION
1. Charitable and religious activity related services

2. Agriculture related services
3. Educational institution
4. Health care services
5. Services by Govt, Local Authority (entry no.6 notification
12/2017 central tax (rate)
6. Construction services
7. Passenger transportation services
8. Goods Transportation Services
9. Banking and financial services
10. Life insurance business services
11. Services provided by specified bodies
TOPICS 12. General insurance business services
13. Pension schemes
14. Business Facilitator/Correspondent
15. Services provided to Government
16. Leasing Services
17. Legal Services
18. Sponsorship of sports events
19. Performance by an artist
20. Right to Admission to various events
21. Services by an Unincorporated body or a Non- profit entity
22. Renting of Immovable properties
23. Renting of Motor Vehicles
24. Women’s FIFA World Cup
25. Research & Development
26. Other exempt services

Question 1, 2
1. CHARITABLE AND RELIGIOUS ACTIVITY
RELATED SERVICES
1 Services by an entity registered u/s 12AA of the Income-tax Act, 1961 by way of charitable
activities.
In order to claim exemption under Entry 1 of the Notification, following two conditions must
be satisfied
The entity is registered under The entity carries out one or

section 12AA of the more of the specified
Incometax Act, 1961, and charitable activities.
Meaning of term ‘charitable activities’ Activities relating to-
(i) PUBLIC (ii) ADVANCEMENT (iii) ADVANCEMENT (iv)

HEALTHby way of- OF RELIGION, OF EDUCATIONAL PRESERVATION OF
spirituality or yoga; PROGRAMMES/SKILL ENVIRONMENTincl
DEVELOPMENTrelating uding watershed,
(A) Care or counseling of to,-
forests & wildlife.
(I) Terminally ill persons or persons
with severe physical or mental
disability;
(II) Persons afflicted with HIV or AIDS;

(A) (B) (C) (D) Persons
(III) Persons addicted to a dependence- Abandoned Physically or Prisoners; over the
forming substance such as narcotics
, orphaned mentally or age of 65
drugs or alcohol; or
or abused and years
(B) Public awareness of preventive homeless traumatized residing in
health, family planning or prevention children; persons a rural area
of HIV infection;

Liability to pay GST
There could be many services provided by charitable and religious trusts - registered under section
12AA of the Income-tax Act, 1961 - which are not covered by the definition of charitable activities
and hence, such services would attract GST
For instance, grant of advertising rights to a person on the premises of the charitable/religious
trust or on publications of the trust, or granting admission to events, functions, celebrations,
shows against admission tickets or fee etc. would attract GST.
Arranging yoga and meditation camp by charitable trusts
Residential programmes or camps where the fee charged includes cost of lodging and boarding
shall be exempt as long as the primary and predominant activity, objective and purpose of such
residential programmes or camps is advancement of religion, spirituality or yoga.
However, if charitable or religious trusts merely or primarily provide accommodation or serve

food and drinks against consideration in any form including donation, such activities will be
taxable. Similarly, activities such as holding of fitness camps or classes such as those in aerobics,
dance, music etc. will be taxable.
Services by an old age home run by:
9D Central Government, State Government or

an entity registered under section 12AA of the Income-tax Act, 1961
to its residents (aged 60 years or more) against consideration upto ₹ 25,000 per month per
member, provided that the consideration charged is inclusive of charges for boarding, lodging
and maintenance.
Services by a person by way of-
(a) conduct of any religious ceremony;
(b) renting of precincts of a religious place meant for general public by charitable or religious
trust under section 12AA / 10(23C)(v) / 10(23BBA) of Income Tax act
Exception to point (b)
However, nothing contained in entry (b) of this exemption shall apply to-
13
(i) Renting of (ii) Renting of premises, (iii) Renting of shops or

rooms where community halls, other spaces for business or
charges are ` kalyanmandapam or open area, commerce where charges
1,000 or more per and the like where charges are
are 10,000 or more p.m
day; 10,000 or more per day;

Religious ceremonies
are life-cycle rituals
including special
Religious place means General public means The exemption is religious poojas
a place which is the body of people at applicable to conducted in terms of
primarily meant for large sufficiently renting of precincts religious texts by a
conduct of prayers or defined by some of religious places person so authorized
worship pertaining to a common quality of of all religions. by such religious texts.
religion, meditation, or public or impersonal
Occasions like birth,
spirituality. nature
marriage, and death
involve elaborate
religious ceremonies.
60 Services by a specified organization in respect of a religious pilgrimagefacilitated

pilgrimage by the
Government of India, under bilateral arrangement.
Religious yatras or pilgrimage
Religious Yatras/pilgrimage Only such services of religious The term specified

organised by any charitable or pilgrimage as are provided by organization means
religious trust are not exempt. specified organization in - Kumaon Mandal Vikas Nigam
Further, services of respect of a religious Limited (KMVN), a Government
transportation of passengers pilgrimage facilitated by the of Uttarakhand Undertaking;
for a pilgrimage by the Government of India (GoI), or
charitable trust are not exempt under bilateral arrangement,
from GST. are exempt from GST. - State Haj Committee
including Joint State
Committee
Services by way of training or coaching in recreational activities relating to-

to
(a) Arts or culture, or
80 (b) Sports
(c) By charitable entitiesregistered
registered under section 12AA of the Income
Income-tax Act.
Recreational activities mean all forms of dance, music, painting, sculpture making, theatre and
sports etc..,

Services provided
to charitable or
GST on services religious trusts are
provided TO not outside the
charitable trusts ambit of GST (i.e.,
Taxable)
Unless specifically
exempted, all goods and
services supplied to
charitable or religious
trusts are leviable to GST.
2. AGRICULTURE RELATED SERVICES Question 3
Services relating to cultivation of plants and rearing of all life forms of animals,
except the rearing of horses, for food, fibre, fuel, raw material or other similar
products or agricultural produce by way ofof—
(a)agricultural
agricultural operations directly related to production of any agricultural
produce including cultivation, harvesting, threshing, plant protection or testing;
(b) supply of farm labour

labour;
(c)processes
processes car
carried out at an agricultural farmincluding
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 the essential characterist
characteristics
ics of agricultural produce but make it only
54 marketable for the primary market;
(d)renting
renting or leasing of agro machinery or vacant land
landwith
with or without a structure
incidental to its use;
(e)loading,
loading, unloading, packing, storage or warehousing
warehousingof
of agricultural produce;
p
(f)agricultural
agricultural extension services
services;
(g) Services
ervices by any Agricultural Produce Marketing Committeeor
Committee Board or
services provided by a commission agent for sale or purchase of agricultural
produce.

Entry 54 include activities like breeding of fish Further, the term ‘agricultural produce’ means
(pisciculture), rearing of silk worms (sericulture), any produce out of cultivation of plants and
cultivation of ornamental flowers (floriculture) rearing of all life forms of animals, except the
and horticulture, forestry, etc. rearing of horses
Entry 54
Thus, in terms of the definition of agricultural (b) Process which makes agricultural produce
produce, following processes are liable to GST:- marketable in the retail market:
market The processes
(a) Process which alters the essential of grinding, sterilizing, extraction packaging in
characteristics of the agricultural produce: For retail packs of agricultural products, which make
instance, potato chips or tomato ketchup are the agricultural products marketable in retail
manufactured through processes which alter the market, would NOT be covered in this entry. Only
essential characteristic of farm produce such processes are covered in this entry which
(potatoes and tomatoes in this case) makes agricultural produce marketable in the
primary market.
Warehousing of agriculture produce

Item (e) of the entry exempts loading, unloading, packing, storage or warehousing of agricultural
produce. In this regard, following are not agricultural Produce & warehousing of following items
were liable to GST
Processed Tea
and coffee
Jaggery
Pulses
(dehusked or
split)
processed
dry fruits
processed
cashew nuts
However, whole pulse grains such as whole gram, rajma etc. are covered in the definition of
agricultural produce.

Custom milling of paddy into rice
Milling of paddy into rice also changes its essential

characteristics. Hence it is chargeable to GST
Classification of leguminous vegetables when subject to mild heat

treatment(parching)
Leguminous vegetables which Such goods if branded and In all other cases such goods
are subjected to mere heat packed in a unit container would be exempted from GST
treatment for removing would attract GST at the rate
moisture, or for softening and of 5%
puffing or removing the skin,
and not subjecting to any
other processing or addition
of any other ingredients such
as salt and oil.
Entry No. Description of services
24 Services by way of loading, unloading, packing, storage or warehousing of rice.
24A Services by way of warehousing of minor forest produce.
24B Services by way of storage or warehousing of cereals, pulses, fruits, nuts and vegetables,
spices, copra, sugarcane, jaggery, raw vegetable fibres such as cotton, flax, jute etc.,
indigo, unmanufactured tobacco, betel leaves, tendu leaves, coffee and tea
53A Services by way of fumigation in a warehouse of agricultural produce

produce.
55 Carrying out an intermediate production process as job work in relation to cultivation of

plants and rearing of all life forms of animals, except th thee rearing of horses, for food,
fibre, fuel, raw material or other similar products or agricultural produce.
55A Services by way of artificial insemination of livestock (other than horses).
57 Services by way of pre

pre-conditioning, pre- cooling, ripening,waxing,
,waxing, retail packing, labellingof
labelling
fruits and vegetables which donot change or alter the essential characteristics of the said fruits
orvegetables.

Question 4-8
3. EDUCATIONAL INSTITUTION
Taxability Input services (Entry 66(b))
Taxability Output services (Entry 66(a))
I. Transport of Students, Faculty, Staff
Educational All are exempt

For (a)-exempt II. Catering (incl. midday meals scheme)
Institute Under Entry 66(a)
III. Security/Cleaning/House Keeping Input service Output service
For (a) (b)

(c)exempt IV.Conduct of examination a) Preschool & Higher Secondary
(or) Equal
a) School Fee
For (b)-exempt V. Online Education Journals b) As part of curriculum b) Bus Fee
Recognized by Indian law c) Application Fee
c) Approved Vocational courses d) Tuition Fee
e) Entrance Fee
Taxable for all VI. Any other services -MESC(Modular Employable Skill Course)
f) Exam Fee
- ITI / ITC(Industrial Training Institute / Center) g) Hostel Fee
Note h) Admission Fee
i) Fines, Penalties
j) Uniform Fee
Output service by IIM 2 years full time post graduation – Exempt k) Books fees
(Entry 67) Executive Development programme- Taxable l) Co circular activities Fee
5 years Integrated programme- Exempt
(Indian Institute of Management) Fellow programme in Management- Exempt Exemptions for Skill Development Services:
Note:Training of courses recognized by foreign law is Taxable Services under NSDC/ DDUGKY (Entry 69,70,71)

EDUCATION SERVICES- OTHER SPECIAL POINTS
Composite and mixed supply in so far

as education is concerned
 Boarding schools– Composite supply- Exempt

 Course in a college leads to dual qualification only one of which is recognized by law-
Mixed Supply- highest rate of tax to be paid on entire value
 However, incidental auxiliary courses provided by way of hobby classes or extra-
curricular activities in furtherance of overall well-beingwill be an example of naturally
bundled course, and therefore treated as composite supply.
One relevant consideration in such cases will be the amount of extra billing being done for
the unrecognized component viz-a-viz the recognized course. If extra billing is being done,
it may be a case of artificial bundling of two different supplies, not supplied together in the
ordinary course of business, and therefore will be treated as a mixed supply, attracting the
rate of the higher taxed component for the entire consideration.
Supply of
food in a
mess or
canteen
If the catering services is one of the services provided by an educational institution to its
students, faculty and staff and the said educational institution is covered by the definition of
‘educational institution’ as given above, then the same is exempt
If the catering services, i.e., supply of food or drink in a mess or canteen, is provided by anyone
other than the educational institution, i.e. the institution outsources the catering activity to an
outside contractor, then it is a supply of service to the concerned educational institution by such
outside caterer and attracts GST
Note:It may be noted that said services when provided to an educational institution providing
pre-school education or education up to higher secondary school or equivalent are exempt from
tax.
Fees charged from prospective employers (i.e., Campus placement Fee)
Educational institutes such as IITs, IIMs charge a fee from prospective employers like corporate
houses/MNCs, who come to the institutes for recruiting candidates through campus interviews
in relation to campus recruitments. Such services shall also be liable to tax

4. HEALTH CARE SERVICES Question 9
74 Services by way of-

a. Health
ealth care services by a clinical establishment, an authorized medical practitioner or para
para-
medics;
b. Services
ervices provided by way of transportation of a patient in an ambulance, other than those
specified in (a) above.
Health care services
Means any service by way Includes services by way Does

oes not include hair
of diagnosis or treatment of transportation of the transplant or cosmetic or
or care for illness, injury, patient to and from a plastic surgery,
surgery except when
deformity, abnormality or clinical establishment, undertaken to restore or to
pregnancy in any but reconstruct anatomy or
recognized system functions of body affected due
ofmedicinesin India to congenital defects,
developmental abnormalities,
injury or trauma
As it is apparent from the definition of health care services, only services in recognized
re systems
ofmedicines in Indiaare
are exempt under this entry. Following systems of medicines are the recognized
systems of medicines in India:-
Any other
Allopathy system of
medicine that
Yoga may be
recognized by
C. Govt.
Recognized
Naturopathy systems Unani
Siddha
Ayurveda
Homeopat
hy

Rent of rooms • Rent of rooms provided to in-patients

patients in hospitals
provided to in- is exempt [Circular No. 27/01/2018
2018 GST dated
patients 04.01.2018].
Food supplied to the patients
Food supplied to the in- Other supplies of food by a

patients as advised by the hospital to patients (not
doctor/nutritionists is a admitted) or their attendants
part of composite supply or visitors are taxable
of healthcare and not [Circular No. 32/06/2018 GST
separately taxable. dated 12.02.2018].
Services other than health care services in clinical establishment’s premises :Supply of services
other than healthcare services such as renting of shops, auditoriums in the premises of the clinical
establishment, display of advertisements etc. will be subject to GST.
Entry Description of services

No.
46 Services by a veterinary clinic in relation to health care of animals or birds.
73 Services provided by the cord blood banks by way of preservation of stem cells or any
other service in relation to such preservation.
74A Services provided by rehabilitation professionals recognized under the Rehabilitation
Council of India Act, 1992 (34 of 1992) at
75 Services provided by operators of the common bio-medicalmedical waste treatment facility
to a clinical establishment by way of trtreatment or disposal of bio--medical waste or the
processes incidental thereto.

Question 10,11
5. SERVICES BY GOVT, LOCAL AUTHORITY (Entry No.6 Notification 12/2017 Central Tax (Rate)
B C E
A D
Transportation of Any other services

Department Services to To CG/SG/LA
Goods & Passenger’s provided
of Posts Vessel/Aircraft
Inside/Outside Special concept Exempt

a)Speed post Other To Business Entity To other than
b)Express Parcel services (Refer further pages) Business Entity
Post c)Postal But entry No.
life Ins. Precincts of
d)Agency Services Airport (or) Port 6(b), & 6(c) are
Exempt Renting of immovable Other services to Exempt Taxable
property Business Entity
Eg: Repairs &
Maintenance of
To Refer Chart in next page
To Local To Vessel, landing &
CG Rent 5000 p.a Rent > 5000 p.a
Authority Others parking charges Etc.
SG
UT
Taxable (f/w) Exempt
To Registered To
Exempt Taxable (f/w) Business Entity unregisteredBusi
Taxable (RCM) Taxable (f/w)

GOVERNMENT PROVIDING OTHER SERVICES TO BUSINESS ENTITY
If Business Entity T.O

If the T.O exceed
does not exceed
registration limit
registration limit
Exempt(En If service value has not If the service value

try No.7) exceeded ₹5000/- exceeded ₹5000/-
The following services Any other services to

were exempt business entities
Entry no.
Taxableun
47,61,62,63,65,34A,9C
der RCM
Exempt

No.
4 Services by governmental authority by way of any activity in relation to any
functionentrusted to a municipalityunder article 243 W of the Constitution are exempt.
5 Services by a governmental authorityby way of any activity in relation to any
functionentrusted to a Panchayatunder article 243G of the Constitution.
Services by the Central Government, State Government, Union territory or local authority
excluding the following services—
6 (a) Services by the Department of Postsby way of speed post, express parcel post, life
insurance, and agency services provided to a person other than the Central Government,
State Government, Union territory;
(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.
7 Services provided by the Central Government, State Government, Union territory or local
authority to a business entity with an aggregate turnover of up to ` 20 lakh(` 10 lakh in
case of a Special Category States) in the preceding FY.

Explanation - For the purposes of this entry, it is hereby clarified that the provisions of this
entry shall not be applicable to following services:-
(i) Item (a), (b) and (c) of Entry 6 above.
(ii) Services by way of renting of immovable property.
Services provided by the Central Government, State Government, Union territory or local
authority to another Central Government, State Government, Union territory or local
8 authority.
However, nothing contained in this entry shall apply to services referred in item (a), (b) and
(c) of Entry 6 above.
Services provided by Central Government, State Government, Union territory or a local
authority where the consideration for such services does not exceed ` 5,000.
However, nothing contained in this entry shall apply to services referred in item (a), (b) and
9 (c) of Entry 6 above
Further, in case where continuous supply of service* is provided by the Central
Government, State Government, Union territory or a local authority, the exemption shall
apply only where the consideration charged for such service does not exceed ` 5,000 in
aFY.*as defined in section 2(33) of the CGST Act, 2017
Supply of service by a Government Entity to Central Government, State Government, Union
9C territory, local authority or any person specified by Central Government, State Government,
Union territory or local authority against consideration received from
Central Government, State Government, Union territory or local authority, in the form of
grants.
Services by:
an old age homerun by:
Central Government, State Government or
9D An entity registered under section 12AA of the Income-tax Act, 1961
to its residents (aged 60 years or more)
against consideration upto ` 25,000 per month per member, provided that the
consideration charged is inclusive of charges for boarding, lodging and maintenance.
34A 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.
authority by way of-
(a) registration required under any law for the time being in force;
(b) testing, calibration, safety check or certification relating to protection or safety of
workers, consumers or public at large, including fire license, required under any law for the
time being in force.
authority by way of issuance of passport, visa, driving license, birth certificate or death
certificate.
62 authority by way of tolerating nonperformance of a contract for which consideration in
the form of fines or liquidated damages is payableto the Central Government, State
Government, Union territory or local authority under such contract.
63 authority by way of assignment of right to use natural resources to an individual farmer for

cultivation of plants and rearing of all life forms of animals, except the rearing of horses, for
food, fibre, fuel, raw material or other similar products.
Services provided by the Central Government, State Government, Union territory by way of
65 deputing officers after office hours or on holidays for inspection or container stuffingor
such other duties in relation to import export cargo on payment of Merchant Overtime
charges.
Services supplied by a State Government to Excess Royalty Collection Contractor (ERCC) by
65B way of assigning the right to collect royalty on behalf of the State Government on the
mineral dispatched by the mining lease holders.
Services provided by Police/security agencies of Government to PSUs/corporate

entities/sports events held by private entities
 Services provided by Police or security agencies of

Government to PSU/private business entities are
not exempt from GST.
 Such services are taxable supplies and the

recipients are required to pay the tax under
reverse charge mechanism on the amount
of consideration paid to Government for
such supply of services
Services provided by the Department of Posts
 The services by way of speed post, express parcel post, and life insurance, provided to a person
other than the Government or Union territory are not exempt. The Department of Posts also
provides services like distribution of mutual funds, bonds, passport applications, collection of
telephone and electricity bills on commission basis. These services are in the nature of
intermediary and generally called agency services.
 In these services, the Department of Posts is liable to pay taxwithout application of reverse
charge.
 However, the following services provided by the Department of Posts are not liable to tax:
(a) Basic mail servicesknown as postal services such as post card, inland letter, book post,
registeredpost provided exclusively by the Department of Posts to meet the universal postal
obligations.
(b) Transfer of money through money orders, operation of savings accounts, issue of postal
orders, pension payments and other such services.

6. CONSTRUCTION SERVICES

Services provided by way of pure labour contractsof construction, erection,
10 commissioning, installation, completion, fitting out, repair, maintenance, renovation,
or alteration 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 or PradhanMantriAwasYojana.
10A Services supplied by Electricity Distribution Utilities by way of construction, erection,
commissioning, or installation of infrastructure for extending electricity distribution
network upto the tube well of the farmer or agriculturalist for agricultural use.
11 Services by way of pure labour contractsof construction, erection, commissioning, or
installation of original works pertaining to a single residential unit otherwise than as a
part of a residential complex.
Question 12
7. PASSENGER TRANSPORTATION SERVICES
TRANSPORT OF PASSENGERS
AIRWAYS
Outside India to India to Outside Within India

India India
Here POS is Place where

passenger embarks- Which is
located outside India
Taxable
Not Taxable
However, if a passenger embarks (or)
Services provided to the Central Government, by disembarks at Airport located in North
way of transport of passengers with or without eastern states (Arunachal Pradesh,
accompanied belongings, by air, embarking from Assam, Manipur, Meghalaya, Mizoram,
or terminating at a RCS (Regional
Nagaland, Sikkim, or Tripura or at
16 ConnectivityScheme) airport, against
consideration in the form of viability gap funding Bagdogra located in West Bengal)
for a period of 3 years from the date of
commencement of operations of the RCS airport Exempt
as notified by the Ministry of Civil Aviation.

RAILWAYS
A.C (First class 2 tier & 3 tier) Non-A.C
Sleeper class, General class

Taxable
Non-Taxable
Note: -However, Transportation through metro, Tram way, Mono Rail is EXEMPT
ROADWAYS
Stage carriage Contract carriage Metered Cab’s (or) Radio

Auto Rickshaw’s Taxies
Taxable
A.C Non-A.C Not for Tourism Exempted
Tourism both A.C &
Purpose / Travels Non-A.C
Taxable Non- Including E-

Taxable Taxable Rickshaw’s Booking
A.C Non-A.C through
GPSNetwork
E.g. RTC Taxable Exempted

Bus

WATERWAYS
India to outside Outside India to Within India

India India
Place where passenger Exempt

embarks i.e., India  Inland Tourism
waterways Purpose
Place of supply outside
 Public
Taxable India transport
other
Taxable
Because place where transport for
passenger embarks is tourism
POS
Exempt
8. GOODS TRANSPORTATION SERVICES
AIRWAYS
Outside India to India India to Outside India Within India
Here POS is Destination, Exempt upto

Taxable
i.e., India 30.09.2021
Amendment
Since place of supply is Generally Entry No.19

in India taxable Exempt
RAILWAYS Question 13
Item’s specified in Entry No. 20 All Other Items
Exempt Taxable

ROADWAYS
Question 14-16
Transportation of Goods by Own I.e. Transportation facility Transportation Through

vehicle/Leased vehicle is arranged by supplier
E.g. Mr. A sells goods valuing ₹50,000 to GTA Courier All other
Mr. B, for the purpose Of Agencies mode
transportation. A has charged ₹10,000
addition for which a separate Invoice
has been issued. How much tax liability Auto,
Items specified in All Other Taxable
should arise if tax rate on goods is 18%, Rickshaw
transportation service is 5%? entry No. 21 Items
Exempt
As per sec 15, all the Incidental Exempt Taxable
Expenses shall be included in
theValue of supply Services provided by a goods transport agency, by way of transport in a goods carriage of –
(a) agricultural produce;
(b) goods, where consideration charged for the transportation of goods on a consignment transported in a single carriage
Hence, even though separate does not exceed `1,500;
(c) goods, where consideration charged for transportation of all such goods for a single consignee does not exceed ` 750;
Invoice has been raised on 21 (d) milk, salt and food grain including flour, pulses and rice;
serviceGST is leviable on GST (e) organic manure;
@18% on₹50,000+₹10,000 (f) newspaper or magazines registered with the Registrar of Newspapers;
(g) relief materials meant for victims of natural or man-made disasters, calamities, accidents or mishap; or defence or
military equipments.
21A Services by GTA to Unregistered persons is Exempt

WATERWAYS
Outside India to India to Outside Within India

India India
Taxable Exempt upto

By Inland Private
30.09.2021
water ways ships
But under RCM Amendment
Exempt
Items specified All other
Importer is in Entry 20 items
liability to pay
GST
Exempt Taxable
But services provided to

unregistered Persons
Exempt

Who is a GTA – Goods Transport Agency?
Let us understand the meaning of Goods Transport agency (GTA). Goods transport agency has been
defined in the Notification to mean any person who:
Provides service in relation to transport of goods by road and

Issues consignment note, by whatever name called.
Thus, it can be seen that issuance of a consignment note is the sine-quanonfor a supplier of
service to be considered as a GTA.
If such a consignment note is not issued by the transporter, the service provider will not come
within the ambit of GTA.
If a consignment note is issued, it indicates that the lien on the goods has been transferred (to
the transporter) and the transporter becomes responsible for the goods till its safe delivery to the
consignee.
Individual truck/tempo operators who do not issue any consignment note are not covered within
the meaning of the term GTA. As a result, the services provided by such individual transporters
who do not issue a consignment note will be covered by the entry at Entry 18 of Notification,
which are exempt from GST
E.g
Hari Prasad owns a truck and operates it himself. He carries the goods booked for his truck
without issuance of consignment note. Services provided by Hari Prasad by way of transportation
of goods by road are exempt under Entry 18 of the Notification.
Consignment note
Means a document, issued by a GTA against the receipt of

goods for the purpose of transport of goods by road in a
goods carriage, which is serially numbered, and contains:

• The name of the consignor and consignee,
• Registration number of the goods carriage in which the goods are transported,
• Details of the goods transported,
• Details of the place of origin and destination,
• Gross weight of the consignment;
• GSTIN of the person liable for paying tax whether consignor, consignee or GTA
• Other particulars as prescribed for a tax invoice
Significance of the term ‘in relation to’ in the definition of GTA
The use of the phrase ‘in It includes not only the actual
relation to’ has extended the transportation of goods, but
scope of the definition of GTA. also various intermediary and
ancillary services, such as,
loading/ unloading, packing/
unpacking, transshipment and
temporary warehousing, which
are provided in the course of
transport of goods by road.

Question 17, 18
9. BANKING AND FINANCIAL SERVICES
 All types of interests are Exempted except credit card late payment interest
 All charges are liable from GST, except bill discounting charges
TAXABILITY OF INTER STATE OF FOREIGN CURRENCY
Foreign Exchange Transactions
Bank to Bank Bank to Dealer Dealer to Bank Dealer to Dealer Bank toCustomer DealertoCustomer
Exempt Taxable
Here Dealer means FOREIGN EXCHANGE DEALER regd under FEMA For Value of supply , Refer Pg.7.13

26 Services by the Reserve Bank of India.
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 currencyamongst banks or authorized dealers of

foreign exchange or amongst banks and such dealers.
27A Services provided by a banking company to Basic Saving Bank Deposit (BSBD) account
holders under PradhanMantri Jan DhanYojana (PMJDY).
34 Services by an acquiring bank, to any person in relation to settlement of an amount upto

` 2,000 in a single transaction transacted through credit card, debit card, charge card or
other payment card service. Explanation.— For the purposes of this entry,
“acquiringbank”means any banking company, financial institution including nonbanking
financial company or any other person, who makes the payment to any person who
accepts such card.
39A Services by an intermediary of financial services located in a multi services SEZ with
International Financial Services Centre (IFSC) status to a customer located outside India
for international financial services in currencies other than Indian rupees (INR).
Illustrations of such services are -
Fixed deposits or Providing a loan or Mortgages or loans Corporate deposits

saving deposits or overdraft facility or a with a collateral to the extent that
any other such credit limit facility in security to the the consideration for
deposits in a bank or consideration for extent that the advancing such loans
a financial institution payment of interest consideration for or advances are
for which return is advancing such loans represented by way
received by way of or advances are of interest or
interest. represented by way discount.
of interest.

Service charges or Invoice Any interest/ Charges for late Instruments like Income from
administrative discounting/cheque delayed payment payment of repos and reverse Commercial
charges or entry discounting or any charges charged to outstanding dues on repos:They have the Paper (CP) or
charges collected other similar form clients for delay in credit card:Interest characteristics of Certificates of
over and of discountingis payment of charged on loans and deposits Deposit (CD):
aboveintereston covered only to the brokerage amount/ outstanding credit for interest and are Not chargeable
loan, advance or a extent consideration settlement card balances has accordingly exempt to GST.
deposit are not is represented by obligations/ margin been specifically from GST under
exempt and thus, way of discount as trading facility:is excluded from Entry Entry 27
represent taxable such discounting is a exempt from GST 27. Hence, the same
consideration. manner of extending since settlement is liable to GST
a credit facility or a obligations/ margin
loan. trading facilities are
transactions which
are in the nature of
extending loans or
advances and are
covered by Entry 27 Interest on a finance Securitization
lease transactions
transaction:Interest undertaken
bybanks:Securitized
on finance lease
assets are in the
transactions will be nature of securities
taxable under GST. and hence not
subject to GST.

10. LIFE INSURANCE BUSINESS SERVICES

No.
28 Services of life insurance business provided by way of annuity under the National
PensionSystemregulated by the Pension Fund Regulatory and Development Authority of
India under the Pension Fund Regulatory and Development Authority Act, 2013.
29 Services of life insurance business provided or agreed to be provided by the Army, Naval
and Air Force Group Insurance Fundsto members of the Army, Navy and Air Force,
respectively, under the Group Insurance Schemes of the Central Government.
29A Services of life insurance provided or agreed to be provided by the Naval Group Insurance
Fund to the personnel of Coast Guard under the Group Insurance Schemes of the Central
Government.
29B Services of life insurance provided or agreed to be provided by the Central Armed Police
Forces (under Ministry of Home Affairs) Group Insurance Funds to their members under
the Group Insurance Schemes of the concerned Central Armed Police Force
36 Services of life insurance business provided under following schemes-
a. Janashree Bima Yojana
b. Aam Aadmi BimaYojana
c. Life micro-insurance product as approved by the Insurance Regulatory and
Development Authority, having maximum amount of cover of ` 2,00,000;
d. Varishtha Pension Bima Yojana
e. Pradhan Mantri Jeevan Jyoti BimaYojana
f. Pradhan Mantri Jan Dhan Yogana;
g. Pradhan Mantri Vaya Vandan Yojana.
11. SERVICES PROVIDED BY SPECIFIED BODIES

No.
26 Services by the Reserve Bank of India.
30 Services by the Employees’ State Insurance Corporation
31 Services provided by the Employees Provident Fund Organisation
31A Services by Coal Mines Provident Fund Organisation
31B Services by National Pension System (NPS) Trust in the form of administrative fee.
32 Services provided by the IRDAI
33 Services provided by the SEBI
58 Services provided by the National Centre for Cold Chain Development
59 Services by a foreign diplomatic missionlocated in India.

12. GENERAL INSURANCE BUSINESS SERVICES

No.
Services of general insurance business provided under following schemes –
a. Hut Insurance Scheme;
b. Cattle Insurance under Swarnajaynti Gram Swarozgar Yojna14;
c. Scheme for Insurance of Tribals;
d. Janata Personal Accident Policy and Gramin Accident Policy;
e. Group Personal Accident Policy for Self-Employed Women;
f. Agricultural Pumpset and Failed Well Insurance;
g. premia collected on export credit insurance;
h. Restructured Weather Based Crop Insurance Scheme (RWCIS), approved by the
35 Government of India and implemented by the Ministry of Agriculture;
i. Jan ArogyaBima Policy;
j. Pradhan Mantri Fasal Bima Yojana (PMFBY);
k. Pilot Scheme on Seed Crop Insurance;
l. Central Sector Scheme on Cattle Insurance;
m. Universal Health Insurance Scheme;
n. Rashtriya Swasthya Bima Yojana;
o. Coconut Palm Insurance Scheme;
p. Pradhan Mantri Suraksha Bima Yojna;
q. Niramaya Health Insurance Scheme implemented by the Trust constituted under the
provisions of the National Trust for the Welfare of Persons with Autism, Cerebral Palsy,
Mental Retardation and Multiple Disabilities Act, 1999.
r. Bangla ShasyaBima
36A Services by way of reinsurance of the insurance schemes specified in serial number 35 or 36.
13. PENSION SCHEMES

No.
37 Services by way of collection of contribution under the Atal Pension Yojana.
38 Services by way of collection of contribution under any pension scheme of the State
Governments.

14. BUSINESS FACILITATOR/CORRESPONDENT

Entry
39
Services by the following persons in respective capacities –

a. Business facilitator or a business correspondent to a banking company with respect to accounts
in its rural area branch;
b. Any person as an intermediary to a business facilitator or a business correspondent with respect
to services mentioned in entry (a); or
c. Business facilitator or a business correspondent to an insurance company in a rural area.
Note: BCs / BFs help villagers to open bank accounts and provide other banking services to them.
They act as an intermediary between the bank and its customers. Banks, in turn, pay commission/
fee to the BCs/BFs.
According to the RBI guidelines, while the BCs are permitted to carry out transactions on behalf of
the bank as agents, the BFs can refer clients, pursue the clients’ proposal and facilitate the bank to
carry out its transactions, but cannot transact on behalf of the ban. As per RBI guidelines, banks may
pay reasonable commission/fee to the BC in respect of the services provided by BC to the customers.
However, BC are specifically prohibited from directly charging any fee to the customers for services
rendered by them on behalf of the bank. Instead, the banks (and not BCs) are permitted to collect
reasonable service charges from the customers for such service in a transparent manner.
RCM
S.No Supplier of Recipient of
Service & Type of Service Service
1. Business facilitator(BF)(w.e.f.01/01/2019) A banking company, located in the taxable
territory
2. Services provided by an agent of business To Business correspondent
correspondent(BC) (w.e.f.01/01/2019)
Finally, services provided by BC to bank is taxable under forward charge only
15. Services provided to Government

No.
3 Pure Labour services provided to the Central Government, State Government or Union
territory or local authority or a Governmental authority or a Government Entity
in relation to any function entrusted to a Panchayat / Municipality
3A Composite supply of goods and services TO Government: 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 supplyprovided to the Central Government, State Government or

Union territory or local authority or a Governmental authority or a Government Entityin
relation to any function entrusted to a Panchayat / Municipality
11A Service provided by Fair Price Shops to Central Government, State Government or Union
territory by way of sale of food grains, kerosene, sugar, edible oil, etc. under Public
Distribution System against consideration in the form of commission or margin.
40 Services provided to the Central Government, State Government, Union territory under
any insurance scheme for which total premium is paid by the Central Government, State
Government, Union territory.
72 Services provided to the Central Government, State Government, Union territory
administration under any training programme for which total expenditure is borne by the
Central Government, State Government, Union territory administration.
51 Services provided by the GSTN(Goods and Services Tax Network) to the Central
Government or State Governments or Union territories for implementation of Goods and
Services Tax.
16. LEASING SERVICES

No.
41/41A/41B Covered in Real Estate
43 Services of leasing of assets (rolling stock assets including wagons, coaches, locos) by the
Indian Railways Finance Corporation to Indian Railways.
Question 19
17. LEGAL SERVICES
Entry 45
Definition of Senior advocate: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
standing at the Bar or special knowledge or experience in law he is deserving of such
distinction. Senior advocates shall, in the matter of their practice, be subject to such
restrictions as the Bar Council of India may, in the interest of the legal profession, prescribe.

SERVICES BY ADVOCATES/FIRMS OF ADVOCATES

Entry 45
To To Business Entities To Other than To Advocates/Firms

CG/SG/UT/LA/GA/GE Business Entities of Advocates
Exempt Exempt
With T.O during With T.O during Senior Advocate Other Cases
P.Y.≤ Reg. limit P.Y.> Reg. limit to any
Advocate/Firm
Exempt Exempt
RCM i.e.
Business
Entity pays
tax
With With
T.O.≤RL T.O.>RL
Senior Advocate : Section 16 of the Advocates Act, 1961 which,
inter alia, provides that an advocate may, with his consent, be
designated as senior advocate if the Supreme Court or a High
Exempt Taxable
Court is of opinion that by virtue of his ability standing at the
Bar or special knowledge or experience in law he is deserving of under RCM
such distinction. Senior advocates shall, in the matter of their
practice, be subject to such restrictions as the Bar Council of India
may, in the interest of the legal profession, prescribe.

SERVICES BY ARBITRAL TRIBUNALS
Arbitral Other Tribunal

Tribunal Courts
To To To Exempt
CG/SG/UT/ Business Business
LA/GA/GE Entity Entity
Exempt Exempt
With T.O≤ With T.O>Reg.

Reg. limit limit
Exempt Taxable
under RCM
Entry 53 18. SPONSORSHIP OF SPORTS EVENTS
Services by way of sponsorship of sporting events organised –

a. By a national sports federation, or its affiliated federations, where the participating
teams or individuals represent any district, State, zone or Country;
b. By Association of Indian Universities, Inter-University Sports Board, School Games
Federation of India, All India Sports Council for the Deaf, Paralympic Committee of India
or Special Olympics Bharat;
c. By the Central Civil Services Cultural and Sports Board;
d. As part of national games, by the Indian Olympic Association; or
e. Under the Panchayat Yuva Kreeda Aur Khel Abhiyaan Scheme.

19. PERFORMANCE BY AN ARTIST

Entry 78
Services by an artist by way of a performance in folk or classical art forms of-

a. music, or
b. dance, or
c. theatre,
If the consideration charged for such performance is not more than ` 1,50,000 are exempt from GST.
However, the exemption shall not apply to service provided by such artist as a brand ambassador.
The activities by a performing artist in folk or classical art forms of music, dance, or theatre are
exempt if consideration does not exceed ` 1,50,000. However, if consideration from such activities
exceeds ` 1,50,000, entire consideration is subject to GST. Further, all other activities by an artist in
other art forms .E.g. western music or dance, modern theatres, performance of actors in films or
television serials would be taxable.
20. RIGHT TO ADMISSION TO VARIOUS EVENTS Question 20,21

No.
79/79A Services by way of admission to a museum, national park, wildlife sanctuary, tiger reserveor
zoo
Services by way of right to admission to-
81 a. Circus, dance, or theatrical performance including drama or ballet;
b. Award function, concert, pageant, musical performance or any sporting event
c. Planetarium,
Where the consideration for right to admission to the events or places as referred to in items
(a), (b), (c) above is not more than ` 500 per person.
21. SERVICES BY AN UNINCORPORATED BODY OR A NON- PROFIT ENTITY

No.
77 Service by an unincorporated body or a non- profit entity registered under any law for the
time being in force, to its own members by way of reimbursement of charges –
a. As a trade union
b. For the provision of carrying out any activity which is exempt from the levy of GST; or
c. Up to an amount of ` 7,500 per month per member for sourcing of goods or services
from a third person for the common use of its members in a housing society or a
residential complex.
77A Services provided by an unincorporated body or a non-profit entity registered under any
law for the time being in force, engaged in,-
 Activities relating to the welfare of industrial or agricultural labour or farmers; or
 Promotion of trade, commerce, industry, agriculture, art, science, literature, culture,
sports, education, social welfare, charitable activities and protection of environment,
to its own members against consideration in the form of membership fee upto an
amount of ` 1000/- per member per year.

ANALYSIS
Taxability of various charges collected by societies

If a society collects the following charges from the members on quarterly basis as follows:
Property Tax- Water Tax- Non- Electricity Sinking Fund- Repairs & Car Non- Simple
actual as per Municipal Agricultural charges mandatory maintenance parking Occupancy interest for
Municipal Corporation Tax- under the fund Charges Charges late
Corporation of of Greater Maharashtra Bye-laws of payment
Greater Mumbai State the Co-
Mumbai(MCG (MCGM) Government operative
M) Societies
However, if these Sinking fund, repairs &

Services provided by the Central maintenance fund, car
Government, State Government, charges are collected by
the Society for parking charges, No
Union territory or local authority occupancy charges or
to a person other than business generation of electricity
by Society’s generator simple interest for late
entity, is exempted from GST. So, payment, attract GST, as
Property Tax, Water Tax, if or to provide drinking
water facility or any these charges are collected
collected by the RWA/Co- by the RWA/Co-operative
operative Society on behalf of the other service, then such
charges collected by the Society for supply of
MCGM from individual flat services meant for its
owners, then GST is not leviable. society are liable to
GST. members.

GST on monthly subscription/contribution charged by a Residential Welfare Association from its

membersCircular No.109/28/2019- GST
S.No Issue Clarification
1. A RWA has aggregate turnover of Annual Monthly Whether
Rs.20 lakh or less in a financial year. Is turnover of maintenance charge exempt?
it required to take registration and pay RWA
GST on maintenance charges if the More than Rs. More than Rs. 7,500/- No
amount of such charges is more than 20 lakhs Rs. 7,500/- or less Yes
Rs. 7500/- per month per member?
Rs. 20 Lakhs More than Rs. 7,500/- Yes
or less Rs. 7,500/- or less Yes
2. Where a person owns two or more For example, if a person owns two residential
flats in the housing society or apartments in a residential complex and pays Rs.
residential complex, whether the 15000/- per month as maintenance charges
ceiling of Rs. 7500/- per month per towards maintenance of each apartment to the
member on the maintenance for the RWA (Rs. 7500/- per month in respect of each
exemption to be available shall be residential apartment), the exemption from GST
applied per residential apartment or shall be available to each apartment
per person?
3. How should the RWA calculate GST In case the charges exceed Rs. 7500/- per month
payable where the maintenance per member, the entire amount is taxable. For
charges exceed Rs. 7500/- per month example, if the maintenance charges are Rs. 9000/-
per member? Is the GST payable only per month per member, GST @18% shall be
on the amount exceeding Rs. 7500/- payable on the entire amount of Rs. 9000/- and not
or on the entire amount of on [Rs. 9000 - Rs. 7500] = Rs. 1500/- .
maintenance charges?
22. Renting of Immovable properties Question 22
Entry Description of Services

No
54 Let out of vacant land for the purpose of Agriculture
12 Services by way of renting of residential dwelling for use as residence.
14 Services by a hotel, inn, guest house, club or campsite, by whatever name called, for
residential or lodging purposes, having value of supply of a unit of accommodation below or
equal to Rs.1000 per day or equivalent

23. Renting of Motor Vehicles Question 23
Services by way of giving on hire –
Motor vehicle Electrically Vehicle meant for Vehicle for

Meant to carry operated vehicle Transportation of transport of
>12 passengers to carry> 12 goods Students,
passengers Staff, Faculty
22
To a To a Local To GTA To Schools
statetransportunde Authority
rtaking (STU)
24. Women’s FIFA World Cup
9AA Services provided by and to

a. Federation Internationalized Football Association (FIFA) and
b. 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 (Certificate from Director (Sports), Ministry of Youth Affairs and Sports is required to
claim Exemption)
82A Services by way of right to admission to the events organised under FIFA U-17 Women's
World Cup 2020.
25. Research & Development
48 Services provided by a TBI/STEP/bio- incubators recognized under the Department of

Biotechnology, Government of India (BIRAC).
Services provided by an incubatee up to a total turnover of ` 50 lakh in a financial year subject
to the following conditions, namely:-
a. The total turnover had not exceeded ` 50 lakh during the preceding financial year; and
b. A period of 3 years has not elapsed from the date of entering into an agreement as an
incubatee.
44 Incubatee: means an entrepreneur located within the premises of a Technology Business
Incubator (TBI)/ Science and Technology Entrepreneurship Park (STEP) and who has entered
into an agreement with the TBI/STEP to enable himself to develop and produce hi-tech and
innovative products.

26. Other exempt services Question 24-28

No.
2 Services by way of transfer of a going concern, as a whole or an independent part thereof.
Eg:Royal Hotel Group is in the business of running a chain of restaurants. It intends to sell its
business. It is not required to pay GST on such sale of its business.
9B Supply of services associated with transit cargo to Nepal and Bhutan (landlocked countries).
23 Service by way of access to a road or a bridge on payment of toll charges.
23A Service by way of access to a road or a bridge on payment of annuity.
25 Transmission/distribution of electricity by an electricity transmission/ distribution utility.
However, in this regard CBIC has clarified that the other services provided by DISCOMS
(distribution companies) to consumer against charges are liable to GST such as,-
 Application fee for releasing connection of electricity;
 Rental Charges against metering equipment;
 Testing fee for meters/transformers, capacitors etc.;
 Labour charges from customers for shifting of meters or shifting of service lines;
 Charges for duplicate bill [Circular No. 34/8/2018 GST dated 01.03.2018].
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.
49 Services by way of collecting or providing news by an independent journalist, Press Trust of
India or United News of India.
50 Services of public librariesby way of lending of books, publications or any other knowledge-
enhancing content or material.
52 Services by an organizer to any person in respect of a business exhibitionheld outside India.
56 Services by way of slaughtering of animals.
65A Services by way of providing information under the RTI Act (Right to Information Act, 2005).
68 Services provided to a recognized sports 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 recognized sports body.
However, services by individuals such as selectors, commentators, curators, technical experts
are taxable. The service of a player to a franchisee which is not a recognized sports body is
also taxable. The term ‘recognized sports body’has been defined earlier in this chapter.
76 Services by way of public conveniences such as provision of facilities of bathroom,
washrooms, lavatories, urinal or toilets.
Amendment
Services Exempted from GST
Entry No. Type of Service Supplier of Service
19C Satellite launch services  Indian Space Research Organisation
 Antrix Corporation Limited
 New space India Limited

II. IMPORT & EXPORT OF SERVICE EXEMPTIONS
IMPORT OF SERVICES & ITS TAXABILITY
IMPORT OF SERVICES & ITS TAXABILITY

S.No Type of Service SP SR(Located in India) Purpose &Taxability
CG For Business purpose:
SG Taxable under RCM
UT
LA Other Purpose : Exempt
GA (i.e, Personal use)
Any service other Located Outside Individual
1
than 2&3 India Charitable Trust For Charitable Purpose :
Exempt
Other Purpose :
Taxable Under RCM
Other Persons Any Purpose : Taxable Under
RCM
B2B Taxable Under RCM
Located Outside
2 OIDAR B2C Taxable-F/w charge
India
OIDAR should get registration
in India & Pay GST (GSTR 5A)
Transportation of Located Outside Any person Taxable Under RCM
3
goods by a vessel India
Foreign Exchange
Located Outside
4 Management RBI Exempt
India
Reserves
a. UNO
b. Foreign Diplomatic
Located Outside Mission Exempt
5 Any Service
India c. Specified
International
Organization
6 Any Service/Good SEZ Any Person Taxable Under RCM
Any Service SEZ Zero Rated Supply
7 Located in India
/Good
8 Any Service Outside India SEZ Exempt
9 Any Good Outside India SEZ Exempt under Customs Act

Export of Service
The following cases, even

Zero Rated Supply though not an export of
service, exemption available
S.No Type of Service SP SR Taxability
1 Tour Outside India Tour Operator in India Foreign Tourist Exempt
Any service among

2 Establishment in India Establishment Outside India Exempt
distinct persons
Any service having POS

in Nepal or Bhutan
3 Located In India Outside In India Exempt
(Realization in Indian
Rupees)
III. OTHER EXEMPTIONS
1 Central Government’s share of profit petroleum exempted from CGST

2 IGST exempted to the extent it is paid on the consideration attributable to royalty and license
fee included in transaction value under rule 10(1)(c) of Customs Valuation (Determination of
value of imported Goods) Rules, 2007

CH.SUDHEER C.A, C.M.A Chapter 5 Place of Supply
Chapter 5 PLACE OF SUPPLY
Place of Supply
In case of In case of
Goods Services
Both Supplier & Imports & Both supplier & Either supplier (or)
Recipient Exports recipient located recipient located
located in India in India outside India
Sec 10 of IGST Act Sec 11 of IGST Act Sec 12 of IGST Act Sec 13 of IGST Act
5 Cases 2 Cases 13 Cases 10 Cases

A. Place of supply of goods other than import and export [Section 10]
S.N Nature of Supply Place of Supply Examples

1. Where the supply involves the Location of the goods at the time (i) Mr. A of Nasik, Maharashtra sells 10 refrigerators to Mr. B of Pune,
movement of goods, whether by at which, the movement of goods Maharashtra for delivery at Mr. B’s place of business in Pune. The place
the supplier or the recipient or by terminates for delivery to the of supply is Pune in Maharashtra.
any other person recipient
(ii) Mr. A of Nasik, Maharashtra sells 20 refrigerators to Mr. C of
Ahmadabad, Gujarat for delivery at Mr. C’s place of business in
Ahmadabad. The place of supply is Ahmadabad.
2. Where the goods are delivered to The principal place of business of Mr. X (a supplier registered in Uttar Pradesh having principal place of
the recipient, or any person on the such third person business at Noida) asks Mr. Y of Ahmadabad, Gujarat to deliver 50
direction of the third person by way washing machines to his buyer Mr. Z at Jaipur, Rajasthan. In this case,
of transfer of title or otherwise, its two supplies are involved, one between Mr. X and Mr. Z and other
Shall be deemed that the third between Mr. Y and Mr. X.
person has received the goods While the former supply is covered under clause (a) of section 10(1),
the latter one i.e., between Mr. Y and Mr. X is covered under clause (b)
of section 10(1).
Accordingly, in this case, the place of supply of goods is not the location
of delivery of such goods (Jaipur) but the principal place of business of
third person i.e., principal place of business of Mr. X located at Noida.
3. Where there is no movement of Location of such goods at the time (i) Mr. A (New Delhi) has leased his machine (cost Rs 8,00,000) to Mr. B
goods either by supplier or of delivery to the recipient (Noida, Uttar Pradesh) for production of goods on a monthly rent of ₹
recipient 40,000. After 14 months Mr. B requested Mr. A to sell the machine to
him for Rs 4,00,000, which is agreed to by Mr. A.
In this case, there will be no movement of goods and the same will be
sold on as is where is basis. Thus, the location of the machine at the
time of such sale will be the place of supply i.e., Noida.

(ii) XZ Ltd. (Mumbai, Maharashtra) opens a new branch office at

Gurugram, Haryana. It purchases a building for office from KTS Builders
(Gurugram) along with pre-installed office furniture and fixtures.
Though there will be no GST liability on purchase of building, office

furniture and fixtures will be liable to GST. Since there is no movement
of office furniture and fixtures, the place of supply of such goods is
their location at the time of delivery to the recipient (XZ Ltd.) i.e.,
Gurugram.
4. Where goods are assembled or The place where the goods are (i) Mr. A (New Delhi) purchases a machine from Mr. B (New Delhi) for
installed at site assembled or installed being installed in his factory at Noida, Uttar Pradesh. The place of
supply is the site at which the machine is installed i.e., Noida.
(ii) Pure Refineries (Mumbai, Maharashtra) gives a contract to PQ Ltd.

(Ranchi, Jharkhand) to assemble a power plant in its Kutch, Gujarat
refinery. The place of supply is the site of assembly of power plant i.e.,
Kutch even though Pure refineries is located in Maharashtra.
5. Where the goods are supplied The place where such goods are (i) Mr. X (New Delhi) boards the New Delhi-Kota train at New Delhi. He
onboard a conveyance like a vessel, taken on-board the conveyance sells the MRP goods taken on board by him (at New Delhi), at Jaipur
aircraft, train or motor vehicle during the journey. The place of supply of goods is the location at which
the goods are taken on board i.e., New Delhi and not Jaipur where they
have been sold.
(iv) Ms. S, an unregistered person, (New Delhi) is travelling from New

Delhi to Kanpur, Uttar Pradesh in a train. The train starts at New Delhi
and stops at three stations before reaching Kanpur. The books were
loaded into the train at Aligarh (Uttar Pradesh) – 2nd Station. Ms. S
buys books on board the train. The place of supply is the location at
which the goods are taken on board i.e., Aligarh. The location at which
Ms. S boards the train is irrelevant.

B. Place of supply of goods imported into, or exported from India [section11]
S.N Nature of Supply of Goods Place of Supply Example

1. Import Location of importer Ms. M imports electric kettles from China for her Kitchen Store in Noida, Uttar
Pradesh. Ms. M is registered in Uttar Pradesh. The place of supply is Noida.
2. Export Location outside India Ms. Lavanya (New Delhi) exports spices from New Delhi to London, UK. The place
of supply is London.
C. Place of supply of services where location of supplier AND recipient is in India [Section 12]
In respect of the following 12 categories of services, the place of supply is determined with reference to a proxy; rest of the services are governed by the
default provision.
No. Nature of Service Place of Supply
1. Immovable Location at which the immovable (i) KTS Builders (Mumbai) is constructing a factory building for PLM Pvt. Ltd. (Kolkata),
property related- property is located or intended to in New Delhi. The place of supply is the location of the immovable property i.e., New
services including be located Delhi.
accommodation
(ii) Shah and Shah, an architectural firm at Kolkata, has been hired by MKF Builders of
inn
If property is located outside India: Mumbai to draw up a plan for a high rise building to be constructed by them in
then POS is the location of the Ahmadabad, Gujarat. The place of supply is the place where the immovable property
recipient is intended to be located i.e., Ahmadabad.
(iii) Mr. Ramesh, a Chartered Accountant, (New Delhi) travels to Mumbai for business
and stays in a hotel there. The place of supply of accommodation service is the place
where the hotel is located i.e., Mumbai.
(iv) Mr. X, a consulting engineer based in Mumbai renders professional services in
respect of an immovable property of Mr. Y (Bangalore) located in Australia. Since the
immovable property is located outside India, the POS of service is the location of
recipient i.e., Bangalore

2. Restaurant and Location where the services are (i) Mr. A, a business man from Pune dines in a restaurant at Mumbai while on a
catering services, actually performed business trip. The place of supply of restaurant service is the location where such
personal grooming, service is performed i.e., Mumbai.
fitness, beauty
treatment and (ii) Mr. Timmy Ferreira, a makeup artist at Kolkata, goes to Jaipur, Rajasthan for doing
health service the makeup of Ms. Simran Kapoor, a Bollywood actress based in Mumbai. The place of
supply is the location where such service is performed i.e., Jaipur
3 Training and B2B: Location of such registered (i) DEO Consultants (Kolkata) impart GST training to accounts and finance personnel of
performance person Sun Cements Ltd. (Guwahati, Assam) at the company’s Kolkata office. Since the
appraisal B2C: Location where the services recipient is registered, the place of supply is the location of the registered person i.e.,
are actually performed Guwahati.
(ii) Mr. Suresh (unregistered person based in Noida) signs up with Excellent Linguistics
(New Delhi) for training on English speaking at their New Delhi Centre. Since the
recipient is unregistered, the place of supply is the location where services are
provided i.e., New Delhi.
4. Admission to an Place where the event is actually (i) Mr. A, a resident of Ghaziabad, Uttar Pradesh, buys a ticket for a circus organized at
event or held or where the park or the other Gurugram, Haryana by a circus company based in New Delhi. The place of supply is
amusement park place is located the location where the circus is held i.e., Gurugram.
(ii) Mr. B of New Delhi buys a ticket for an amusement park located in Noida,
Uttar Pradesh. The place of the supply is the location where the park is located i.e.,
Noida.
5. Organisation of an B2B: Location of such registered (i) Mega Events, an event management company at New Delhi, organizes an award
event Person function for Shah Diamond Merchants of Ahmadabad (registered in Gujarat), at
Mumbai. Since the recipient is a registered person, the place of supply is the location
of the recipient, i.e., Ahmadabad.
B2C: Location where the event is
actually held (ii) Mega Events, an event management company at New Delhi, organizes an award
function for Shah Diamond Merchants of Ahmadabad (registered in Gujarat), at
If the event is held outside India: Mauritius. Since the recipient is a registered person, the place of supply is the location
Location of the recipient of the recipient, i.e., Ahmadabad.

6. Transportation of B2B: Location of such registered (i) M/s XYZ Pvt. Ltd. is a registered company in New Delhi. It sends its courier to Pune
goods, including person through M/s Brue Air Courier Service. The recipient being registered person, the place
mails of supply is the location of recipient i.e., New Delhi.
B2C: Location at which such goods (ii) Mr. Y, an unregistered person, of New Delhi sends a courier to his brother in
Amritsar, Punjab. The recipient being unregistered person, the place of supply is the
are handed over for their
transportation location where goods are handed over for their transportation i.e., New Delhi.
(iii) PR Pvt. Ltd., a Goods Transportation Agency based in Kanpur, Uttar Pradesh, is
Where the transportation of goods hired by Hajela Enterprises (registered supplier in Kanpur) to transport its
is to a place outside India, the place consignment of goods to a buyer in New Delhi. The recipient being registered, the
of supply shall be the place of place of supply is the location of recipient i.e., Kanpur.
destination of such goods.
(iv) ST Pvt. Ltd., a Goods Transportation Agency based in Noida, Uttar Pradesh, is
The intention of this point is to levy hired by Chhaya Trade Links (registered supplier in New Delhi) to transport its
consignment of goods to a buyer in Kanpur, Uttar Pradesh. The recipient being
IGST in this case
registered, the place of supply is the location of recipient i.e., New Delhi.
(v) Mr. Srikant, a manager in a Bank, is transferred from Bareilly, Uttar Pradesh to
Bhopal, Madhya Pradesh. Mr. Srikant’s family is stationed in Kanpur, Uttar Pradesh.
He hires Goel Carriers of Lucknow, Uttar Pradesh (registered in Uttar Pradesh), to
transport his household goods from Kanpur to Bhopal. The recipient being
unregistered person, the place of supply is the location where goods are handed over
for their transportation i.e., Kanpur.
7. Passenger B2B: Location of such registered Examples of issue of right to passage for future use-point of boarding not known at
transportation person the time of issue of right
(i) An airline may issue seasonal tickets, containing say 10 leafs which could be used
B2C: Place where the passenger
for travel between any two locations in the country.
embarks on the conveyance for a
continuous journey (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.

Other Examples
In case of future use (Pre paid (i) Mr. Amar (registered person in New Delhi) travels from Mumbai to Bangalore in
cards) i.e, point of boarding is not Airjet flight. Mr. Amar has bought the tickets for the journey from Airjet’s office
registered in New Delhi. The place of supply is the location of recipient i.e., New Delhi.
known: then POS shall be location
of the Recipient. (ii) Mr. C (unregistered person in Chennai) has come to Delhi on a vacation. He buys
pre-paid Delhi Metro Card from Delhi Metro (New Delhi) for hassle free commute in
If recipient location is not known
the National Capital Region. Recipient being unregistered person, the place of supply
then POS is location of Supplier is the address of Mr. C i.e., Chennai. If address of Mr. C is not available with the Delhi
Metro, the POS will be the location of the supplier of services i.e., New Delhi.
(iii) Mr. Shyam, an unregistered person, based in Gurugram, Haryana books a two-way
air journey ticket from New Delhi to Mumbai on 5th December. He leaves New Delhi
on 10th December in a late-night flight and lands in Mumbai the next day. He leaves
Mumbai on 14th December in a morning flight and lands in New Delhi the same day.
The return journey is treated as a separate journey, even if the tickets for onward and
return journey are issued at the same time. Thus, being an unregistered person, the
POS for the outward and return journeys are the locations where the unregistered
person embarks on the conveyance i.e., New Delhi and Mumbai respectively.
8. Services on board a Location of the first scheduled point Mr. X is travelling from Delhi to Mumbai in an Airjet flight. He desires to watch an
conveyance of departure of that conveyance for English movie during the journey by making the necessary payment. The place of
the journey supply of such service of showing ‘movie on demand’ is the first scheduled point of
departure of the conveyance for the journey i.e., Delhi.
9 Banking and other Location of the recipient of services (i) Mr. A (Chennai) buys shares from a broker in BSE (Mumbai). The place of supply is
financial services on the records of the supplier the location of the recipient of services on the records of the supplier i.e., Chennai.
(ii) Mr. B (New Delhi) withdraws money from Best Bank’s ATM in Amritsar. Mr. B has
Location of the supplier of services crossed his limit of free ATM withdrawals. The place of supply is the location of the
if the location of the recipient of recipient of services in the records of the supplier i.e., New Delhi
services is not available
(iii) Mr. C, an unregistered person from Varanasi, UP, visits a bank registered in New
Delhi for getting a demand draft made. Since the location of recipient is not available
in the records of the supplier, the POS is the location of the supplier i.e., New Delhi.

10. Insurance services B2B: Location of such registered (i) Mr. A, CEO of XY Ltd., Mumbai (a company registered in Maharashtra) buys
Person insurance cover for the inventory stored in company’s factory located at Mumbai,
from Excellent Insurers, Chennai (registered in Tamil Nadu). The place of supply is the
B2C: Location of the recipient of
location of the registered recipient i.e., Mumbai.
services on the records of the
(ii) Ms. B (unregistered resident of Kolkata) goes to her native place Patna, Bihar and
supplier
buys a medical insurance policy for her parents there from Safe Insurers, Patna
(registered in Bihar). The place of supply is the location of the recipient of services on
the records of the supplier i.e., Patna.
11. Advertisement a) Each of States/Union Territory (i) Gujarat Government gives an advertisement contract to an advertising agency
services to the where the advertisement is (registered in Ahmadabad) to promote Gujarat tourism throughout the country. The
Government broadcasted/displayed/run place of supply is in all the States and Union Territories of India.
b) Proportionate value in case of (ii) Delhi Government gives an advertisement contract to agency registered in Delhi to
multiple States promote its ‘Every Child Can Read’ campaign in Delhi. The place of supply is Delhi.
12. Telecommunication a) Services involving fixed line, (i) Mr. X (Kolkata) gets a landline phone installed at his home from Skybel Ltd. The
services circuits, dish etc: Location of such POS is the location where the telecommunication line is installed i.e., Kolkata.
fixed equipment
(ii) Mr. Y (Mumbai) gets a DTH installed at his home from RT Ltd. The place of supply is
b) Mobile/ Internet post-paid the location where the DTH is installed i.e., Mumbai.
services: Location of billing address (iii) Mr. D (Mumbai) takes a post-paid mobile connection in Mumbai from Skybel Ltd.
of the recipient The place of supply is the location of billing address of the recipient i.e., Mumbai.
c) Sale of pre-paid voucher: Place of (iv) Mr. E (New Delhi) gets his post-paid bill paid online from Goa. The payment being
sale of such vouchers made through electronic mode, the place of supply is the location of the recipient in
the records of the supplier i.e., New Delhi.
d) Other cases: Address of the
recipient in records (v) Mr. C (Pune) purchases a pre-paid card from a selling agent in Mumbai. The place
of supply is the address of the selling agent or re-seller i.e., Mumbai.
(vi) Mr. F (Puducherry) gets a pre-paid recharged from a grocery shop in Chennai. The
place of supply is the location where such pre-payment is received i.e, Chennai

Default rule for the services other than the 12 specified services
S.N Description of Supply Place of Supply Examples
13. B2B Location of such registered person (i) Mr. A (a Chartered Accountant registered in New Delhi) makes a supply of
service to his client Mr. B of Noida, Uttar Pradesh (registered in Uttar Pradesh). In
this cases, since the supply is made to a registered person, the place of supply is
the location of the registered recipient i.e., Noida.
B2C Where the address on record exists: (ii) Mr. A, a barber in Gurugram, Haryana, (registered in Haryana) provides hair
Location of the recipient cutting services to his client Mr. C who is a resident of New Delhi but is not
Other cases: Location of the supplier registered under GST. If the address of Mr. C is available in the records of Mr. A,
location of Mr. C i.e., New Delhi will be the place of supply, else the location of Mr.
of services
A, which is Gurugram, will be the place of supply.
D. Place of supply of services where Either location of supplier OR location of recipient is outside
India [Section 13]
(i) In respect of the following 9 categories of services, the POS is determined as under ; rest of the services are governed by the default provision.
No. Nature of Service Place of Supply
1. Services supplied in respect of Location where the (i) Mr. X (New Delhi) imports a machine from Germany for being installed in his
goods which are required to be services are actually factory at New Delhi. To install such machine, Mr. X takes the service of an engineer
made physically available performed who comes to India from Germany for this specific installation. The place of supply of
installation service, which requires the physical presence of machinery, is the location
where the service is actually performed i.e., New Delhi.
Services supplied in respect of Location where the (ii) A software company located in United States of America (USA) takes services of a
goods but from a remote goods are situated at software company located in Bangalore to service its software in USA. The Indian
location by way of electronic the time of supply of software company provides its services through electronic means from its office in
means services India. The place of supply is the location where goods are situated at the time of
supply of service i.e., USA.

Above provisions are not applicable in case of goods that (iii) ABC Ltd., Hyderabad has exported a machine to a company in Indonesia.
are temporarily imported into India for repairs and The machine stops functioning and is thus, imported by ABC Ltd. for free repairs in
exported after repairs terms of the sale contract. The machine is exported after repairs.
The place of supply of repair service is the location of the recipient i.e., Indonesia
2. Services which require the Location where the (iv) Mr. X, a hair stylist registered in New Delhi, travels to Singapore to provide his
physical presence of the recipient services are actually services to Ms. Y, a resident of Singapore. The place of supply is the location where
or the person acting on his behalf performed the services are actually performed i.e., Singapore
with the supplier of services
3. Service supplied directly in Place where the (i) Mr. C, an architect (New Delhi), provides professional services to Mr. Z of New York
relation to an immovable immovable property in relation to his immovable property located in Pune. The place of supply is the
property is located or location of immovable property i.e., Pune.
intended to be (ii) Mr. C, an architect (New Delhi), enters into a contract with Mr. Z of New York to
located provide professional services in respect of immovable properties of Mr. Z located in
Pune and New York. Since the immovable properties are located in more than one
location including a location in the taxable territory, the place of supply is the location
in the taxable territory i.e., Pune.
4. Admission to or organisation of Place where the (i) A circus team from Russia organizes a circus in New Delhi. The place of supply is the
an event event is actually held location where the event is actually held i.e., New Delhi.
(ii) An event management company registered in New Delhi organises an art
exhibition displaying works of an international painter base in Dubai. The exhibition is
organised in 3 countries including New Delhi. Since the service is supplied at more
than one location including a location in the taxable territory, the place of supply is
the location in the taxable territory i.e., New Delhi.
If the above services are supplied Location in the PQR Consultants, New Delhi, bags a contract for doing a market research for a vehicle
at more than one locations. i.e., taxable territory manufacturing company based in South Korea, in respect of its upcoming model of a
Goods & individual related If more than one car. The research is to be carried out in five countries including New Delhi. Since the
Immovable property- state services are supplied at more than one location including a location in the taxable
related Each such State in territory, the place of supply is the location in the taxable territory i.e., New Delhi.
Event related proportion to the
value of services in
each State

5. Services supplied Location of the (i) Mr. C, a foreign tourist, on a visit to Varanasi (Uttar Pradesh) uses his international
a) By a Banks, PFI, NBFC’s to supplier of services debit card to withdraw money from an ATM of a local Bank registered in Uttar
Account holders Pradesh. The place of supply is the location of the supplier of services i.e., Varanasi.
b) Intermediary services (ii) A travel agent registered in New Delhi books a tour of famous Indian cities for a
c) Services consisting of hiring of Dubai resident. The place of supply is the location of the supplier of services i.e., New
means of transport, Delhi.
 including yachts but (iii) Mr. D, an unregistered person based in New Delhi, leaves for a European holiday.
 excluding aircrafts and He hires a car from London, UK for 20 days. The place of supply is the location of the
vessels, supplier of services i.e., London.
up to a period of one month
6. Transportation of goods, other Place of destination (i) A shipping line, Mumbai, Maharashtra transports a shipment of flowers from
than by way of mail or courier of such goods Mumbai to Paris, for an event management company based in Paris. The place of
supply is the location of destination of goods transported i.e., Paris.
7. Passenger transportation Place where the (i) Mr. A, a foreign tourist, has booked a ticket for New Delhi-Sri Lanka flight from an
passenger embarks airline registered in New Delhi for a continuous journey without any stopover. The
on the conveyance place of supply is the place where the passenger embarks on the conveyance for a
for continuous continuous journey i.e., New Delhi.
journey
8. Services provided on-board a First scheduled point -
conveyance of departure of that
conveyance for the
journey
9. OIDAR Services Location of recipient Refer Pg.3.
of service
(ii) For the rest of the services other than those specified above, a default provision has been prescribed as under:
Default rule for the cross-border supply of services other than nine specified services
10. Any Location of the recipient of service
Location of the supplier of service, if location of recipient is not available in the ordinary course of business

New IGST Rules introduced
(a) In case of advertisements over the internet, service is deemed to be provided all over India [Rule 3 of the IGST Rules]
Thus, the value of such service will be apportioned amongst all States and UTs, of India in the manner prescribed therein
(b) Computation of value of services where immovable property is located in more than one State and where the location of supplier and
recipient is in India [New rule 4 of the IGST Rules]
Example 1 A hotel chain X charges a consolidated sum of Rs.30,000/-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. The place of supply in this case is both in the Union territory of Delhi and in
the State of Uttar Pradesh and the service shall be deemed to have been provided in the Union territory of Delhi and in the State
of Uttar Pradesh in the ratio 2:1 respectively. The value of services provided will thus be apportioned as Rs.20,000/-in the Union
territory of Delhi and Rs.10,000/-in the State of Uttar Pradesh
Example 2
There is a piece of land of area 20,000 square feet which is partly in State S1 say 12,000 square feet and partly in State S2 , say
8000 square feet. Site preparation work has been entrusted to T. The ratio of land in the two states works out to 12:8 or 3:2
(simplified). The place of supply is in both S1 and S2. The service shall be deemed to have been provided in the ratio of 12:8 or 3:2
(simplified) in the States S1 and S2 respectively. The value of the service shall be accordingly apportioned between the States.
Example 3
There is a piece of land of area 20,000 square feet which is partly in State S1 say 12,000 square feet and partly in State S2, say
8000 square feet. Site preparation work has been entrusted to T. The ratio of land in the two states works out to 12:8 or 3:2
(simplified). The place of supply is in both S1 and S2. The service shall be deemed to have been provided in the ratio of 12:8 or 3:2
(simplified) in the States S1 and S2 respectively. The value of the service shall be accordingly apportioned between the States.
(c) Computation of value of services where event is organized in more than one State and where the location of supplier and the recipient is in
India [New rule 5 of the IGST Rules]

An event management company E has to organize some promotional events in States S1 and S2 for a
recipient R(unregistered). 3 events are to be organized in S1 and 2 in S2. They charge a consolidated
Example amount of Rs.10,00,000 from R. The place of supply of this service is in both the States S1 and S2.
Say 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
(d) Computation of value of services where leased circuit is installed in more than one State and where the location of supplier and the recipient is
in India [New rule 6 of the IGST Rules]
Number of Points Example

In the case of a circuit between two Example 1: A company T installs a leased circuit between the Delhi and Mumbai offices of a company C. The
points or places, the starting point or starting point of this circuit is in Delhi and the end point of the circuit is in Mumbai. Hence, one point of this
place of the circuit and the end point circuit is in Delhi and another in Maharashtra. The place of supply of this service is in the Union territory of
or place of the circuit will invariably Delhi and the State of Maharashtra. The service shall be deemed to have been provided in the ratio of1:1 in
constitute two points the Union territory of Delhi and the State of Maharashtra, respectively.
Any intermediate point or place in Example 2: A company T installs a leased circuit between the Chennai, Bangalore and Mysore offices of a
the circuit will also constitute a point company C. The starting point of this circuit is in Chennai and the end point of the circuit is in Mysore. The
provided that the benefit of the circuit also connects Bangalore. Hence, one point of this circuit is in Tamil Nadu and two points in Karnataka.
leased circuit is also available at that The place of supply of this service is in the States of Tamil Nadu and Karnataka. The service shall be deemed
intermediate point to have been provided in the ratio of 1:2 in the States of Tamil Nadu and Karnataka, respectively.
Example 3: 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.
(e) Computation of value of services where the service is performed in more than one State and where the location of supplier or the recipient is
outside India [New rule 7 of the IGST Rules]

• A company C which is located in Kolkata is providing the services of testing of a dredging machine and the testing service on the
machine is carried out in Orissa and Andhra Pradesh. The place of supply is in Orissa and Andhra Pradesh and the value of the service in
Exapmle 1 Orissa and Andhra Pradesh will be ascertained by dividing the value of the service equally between these two States.
•A company C which is located in Delhi is providing the service of servicing of two cars belonging to Mr. X. One car is of manufacturer J and is located
in Delhi and is serviced by its Delhi workshop. The other car is of manufacturer A and is located in Gurugram and is serviced by its Gurugram
workshop. The value of service attributable to the UT of Delhi and the Stateof Haryana respectively shall be calculated by applying the ratio of the
Example 2 invoice value of car J and the invoice value of car A, to the total value of the service.
•A makeup artist M has to provide make up services to an actor A. A is shooting some scenes in Mumbai and some scenes in Goa. M provides the
makeup services in Mumbai and Goa. The services are provided in Maharashtra and Goa and the value of the service in Maharashtra and Goa will be
Example 3 ascertained by applying the generally accepted accounting principles
(f) Computation of value of services where immovable property is located in more than one State and where the location of supplier or the
recipient is outside India [New rule 8 of the IGST Rules]
Rule 8 of the IGST Rules lays down that in the absence of any such contract or agreement, the value is determined by applying the provisions of
rule 4 of the said rules, mutatis mutandis.
(g) Computation of value of services where event is held in more than one State and where the location of supplier or the recipient is outside India
[New rule 9 of the IGST Rules]
As per section 13(7) of the IGST Act, the place of supply of services supplied, by way of admission to or organization of an event in more than one
State/ UT is taken as being in each such State/ UT and the value of such supplies is determined in terms of the contract or agreement entered into in
this regard. Rule 9 of the IGST Rules lays down that in the absence of any such contract or agreement, the value is determined by applying the
provisions of rule 5 of the said rules, mutatis mutandis.[Notification No. 04/2018 IT dated 31.12.2018]

CH.SUDHEER C.A, C.M.A Chapter 6 Time of Supply
Chapter 6
TIME OF SUPPLY
LIST OF TOPICS : TIME OF SUPPLY IN CASE OF
1) Forward charge 4) Residual Cases
2) RCM 5) Interest/ late fee on delayed payment
3) Issue of Vouchers/ coupons 6) Change in Rate of Tax
 Time of supply of goods or Services should be known to determine the point of time at which GST
becomes payable
 Before knowing the point of time when the GST becomes payable, we should know first the point
of time when the invoice is to be issued
TIME LIMIT FOR RAISING INVOICES
Particulars Supply of Goods (Section 31(1)) Supply of service( Section 31(2))
Before or at the time of,- Before or after the provision of service but
(a) removal of goods for supply to the within 30 days from the date of supply of
recipient, where the supply involves services.
Generally
movement of goods, or [45 days in case of insurance cos./banking and
(b) delivery of goods or making financial institutions including NBFCs]
available thereof to the recipient, in
any other case
In case of continuous supply of goods, In case of continuous supply of services,-

where Due date of payment Invoice to be issued
a) Successive statements of accounts on or before the due
Ascertainable
Continuous supply or date of payment;
b) Successive payments are involved, Not ascertainable before or at the time
the invoice shall be issued before or at when the supplier of
the time each such statement is issued service receives the
or, as the case may be, each such payment
payment is received.
Payment is linked to on or before the
the completion of an date of completion
event of that event.
Sale on approval Before or at the time of supply Such invoice shall be issued to the extent of the
basis / Cease of or supply made before such cessation
supply of service
Six months from the date of removal,
whichever is earlier.

1. TIME OF SUPPLY WHERE TAX IS PAYABLE UNDER FORWARD CHARGE Question 1-4
Supply of Goods (Section 12(2)) Supply of service( Section 13(2))
Earliest of the following:

If
DOI
Invoice has Invoice has Above events

been Issued not been are
(or) Within time Issued Within unascertainable
u/s 31 time u/s 31
Last date by
which
invoice must be DOI DOC Date of entry
issued u/s 31 Or Or in the books
DOROP DOROP by recipient
Note Here Date of Receipt of payment means
a) Date of entry in the books of account

or Whichever is earlier
b) Date of credit in the Bank account
Question 5-12
2.TIME OF SUPPLY WHERE TAX IS PAYABLE UNDER REVERSE CHARGE
Supply of Goods (Section 12(3)) Supply of service( Section 13(3))
Earliest of the following Earliest of the following
Date of Date of 31st day from Date of 61st day from

Receipt of payment date of issue payment date of invoice
goods of invoice
Note Here Date of Receipt of payment means

a) Date entered in the books of account of receipient Whichever is
or earlier
b) Date on which payment is debited in the Bank account

Where the above events are not ascertainable, the time of supply shall be the date of entry in the
books of account of the recipient of supply
Import of service from associated enterprises:
a) Date of entry in the books of account the receipient

or
b) Date of payment
3. TIME OF SUPPLY OF VOUCHERS EXCHANGEABLE FOR GOODS AND SERVICES

(Section 12(4) & 13 (4))
(a) Supply of goods or services is identifiable at the time of issue of voucher

 Date of issue of the voucher
Question 13
(b) Other cases - Date of redemption of the voucher
4. TIME OF SUPPLY OF GOODS AND SERVICES IN RESIDUAL CASES
(a) Where a periodical return is required to be filed

 Due date of filing such return
Question 14
(b) Other cases- Date of payment of tax
5. TIME OF SUPPLY FOR ADDITION IN VALUE BY WAY OF INTEREST/ LATE

FEE/PENALTY FOR DELAYED PAYMENT OF CONSIDERATION
Addition in value by way of interest, late fee/penalty for delayed payment of consideration
Time of Supply - Date on which the supplier receives such addition in value.
Question 15

Question 16 -19
6. CHANGE IN RATE OF TAX
In case of change in rate of tax, determination of rate of tax depends upon three events namely,-
Date of supply Date of Date of

of goods or invoice; and receipt of
services payment
If any two of the above events occur before the change of rate, the time of supply is before the
change of rate. If any two of them occur after the change of rate, the time of supply is after the
change of rate and the new rate becomes applicable to the supply. Using this principle, time of
supply, in case of change in rate of tax, can be determined as under:
Supply Issue of Receipt of Rate of Tax Time of supply

Invoice Payment
BEFORE BEFORE AFTER BEFORE Date of issue of invoice
BEFORE AFTER BEFORE BEFORE Date of receipt of payment
BEFORE AFTER AFTER AFTER Date of issue of invoice or date of
receipt of payment, whichever is earlier
AFTER AFTER BEFORE AFTER Date of issue of invoice
AFTER BEFORE AFTER AFTER Date of receipt of payment
AFTER BEFORE BEFORE BEFORE Date of issue of invoice or date of
receipt of payment, whichever is earlier

CH.SUDHEER C.A, C.M.A Chapter 7 Value of Supply
Chapter 7
VALUE OF SUPPLY
A. Supply to Unrelated persons where price is the sole

consideration for
i. Transaction value [S.15 (1)]
ii. Inclusions in transaction value [S.15(2)]
iii. Exclusion of discounts from transaction value [Section
15(3)]
iv. CREDIT NOTES & DEBIT NOTES under GST (Section 34)
B. Supplies where value cannot be determined u/s 15(1) &
Notified Supplies
1. Rule 27 - Value of supply of goods or services where the
consideration is not wholly in money
2. Rule 28 - Value of supply of goods or services or both
between distinct or related persons, other than through an
agent
3. Rule 29 – Value of supply of goods or received through an
agent (This rule is applicable only for supply of goods)
4. Rule 30 – Value of supply of goods or services or both based
on cost
5. Rule 31 – Value of supply in Residual Cases
TOPICS 6. New rule 31A introduced in CGST Rules to provide for
valuation of supply of lottery
7. Rule 32 – Determination of value in respect of certain
supplies
i. Service of purchase or sale of foreign currency including
money
ii. Service of booking of tickets for air travel by an air
travel agent
iii. Life insurance business
iv. Value of second hand goods – Margin Scheme
v. Redeemable vouchers/stamps/coupons/tokens
8. Value of supply in cases where Kerala Flood Cess is applicable
(Rule 32A)
9. Rule 33 – Value of supply of services in case of pure agent
10. Rule 34 - Rate of exchange of currency, other than Indian
rupees, for determination of value of Goods and services
11. Rule 35 - Value of supply inclusive of integrated tax, central
tax, State tax, Union territory tax
12. SALE OF MOTOR VEHICLE

Section 15 of the CGST Act provides common provisions for determining the value of goods and
services. It provides the mechanism for determining the value of a supply which is made between
unrelated persons and when price and only the price is the sole consideration of the supply.
VALUE OF SUPPLY
A. Supply to Unrelated persons B.Supplies where value cannot

where price is the sole be determined u/s 15(1) &
consideration for sale Notified Supplies
A. Supply to Unrelated persons where price is the sole consideration for sale
(i) Transaction value [S.15 (1)]

(ii) Inclusions in transaction value [S.15(2)] Question 1-25
Under assessment based on “transaction value”, the taxable value includes certain elements in addition to price.
The ingredients of “taxable value” based on transaction value are enumerated and discussed below.
1. Price actually paid or 2. Taxes other than GST, if charged 3. Payments made to third parties by the
payable for the supply separately by the supplier [S 15(2)(a)] recipient on behalf of the supplier in relation to
the supply [S 15(2)(b)]
Eg:- Contracted price for 1 MT

GST and GST cess are not part of taxable value, If the customer makes direct payment of some of such
of cement from X Ltd to Y: ₹
but other taxes/cesses/fees etc. will form part liabilities (of the supplier) to the third parties, and the
7000. Advance payment
of the value of taxable supply, if separately supplier does not include this amount in his bill, it would still
before despatch: ₹ 700. form part of the value of the taxable supply.
billed.
Payable after credit period of Eg:-Grand Biz contracts with ABC Co. to conduct a dealers’
30 days: ₹ 6300. For instance, if a supplier of goods pays a meet. In furtherance of this, Grand Biz contracts with vendors
municipal tax in relation to the goods being to deliver goods / services, like water, soft drinks, audio
Base taxable value:₹ 7000. supplied and bills the same separately, such tax system, projector, catering, flowers etc. at the venue on the
This would be so even though will form part of the value of taxable supply. stipulated dates at the stipulated prices. Grand Biz is liable to
only ₹ 700 has been received make these payments as contracted.
In the same situation, if the supplier pays the
at the time of payment of GST The soft drinks supplier wants payment upon delivery; ABC
on the supply municipal tax but does not charge the same
Co. agrees to pay the bill raised by the soft drinks vendor on
separately, even then such tax will form part of
Grand Biz on receiving the crates of soft drinks. This amount is
the value of taxable supply as the supplier not billed by Grand Biz to ABC Co. However, it would be
would have factored such tax while computing added to the value of service provided by Grand Biz to ABC
the cost of the goods. Co. for payment of GST.

4. Incidental expenses 5. Interest, late fee and penalty for 6. Subsidies [Section 15(2)(e)]
[Section 15(2)(c)] delayed payment [Section 15(2)(d)]
Incidental expenses, such as, commission and The value for a taxable supply will include Subsidy is a sum of money given to keep the
packing charged by the supplier or anything else not only the base price but also the charges price of a service or commodity low. If the
done by the supplier in relation to the supply at for delay in payment. subsidy is given by the State or Central
the time of or before the delivery of goods or Government; the lower price, after adjusting
Eg:-A supply priced at ₹ 2,000 is made, with a
supply of services must be added to value. the subsidy, is the taxable value. If the
credit period of 1 month for payment.
subsidy is given by a person or entity other
Eg:- Few examples of such incidental expenses Thereafter interest of 12% is charged. The
than the State or Central Government, it
are- payment is received after the lapse of two
does not lower the taxable value. The
months from the date of supply.
 Commission: This may be paid to an agent subsidy is added to the value of supply of the
and recovered from the buyer of the goods / The amount of 12% p.a. (i.e. 1% per month) supplier who receives the subsidy.
services; this is part of the value of the supply. on ₹ 2,000 for one month after the free
Eg:-The selling price of a notebook is ₹ 50.
credit period is ₹ 20. Such interest will be
 Packing, if charged by the supplier to the For notebooks sold to students in
added to the value and thus, the value of
recipient, is similarly part of the value of the Government schools, a company uses its CSR
taxable supply will work out to be ₹ 2,020.
supply. funds to pay the seller ₹ 30, so that the
students pay only ₹ 20 per notebook. The
 Inspection or certification charges are taxable value of the notebook will be ₹ 50, as
another element that may be added to the this is a non-government subsidy. If the same
value, if billed to the recipient of supply.
subsidy is paid by the Central Government or
State Government, the taxable value of the
 Installation and testing charges at the
notebook would be ₹ 20.
recipient’s site will also be added, being an
amount charged for something done by the
supplier in respect of the supply at the time of
making the supply.

(iii) Exclusion of discounts from transaction value [Section 15(3)]
The principle here is that price as established at the time of supply forms the basis of taxable value.
Discounts that are allowed are as follows:
Discounts that are allowed before or at the time of Discounts that are allowed after supply and are worked
supply and shown in the invoice e.g., pre-supply out invoice-wise for which GST Credit Note is issued Government Subsidy
discounts like trade discount, quantity discount etc. and the proportionate input tax credit is reversed by
recorded in the invoice; the recipient.
Eg:-Examples of discount deductible from value of supply Royal Biscuit Co. gives a discount of
30% on the list price to its distributors. Thus, for a carton of Spicebisk, in the invoice the list
price is mentioned as ₹ 200, on which a discount of 30% is given to arrive at the final price of ₹
140. The taxable value is ₹ 140, as the discount is allowed at the time of supply and shown in
the invoice Note:
Eg:-The agreement of Raju Electrical Appliances with its dealers is that sale of rice cookers Royalty and license fee exempted from IGST
over 100 pieces in the Diwali month will entitle them to discount of 5% per cooker sold in the to the extent it is paid on the consideration
next month. The next month’s stock has already been despatched when the sales figures for
attributable to royalty and license fee
the Diwali month are worked out. However the discount can be worked out for each invoice &
GST credit note is issued, the taxable value will be reduced .The dealer(Buyer) must reverse included in transaction value under Rule
the proportionate input tax credit on the relevant stock to bring it in line with the reduced tax. 10(1)(c) of Customs Valuation
(Determination of value of imported Goods)
Eg:-A company announces turnover discounts after reviewing dealer performance during the
Rules, 2007
year. The discounts are based on performance slabs and are given as cash-back. As these
discounts were not known at the time of supply of the goods, they will not be deducted from
taxable value of those goods.

(iv) CREDIT NOTES & DEBIT NOTES under GST (Section 34)
GST Credit Notes Supplier may issue GST Credit Notes
1. Purpose of GST Credit Notes 2. Conditions for issuing GST Credit Note 3. Upon issue of GST Credit Note
To decrease To be issued Original invoice Supplies Recipient

To Goods are
value of within time number/ numbers liability in should
decrease returned
supply & limit specified should be decrease reverse ITC
Tax (or)
Respective in point no.4 mentioned on
rejected
Tax credit notes
6. Issue of Financial Credit Note

4. Time limit for issuing GST credit note 5. Where to disclose?
(i.e, credit note does not contain GST)
Within due date of filing GSTR-1 of a) GSTR-1

year September month of succeeding (i) Original - Table 9B Supplies liability will Recipient need not
(ii) Amendments- Table 9C not decrease reverse ITC/ pay tax
Or
b) GSTR – 3B, Table 3.1(a) i.e.,
Date of filing GSTR-9 of that F.Y  Circular No.105/24/2019 dt.28.06.2019
reduced from o/w supplies
 Circular No.112/31/2019 dt.03.10.2019

GST Debit Notes Supplier shall issue GST Debit Note
1. Purpose of GST Debit Notes 2. Conditions for issuing GST Debit Note 3. Upon issue of GST Debit Note
To increase To
To be issued Original invoice Supplies Recipient can
value of increase
within time number/ numbers liability in claim ITC
supply & Tax
limit specified should be increase
respective in point no.4 mentioned on Debit
Tax notes
4. Time limit for issuing GST Debit note 5. Where to disclose? 6. Issue of Financial Debit Note
(i.e., Debit note does not GST
Within due date of filing GSTR-1 of a) GSTR-1

year September month of succeeding (i) Original - Table 9B Not possible. Issue of GST
(ii) Amendments- Table 9c Debit note is Mandatory
Or
b) GSTR – 3B, Table 3.1(a) i.e.,
Date of filing GSTR-9
added to o/w supplies

B. Supplies where value cannot be determined u/s 15(1) & Notified Supplies
Question 26-30
1) Rule 27 -Value of supply of goods or services where the consideration is not wholly in money
4
a)110% of cost of supply (Rule 30 ) or
b) Other reasonable means (Rule 31)

3
Value of supply of like

kind and quality In case of Goods:
2 First Rule 30, if not possible
then Rule 31
Monetary consideration (+) Money
1 value of non monetary consideration In case of Services:
Rule 30 (or) Rule 31,

Open market whichever is available can be
value opted

What is open market value?
Open market value means the full value of money excluding taxes under GST laws, payable by a
person to obtain such supply at the time when supply being valued is made, provided such supply
is between unrelated persons and price is the sole consideration for such supply.
What is supply of like kind and quality?
Supply of like kind & quality means any other supply made under similarcircumstances, which is same or
closely or substantially resembles in respect ofcharacteristics, quality, quantity, functionality, reputation to
the supply beingvalued.
Examples
Eg:
(i) Exchange value of old phone lowers the price of a new phone. The known market value
of the new phone (without exchange of old phone) is its taxable value.
(ii) Laptop is manufactured and supplied for ₹ 40,000. Part value is received in barter in
the form of a printer valued at ₹ 4000. Market value of the laptop is not known. Its
taxable value will be ₹ 44,000
(iii) A company procures and modifies a machine and supplies it to its unrelated customer.
Since, it is a customised machine, the open market value of the machine is not available as
also the value of any other machine of the like kind and quality is also not available.
Therefore, the value should be worked out by adding the cost of modification to thecost of
acquisition of the machine and adding thereto 10% of the sum of these costs.

2) Rule 28 - Value of supply of goods or services or both between distinct or related persons, other than through an agent
Question 31-37
(a) (c)
The open market If value cannot be determined
value of such supply under the above methods, it
or must be worked out based on
(b)
The cost of the By other
The value of supply of
supply (+)10% Or reasonable
Or goods or services of
mark-up means
like kind and quality
(b)
90% of the price charged

for the supply of goods of
like kind and quality by
the recipient to his
unrelated customer
Note:If the recipient is eligible for full ITC then invoice value is accepted as open market value

RELATED PARTY DEFINITION UNDER GST
iv. Any person directly or

i. Such persons are officers ii. Such persons are legally iii. Such persons are indirectly owns, controls or
or directors of one recognized partners in employer and employee holds twenty-five per cent or
another’s businesses business more of the outstanding voting
stock or shares of both of them
AB & Co partnership firm

A ltd B ltd
Mr. X
Officer
25% 25%
Officer Partners
Major SH Major SH
Company Company
is Mr. A is Mr. B
Mr. A Mr. B A B
In such case A Ltd & B Ltd In such case Mr. A & Mr. B
are related parties are related parties Company A& B are Relatives

v. One of them directly or vi. Both of them are directly Vii. Together they viii. They are
indirectly controls the other or indirectly controlled by a directly or indirectly members of the
third person control a third person same family
A ltd B ltd 1. the spouse and
Controls BoD
Controls BoD
51% X Ltd children of the person,
ALtd B Ltd &
A ltd &B ltd are Related
2. the parents, grand-
Control BoD
Control BoD
parents, brothers and
A Ltd B Ltd sisters of the person if
This also includes significant
X Ltd they are wholly or
role in Corporate policy, design
mainly dependent on
specification, marketing etc., Then A ltd & B ltd are Then A ltd & B ltd are the said person
relatives relatives [Section 2(49)].
ix. Persons who are associated in the business

of one another in that one is the sole agent or
sole distributor or sole concessionaire,
howsoever described, of the other, shall be
deemed to be related.

3) Rule 29 – Value of supply of goods or received through an agent

(This rule is applicable only for supply of goods)
Question 38,39
3
1
Open Market Value Best judgement
Method (value using
reasonable means)
2
Or
1 110% of cost
of supply
90% of the price
charged foe the goods
of like kind and quality
by the recipient to his
unrelated customer
Example of clause (a)
P (principal) supplies groundnuts to A (agent). A in turn sells groundnuts at ₹ 5000 per quintal.
Another independent supplier sells groundnuts at ₹ 4550 per quintal.
Thus, the open market value of groundnuts is ₹ 4550 per quintal. 90% of A’s selling price in the normal
course of trade is ₹ 4500 per quintal. P has the option to adopt the open market price (₹ 4550) or 90%
of A’s onward selling price (₹ 4500) as the taxable value of the groundnuts supplied by him to A.
4) Rule 30 – Value of supply of goods or services or both based on cost
Note:Service providers have the option to directly move to rule 31 bypassing rule 30. If the value
of a supply of goods and/or services cannot be worked out by the foregoing methods, its value
will be 110% of the cost of production/ manufacture/acquisition of such goods or cost of
provision of such services

5) Rule 31 – Value of supply in Residual Cases
The supplier of goods needs to sequentially follow rules 27 to 30 before valuing goods as per this
residual rule 31. Service providers, however, have the option of valuing services as per rule 30 or
rule 31 after sequentially following rules 27 to 29.
The residual method consists of determination of value by using reasonable means consistent with
the principles and general provisions of section 15 and these Rules.
6) New rule 31A introduced in CGST Rules to provide for valuation of supply of lottery
Supply Value
Supply of lottery Higher of the two amounts to be deemed as
thevalue
(ii) 100/128 of the face value of ticket
(OR)
(iii) Price as notified in the Official Gazette by
the organising State
Supply of actionable claim in theform of (i) 100% of the face value of the bet
chance to win in betting,gambling or horse (OR)
racing in arace club (ii) the amount paid into the totalisator
7) Rule 32 – Determination of value in respect of certain supplies
(a) This rule provides the valuation methods for five specific supplies.
(b) This rule overrides other rules of valuation. Thus, the supplies prescribed in this
rule need not be valued by sequentially following rules 27 to 31.
(c) The valuation methods prescribed under this rule are optional; the supplier can
use them if he so desires. He can also opt to value his supplies in accordance
with other valuation rules.

The special provisions related to determination of value of such specific supplies are discussed below- 5 situations
Purchase or sale of Booking of

foreign currency tickets for air
including money travel by an air
changing travel agent
Life insurance
SPECIAL VALUATION
business
METHODS FOR 5
SUPPLIES
Value of Value of supply

redeemable of second hand
vouchers/stamps/ goods
coupons/tokens

(i) Service of purchase or sale of foreign currency including money changing Question 40-44
The value of service in relation to purchase or sale of foreign currency, including money changing, is determined by either of
the two methods:
Method - I Method - II
Case 1:If RBI Reference Rate available S.N Currency exchanged Value of supply
value of supply = difference between buying rate or selling rate of 1. Upto ₹ 1,00,000 1% of the gross amount of
currency and RBI reference rate currency exchanged
(or)
Case 2 :If RBI reference rate not available then ₹250 whichever ishigher
value of supply =1% of the gross amount of Indian Rupees
2. Exceeding ₹ 1,00,000 ₹ 1,000 + 0.50% of the (gross
and upto ₹ 10,00,000 amount ofcurrency exchanged - ₹
Case 3: If foreign currency exchanged for another foreign currency without
1,00,000)
involvement if Indian Rupees
First convert both the currencies into Indian Rupees using RBI Reference 3. Exceeding ₹ 10,00,000 ₹ 5,500 + 0.1% of the (gross
rate, then Value of supply = 1% of the lesser of the two amounts amount ofcurrency exchanged - ₹
10,00,000)
(or)
₹ 60,000 whichever is lower
Among the both options, one of the options chooses by assessee at the beginning of the year & to be followed by entire year.

Question 45-48 (ii) Service of booking of tickets for air travel by an air travel agent
Domestic Internati
air travel onal air
travel
5% of basic 10% of basic

fare fare
Air fare on which To the air travel agent by

BASIC FARE commission is normally the airlines
paid
Note:
Passenger Service Fee (PSF) & User Development Fee (UDF) levied under rule 89 of the Aircraft rules 1937 to be
included in the value of Supply for purpose of levying GST

Question 49-51 (iii) Life insurance business
Policy with dual Single premium Other Cases Policy with ONLY
benefits of risk annuity policy risk cover
coverage &
investment
Taxable value =
Taxable value =
Taxable value = 10% of the a) 25% of premium charged Taxable value = Entire
Gross premium charged
single premium charged from from the policy holder in premium charged from the
(-) the policy holder the 1st year and policy holder
amount allocated for b) 12.5% of premium
investments/ savings charged for subsequent
if such allocation is intimated years
to the policy holder at the
time of collection of premium
(iv) Value of second hand goods – Margin Scheme Question 52,53

Value of Second Hand Goods
When ITC is not availed [Margin Scheme] When ITC is availed

• Value = Selling price – Purchase price • Normal valuation as per other
• Selling price < Purchase price ⇒ Ignore applicable provisions
negative value

Purchase value of supply of goods repossessed from a defaulting borrower
Many a time’s goods taken on loan are repossessed by the lender in the event of default in payment of the loan. The purchase
value of such repossessed asset is-
If the defaulting borrower is un-registered If the defaulting borrower is registered
Purchase value = Purchase price in the The repossessing lender agency will
hands of such borrower reduced by 5% discharge GST at the supply value
for every quarter or part thereof, without any reduction from actual /
between the date of purchase and the notional purchase value
date of disposal by the person making
such repossession
(v) Redeemable vouchers/stamps/coupons/tokens Question 54-56
The value of a token, voucher or coupon, or a stamp (other than postage stamp) which is redeemable against a supply of goods and/or
services is equal to the money value of the goods and/or services redeemable against such token, voucher, coupon or stamp.
Eg: If ₹ 1,500 worth of Sodexo is supplied by the taxable person, the value of supply under GST law will also be ₹ 1,500.

8)Value of supply in cases where Kerala Flood Cess is applicable (Rule 32A)
The value of supply of goods or services or both on which

Kerala Flood Cess is levied under clause 14 of the Kerala
Finance Bill, 2019 shall be deemed to be the value determined
in terms of section 15 of the Act, but shall not include the said
cess
9)Rule 33 – Value of supply of services in case of pure agent
Means
While Claims Enters into Does not Does not Receives

making a reimbursem contractual hold or use for only the
supply to the ent (as agreement intends to his own actual
with hold any interest amount
recipient, actual,
such
also receives without principal to title to the incurred
goods or
and incurs adding it to act as his goods and / to
services
expenditure the value of pure agent or services so procure
on some his own to incur so procured procured such
other supply supply) for expenditur or supplied and goods or
on behalf of such supplies e/costs in as pure services
the recipient from the the course agent of (apart
and recipient of of supply principal from the
the main of goods amount
supply and /or for the
services
provided
on his
own
account)
While the relationship between them (provider of service and recipient of
service) in respect of the main service is on a principal to principal basis, the
relationship between them in respect of other ancillary services is on pure agent
basis.
The supplier needs to fulfilALLthe above conditions in order to qualify as a pure

agent. In case the conditions are not satisfied, such expenditure incurred is
included in the value of supply under GST.

Eg 1:The following illustration will make the concept clearer:

EG Corporate services firm A is engaged to handle the legal work pertaining to the
incorporation of Company B.
• Other than its service fees, A also recovers from B, registration fee and approval fee for
the name of the company paid to Registrar of the Companies.
• The fees charged by the Registrar of the Companies for registration and approval of the
name are compulsorily levied on B.
• A is merely acting as a pure agent in the payment of those fees.
• Therefore, A’s recovery of such expenses is a disbursement and not part of the value of
supply made by A to B.
Eg 2: Some examples of expenditure/costs incurred as pure agent are:

1. Port fees, port charges, custom duty, dock dues, transport charges etc. paid by customs
broker on behalf of the owner of goods.
2. Expenses incurred by C&F agent and reimbursed by principal such as freight, godown
charges.
Eg 3:Suppose a customs broker issues an invoice for reimbursement of a few expenses and
for consideration towards agency service rendered to an importer. the amounts charged by
the customs broker are as below:
S.N Component charged in invoice Amount
1. Agency income ₹ 10000/-
2. Travelling expenses Hotel ₹ 15,000/-
expenses
3. Customs duty ₹ 55,000/-
4. Docks dues ₹ 5000/
In the above situation, agency income and travelling/ hotel expenses shall be added for
determining the value of supply by the customs broker whereas docks dues and the
customs duty shall not be added to the value, provided the conditions of pure agent are
satisfied.

10) Rule 34 - Rate of exchange of currency, other than Indian rupees, for determination of
value of Goods and services
Goods Services
The relevant rate of The relevant rate of

exchange for exchange for
determining the value of determining the value of
taxable goods is the rate taxable service is the
notified by CBIC under rate determined as per
section 14 of the GAAP, prevalent on the
Customs Act, 1962, date of time of supply of
prevalent on the date of said service.
time of supply of said
goods
11) Rule 35 - Value of supply inclusive of integrated tax, central tax, State tax, Union
territory tax
Where the value of supply is inclusive of GST, the tax amount is

determined in the following manner:
Eg: If the value inclusive of tax is ₹ 100/- and applicable GST

rate is 18% [IGST or CGST, SGST/UTGST] then,
Tax amount = (100x18)/(100+18)= 1800/118=₹ 15.25

Applicability of GST on additional / penal interest (C.No. 102/21/2019 dt.28.06.2019)-

Clarification
Case – 1:
X sells a mobile phone to Y. The cost of mobile phone is Rs 40,000/-. However, X gives Y an option to
pay in installments, Rs 11,000/- every month before 10th day of the following month, over next four
months (Rs 11,000/- *4 = Rs. 44,000/-). Further, as per the contract, if there is any delay in payment
by Y beyond the scheduled date, Y would be liable to pay additional / penal interest amounting to
Rs. 500/- per month for the delay. In some instances, X is charging Y Rs. 40,000/- for the mobile and
is separately issuing another invoice for providing the services of extending loans to Y, the
consideration for which is the interest of 2.5% per month and an additional / penal interest
amounting to Rs. 500/- per month for each delay in payment.
Clarification:
As per the provisions of sub-clause (d) of sub-section (2) of section 15 of the CGST Act, the amount
of penal interest is to be included in the value of supply. The transaction between X and Y is for
supply of taxable goods i.e. mobile phone. Accordingly, the penal interest would be taxable as it
would be included in the value of the mobile, irrespective of the manner of invoicing.
Case – 2:
X sells a mobile phone to Y. The cost of mobile phone is Rs 40,000/-. Y has the option to avail a loan
at interest of 2.5% per month for purchasing the mobile from M/s ABC Ltd. The terms of the loan
from M/s ABC Ltd. allows Y a period of four months to repay the loan and an additional / penal
interest @ 1.25% per month for any delay in payment.
Clarification:
The additional / penal interest is charged for a transaction between Y and M/s ABC Ltd., and the
same is getting covered under Sl. No. 27 of notification No. 12/2017-Central Tax (Rate) dated
28.06.2017. Accordingly, in this case the 'penal interest' charged thereon on a transaction between
Y and M/s ABC Ltd. would not be subject to GST, as the same would not be covered under
notification No. 12/2017-Central Tax (Rate) dated 28.06.2017. The value of supply of mobile by X to
Y would be Rs. 40,000/- for the purpose of levy of GST
Clarification on valuation methodology for ascertainment of GST on TCS under IT Act, 1961
a)Section 15(2) of CGST Act specifies that the value of supply shall include “any taxes, duties cesses,
fees and charges levied under any law for the time being in force other than this Act, the SGST Act,
the UTGST Act and the GST (Compensation to States) Act, if charged separately by the supplier.
b)It has been clarified that for the purpose of determination of value of supply under GST, tax
collected at source (TCS) under the provisions of the Income Tax Act, 1961 would not be includible
as it is an interim levy not having the character of tax.

12) SALE OF MOTOR VEHICLE
(Notification 8/2018 CT (A)
ITC availed either ITC not availed

in law earlier law either in earlier
(or) GST law law (or) GST law
GST payable on GST payable on

sales Margin of supply
consideration (MOS)
MOS Means
If depreciated If depreciated
claimed u/s 32 of not claimed
IT Act
MOS = Sale MOS = SP - PP

Value (-) WDV
If MOS is negative, then ignore
Rate of GST on Motor Vehicle
Petrol (or) CNG Vehicle Diesel with engine Sports vehicles Any other
with engine capacity capacity 1500cc or (SVV) with 1500cc vehicles
1200cc or more more or more
18% 18% 18% 12%

CH.SUDHEER C.A, C.M.A Chapter 8 Input Tax Credit (ITC)
Chapter 8
INPUT TAX CREDIT (ITC)
1. Eligibility and conditions for taking ITC (Section 16)

2. Time limit for Availing ITC (Section 16)
3. Blocked Credits (Section 17) TOPICS
4. Apportionment of Credit & Reversal there of (Section 17)
a) On Input and Input service
b) On Capital Goods
c) Optional Method for Banks
5. Credit in special Circumstances(Section 18)
I. Entitlement of ITC on New registration, conversion from Composition scheme to
Regular etc.,
II. Reversal of ITC on opting of Composition scheme etc.,
III. Cancellation of Registration
IV. Supply of CG or P & M on which ITC has been availed
V. Transfer of ITC in case of Change in the constitution
VI. Transfer of ITC
6. Taking ITC in respect of Inputs and CG sent for Jobwork (Section 19)
7. Distribution of ITC by Input Service Distributor (ISD) (Section 20 & 21)
8. How ITC is availed and Utilised ( Section 41,42,49)
9. Amendment in Rule 41
10. New Rule 86A to Restrict ITC
11. Restriction of ITC (Rule 86B) : V.V.IMPORTANT
1. Eligibility and conditions for taking ITC (Section 16)
Registration under GST Goods/services to be used for

business purposes
ITC will be available on goods and/or services

(i) which are used in the course or furtherance of
Every registered person shall be entitled to ITC the business or
charged on inward supply of goods and / or
services. (ii) the “intention to use” the goods and/or
services in the course or furtherance of business
ITC will be credited in Electronic Credit Ledger.

Conditions for takingITC

Question 1
1. Possession of 2. Receipt of the goods

taxpaying document and / or services
ITC can be availed on the basis of any of the following documents:

i) Invoice issued by a supplier of goods and/or services  The person taking the ITC must have received
ii) Invoice issued by recipient (receiving goods and/or services from the goods /services.
unregistered supplier) along with proof of payment of tax (in case of reverse  In case of “Bill to Ship to” Model eventhough
charge) goods were received by person to whom
iii) A debit note issued by supplier delivery is made, ITC can be availed by the
person to whom Billing is done
iv) Bill of entry or similar document prescribed under Customs Act
v) Revised invoice Example for Bill to ship to Model: A is a trader who
vi) Document issued by Input Service Distributor places an order on B for a consignment of soda ash. A
receives a buying order from C for the same quantity of
soda ash. A instructs B to deliver the goods to C,and in
Note: Rule 48 of the CGST Rules specifies that the original copy is for the
recipient of goods.The original copy may preferably be kept for record to turn he raises an invoice on C. Though the goods are
support the credit entry. not physically received at the premises of A, the
condition of section 16(2)(b) is satisfied, and A is
Note: Provided that if the said document does not contain all the specified entitled to ITC on the consignment.
particulars but contains the details of the amount of tax charged, description
of goods or services, total value of supply of goods or services or both, GSTIN
of the supplier and recipient and place of supply in case of inter-State supply,
input tax credit may be availed by such registered person (Rule 36)

Conditions for takingITC
3. Tax leviable on supply 4. Filing of return (i.e.,

actually paid to Government GSTR 3B):
Tax should actually have been paid, by

cash or through utilization of ITC, on the The registered person taking the ITC
goods and / or services for which ITC is must have filed his return under section
being taken. However, provisional ITC can 39. (GSTR 3B)
be taken initially, prior to matching in the
common portal, and used for payment of
self-assessed tax on outward supply
(Refer Note 4)
Note 1 Eg: XYZ makes an advance payment in August and

orders 10 MT of a particular chemical which is in
In case of Goods received in lots, ITC short supply. The supplier of the chemical raises a
available only on receipt of last lot / bill for the entire amount in August and collects
Installment GST from XYZ on the advance paid. The chemical is
delivered in lots over a period of three months and
the supply is completed in November. Though XYZ
Question 2
paid some tax in advance as early as August, he can
take the ITC only on receipt of last instalment of
the chemical in the month of November.
Note 2 Payment for the invoice to be made Exceptions:This condition of payment of value of
within 180 days from DOI: supply plus tax within 180 days does not apply in
The registered person must pay the the following situations:
supplier, the value of the goods (i) Supplies on which tax is payable under reverse
and/or services along with the tax charge
within 180 days from the date of (ii)Deemed supplies without consideration
issue of invoice.
In the event of failure to do so, Such
credits availed by the registered
person would be added to his
output tax liability in GSTR -3B Question 3
Interest will be paid @ 18% from
the date of availing credit till the
date of reversal of credit.
However, once the payment is
made, the recipient will be entitled
to avail the credit again without any
time limit

Note 3 If depreciation claimed on tax Thus, in respect of the tax paid on such items, dual
component, ITC not allowed benefit cannot be claimed under Income-tax Act,
1961 and GST laws simultaneously. In other words,
either depreciation on the tax component can be
claimed under Income Tax Act or ITC of such tax
paid can be availed under GST laws.
Note4 PROVISIONAL ITC Input tax credit to be availed by a registered
Rule 36(4)- Invoices not uploaded shall person in respect of invoices or debit notes, the
not exceed 5% of Eligible credit details of which have not been furnished by the
suppliers in GSTR -1, shall not exceed 5% of the
eligible credit available in respect of invoices or
debit notes the details of which have been
furnished by the suppliers in GSTR-1
PROVISIONAL ITC Input tax credit to be availed by a registered person in respect of invoices or
Rule 36(4)- Invoices not debit notes, the details of which have not been furnished by the suppliers in
uploaded shall not exceed GSTR -1, shall not exceed 5% of the eligible credit available in respect of
5% of Eligible credit invoices or debit notes the details of which have been furnished by the
suppliers in GSTR-1 within the due date
GENESIS OF RULE 36(4)
Applicability Restriction Reference
Before 09/10/2019 No Restriction i.e, Assessee can avail ----
Provisional ITC as per Purchase Register
w.e.f.09/10/2019 Provisional ITC restricted to 20% of Notn 49/2019 & Circular 123/42/2019
Eligible ITC in GSTR-2B
w.e.f.01/01/2020 Provisional ITC restricted to 10% of Notn 75/2019
w.e.f.01/01/2021 Provisional ITC restricted to 5% of Notn 94/2020
Amendment

Question 4
2. Time limit for availing ITC
ITC on invoices pertaining to a financial year or debit notes relating to invoices pertaining to a
financial year can be availed any time till the
a)Due date of filing of the return for the month of September of the succeeding FY
Or
b) The date of filing of the relevant annual return,
 It may be noted that the return for the month of September is to be filed by the 20 th
October
 Annual return of a F.Y is to be filed by 31st December of the succeeding FY
 The time limit u/s 16(4) does not apply to claim for re-availing of credit that had been
reversed earlier.
Eg : Hercules Machinery delivered a machine to XYZ in January 2020 under Invoice no. 49 dated 28th
January, 2020 for ₹ 4,15,000 plus GST, and undertook trial runs and calibration of the machine as per
the requirements of XYZ. The amount chargeable for the post-delivery activities was covered in a debit
note raised in April 2020 for ₹ 50,000 plus GST. Hercules Machinery did not file its annual return till
October, 2020.
Though the debit note was received in the next financial year, it relates to an invoice received in the
financial year ending March 2020.
Therefore, the time limit for taking ITC available on ₹ 50,000 as well as on ₹ 4,15,000 is 20th October,
2020; earlier of the
a) Date of filing the annual return for 2019-20OR
b) The return for September 2020.

Question 5-23
3. Blocked credits [Section 17(5)]
In the following cases ITC is not available at all

S.N Name Exception (i.e., ITC is available)
1. Motor vehicles for When used for making the following taxable supplies:
transportation of • Further supply of such vehicles of conveyances; or
persons having • Transportation of passengers; or
approved seating • imparting training on driving such motor vehicles
capacity of not more Eg: A car dealer is allowed ITC on cars purchased for resale; a cab
than 13 persons service is allowed ITC on cars purchased for use as cabs; a driving
(including the driver) school is allowed ITC on cars purchased for use in teaching driving.
Note: ITC is available on Motor vehicles with seating capacity of
more than 13 persons (Blocked credit is only for vehicles with
seating capacity ≤ 13 persons)
2. Vessels and aircraft (i) for making the following taxable supplies, namely:—
(A) further supply of such vessels or aircraft; or
(B) transportation of passengers; or
(C) imparting training on navigating such vessels; or
(D) imparting training on flying such aircraft;
(ii) for transportation of goods;
3. Services of general (i) If ITC is eligible(as per Exception 1 & 2), then these services also
insurance, servicing, eligible as ITC;
repair and maintenance (ii) where received by a taxable person engaged-
in so far as they relate (a) in the manufacture of such motor vehicles, vessels or aircraft;
to motor vehicles, or
vessels or aircraft (b) in the supply of general insurance services in respect of such
referred to in 1 & 2 motor vehicles, vessels or aircraft insured by him;
points above
4. Foods and beverages, a) An inward supply of these is used for making an outward taxable
outdoor catering, beauty supply of the same category or as an element of a taxable
treatment, health composite or mixed supply.
services, cosmetic and Eg :A caterer for a wedding gets the sweet dish course supplied by a
plastic surgery specialist in desserts. He is allowed ITC of the tax paid by him
to the specialist.
b) The Government has made it obligatory for an employer to
provide any of these services to its employees
5. leasing, renting or hiring a) The Government has made it obligatory for an employer to
of motor vehicles, provide any of these services to its employees; or
vessels or aircraft,life b) Inward supply of these services is used for making an outward
insurance and health taxable supply of the same category or as an element of a
insurance taxable composite or mixed supply.
6. Works contract services a) It is input service for further supply of works contract service
for construction of an b) Immovable property is plant and machinery
immovable property
7. Membership of a club, When such services are provided by an employer to its employees

health and fitness centre under a statutory obligation

8. Travel benefits to The Government has made it obligatory for an employer to provide
employees on vacation any of these services to its employees under any law;
such as LTC
9. Inward supplies received by a taxable person for construction of an immovable property (other
than plant and machinery) on his own account even when such supplies are used in the course
or furtherance of business
Eg : - A company buys material and hires a contractor to construct an office building to house
the plant supervisory staff. The input tax paid on such goods and services is not allowed as
credit.
Meaning of construction and plant and machinery
“Construction”,both in this clause and the previous one, includes reconstruction, renovation,
additions or alterations or repairs, to the extent of capitalization, to immovable property;
“Plant and machinery”means apparatus, equipment, and machinery fixed to earth by
foundation or structural supports but excludes land, building or other civil structures,
telecommunication towers, and pipelines laid outside the factory premises.
10. Inward supplies on which tax has been paid under the composition scheme
11. Inward supplies received by a non-resident taxable person except goods imported by him
12. Goods and / or services used for personal consumption
13. Goods that are lost, stolen, destroyed, written off or disposed of by way of gift or free samples
14. Tax paid under sections 74, 129 and 130. (These sections prescribe the provisions relating to tax
paid as a result of evasion of taxes, or upon detention of goods or conveyances in transit, or
towards redemption of confiscated goods/conveyances.)
Eg:
ITC on cars purchased by a manufacturing company for official use of its employees is blocked.
ITC on cars purchased by a car dealer for sale to customers is allowed.
ITC on cars purchased by a company engaged in renting out cars for transportation of passengers, is
allowed.
ITC on cars purchased by a car driving school is allowed.
ITC on buses purchased by a company for transportation of its employees from their residence to
office and back, is allowed.
ITC on trucks purchased by a company for transportation of its finished goods is allowed.
ITC on aircraft purchased by a manufacturing company for official use of its CEO is blocked.
ITC on aircraft purchased by an Aviation School providing training on flying aircrafts, is allowed.
ITC on general insurance taken on a car used by employees of a manufacturing company for official
purposes, is blocked.
ITC on maintenance & repair services availed by a company for a truck used for transporting its
finished goods, is allowed.
AB & Co., a caterer of Amritsar, has been awarded a contract for catering in a marriage to be held
at Ludhiana. The firm has given the contract for supply of snacks, to be served in the marriage, to
CD & Sons, a local caterer of Ludhiana. ITC on such outdoor catering services availed by AB & Co., is
allowed.
ITC on outdoor catering services availed by a company, for a team development event organized
for its employees, is blocked.
ITC on outdoor catering service availed by a company to run a canteen inits factory. The Factories
Act, 1948 requires the company to set up a canteen in its factory. ITC on such outdoor catering is
allowed.

4. Apportionment of Credit (Section 17)
Question 24
ITC is available when the Inward Supply is
Used for Outward Used as Capital Used for Business Used for Zero
supply of Taxable Goods purpose rated supplies
goods and notwithstanding
services exempt nature
Apportionment of ITC
The situations requiring apportionment are as follows:

(a) When the goods and / or services are used by the registered person partly for the purpose of
business and partly for Non business purpose and
(b) When the goods and / or services are used by the registered person partly for making
taxable supplies and partly for making exempt supplies
(Here taxable supply includes zero-rated supplies)
In both the above situations, full ITC on inward supplies cannot be taken; only
proportionate ITC is allowed in such scenarios.
Eg
Out of 10 containers purchased by a registered person engaged in

taxable supply of goods, 5 are used for storing non-taxable goods
(exempt supply) such as petroleum (petroleum is out of GST gamut). ITC
on 5 containers used for non-taxable goods cannot be availed.
A registered person (partnership firm) purchases 5 laptops but one of the
laptop is being used by the son of one of the partners of the firm. ITC will
not be available on such laptop as it is used for personal purposes.

Question 25-27
a) Methodology of apportionment of credit on Inputs and Input services and reversal there of
Rule 42 of the CGST Rules provides the methodology for apportionment of ITC on inputs and input
services and reversal of ineligible credit:
Step 1 – Compute common credit
Total input tax involved on inputs & input services in a tax period T
Less: Input tax on inputs & input services that are intended to be used exclusively for (T1)
non-business purposes
Less: Input tax on inputs & input services that are intended to (T2)
be used exclusively for exempt supplies
Less: Input tax on inputs & input services which are ineligiblefor credit [i.e., blocked (T3)
credits]
ITC credited to Electronic Credit Ledger C1
Less: ITC on inputs & input services that are intended to be used exclusively for taxable (T4)
supplies including zero rated supplies
Common ITC available for apportionment (C2)
Step 2 – Compute credit attributable to exempt supplies (ineligible credit) by

apportionment of common credit
a) Calculate D1: Apportion C2 into credit attributable to exempt supplies D1 as under:

D1 = (E/F) x C2
Where
E = Aggregate value of exempt supplies during the tax period

F = Total turnover in the State during the tax period
b) Calculate D2: Compute credit attributable to non-business purposes D2 as under
D2 = 5% of C2 (common credit)
Notes
If the registered person does not have any turnover during the said tax period, or the above
information is not available, the values for the last tax period may be used.

Step 3 – Restrict ineligible credits
Add D1 + D2 to the output tax liability.
Important points
If Σ(D1 + D2) > the amount

already added to output
Compute Σ (D1 + D2) for
tax liability every month, If the amount added to
the whole financial year,
the differential amount has output tax liability every
by taking exempted
Compute C3 to be added to the output month > Σ (D1 + D2), the
turnover and aggregate
separately for tax liability of any month additional amount paid has
turnover for the whole
ITC of CGST, till September in the to be claimed back as
financial year, before the
SGST/ UTGST following financial year and credit in the return of the
due date for filing the
and IGST. interest @ rate 18% should month not later than
return for September in
be paid on such differential September in the next
the following financial
amount from 1st April of financial year.
year.
succeeding year till the
date of payment.

EXEMPTED TURNOVER INCLUDES

(For Rule 42, 43)
Exempted by way of Goods & Services Outward supplies Sale of land & building Transaction
Alcohol liquor for
notification with term denoting which were where entire in shares
human consumption
in SAC,HSN in rate taxable under consideration is &securities
E.g.: - Notification sale of petrol diesel,
column as “NIL” RCM (From view received after issuance
12/2017 (For Services) crude, ATF
point of supplier of completion
E.g.:- Notification this is exempt) certificate
2/2017 (For goods)
EXEMPTED TURNOVER (OR) SUPPPLY EXCLUDES

(i.e. ITC AVAILABLE FOR BELOW POINTS)
Supply of services, having Interest or discounts on deposits and Transport of goods by

place of Supply in loans (However for banks & financial vessel from India to
Nepal/Bhutan for payment In Institutions exempted T.O includes outside India
Indian Rupee’s interests/discounts)
As per notification 12/2017-GST Act and 9/2017 IGST Act, they are exempted services. But to allow ITC they are excluded from exempted services
definition.

Amendments in Rule 42 – In case of assessee under business of construction (Notification no.

16/2019-CT date. 29.03.2019) (Refer Chapter 25 for complete details)
E shall include While calculating

E = Aggregate aggregate carpet ‘E’ , carpet area of
carpet area of area of apartment on
apartments apartments which tax @1%, 5%
D1 shall be which are which have not D1 &D2 shall be
is to be paid shall
calculated exempt from been booked till reversed either
also be included.
for each tax the date of in GSTR 3B or
Because in those
project F = Aggregate issuance of through GST
cases ITC cannot be
separately carpet area of completion DRC-03
availed If availed,
apartments in certificate or first then reversal shall
the project occupation of be made under this
project, rule.
whichever is
earlier
b) Methodology of apportionment of credit of Capital Goods and reversal there of (Rule 43)
Question 28-30
CAPITAL GOODS
Used for Taxable Used for exempted Common use

purpose purpose
Claim credit Initially &

Claim ITC in full No Claim
reverse for 60 months
under rule 43

Step 1 - Determine common credit ‘Tc ’ on capital goods as under
(i) Identify input tax on capital goods which are used/intended to be used commonly for
making taxable as well as exempt supplies & business & non business purposes and denote
the same as ‘A’. Such amount will be credited to ECrL.
(ii) The useful life of such capital goods will be taken as 5 years from the date of invoice. (i.e.,
60 months)
Step 2 - Determine common credit during the useful life of capital goods for a tax period
asunder and denote the same as ‘Tm’
Tm = Tc ÷ 60
Step 3 - Apportion common credit attributable to exempt supplies as under
Te = (E ÷ F) x Tm
Where
E = Aggregate value of exempt supplies made during the tax
period
F = Total turnover during the tax period
Step 4: Restrict ineligible credit
Add ‘Te’ to the output tax liability along with applicable

interest @ 18% p.a during every tax period of the useful
life of the capital goods concerned.
Notes
If the registered person does not have any turnover during the said tax period, or the above
information is not available, the values for the last tax period may be used.

Conversion of use of CAPITAL GOODS
1. Capital goods used for taxable supplies at the time of acquisition &Later converted to exempted
supplies/Non-Business use.
 Initially ITC has been availed
 Upon conversion, reversal of ITC = Total ITC *balance no. of months
60 months
E.g. If a capital good used for 5m 6 days, then reversal of ITC later = Total ITC* 54M
60M
 Then capitalise the amount and claim depreciation.
2. Capital goods used for exempted supplies at the time of acquisition & Later converted to taxable
supplies
 If any ineligible claim is capitalised and depreciation is claimed, then no ITC is admissible
now.
 However, if ITC is shown as current asset initially (i.e., not claim ITC or not capitalised) or
depreciation claimed on ITC has been reversed, then
 Now ITC to be availed = Total ITC-5% per quarter (or) part thereof
3. Capital goods used for taxable supply at the time of acquisition & Later used for common use
 Initially full ITC is claimed
Amendment
 After conversion, compute common credit
w.e.f.01/04/2020
 Common credit = ITC-5% per quarter (or) part thereof
 The common credit is already claimed (because, initially it is taxable so claimed)
 So, reversal has to be made by procedure specified in rule-43 for 60 months
 i.e. monthly reversal under Rule 43 = ITC availed at time of purchase X Exempted T.O
60M Total T.O
4. Capital goods used for exempted supply at the time of acquisition & Later used for common use
 Initially no ITC is taken
 After conversion, Compute Ineligible credit Amendment
 Ineligible credit = ITC-5% per quarter (or) part thereof w.e.f.01/04/2020
 Add Ineligible credit to Output Tax Liability
 Avail full ITC available in Invoice at time of Purchase
 Later monthly reversed for 60 months (Rule 43) =
Common credit X Exempted T.O
60M Total T.O
5. Capital goods used for common use at the time of acquisition & Later used for taxable supplies
 E.g. For suppose, for 4 months used for common usage and ITC reversed as per rule 43 from
5th month it used exclusively for taxable supply then,
 No reversal is required from this month i.e., reverse of ITC under rule 43
 Availment of ITC is already made at the time of acquisition itself.
6. Capital goods used for common use at the time of acquisition & Later used for exempted supply
 Initially credit is availed and reversal is being made monthly for 9 months
 After conversion into exempted supply.
 Reversal = ITC * Balance No. of months
60 months

C) Optional Methodology of apportionment of ITC for Banks & Financial Institutions
Rule 38 of the CGST Rules provides the optional methodology
• As an alternative of Rule 42 & 43, a banking company or a financial institution including a

NBFC, which accepts deposits, or extends loans or advances, has the option to limit its
availment of ITC to 50% of the eligible ITC on inputs, capital goods and input services each
month and the remaining ITC shall lapse.
• Credit of tax paid on inputs and input services that are used for nonbusiness purposes and
items mentioned u/s section 17(5) [blocked credits] cannot be availed.
• The restriction of availing 50% ITC shall not apply to the tax paid on supplies
procured from another registration within the same entity i.e., 100% credit of such
tax can be availed.
• The option once exercised cannot be changed during the remaining part of the
financial year.
Question 31-33

5. Credit in Special Circumstances [Section 18]
I. I. Entitlement of ITC:
Section 18 read with Rule 40 of CGST rules:

In all the below cases, the registered person has to make an electronic declaration in ITC-01 within
30 days from the date when the registered person becomes eligible to avail ITC.
If the claim of ITC pertaining to CGST, SGST/UTGST, IGST put together exceeds ₹ 2,00,000, the
declaration needs to be certified by a practicing Chartered Accountant/Cost Accountant.
S.N Persons eligible to take Goods entitled to ITC Restrictions/

credit Inputs held in stock/ As on Conditions
capital goods
1. New Registration a) Inputs held in stock The
Person who has applied b) Inputs contained in dayImmediately
for registration within 30 semi-finished or preceding the
days from the date on c) Finished goods held date
ITC to be availed
which he becomesliable in stock from which he
within 1 year from
to registration becomes liable to
the date of the issue
pay tax
of the tax invoice by
2. Voluntary registration a) Inputs held in stock The day
the supplier.
Person who is not b) Inputs contained in immediately
required to register, but semi-finished or preceding the
obtains voluntary c) Finished goods held date of
registration in stock registration
3. Composition tax to a) Inputs held in stock The day a)ITC on capital
Regular scheme b) Inputs contained in immediately goods will be
semi-finished or preceding the reduced by 5%per
c) Finished goods held date liable to pay quarter of a year
in stock tax under regular orpart of the year
d) capital goods scheme from the date of
4. Exempt supplies become a) Inputs held in stock The day invoice.
Taxable supplies b) Inputs contained in immediately b) ITC can be claimed
semi-finished or preceding the only in invoices were
c) Finished goods held date available
in stock from which such b) ITC to be availed
d) capital goods supply becomes within 1 year from
exclusively used for taxable thedate of the issue
such exempt supply of thetax invoice by
thesupplier.
Questions 34-37 respectively

Eg
1: Mr. Z becomes liable to pay tax on 1st August and has obtained registration on 15th August. Mr. Z
is eligible for ITC on inputs held in stock and as part of semi-finished goods or finished goods held in
stock as on 31st July. Mr. Z cannot take ITC on capital goods.
2:Mr. A applies for voluntary registration on 5th June and obtains registration on 22th June. Mr. A is
eligible for ITC on inputs held in stock and as part of semi-finished goods or finished goods held in
stock as on 21st June. Mr. A cannot take ITC on capital goods.
3: Mr. B, a registered taxable person, was paying tax at composition rate upto 30th July. However,
w.e.f. 31st July, Mr. B becomes liable to pay tax under regular scheme. Mr. B will be eligible for ITC
on inputs held in stock and inputs contained in semi-finished or finished goods held in stock and on
capital goods as on 30th July. ITC on capital goods will be reduced by 5% per quarter from the date of
the invoice
II. Reversal of ITC(Section 18(4) read with rule 44 of CGST Rules)
CASE 1 :Conversion from Regular to Composition scheme

Question 38-39
CASE 2 :Taxable supplies become Exempted supplies respectively
a) In respect of Inputs held in Stock
If invoices available : ITC on inputs will be reversed proportionately on the basis of
corresponding invoices on which credit had been availed on such inputs.
If invoices are not available :If invoices are not available, the ITC to be reversed will be based
on the prevailing market price of such goods on the date of switch over/exemption.
The details furnished on the basis of prevailing market value will be duly certified by a
practicing Chartered Accountant/ Cost Accountant.
b) In respect of Capital Goods

ITC involved in the remaining useful life (in months) of the capital goods will be reversed on
pro-rata basis, taking the useful life as 5 years.
Eg:Capital goods have been in use for 4 years, 6 month and 15 days.
The useful remaining life in months = 5 months ignoring a part of the month.
ITC taken on such capital goods = C
ITC attributable to remaining useful life = C x 5/60
c) Details of the amount payable must be furnished in FORM GST ITC-03(This form is to be filed
with 60 days from the date of CASE 1/ 2 above)
d) Credit Ledger shall be reversed to the extent of Tax on ITC -03. Balance of ITC, if any, lying in
the electronic credit ledger shall lapse.
e) The ITC to be reversed on inputs and capital goods will be calculated separately for ITC of
CGST, SGST/UTGST and IGST.

 Same as Case 1 & 2 given above but Tax payable in this case
is
a) Tax computed as per above provision
(or)
III. Cancellation of b) Tax on Transaction value
registration
 This tax shall be paid in GST REG -16 itself (Application for
Cancellation of Registration)
 Final Return in GSTR-10 should also be submitted within 3

months from date of Cancellation
IV. Amount payable on supply of capital goods on which ITC has

beenavailed (S.18(6) read with rule 40& 44 CGST Rules)
(i) ITC availed (-) 5% per quarter of a year or part

thereof
a) If capital goods or
plant and machinery on
which ITC has been taken Or
are supplied outward by
the registered person, he
(ii) Tax on transaction value
must pay an amount that
is the higher of the
following:
b) ITC pertaining to remaining useful life of the capital goods will be computed separately for ITC of
CGST, SGST/UTGST and IGST.
c) Such amount will have to be paid and thus, will be added to the output tax liability.
d)If refractory bricks, moulds and dies, jigs and fixtures are supplied as scrap, the taxable person may
pay tax on the transaction value.
Question 40, 41

V. Transfer of ITC on account of change in constitution of registered person

Section 18(3) read with rule 41 of CGST Rules
In case of change in In case of death of

constitution of a Upon acceptance value of assets‖ sole proprietor if
registered person The registered of such details by means the value the business is
like person will have to the transferee on The transferee of the entire continued by any
a) sale furnish the details the common will record the assets of the person being
b) demerger, of change in portal, the inputs and capital business,
constitution on the transferee or
c) transfer of unutilized ITC will goods so whether or not
common successor, the input
business be credited to his transferred in his input tax credit
portal(FORM GST electronic credit has been availed tax credit which
d) Amalgamation books of account
e) Demerger etc., ITC-02)and submit a ledger. thereon. remains un-utilized
certificate from in the electronic
the ITC in the ECrL practicing CA/CMA credit ledger is
can be transferred allowed to be
to the new entity, transferred to the
transferee as per
above provisions
Refer pg 8.23
for
Condition : Amendment
All the liabilities

should be
transferred to
New Entity
Question 42, 43

VI. Rule 41A. Transfer of credit on obtaining separate registration

for multiple places of business within a State or Union territory.-
a) A registered person taking multiple registration in State if intends to transfer the ITC to the newly
registered entity then he shall file the details of ITC to be transferred inFORM ITC 02A (newly
inserted in Forms) within 30 days of obtaining separate registration.
b) ITC shall be transferred in the ratio of value of assets held by those multiple entities at the time
of registration
a) Principal can take credit on goods (inputs and capital goods) sent for job work.
b) Credit can be taken even if the said goods are sent directly to job worker without being first
brought to the principal's place of business
Time limit for return of On failing to comply with the timelines, the Time-lines do not
goods sent for job goods will be deemed to have been supplied apply to moulds and
work/supply from job to the job worker on the day they were sent dies, jigs and fixtures
worker's place of business out. or tools sent out for
job work.
♦ Inputs - 1 year a) It should be declared in GSTR 1
b) Principal is liable to pay tax along with
♦ Capital goods - 3 years applicable interest on such supply.
from the date of sending the c) Subsequent return of the goods by the
same for job work / direct job worker will be treated as a separate
receipt by Job worker supply
Other Conditions:
Question 44, 45
a) Delivery challan to be issued by the principal under Rule 55
b) The challan needs to be issued for the inputs or capital goods sent directly to the job worker.
c) The responsibility for keeping proper accounts for the inputs or capital goods lies with the
principal.
d) The details of various challans relating to goods sent to /received from job worker or sent
from one job worker to another job worker are to be included in quarterly Form GST ITC 04
submitted by 25th day of the month succeeding the relevant quarter.
e) Details of goods sent by one jobworker to another jobworkerneed not uploaded in GST ITC-04
Original Time limit Extension on approval by commissioner

Inputs 1 year from date of sending One more year
goods to Job worker
Capital goods 3 years from date of sending 2 more years
goods to Job worker

Question 46
7. Distribution of Credit by ISD (Section 20 & 21)
ISD is an office of a business which receives tax invoice for

input service and distributes available ITC to other branch
offices of the same business
Since the common expenditure is meant for the business of all units, it is but natural that the credit of input services in respect of such common invoices
should be apportioned between all the consuming units. ISD mechanism enables proportionate distribution of credit of input services amongst all the
consuming units. The concept of ISD under GST is a legacy carried over from the service tax regime.
An ISD is compulsorily required to obtain a separate registration as an ISD even though it may be separately registered. There is no threshold limit for
registration for an ISD. The other locations may be registered separately. Since the services relate to other locations the corresponding credit should be
transferred to such locations (having separate registrations) as the output services are being provided there.
Eg:The Corporate office of ABC Ltd., is at Bangalore, with its business locations of selling and servicing of goods at Bangalore, Chennai, Mumbai and
Kolkata. Software license and maintenance is used at all the locations, but invoice for these services (indicating CGST and SGST) are received at Corporate
Office. Since the software is used at all the four locations, the ITC of entire services cannot be claimed at Bangalore. The same has to be distributed to all
the four locations. For that reason, the Bangalore Corporate office has to act as ISD to distribute the credit.
If the corporate office of ABC Ltd, an ISD situated in Bangalore, receives invoices indicating ₹ 4 lakh of CGST, ₹4 lakh of SGST and ₹ 7 lakh of IGST, it can
distribute the ITC of CGST, SGST as well as IGST of ₹ 15 lakh amongst its locations at Bangalore, Chennai, Mumbai and Kolkata through an ISD invoice
containing the amount of credit distributed.

Can a company have multiple ISDs?

Yes, different offices a company like marketing division, security
division etc. may apply for separate ISD registration.
(i)Manner of distribution of credit by an ISD [Section 20 read with rule 39 of CGST

Rules]
It must follow these principles
1 The credit connected to an input service must be distributed only to the particular
recipient to whomss that input service is attributable.
If the input service is attributable to more than one recipient, the relevant ITC is
distributed to such recipients in the ratio of turnover during the relevant period of the
2
recipient in a State / Union Territory to the aggregate turnover during the relevant
period of all the recipients to whom the input service is attributable and which are
operational during the current year.
3 ITC pertaining to input services which are common for all units, is distributed to all
the recipients in the ratio of turnover during the relevant period as described in (b)
above.
4
Both Ineligible and eligible ITC are distributed separately
5
ITC of CGST, SGST/UTGST and IGST are distributed separately.
6 The credit attributable to a recipient is distributed even if such recipient is making

exempt supplies
7 Here Turnover includes both taxable and non-taxable goods
“Relevant period”for working out the above distribution is the

previous financial year, if all the recipients of credit had turnover in
their State / Union Territory during that year.
If some or all the recipients did not have turnover in their State /
Union territory during the previous financial year, then the last
quarter for which details of turnover of all the recipients is available,
prior to the month for which credit is to be distributed, will be the
“relevant period”.

(ii) Distribution of taxes
ITC of CGST and

SGST/UTGST, in respect
ITC of CGST, SGSTin
ITC on account of of a recipient located in a
respect of recipient
IGST is distributed different State, is
located in the same distributed as IGST (total
as IGST
Stateis distributed as of ITC of CGST and
CGST / SGST respectively SGST/UTGST which were
to be distributed to such
recipient).
(iii) Procedural aspects of distribution of credit [Rule 39 of CGST Rules]
The ISD has to The ISD needs  Furnishmonthly

An ISD cannot
issue an ISD to issue aISD GSTR-6 within 13
days. accept any
invoicefor credit note,
 The details of ITC invoices on
distributing for reduction
ITC. Indicate in credit if the are made available which tax is to
in such distributed to recipients in be discharged
invoice that it credit gets GSTR 2A. under reverse
is issued only reduced for  The recipients may charge
for distributing any reason. include these in its mechanism.
ITC GSTR- 3B for ITC
ITC available An ISD is

for not Recovery of excess credit distributed to
distribution a recipient [Section 21]
in a month is required to
to be file annual Shall be recovered from the recipient
distributed return. but not from ISD
in the same
month.
Refer pg.1.10
8. How ITC is availed & Utilised (Section 49)

9. Amendment with respect to Rule 41 (Transfer of Business) Amendment
S.No Question Clarification
1. In case of demerger, Illustration: A company XYZ is registered in two States of M.P.

proviso to rule 41 (1) of the and U.P. Its total value of assets is worth Rs. 100 crore, while
CGST Rules provides that its assets in State of M.P. and U.P are Rs 60 crore and Rs 40
the input tax credit shall be crore respectively.
apportioned in the ratio of
It demerges a part of its business to company ABC. As a part of
the value of assets of the
such demerger, assets of XYZ amounting to Rs 30 Crore are
new units as specified in
transferred to company ABC in State of M.P, while assets
the demerger scheme.
amounting to Rs 10 crore only are transferred to ABC in State
However, it is not clear as of U.P. (Total assets amounting to Rs 40 crore at all-India level
to whether the value of are transferred from XYZ to ABC).
assets of the new units is to
The unutilized ITC of XYZ in State of M.P. shall be transferred to
be considered at State level
ABC on the basis of ratio of value of assets in State of M.P., i.e.
or at All-India level.
30/60 = 0.5 and not on the basis of all-India ratio of value of
assets, i.e. 40/100=0.4. Similarly, unutilized ITC of XYZ in State
of U.P. will be transferred to ABC in ratio of value of assets in
State of U.P.,i.e. 10/40 = 0.25.
2. Is Rule 41 i.e, Transfer of Yes, the formula for apportionment of ITC, as prescribed under
credit applicable in case of proviso to sub-rule (1) of rule 41 of the CGST Rules, shall be
partial transfer of business applicable for all forms of business re-organization that results
assets along with liabilities in partial transfer of business assets along with liabilities.
3. Whether the ratio of value No, the ratio of value of assets, as prescribed under Rule 41 of
of assets, as prescribed the CGST Rules, shall be applied to the total amount of
under proviso to rule 41 (1) unutilized input tax credit (ITC) of the transferor i.e. sum of
of the CGST Rules, shall be CGST, SGST/UTGST and IGST credit. The said formula need not
applied in respect of each be applied separately in respect of each heads of ITC
of the heads of input tax (CGST/SGST/IGST).
credit viz. CGST/ SGST/
IGST/ Cess? Illustration A: The ITC balances of transferor X in the State of
Maharashtra under CGST, SGST and IGST heads are 5 lakh, 5
lakh and 10 lakh respectively. Pursuant to a scheme of
demerger, X transfers 60% of its assets to transferee B.
Accordingly, the amount of ITC to be transferred from A to B
shall be 60% of 20 lakh (total sum of CGST, SGST and IGST
credit) i.e. 12lakh.
4 Is the transferor required No. The transferor is required to file FORM GST ITC-02 only in
to file FORM GST ITC – 02 those States where both transferor and transferee are
in allStates where it is registered.
registered?

10. Rule 86A- Restrictions on ITC Availament

Amendment
Rule 86A has empowered the Department to impose restrictions on use of available input Tax Credit of
recipients in certain cases. The commissioner or an officer authorized by him, on his behalf, not below
the rank of an Assistant Commissioner has powers to block credit under Rule 86A
A.Cases where credit availed be considered as ineligible or fraudulently availed
Power under Rule 86A is exercised by authorities if they have reason to believe that ITC is ineligible or
has been fraudulently availed. ITC is said to have been availed fraudulently in following cases
a. Supplier found non-

existent or not
conducting business
from its registered
place
d. Recipient is not in b. Taxes not paid into

possession of tax the Government
invoice debit note or Treasury. i.e. the
any other document supplier has not paid
prescribed under rule GST against prescribed
30 documents on which
recipient availed credit
c. Recipient availed
credit without receipts
of goods or services

B.Procedure to restrict credit under Rule 86A
The commissioner or officer authorized by him will record reasons in writing and block credit
available in the recipient. As a result, recipient is not allowed to utilize available credit for discharge
of any liability under sec. 49 or claim refund for unutilized amount in his Electronic Credit Leger
In case, recipient submit proof/documentary evidence and commissioner/office satisfied that
conditions for blocking credits are no longer exist, he can allow/unblock Input Tax Credit
C. Period of Restrictions
The restrictions on the utilization of credit under Rule 86A will ceases to effect after the expiry of a
period of one year from the date of imposing such restrictions
As if now, recipient needs to be alert while dealing with the suppliers
11. Restriction of ITC (Rule 86B) : V.V.IMPORTANT Amendment
Condition Turnover during the Month is > 50 lakhs (excluding Exempted & Zero rated
supplies)
Restriction Only 99% of Available ITC in Credit ledger should be utilized in GSTR 3B
(Balance Credit will continue in Electronic Credit Ledger)
Result 1% of Tax payable should be paid through Electronic Cash Ledger
Exceptions The following assesses’s can use 100% ITC i.e., this Rule does not apply
a)
If assessee is Who have to pay IT Amount
Proprietary Concern Such Sole Proprietor Have paid
HUF Karta INCOME TAX >
Company a) MD or 1,00,000 in each
b) Any two of Whole of last two F.Y’s in
time directors or respect of years
where time limit
Partnership Firm Any of Two partners
to file IT u/s 139 is
AOP Any two of Members of expired
Managing Committee
Trust Board of Trustees
b) Received Refund > 1 lakh for Exports or Inverted Duty structure u/s 54(3)
c) Cumulatively this year Tax paid through Cash Ledger > 1% of total Output tax
liability
d) Assessee is Govt department, PSU, LA, A statutory Body(LIC,SBI etc..,)

Example Mr. A is a GST registered person, and his taxable supply for January 2021 is
Rs. 55,00,000. Let’s assume that the output tax liability of Mr A is Rs.9,00,000 and
the balance available in his electronic credit ledger is Rs.9,50,000.
As per the new Rule 86B, Mr A can pay only INR 8,91,000 (9,00,000*99%) from his
electronic credit ledger. The balance – INR 9,000 (9,00,000 – 8,91,000) has to be
paid in cash.
Balance in Electronic Credit ledger is Rs. 9,50,000- 8,91,000 = 59,000
Previously, taxpayers could utilise 100% of the available credit ledger balance to
pay off the output tax liability. This new Rule 86B has limited the use of the
available ITC balance.

CH.SUDHEER C.A, C.M.A Chapter 9 Registration
Chapter 9
REGISTRATION
TOPICS
1. Persons liable for Registration (Section 22) 6. Cancellation of Registration (Section 29 & 30)
2. Compulsory Registration in certain Cases (Section 7. Revocation of Cancellation of Registration

24) (Section 30)
3. Persons not liable for Registration (Section 23) 8. Application for registration by Special Economic
Zone (SEZ)
4. Procedure for Registration (Section 25,26,27) 9. Suspension of Registration (Rule 21A)
5. Amendment of Registration (Section 28) 10. Registration of IBC Insolvency Professional
Question 1-4
1. Persons liable for Registration (Section 22)
States with threshold States with threshold States with threshold

limit of ₹ 10 lakh for limit of ₹ 20 lakh for both limit of ₹ 20 lakh for
both goods and services goods and services services and ₹ 40 lakh
for exclusive supply of
Arunachal Pradesh
Manipur goods
Meghalaya
Mizoram Jammu & Kashmir

Sikkim
Uttarakhand Assam
Nagaland
Puducherry Himachal Pradesh
Tripura
Telangana
All other States
Type Threshold limit u/s 22

Persons engaged in manufacturing following goods: 20 lakhs
a) Ice cream and other edible ice, whether or not containing cocoa
b) Pan masala
c) All goods, i.e. Tobacco and manufactured tobacco substitutes

Aggregate Turnover:Section 2(6) of the CGST Act
Includes Excludes
1. Taxable Supplies 1.CGST
2. Exempt supplies 2.SGST
3. Exports 3.UTGST
4. Inter-State supplies 4.IGST
5. 5.Compensation cess
Outward Supplies taxable as reverse charge
6. 6.value of Inward supplies on which tax is
Turnover of all the branches with same PAN
payable under reverse charge
7. all supplies made by the taxable person, 7.Value of goods cleared from registered Job
whether on his own account or made on worker premises should be excluded for Job
behalf of all his principals. worker ( Should be included for Principal)
(Refer Note 2 below)
8. Value of goods cleared by Principal directly

from Job worker premises to be included in
turnover of Principal
Note :Goods directly cleared from Job worker premises

Principal can supply the goods directly from the premises of the job worker without bringing it
back to his own premises.
In case the Job worker is unregistered, principal should declare job worker’s premises as his
additional place of business and remove goods from the same.
If the Job worker is a registered person/ principal supplies notified goods, goods can be supplied
directly from the premises of the job worker.
Supply of goods, after completion of job work, directly from a registered job worker’s premises is
treated as supply of goods by the principal.
Further, the value of such goods supplied will be included in the aggregate turnover of the
principal and not job worker.
Storage of goods at Premises of Transporter (Circular No. 61/35/2018)
Transporter’s godown Transportation under the e-

has to be declared as an way bill shall be deemed to whenever the goods are
APOB by the recipient be concluded once the transported from the
taxpayer. In such cases, goods have reached the transporters’ godown , to any
transporter’s godown
mere declaration by the other premises of the
(recipient taxpayer’
recipient taxpayer to additional place of
recipient taxpayer then, the
this effect with the business). Hence, e-way bill relevant provisions of the e-
concurrence of the validity in such cases will way bill rules shall apply.
transporter in the said not be required to be
declaration will suffice. extended.

Where a business is Where the business is

transferred, whether on transferred, pursuant to
account of succession/any sanction of a scheme/
other reason, to another arrangement for amalgamation/
person as a going concern, Person liable de-merger of two or more
the transferee/successor is for registration companies, pursuant to an order
to be registered with effect in case of of a High Court/Tribunal, the
from the date of such transferee is to be registered
transfer of
transfer/succession. with effect from the date on
business which the Registrar of
Companies issues a certificate of
incorporation giving effect to
such order.
Special Point
If assessee is involved in
Only Intra State Only Inter State or

supplies of goods both Intra and
or services Inter state
Registration
required only Supply of Goods Supply of Service
when aggregate
turnover exceeds
Should get compulsorily Registration required only
₹ 20 lakhs / 40
registered even though turnover when Inter & Intra state
lakhs
does not exceed 40 lakhs exceeds Rs.20 lakhs

Question 5-7
2. Compulsory Registration in certain Cases (Section 24)
S.N Type of Person Analysis

1. Persons making any Inter-State taxable So when even the value of supply to other state is
supply of goods just Rs.10/- also registration under GST is
mandatory and IGST is to be paid.
But in case of service , Inter State supply of service
upto 20 lakhs is exempt (Notn-10/2017)
2. Casual taxable persons making taxable Casual taxable person means who occasionally
supply undertakes transactions involving supply of goods
or services or both in the course or furtherance of
business in a state or union territory where he has
no fixed place of business
3. Persons who are required to pay tax Reverse charge means liability to pay tax is on the
under reverse charge receipient of goods or services
4. Mandatory Registration of ECO: ECO means any person who owns, operates or
Electronic Commerce operator manages digital or electronic facility or platform for
a) who provides services specified in electronic commerce.
Section 9(5)
(or) Other ECO:
b) who is required to collect TCS u/s Other small e-commerce operators would now be
52 (i.e., where payment collected eligible for availing the threshold exemption limit
by ECO on behalf of Supplier) benefit for registration purposes.
5. Non-resident taxable persons making Non-resident taxable personmeans any person

Taxable supply who occasionally undertakes transactions involving
supply of goods or services or both but who has no
fixed place of business or residence in India
6. Persons who are required to deduct TDS In case a person already registered under GST is
section 51, whether or not separately required to deduct tax under section 51, he is
registered under this Act required to take separate registration for the
purpose of deducting tax under section 51.
7. Persons who make taxable supply of So when supply of stock is made through agents,
goods or services on behalf of other registration is mandatory
persons as an agent
8 Input Service Distributor Only if registered, credit on common expenditure
can be distributed.
9. Persons who supply goodsOr Note:Persons making supplies of services through
servicesthrough ECO an ECO and having aggregate turnover up to
₹ 20,00,000 exempted from obtaining registration
10. OIDAR located outside India Here only B2C is covered.
(Refer pg.3.18) B2B will be covered in Reverse charge

Question 8, 9
3. Persons not liable for Registration (Section 23)
Persons not liable to registration:
1. Person engaged exclusively in supplying goods/services/both not liable to tax

2. Person engaged exclusively in supplying goods/services/both wholly exempt from tax
3. Agriculturistto the extent of supply of produce out of cultivation of land
4. Persons making only reverse charge supplies(Notification No. 5/2017)
5. Casual Taxable Persons making taxable supplies of handicraft goods
(28 items were listed in Notification No. 56/2018 – Central Tax dt.23/10/2018 .However if
aggregate value of such supplies, computed on all India basis exceeds Rs.20 lakhs they should
get registration. For every inter State supply they should submit E way bill)
Agriculturist
Means an Individual / HUF who undertakes cultivation of land
By own labour, or By the labour of family, or By servants on wages payable
Question 10, 11
4. Procedure for Registration (Section 25,26,27)
No. Particulars Where to register? When to register?

1. Person who is liable to be Registered within 30 days from the date
under section 22 or section 24 in every such on which hebecomes liable to
State/UT in which registration
2. A casual taxable person or a non- he isso liable at least 5 days prior to the
resident taxable person commencementof business
3. Every person who makes a supply from in the coastal within 30 days from the date
the territorial waters of India State/UT where the on which he becomes liable
nearest point of the to registration
appropriate base
line is located
Eg: Sugam Services Ltd. is engaged in taxable supply of services in Madhya Pradesh. The turnover
of Sugam Services Ltd. exceeded ₹ 20 lakh on 1st November. It is liable to get registered by 1st
December in the State of Madhya Pradesh.

 Registration needs to be taken State-wise, i.e. there are no centralized

registrations under GST.
 A business entity having its branches in multiple States will have to take
separate State-wise registration for the branches in different States.
 Further, within a State, an entity with different branches would have
single registration wherein it can declare one place as principal place of
business (PPOB) and other branches as additional place of business
(APOB)
 Taxpayers may opt for multiple registrations within a State/U.T in
respect of multiple places of business located within the same
SPECIAL NOTES
State/U.T on the same PAN.

 If one of the multiple registration of a taxable person is paying tax under
normal levy [Section 9], no other registration shall be granted
registration to pay tax under composition levy [Section 10].
 If one of the separately registered unit becomes ineligible to pay tax
under composition levy, all other registered units would also become so
ineligible.
 Registration can be obtained Voluntarily also.However, once a person
obtains voluntary registration, he has to pay tax even though his
aggregate turnover does not exceed ` 10lakh/20 lakh/` 40 lakh.
 A person who has obtained/ is required to obtain more than one
registration, whether in one State/ Union territory or more than one
State/Union territory shall, in respect of each such registration, be
treated as distinct persons
 A Permanent Account Number is mandatory to be eligible for grant of
registration. A Non-Resident Taxable Person (NRTP) may be granted
registration on the basis of other prescribed documents

Procedure for registration has been depicted by way of a diagram as follows: (Rule 8, 9 & 10)
Part I
Every person liable to get registered and person seeking voluntary registration shall, before applying
for registration, declare his Permanent Account Number (PAN), mobile number, e-mail address,
State/UT in Part A of FORM GST REG-01 on GST Common Portal.
PAN mobile PAN validated Mobile number and

number & e-mail online by Common email verified
address are Portal from CBDT through one time
validated database password sent to it.
Temporary Reference Number (TRN) is generated and communicated to the applicant on the
validated mobile number and e-mailaddress.
Using TRN, applicant shall electronically submit application in Part B of application form, along with
specified documents at the Common Portal.
On receipt of such application, an acknowledgement in the GST REG-02shall be issued to the

applicant electronically. A Causal Taxable Person (CTP) applying for registration gets a TRN for
making an advance deposit of tax in his electronic cash ledger and an acknowledgement is issued
only after saiddeposit.
Application shall be forwarded to the Proper Officer.
The procedure after receipt of application by the Proper Officer is depicted in Part II

Part II
Proper Officer examines the application

and accompanying documents.
Proper Officer issues notice in GST REG-03

electronically, within 7 working days from
No
If same are found in order? application datethereby seeking clarification,
information or documents from the applicant.
Yes
Within 7 working
days from the
date of Applicant should furnish the
clarification, information or documents
submission of
application within 7 working daysfrom receipt of
notice in GST REG-04
No
If proper officer is satisfied with it?
Proper officer will

Yes
grant registration
certificate in Form
GST REG-06 Within 7 workings days from the
date of receipt of
information/clarification/documents
Proper officer will
reject the
application for
reasons to be
recorded in writing
in GST REG-05
Deemed Approval of Application
If the proper officer fails to take any action -

 within 7 working days/30 days (refer next page) from the date of submission of application,or
 within 7 working days from the date of receipt of clarification, information or documents
furnished by theapplicant,
The application for grant of registration shall be deemed to have been approved.

Authentication of Aadhaar Number of

a) Authorized signatory Amendment
b) In case of Firm - Managing & Authorized partners w.e.f.01/04/2020
c) Karta of a HUF
Situation Time limit for Grant of Registration
If Aadhar Authentication done Within 7 Working days from the date of application
If Aadhar Authentication not done a) Physical verification by Proper officer is mandatory
b) Registration will be granted not later than 30 days
from the date of application
Physical verification of business premises in certain cases after grant of registration [Rule 25]
Where the proper officer is satisfied that the physical verification of the place of business of
a person is required due to
a) failure of Aadhaar authentication before the grant of registration, or

b) due to any other reason after the grant of registration
he may get such verification of the place of business, in the presence of the said person,
done and the verification report along with the other documents, including photographs,
shall be uploaded in FORM GST REG-30 on the common portal within a period of fifteen
working days following the date of such verification.]

Timelimit for Aadhar Authentication (w.e.f.21/08/2020)
Registration application shall be deemed to be submitted Amendment

a) After Aadhar Authentication
Or whichever is earlier
b) 15 days from the date of submission of application
Aadhar Authentication is not required for
Amendment
Not a
citizen of
India
UNO/Foreig CG/SG
n Embassy
applying for
Departmen
UIN ts
Aadhar
Authenci
cation
PSU LA
Statutory
Body

Issuance of registration certificate [Rule 10]
Where the application for grant of registration has been approved, a certificate of registration
[duly signed or verified through EVC by the proper officer] in FORM GST REG-06 showing the
principal place of business (PPoB) and additional place(s) of business (APoB) is made available to
the applicant on the Common Portal and a Goods and Services Tax Identification Number
(hereinafter referred to as “GSTIN”) i.e. the GST registration no. Is communicated to applicant,
within 3 days after the grant of registration
Display of registration certificate and GSTIN on the name board [Rule 18]
Every registered person shall display his registration

certificate in a prominent location at his PPoB and at every
APoB. Further, his GSTIN also has to be displayed on the name
board exhibited at the entry of his PPoB and at every APoB
Question 12, 13
Effective date of registration [Rule 10]
Where an applicant submits application for registration effective date of registration is

within 30 days from the date he becomes liable to the date on which he becomes liable to
registration registration
after 30 days from the date he becomes liable to date of grant of registration
registration
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
Eg: Sugam Services Ltd. is engaged in taxable supply of services in Madhya Pradesh. The turnover
of Sugam Services Ltd. exceeded ₹ 20 lakh on 1st November. It is liable to get registered by 1st
December [30 days] in the State of Madhya Pradesh. It applies for registration on 28th November
and is granted registration certificate on 5th December. The effective date of registration of
Sugam Services Ltd. is 1st November.

Special Procedure: Procedure so laid down abovewill not apply to
Non-resident taxable
For them, a
person
separate
Application is
A person required to deduct
tax at source under section 51 provided in
GST REG-08
A person required to collect tax GST REG-09

at source under section 52
GST REG-10
OIDAR located outside India
a) Any specialized agency of the UNO or

b) any Multilateral Financial institution This UIN is needed for claiming refund of
taxes paid on notified supplies of goods
c) consulate or embassy of foreign countries and/or services received by them, and for
d)any other person notified by the such other purpose as may be notified.
Commissioner, is required to obtain a UIN
from the GSTN portal.
Unique Identity Number (UIN)
Such person shall file an application in a

different GST REG-13 . UIN shall be assigned
by the proper officer upon submission of Registration certificate shall be issued within
application in said form or after filling up the 3 working days from the date of submission
said form or after receiving a of application
recommendation from the Ministry of
External Affairs, Government of India.

Suo-motu registration by the proper officer [Section 25(8) read with rule 16]
Where, pursuant to any survey, enquiry, inspection, search or any other proceedings
under the Act, the proper officer finds that a person liable to registration under the
Acthas failed to apply for such registration, such officer may register the said person on
a temporary basis and issue an order in GST REG-12
Such person shall either
(i)Submit an (ii) File an appeal

application for against such
registration within 90 temporary
days from the date of OR registration
grant of temporary
registration,
In case (ii), if the Appellate Authority upholds the liability to registration, application for
registration shall be submitted within 30 days from the date of issuance of such order of
the Appellate Tribunal.
Question 14
Non-Resident Taxable Person (NRTP) and Casual Taxable Person (CTP)- Special Process
[Sections 25 & 27 read with rules 13 & 15]
(A)Both CRTP and NRTP have to compulsorily get registered under GST irrespective of the threshold
limit, at least 5 days prior to commencement of business.
(B)NRTP will generally not have PAN .Registration may be granted on basis of other documents.
He has to submit a However, in case of a business Application will be

self-attested copy of entity incorporated outside submitted by NRTP in a
his valid passport India, the application for GST REG-09 whereas CTP
along with his registration shall be submitted will submit application in
authorized signatory along with its tax identification GST REG-01 and his
who is an Indian number on the basis of which registration of CTP will be
Resident having valid the entity is identified by the a PAN based registration.
PAN. Government of that country

(C) Period of validity of registration certificate granted to CTP/NRTP

Registration Certificate granted to CTP/NRTP will be valid for:
(i) Period specified in the registration application, or
(ii) 90 days from the effective date of registration [can be extended further by a 90 days period]
Note:CTP and NRTP will make taxable supplies only after issuance of the Registration Certificate
(D) Advance deposit of tax
At the time of submitting the registration application, CTP/NRTP are required to make an advance
deposit of taxin an amount equivalent to the Estimated Net tax liability(Gross Tax- ITC)
Such person will get a TRN for making an advance deposit of tax which shall be credited to his
electronic cash ledger.
An acknowledgement of receipt of application for registration is issued only after said deposit.
5. Amendment of Registration (Section 28)
1. Where there is any change in the particulars furnished in registration application/UIN

application, registered person shall submit an application in GST REG-14, within 15days of
such change, along with documents relating to such change at the Common Portal.
2. In case of amendment of core fields of information, the proper officer may, on the basis of
information furnished or as ascertained by him, approve or reject amendments in the
registration particulars in theGST REG-15
3. However, where change relates to non-core fields of information, registration certificate shall
stand amended upon submission of the application for amendment on the Common Portal.
4. Where a change in the constitution of any business results in change of PAN of a
registeredperson, the said person shall apply for fresh registration. The reason for the same is
that GSTIN is PAN based. Any change in PAN would warrant a new registration.
Permission of proper officer required if charge relates to Core fields of information
Legal name of Addition, deletion or retirement of

Address of PPoB / APoB
business partners or directors, Karta,
Managing Committee, Board of
Trustees, Chief Executive Officer or
equivalent , responsible for day to
day affairs of the business
Change of such particulars shall be applicable for all registrations of a registered person
obtained under provisions of this Chapter on same PAN

Deemed to be amended:
If the proper officer fails to take any action,-
(a) Within a period of fifteen working days from the date of submission of the application, or
(b) Within a period of seven working days from the date of the receipt of the reply to the show cause
notice, the certificate of registration shall stand amended to the extent applied for and the amended
certificate shall be made available to the registered person on the common portal

6. Cancellation of Registration (Section 29 & 30)
Where the registration person

Voluntary Cancellation to more requires it
on application made by
Assessee
Cancellation of
registration Where the Proper Officer
considers the registration liable
Suo-motu Cancellation
by Proper Officer
for cancellation in view of
certain defaults
Circumstances when the registration can be cancelled on an application of the registered person
or his legal heirs (in case death of such person)
 Business discontinued Change in the Taxable person (other

constitution of the than voluntarily
 Transferred fully for
business registered person) who is
any reason including
no longer liable to be
death of the proprietor
registered under section
 Amalgamated with 22 or section 24
other legal entity
 Demerged or
 Otherwise disposed of
Circumstances when the proper officer can cancel registration on his own
contraventions done by Assessee:

(i) He does not conduct any A registered Voluntary Registration
business from the declared place of person has not registered was obtained
business, or filed returns for person has not by means of
(ii) He issues invoice without supply  continuous 6 commenced fraud, wilful
(iii) If he violates sec 171 (Anti months(Normal) the business misstatement
Profiteering Refer Page. 24.18)  3 Consecutive within 6 or suppression
(iv) Non Furnishing of Bank Account tax periods in months from of facts
Details within 45 days from date of case of a the date of
grant of Registration person who
registration
opted for
(v)Avails ITC by violating Section 16
composition
(vi)Turnover in GSTR 1 > 3B levy
(vii) Violates Rule 86B (Claiming ITC
> 5% of GSTR 2A) Amendment

Procedure for cancellation of registration
A registered person He is required to furnish in Where a person who has

seeking cancellation of the application the details submitted an application
registration shall of for cancellation of his
electronically submit the a) inputs held in stock registration is no longer
application for or liable to be registered,
cancellation of b) inputs contained in proper officer shall issue
registration in GST REG-16 semi-finished the order of cancellation
within 30 days of c) finished goods held of registration within 30
occurrence of the event in stock and days from the date of
warranting cancellation. d) capital goods held in submission of application
stock for cancellation in
on the date from which GST REG-19
cancellation of registration
is sought
Where cancellation The Taxpayers will

Where the proper officer
cancels the registration suo- is made for Non cancellation not be
filing of GSTR 3B of registration required to
motu, he shall not cancel the
same without giving a show (or) GST CMP-08 shall be file returns
cause notice and without Assessee can file effective from while
giving a reasonable the returns rather a date to be cancellation
opportunity of being heard, to than giving reply. determined of registration
the registered person. Then, proper officer by the proper is under
shall drop the officer. process
The reply to such show cause proceedings
notice (SCN) has to be He will direct
submitted within 7 days of the taxable
service of notice. person to pay
arrears of any
If reply to SCN is satisfactory, tax, interest
proper officer shall drop the or penalty
proceedings and pass an order including the
in GST REG-20 . Where amount liable
registration of a person is to be paid
liable to be cancelled, proper under section
officer shall issue the order of 29(5)
cancellation of registration
within 30 days from the date
of reply to SCN in GST REG-19

Reversal of credit
A. Amount of credit to be reversed in respect of INPUTS
ITC in respect of ITC on inputs computed

inputs calculated proportionately on the
in accordance with basis of corresponding
rule 44 of the invoices** on which
Whichever is
CGST Rules, 2017* credit had been availed
higher
on such inputs
Output tax payable on such goods
**If tax invoices are not available, the ITC to be reversed will be based on the prevailing market price
(MP) of such goods on the date of cancellation
B. Amount of credit to be reversed in respect of CAPITAL GOODS OR PLANT & MACHINERY
ITC in respect of ITC involved in the

capital goods or remaining useful life in
plant & machinery months of the capital
calculated in goods will be reversed
accordance with on pro-rata basis, taking Whichever is
rule 44 of the the useful life as 5 years higher
CGST Rules, 2017
Tax on the transactions value of such capital goods or

plant & machinery u/s 15
Other Points
1.A person to whom a UIN has been granted under rule 17 cannot apply for
cancellation of registration [Rule 20]
2. The cancellation of registration will not affect liability of registered person to
pay tax and other dues under the Act for any period prior to the date of
cancellation [Section 29(3)]

7. Revocation of Cancellation of Registration (Section 30)
1. Where the registration of a person is cancelled suomotu by the proper officer, such registered
person may apply for revocation of the cancellation to such proper officer, within 30 days
from the date of service of the order of cancellation of registration, at the GST Common Portal
in the GST REG-21
2. However, in case registration was cancelled for failure of registered person to furnish returns,
before applying for revocation the person has to make good the defaults (by filing all pending
returns, making payment of all dues in terms of such returns alongwith interest, penalty, late
fee, etc.) for which the registration was cancelled by the officer.
3. If the proper officer is satisfied that there are sufficient grounds for revocation of cancellation,
he may revoke the cancellation of registration, by an order within 30 days of receipt of
application and communicate the same to applicant in GST REG-22
Condonation of delay:
a) With approval of AC/JC : Extension can be given for 30 more days
b) With approval of Commissioner : Extension can be given for 30 more days over (a)
4. Otherwise, he may reject the revocation application. However, before rejecting the
application, he has to first issue SCN to the applicant who shall furnish the clarification within 7
working days of service of SCN.
5. The proper officer shall dispose the application (accept/reject the same) within 30 days of
receipt of clarification.
6. 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 within a period
of 30 days from the date of order of revocation of cancellation of registration.
8. Application for registration by Special Economic Zone (SEZ)
SEZ is a geographically bound zone where the economic laws relating to export and import are more liberal
as compared to other parts of the country. SEZ is considered to be a place outside India for all tax
purposes.
A person having unit in SEZ/SEZ developer will make a separate application for registration as a b usiness
vertical distinct from his other units located outside SEZ. Thus, there may be a case where two units of a
tax payer are located in same State - one in SEZ and another outside SEZ. Separate registrations have to be
obtained for each of the two units as separate business vertical.
Eg: Suvarna Industries is engaged in manufacturing activities in Uttar Pradesh. It has two manufacturing
units in UP - one in SEZ and another outside SEZ. Under GST, one registration per State is required.
However, since in this case, one of the two units of Suvarna Industries is located in SEZ, it will make a
separate application for registration as a business vertical distinct from unit located outside SEZ.

9. Suspension of
Registration(Rule 21A)
a. Reason for Suspension: Where, a comparison of the returns furnished by a registered person
under section 39 with
 The details of outward supplies furnished in FORM GSTR-1; or
 The details of inward supplies derived in GSTR- 2A, or
 Such other analysis, as may be carried out on the recommendations of the Council,
there are significant differences or anomalies indicating contravention of the provisions of

the Act or the rules made thereunder, leading to cancellation of registration of the said
person, his registration shall be suspended
b. Process of Suspension:
 Step1 : Intimate assessee in GST REG-31 in GST portal or by sending E- mail named
“Suo moto cancellation proceeding”.
 Step2: Assessee shall furnish reply within 30 days from receipt of intimation in GST REG-
18. If notice is issued for non filing of Returns, then such Returns have to be filed before
Reply to the notice
 Step3 : Proper office shall either

 Drop the proceedings in GST REG-20 or
 Cancel Registration in GST REG-19. Then GST Status shall be “Cancelled Suo-moto”
c. Suspension of Business Transactions:
 A registered person, whose registration has been suspended shall not make any
taxable supply during the period of suspension and shall not be required to furnish
GSTR 3B & 1
 A registered person, whose registration has been suspended shall not be admitted any
refund during the period of suspension

10. GST compliance of companies under Insolvency and Bankruptcy Code,

2016 (IBC)
As per the Insolvency and Bankruptcy Code, 2016 (IBC), as soon as a company/LLP fails to make a payment
above Rs 1 lakh, the financial/operating creditors can initiate the Corporate Insolvency Resolution Process
(CIRP). The limit has been recently raised to Rs 1 crore, due to the COVID-19 pandemic.
Such an LLP/company can be termed as the defaulting ‘corporate debtor’. Accordingly, the management of the
LLP/company’s assets gets transferred to the Interim Resolution Professional (IRP) or Resolution Professional
(RP).
A corporate debtor undergoing insolvency is liable to furnish its GST returns, make payment of tax and meet all
other compliance as per the GST law during the CIRP period. The IRP/RP must follow a prescribed procedure
for compliance. Further, he must take a new registration under the GST Act within 30 days of the appointment
of the IRP/RP.
The CBIC issued a CGST notification no. 11/2020 on 23rd March 2020 for the procedure. Also, a CGST circular
no. 134/04/2020-GST clarified some frequently asked questions.
Amendment
Special Procedure for Corporate Debtors Undergoing CIRP
A corporate debtor undergoing CIRP and whose assets are managed by IRP or RP should follow the
below procedure. The period of compliance shall begin from the date of appointment of IRP/RP till the
date on which they undergo corporate insolvency resolution process.
1. Obtain a new registration under the GST Act:
From the date of appointment of IRP/RP, such entities are treated as different persons. They are
liable to obtain new registration under each State/Union Territory where it was earlier registered.
2. File returns under Section 40:

Such persons are liable to file their first return as per Section 40 of the CGST Act. The IRP must file
the applicable returns such as GSTR-3B during the period beginning from the date on which the
company becomes liable for new registration till the date on which registration is granted.
3. Claim ITC:
Such persons can avail Input Tax Credit (ITC) on all invoices bearing earlier GSTIN covering both
goods and services. ITC can be availed as per the conditions specified under Chapter V of the CGST
Act.
4. Applying for Refund:

Any amount deposited in the cash ledger of the earlier GSTIN by the IRP/RP is available for a refund
from the date of appointment of IRP till the date of notification specifying a special procedure for
corporate debtors undergoing insolvency. Such refund is available even if GSTR-3B/GSTR-1 returns
are not filed for the said period.

FAQs on the Special Procedure for Corporate Debtors

Undergoing CIRP
SI.No QUESTION ANSWER

1 How are pre-CIRP GST All GST dues with regards to the period prior to the
dues dealt with? commencement of CIRP are treated as operational debt. The
proper officer can file a claim before NCLT for such dues. Such
claims should be as per the provisions of IBC. The tax officials
should ascertain all the details of supplies made/received and tax
dues on the same before filing a claim with the NCLT.
2 Should the GST An entity undergoing CIRP is required to obtain a
Registration of Corporate new registration. However, it is not required to cancel the
Debtor be cancelled? previous registration. If required, the proper officer may suspend
the registration.
3 Is IRP/RP required to file An IRP/RP is liable to comply with legal requirements for the
returns of the pre-CIRP period after the commencement of CIRP. Thus, they are not
period? required to file returns for the period prior to the commencement
of the insolvency process.
4 How to avail ITC of Such persons are required to file their first return as per Section
invoices issued to the 40. They can claim ITC on such supplies subject to the conditions
erstwhile registered specified under Chapter V of the CGST Act and rules made
person in case IRP/RP has thereunder.
been appointed before
issuance of the
notification?
5 Can a person avail ITC on A registered person receiving supplies from such corporate
purchase invoices from debtors is eligible to claim ITC on invoices bearing earlier GSTIN as
the corporate debtor per the conditions specified under Chapter V of the CGST Act.
undergoing CIRP wherein, They can claim for the period from the date of appointment of
IRP/RP was appointed IRP/RP till the date of a new registration or within 30 days of
before issuance of the issuance of the notification, whichever is earlier.
notification?

CH.SUDHEER C.A, C.M.A Chapter 10 Invoices under GST
TAX INVOICE, DEBIT

Chapter 10
& CREDIT NOTES
1. Tax invoice (Section 31)

2. Export Invoice/ Supplies to SEZ (Section 31)
3. REVISED INVOICE (Section 31)
4. Consolidated Tax Invoice on supply to URP with Invoice
value less than 200
5. Bill of Supply
6. Tax invoice cum Bill of Supply
7. Receipt Voucher
8. Refund Voucher
TOPICS 9. Invoice in case of RCM
10. Payment Voucher
11. Special Document in place of Invoice
12. Delivery Challan (Rule 55)
13. Goods Transported in SKD/CKD Condition
14. ISD Invoice (Rule 54)
15. Prohibition on Unauthorized collection of Taxes
(Section 32)
16. Amount of tax to be indicated in Tax invoice (Section
33)
17. Debit & Credit Notes (Section 34)
18. E-Invoice
19. QR code for B2C Invoices
1. Tax invoice (Section 31)
A. GENERAL TIME LIMIT FOR RAISING TAX Refer Pg 6.1
Consolidated tax invoice by Insurance, Banking Companies, Financial Institututes :
Supplier may issue a consolidated tax invoice for the supply of services made during a
month at the end of the month, , physically or electronically whether or not serially
numbered, and whether or not containing the address of the recipient of taxable
service but containing other information as mentioned under rule 46.

B. PARTICULARS OF TAX INVOICE (RULE 46)

a) Name, address and GSTIN of the supplier;
b) A consecutive serial number not exceeding 16 characters, in one or multiple series, containing
alphabets/numerals/special characters & any combination thereof, unique for a FY;
c) Date of its issue
d) If recipient is registered - Name, address and GSTIN or UIN of recipient
e) If recipient is unregistered & value of supply is Particulars of invoice
Rs.50,000 or more Name and address of the recipient and the address of
delivery, along with the name of State and its code
less than ₹ 50,000 Unregistered recipient may still request the aforesaid
details to be recorded in the tax invoice
f) HSN code for goods or services
g) Description of goods or services
h) Quantity in case of goods and unit or Unique Quantity Code thereof
i) Total value of supply of goods or services or both
j) Taxable value of supply of goods or services or both taking into account discount or abatement, if any
k) Rate of tax (central tax, State tax, integrated tax, Union territory tax or cess);
l) Amount of tax charged in respect of taxable goods or services (CGST,SGST,IGST,UTGST,CESS )
m) Place of supply along with the name of State, in case of a supply in the course of inter-State trade
n) Address of delivery where the same is different from the place of Supply
o) Whether the tax is payable on reverse charge basis; and
p) Signature or digital signature of the supplier or his authorized representative
Amendment
C. HSN/SAC Code Disclosure changes in Invoice ( From 01.04.2021)
SI.No Aggregate Turnover in the Preceeding Financial Year Number of Digits

(HSN/SAC Code)
1 Up to Rupees Five Crores 4
2 More than Rupees Five Crores 6
3 8 digit HSN always Mandatory for these 49 items in the link 8
https://drive.google.com/file/d/1O3RJKFRnt702CLbCkLmfU3c_1ChisO6z/view?usp=sharing
(Students need not remember names for Exams. Given just for reference)
D. Manner of issuing the invoice [Sections 31(1) & (2) read with rule
48]
In case of taxable supply of goods In case of taxable supply of services
Invoice shall be prepared in TRIPLICATE Invoice shall be prepared in DUPLICATE
Original copy- For receipient Original copy- For receipient
Duplicate copy- For Transporter Duplicate copy- For Supplier
Triplicate copy- For Supplier

The serial number of invoices shall be furnished in FORM GSTR-1 Table 13
E. Own Invoice Format: All GST taxpayers are free to design their own Tax Invoice Format.But
the contents specified in Rule 46 should be Presented
2. Export Invoice/ Supplies to SEZ (Section 31)
In the case of the export of goods or services, the invoice shall carry an Endorsement
“SUPPLY MEANT FOR EXPORT/ SUPPLY TO SEZ UNIT/SEZ DEVELOPER ON PAYMENT OF IGST”
or
“SUPPLY MEANT FOR EXPORT / SUPPLY TO SEZ UNIT/SEZ DEVELOPER UNDER BOND OR LUT WITHOUT
PAYMENT OF IGST”, as the case may be
Particulars of an Export Invoice are same as a Tax Invoice. However, where recipient is unregistered and
value of supply is ₹ 50,000 or more, instead of name of State and its code, in case of an export invoice,
name of the country of destination is to be mentioned.
3. REVISED INVOICE (Section 31)
A registered person may, within one Eg: Sarabhai Private Ltd. commenced business of supply of
goods on 1st April in Delhi. Its turnover exceeded ₹
month from the date of issuance
20,00,000 on 3rd September. Thus it became liable to
ofcertificate of registration and in registration on 3rd September. It applied for registration on
such manner as may be prescribed, 29th September and granted registration certificate on 5th
issue a revised invoice against the October. Since it applied for registration within 30 days of
invoice already issued during the becoming liable to registration, it was granted registration
with effect from 3rd September. Sarabhai Private Ltd. may
period beginning with the effective
issue Revised Tax Invoices in respect of taxable supplies
date of registration till the date of effected between 3rd September and 5th October.
issuance of certificate of registration

Consolidated Revised Tax Invoice:
A registered person may issue a Consolidated Revised Tax

Invoicein respect of all taxable supplies made to an unregistered
recipient during such period
However, in case of inter-State supplies, a consolidated Revised

Tax Invoice cannot be issued in respect of all unregistered
recipients if the value of a supply exceeds ₹ 2,50,000.
Particulars of Revised Tax Invoice
a) The word“Revised Invoice”, wherever applicable, indicated prominently;

b) Name, address and GSTIN of the supplier;
c) Nature of the document
d) A consecutive serial number not exceeding 16 characters, in one or multiple series, containing
alphabets or numerals or special characters -hyphen or dash and slash and any combination
thereof, unique for a FY;
e) Date of issue of the document
f) Name, address and GSTIN or UIN, if registered, of the recipient
g) 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
h) Serial number and date of the corresponding tax invoice or, as the case may be, bill of supply;
i) Value of taxable supply of goods or services, rate of tax and the amount of the tax
credited/debited to the recipient
j) Signature/digital signature of the supplier/his authorized representative.

4. Consolidated Tax Invoice on supply to URP with Invoice value less than 200
A registered person may not issue a tax invoice if the value of the goods or services or both supplied
is less than Rs.200 subject to such conditions and in such manner as may be prescribed;
Instead such registered person shall issue a Consolidated Tax Invoicefor such supplies at the close of
each day in respect of all such supplies
Thus, small taxpayers, like small retailers, doing a large number of small transactions for upto a value
of ` 200 per transaction to unregistered customers need not issue invoice for every such transaction.
They can issue one consolidated invoice at the end of each day for all transactions done during the
day. However, they should also issue an invoice when the customer demands.
Eg:- Jain & Sons is a trader dealing in stationery items. It is registered under GST and has
undertaken following sales during the day:
S.N Recipient of supply ₹

1. Raghav Traders - a registered retail dealer 190
2. Dhruv Enterprises – an unregistered trader 358
3. Gaurav – a Painter [unregistered] 500
4. Oberoi Orphanage – an unregistered entity 188
5. Aaradhya – a Student [unregistered] 158
In the given illustration, Jain & Sons can issue a Consolidated Tax Invoice only with respect to
supplies made to Oberoi Orphanage [worth ` 188] and Aaradhya [worth ` 158] as the value of goods
supplied to these recipients is less than ` 200 as also these recipients are unregistered and don’t
require a tax invoice.
As regards the supply made to Raghav Traders, although the value of goods supplied to it is less than
₹200, Raghav Traders is registered under GST. So, Consolidated Tax Invoice cannot be issued.
Consolidated Tax Invoice can also not be issued for supplies of goods made to Dhruv Enterprises and
Gaurav although both of them are unregistered. The reason for the same is that the value of goods
supplied is not less than ₹ 200.
Exception
In case of Multiplex screens with the business of Exhibition of Cinematograph films, ticket (Invoice) has
to the issued even though the Invoice value is less than Rs.200

5. Bill of Supply
I. Bill of Supply
a registered person supplying exempted goods or services or both or paying tax under
the provisions of section 10 shall issue, instead of a tax invoice, a bill of supply
containing such particulars and in such manner as may be prescribed.
However if value of goods or services is less than Rs.200 – Consolidated Tax invoice may
be issued
Particulars of Bill of Supply

b) A consecutive serial number not exceeding 16 characters, in one or multiple series,
containing alphabets or numerals or special characters -hyphen or dash and slash and any
combination thereof, unique for a FY;
d) Name, address and GSTIN or UIN, if registered, of the recipient
e) HSN code for Goods or Services
f) Description of goods or services or both;
g) Value of supply of goods or services or both taking into account discount/ abatement, if
any; and
h) Signature/digital signature of the supplier/his authorized representative.
6. Tax invoice cum Bill of Supply
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
7. Receipt Voucher
A registered person shall, on receipt of advance payment with respect to any supply of goods or
services or both, issue a receipt voucher or any other document, containing such particulars as may
be prescribed, evidencing receipt of such payment

Particulars of Receipt Voucher

d) Name, address and GSTIN or UIN, if registered, of the recipient
e) Description of goods or services or both;
f) Amount of advance taken;
g) Rate of tax (central tax, State tax, integrated tax, Union territory tax or cess);
h) Amount of tax charged in respect of taxable goods or services (central tax, State tax,
integrated tax, Union territory tax or cess);
i) Place of supply along with the name of State and its code, in case of a supply in the course of
inter-State trade or commerce;
j) Whether the tax is payable on reverse charge basis; and
k) Signature/digital signature of the supplier/his authorized representative.
Where at the time of receipt of advance, rate of tax/ nature of supply is not determinable
Rate of tax is not Nature of supply is not

determinable -tax determinable- same
shall be paid at the shall be treated as Inter
rate of 18% State supply
8. Refund Voucher
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 no supply is made and 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

9. Invoice in case of RCM
If supplier is Registered: Supplier shall issue Tax invoice by specifying the Tax should be paid under RCM
If supplier is Unregistered : A registered person who is liable to pay tax under section 9 (3) 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
10. Payment Voucher
 A registered person who is liable to pay tax u/s 9(3) or 9(4) shall issue a
payment voucher at the time of making payment to the supplier
 i.e., Recipient should issue payment voucher to supplier at time of
making payment of Value of supply
 This payment voucher should be issued whether or not supplier is
Registered
11. Special Document in place of Invoice
Following suppliers may issue a tax invoice, but they are also permitted to issue any other document
Supplier of taxable service Document in lieu of the tax invoice

Optional Mandatory information
Information
Insurer/Banking company / Financial • Serial number Other information as prescribed for a Tax
institution, including NBFC • Address of the Invoice, under rule 46
recipientof
Such document may be issued/made available,
taxable service
physically /electronically
Goods Transport Agency (GTA) a) Gross weight of the Consignment

supplying services in relation to b)Name of the consignor andconsignee
transportation of goods by road in a c)Registration number of goodscarriage in
goods carriage which the goods are transported
d)Details of goods transported
They can issue Goods Consignment e)Details of place of origin and destination
note bearing f)GSTIN of the person liable for paying tax
whether as consignor, consignee or GTA
g)Other information as prescribed for a tax
invoice under rule 46
Supplier of passenger • Serial number Other information as prescribed for a tax
Transportation service • Address of the invoice, under rule 46
Recipientof Tax invoice shall include ticket in any form, by
taxable service whatever name called

It is important to note here that keeping in view the large number of transactions in banking,
insurance and passenger transportation sector, taxpayers need not mention the address of the
customer and the serial number in their invoices
12. Delivery Challan (Rule 55)
Nature of supply Deliver challan tobe Particulars of Delivery Challan

issued
(1) Supply of liquid gas Serially numbered a)Date and number of the delivery challan
where the quantity at the notexceeding 16
time of removal from the charactersin one or b)Name, address and GSTIN of the
multipleSeries consigner, if registered
place of business of the

supplier is not known,
 at the time of removal c)Name, address and GSTIN or UIN of the
(2) Transportation of goods of goods for consignee, if Registered
for job work, transportation
d)HSN code and description of goods,
(3) Transportationof goods e)Quantity (provisional, where the exact

for reasons other than by quantity being supplied is not known)
way of supply (like Branch
Transfer with same GSTIN) f)Taxable value
(4) Such other supplies as g)Tax rate and tax amount – central tax,
may be notified by the state tax, integrated tax, union territory
Board tax or cess, where the transportation is for
supply to the consignee
h)Place of supply, in case of inter-state

movement
i)Signature
Delivery Challan in Triplicate Declaration in E-way Bill :Where goods are

Original copy- For Consignee being transported on a delivery Challan in
Duplicate copy- For Transporter lieu of invoice, the same shall be declared
Triplicate copy- For Consignor in E-Way Bill.

Tax invoice to be issued after delivery of goods

Where the goods being transported are for the purpose of supply to the recipient but the tax invoice
could not be issued at the time of removal of goods for the purpose of supply, the supplier shall issue
a tax invoice after delivery of goods.
Issue
Suppliers of jewellery etc. who are registered in one State may have to visit other States (other than their
State of registration) and need to carry the goods (such as jewellery) along for approval. In such cases if
jewellery etc. is approved by the buyer, then the supplier issues a tax invoice only at the time of supply.
Here the question is invoice to be issued before commencement of movement or at the time of approval?
Clarification
The goods can be moved on a delivery challan along with the e-way bill wherever applicable
For this purpose, the person carrying the goods for such supply can carry the invoice book with him
so that he can issue the invoice once the supply is fructified.[Circular No. 10/10/2017 GST dated
18.10.2017]
13. Goods Transported in SKD/CKD Condition
Where the goods are being transported in a semi knocked

down or completely knocked down condition oror in
batches or lots,
The supplier The supplier shall Copies of the corresponding The original
shall issue the issue a delivery delivery Challan shall copy of the
complete Challan for each of accompany each consignment invoice shall be
invoice before the subsequent along with a duly certified sent along
dispatch of consignments, giving copy of the invoice; and with the last
the first reference of the consignment.
consignment invoice;

14. ISD Invoice (Rule 54)
An ISD invoice or Debit Note, as the case may be, an ISD credit note issued
by an Input Service Distributor shall contain the following details:-
a) Name, address and GSTIN of ISD;

d) Name, address and GSTIN of the recipient to whom the credit is distributed
e) Amount of credit distributed
f) Signature/digital signature of ISD/his authorized representative
However, where the ISD is an office of a banking company or a financial institution, including NBFC, 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
Person-in-charge of the conveyance to carry a copy of the tax invoice/ bill of supply where such
person is not required to carry an e-way bill
15. Prohibition on Unauthorized collection of Taxes (Section 32)
A person who is not a registered person shall not collect in respect of any
supply of goods or services or both any amount by way of tax under this Act.
No registered person shall collect tax except in accordance with the
provisions of this Act or the rules made thereunder
16. Amount of tax to be indicated in Tax invoice (Section 33)
Notwithstanding anything contained in this Act or any other law for the time being in force, where
any supply is made for a consideration, every person who is liable to pay tax for such supply shall
prominently indicate in all documents relating to assessment, tax invoice and other like documents,
the amount of tax which shall form part of the price at which such supply is made.
18. Debit & Credit Notes (Section 34) Refer Pg 7.6 & 7.7

19. E - INVOICE Amendment
1 What is e-Invoicing  System in which B2B invoices are authenticated electronically by GSTN
under GST? for further use on the common GST portal
 Identification number will be issued against every invoice by the Invoice
Registration Portal (IRP)
 The first IRP was launched by the National Informatics Centre
at einvoice1.gst.gov.in
 All invoice information will be transferred from this portal to both GSTR-
1 and e-way bill portal in real-time
 Therefore, it will eliminate the need for manual data entry while filing
GSTR-1 return as well as generation of part-A of the e-way bills, as the
information is passed directly by the IRP to GST portal.
 E-Invoice is applicable for both the Goods and Services
2 To whom is e-  E-Ienvoicing will be applicable from 1st April 2021 for businesses with a
Invoicing applicable? turnover of more than Rs.50 crores (in any financial year from FY 2017-18
onwards)
3 Are there any  An insurer or a banking company or a financial institution, including an
Exceptional persons NBFC
who need not issue E  A Goods Transport Agency (GTA)
Invoice?  A registered person supplying passenger transportation services
 A registered person supplying services by way of admission to the
exhibition of cinematographic films in multiplex services
 An SEZ unit (excluded via CBIC Notification No. 61/2020 – Central Tax)
4 How will Electronic  E-invoice resolves and plugs a major gap in data reconciliation under GST
invoicing benefit to reduce mismatch errors.
businesses?  E-invoices created on one software can be read by another, allowing
interoperability and help reduce data entry errors.
 Real-time tracking of invoices prepared by the supplier is enabled by e-
invoice.
 Backward integration and automation of the tax return filing process –
the relevant details of the invoices would be auto-populated in the
various returns, especially for generating the part-A of e-way bills.
 Faster availability of genuine input tax credit.
 Lesser possibility of audits/surveys by the tax authorities since the
information they require is available at a transaction level.
5 What are the parts of The GSTN’s e-invoice contains the following parts:
E-Invoice?
(1) E-invoice schema: It consists of the technical field name, description of
each field, whether it is mandatory or not, and has a few sample values along
with explanatory notes.
(2) Masters: Masters will specify the set of inputs for certain fields, that are
pre-defined by GSTN itself. It includes fields like UQC, State Code, invoice
type, supply type, etc.
(3) E-invoice template: The template is as per the GST rules and enables the
reader to correlate the terms used in other sheets. The mandatory fields are
marked in green and optional fields are marked in yellow.
6 How will e-Invoicing It will help in curbing tax evasion in the following ways:
curb tax evasion?  Tax authorities will have access to transactions as they take place in real-
time since the e-invoice will have to be compulsorily generated through
the GST portal.

 There will be less scope for the manipulation of invoices since the invoice
gets generated prior to carrying out a transaction.
 It will reduce the chances of fake GST invoices and the only genuine input
tax credit can be claimed as all invoices need to be generated through the
GST portal. Since the input credit can be matched with output tax details,
it becomes easier for GSTN to track fake tax credit claims.
7 Can an e-Invoice be An e-Invoice cannot be cancelled partially but can be cancelled wholly. On
cancelled cancellation, it must be reported into the IRN within 24 hours. Any attempt to
partially/fully? cancel thereafter, cannot be done on the IRN and needs to be manually
cancelled on the GST portal before the returns are filed.
8 What are the types of The documents that will be covered under e-Invoicing system are as follows-
documents that are to 1. Invoices by the Supplier
be reported into the 2. Credit Notes by the Supplier
IRP? 3. Debit Notes by the Recipient
4. Any other document as notified under GST law to be reported as e-
invoice by the creator of the document
9 Does the e-invoice Yes, the e-invoice scheme applies to reverse charge mechanism (RCM)
schema apply to transactions as well.
reverse charge
mechanism (RCM)
transactions?
10 When T.O crosses the To calculate e-invoicing eligibility, the preceding year’s turnover, beginning
Limit, then from which from FY 2017-18, should be considered. Hence, if a business’ turnover
date E invoice is exceeds the prescribed limit in a financial year, it would be required to
applicable generate e-invoices from the beginning of the next financial year. For
example, if the threshold turnover was exceeded in FY 2020-21, then e-
invoicing will be applicable from 1st April 2021.
11 For 17-18 year, what For FY 2017-18, the aggregate turnover is to be computed from 1st July 2017
do you mean by TO? until 31st March 2018.
12 Is e-invoicing No, e-invoicing is not applicable to nil-rated or wholly-exempt supplies as in
applicable to nil-rated these cases, only a bill of supply is issued and not a tax invoice.
or wholly-exempt
supplies?
13 Do financial or No, only credit and debit notes that are issued under Section 34 of the CGST
commercial credit or SGST Acts need to be reported to the IRP.
notes need to be
reported to the IRP?
14 What is the maximum The maximum number of line items allowed per e-Invoice is 1000.
number of line items
supported by an e-
Invoice?
15 Does the e-invoice A proviso to Rule 46 states that the signature/digital signature shall not be
need to be signed required in the case of issuance of an electronic invoice that is in accordance
again by the supplier? with the provisions of the InformationTechnology Act, 2000.
16 Can a business place Not mandatory. If entity desires, they can do so
its logo on the e-
invoice template?
17 Will an invoice or Under Rule 48(4) of the CGST Rules, a notified person has to prepare an
credit/debit note be invoice by uploading the specified particulars in Form GST INV-01 on the IRP,
valid without an IRN, after obtaining an IRN. Rule 48(5) further states that any invoice issued by
if it is required to be such notified persons in any manner other than the manner specified in Rule
reported to the IRP by 48(4) shall not be treated as an invoice. Hence, an invoice or debit/credit note
a notified person? shall become legally valid only with an IRN if it’s being issued by a notified

person.
18 How can one verify Anyone can verify the correctness of an e-invoice by uploading the signed
the authenticity of an JSON into the e-invoice system, by selecting the option ‘Verify Signed Invoice’
e-invoice? under the ‘Search’ option. One can also download the QR Code Verify app
and verify the QR code printed on the invoice.
19 How can an e-invoice All amendments to an e-invoice can be made only on the GST portal in the
be amended? GSTR-1 return.
20 Is there a time limit A time limit is not yet notified for reporting invoices on the IRP. However, an
for uploading e- invoice is considered valid only after its registration on the Invoice
invoices on the IRP? Registration Portal (IRP). Once uploaded on the IRP, the same will be
registered immediately on a real-time basis.
21 Do export Yes, e-invoice compliance is mandatory for export transactions as well. The e-
transactions require e- invoice system allows the declaration of export invoices as well as zero-rated
invoice compliance? supplies.
24. Advance Received for Supply of Service but Subsequently Cancelled
GST Paid on Advance Received (If Tax Invoice Issued)
Issue Credit Note u/s 34 Refund can be claimed in

Or GSTRFD-01 under “Excess
to reduce tax liability
payment of tax, if any”
GST Paid on Advance Received (If Receipt Voucher Issued)
Issue Refund Voucher to Refund can be claimed in

Reduce Tax Liability Or GSTRFD-01 under “Excess
payment of Tax, if any
25. Goods Returned by Recipient
Issue “CREDIT NOTE” to If there are no sales to

Or
reduce tax liability reduce tax liability
Refund can be claimed in GSTRFD-

01 under “Excess payment of tax, if
any”

19. Dynamic Quick Response (QR) Code on B2C invoices

1. To which invoice is Notification No 14/2020- Tax invoice issued to an unregistered person by a registered person (B2C invoice) whose annual aggregate
Central Tax (S.No. 516) dated 21st March, turnover exceeds 500 Cr rupees in any of the financial years from 2017-18 onwards.
2020 applicable?
2. Exceptions Not applicable to an invoice issued in following cases:
i. Where the supplier of taxable service is:
a) an insurer or a banking company or a financial institution, including a non-banking financial company;
b) a goods transport agency supplying services in relation to transportation of goods by road in a goods
carriage;
c) supplying passenger transportation service;
d) supplying services by way of admission to exhibition of cinematograph in films in multiplex screens
ii. OIDAR supplies made by any registered person, who has obtained registration under section 14 of the
IGST Act 2017, to an unregistered person.
3. Would this requirement be applicable on No. For Exports, E-Invoice has been specified
invoices issued for supplies made for
Exports?
4. What is the purpose of QR code? The main motto of generating QR codes for B2C e-invoices is to promote digitalisation of payments using any
UPI.
5. What to you mean by Dynamic QR Code? Dynamic QR code – A dynamic QR code is editable and allows additional features such as scan analytics,
password protection, device-based redirection and access management. It provides a less dense QR code
image, which is more reliable to scan.
B2C QR code has to be self-generated by the taxpayer. This need not be generated in GST Portal
A taxpayer can generate QR code using their own QR code generating machines and algorithms.
6. What should be the Contents in the Code  GSTIN of the supplier
when scanned?  Supplier UPI ID
 Invoice number, given by the supplier
 Date of the generation of invoice
 Bank account details of the payee and IFSC
 CGST, SGST, IGST, Cess, if any
The scanning of the dynamic QR code should allow the digital payment by the customer.

7. Sample
8. Payment in cash? Yes.

If a Dynamic QR Code has been provided, but If The customer pays with cash, and the supplier provides a cross-reference of the date and amount details on
the customer opts to make a payment the invoice, then it shall be treated as Complaince only
without using it. Will this situation be treated
as compliance with the Dynamic QR Code
requirements?
9. If the payment for an invoice has been made Not required.However, a cross-reference needs to be provided on the invoice, of the payment made through
before the invoice has been issued, then is cash/electronic mode or a combination of both.
the generation of printing of the Dynamic QR
Code on the invoice mandatory? On the other hand, if payment is made later on after issuing the invoice, then the dynamic QR code must be
displayed on it.
10. Will suppliers selling through e-commerce The Dynamic QR Code requirements will apply to each supplier individually.
operators or other online applications be If payment is made later on such as COD after issuing the invoice, then the dynamic QR code must be
required to comply with Dynamic QR Code displayed on it.
requirements, if the e-commerce
operator/application has already complied
with the same?

CH.SUDHEER C.A, C.M.A Chapter 11 ACCOUNTS AND RECORDS
Chapter 11 ACCOUNTS AND

RECORDS
Topics to be dealt in this chapter
1. Records to be 2. Mode of 3. Audit of 4. Failure to 5. Period of

maintained Maintaining Records Maintain Maintenance
Records Records
Under Under Agent Manufacturers Works Godown or Transp

Regular Composition Contractors Warehouse orter
Registration Scheme Keeper
• Assessment in GST is mainly focused on self-assessment by the taxpayers themselves. Every

taxpayer is required to self-assess the taxes payable and furnish a return for each tax period
i.e. the period for which return is required to be filed.
• The compliance verification is done by the Department through scrutiny of returns,audit

and/or investigation. Thus, the compliance verification is to be done through documentary
checks rather than physical controls. This requires certain obligations to be cast on the
taxpayer for keeping and maintaining accounts and records.
• Every registered person shall keep and maintain all records at his principal place of business.
• It is not mandatory to maintain the accounts in electronic form. Accounts and records may
be maintained either electronically or manually. Further, there is no prescribed format for
maintaining the accounts.
• Sections 35 and 36 of the CGST Act enumerates the accounts and records required to be
maintained by a taxpayer and the period for which such accounts and records are required to
be preserved.

1. Accounts and other Records (Section 35)
Who is required to maintain his books of accounts and at which place?
[Section 35(1) read with rule 56(7) and 56(10)]
Every registered person shall Unless proved otherwise, if any

Where more than one place of documents, registers, or any
keep and maintain, his books business is specified in the
of accounts at his principal books of account belonging to
certificate of registration, the a registered person are found
place of business and books of accounts relating to each place
account relating to additional at any premises other than
of business shall be kept at those mentioned in the
place of business [as such places of business.
mentioned in the certificate of certificate of registration, they
registration]. shall be presumed to be
maintained by the said
registered person.
Accounts and records required to be maintained- General View
production or
manufacture of
goods
such other
inward and outward
particulars as may
A true and supply of goods or
be prescribed
services or both
[Section 35(1)] correct
account of
following is to
be maintained
output tax
payable and stock of
paid goods
input tax
credit availed

A. Every Registered dealer under Regular Scheme should maintain the following records
Section 35 & Rule 56,58 : A registered person is required to maintain a true and correct
account of:
 Inward supply
 Inputs
 Input Services
 Capital Goods
 Outward Supply
 Output
a) Exempted
b) Taxable
 Output Services
a) Exempted
b) Taxable
c) RCM
 Capital Goods
a) On which ITC is availed
b) ITC is not availed
 Import of
 Goods
 Services
 Export of
 Goods
 Services
 Inward Supplies attracting RCM

 Separate account of advances received, paid and adjustments made thereto.
 Invoices to be maintained for Inward & Outward Supplies
 Tax Invoice
 Bills of supply
 delivery challans
 Credit notes, Debit notes
 Receipt vouchers
 payment vouchers
 Refund vouchers

 Address of Suppliers
Names and complete addresses of suppliers from whom he has received the goods or
services chargeable to tax under the Act
 Address of Customers
 In case of B2B :
Names and complete addresses of the persons to whom he has supplied goods or
services
 In case of B2C :
Names and complete addresses of the persons to whom he has supplied goods or
services , if Invoice value has exceeded Rs.50,000 (Section 31 & Rule 46)
 Stock Register
 complete address of the premises where goods are stored by him
 PPOB & Each APOB should consist of Stock register w.r.t stock available in such unit
However, if any taxable goods are found to be stored at any place(s) other than those
so declared without the cover of any valid documents, the proper officer shall
determine the amount of tax payable on such goods as if such goods have been
supplied by the registered person
B. Records which are to be maintained by a supplier opting for composition levy
 Purchase Invoices
 Bill of Supply
a) Taxable under HSN
b) Exempted Goods
 Details of Tax paid Quarterly
 Inward supplies Taxable under RCM

C. Records to be maintained by Agent
Every agent shall maintain accounts depicting the-
Particulars
Particulars of Particulars
including Tax paid on
authorisation including
description, value receipts or on
received by him description, value Details of
and quantity supply of
from each principal and quantity accounts
(wherever goods or
to receive or supply (wherever furnished to
applicable) of services
goods or services applicable) of every principal;
goods or services effected on
on behalf of such goods or services and
supplied on behalf of every
principal received on behalf
behalf of every principal.
separately; of every principal;
principal;
D. Additional Records to be maintained by a Manufacturer
 Monthly production accounts showing quantitative details of

raw materials or services used in the manufacture
 Quantitative details of the goods so manufactured including the
waste and by products thereof.
E. Additional Records to be maintained by Building or Works Contractors
The names and addresses of Description, value and

the persons on whose quantity (wherever
behalf the works contract is applicable) of goods or
executed; services received for the
execution of works contract;
Description, value and

quantity (wherever The details of payment
applicable) of goods or received in respect of each
services utilized in the works contract
execution of works
contract;

F. Records to be maintained by owner or operator of godown or warehouse
 Records of the consignor with complete Registration & Address Details

 Delivery Challans for each consignment Received
 Delivery Challan/ Tax Invoice for each consignment Delivered
 Particulars relating to dispatch, movement, receipt, and disposal of such goods.
 The owner or the operator of the godown/ Warehouse 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.
G. Records to be maintained by Transporter
 Every transporter, irrespective of whether he is a registered person or not, shall maintain records
of the
 consignor
 consignee
 Copy of Tax invoice or Bill of supply or Delivery challan
 Copy of E-way bill wherever required
 Consolidated E-way bill Details
 Details of Consignor who specified Transportors premises as APOB
 Registration: If such persons are not already registered, they shall obtain a unique enrolment
number by applying electronically at the GST Common Portal in FORM GST ENR-01,
A transporter who is registered in more than one State or Union Territory having the same
Permanent Account Number, he may apply for a unique common enrolment number by
submitting the details in 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
 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.
 The Transporter 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.

2. How the accounts and records will be maintained? [Rule 56, 57]
A. Records may be in electronic form
The registered person may keep and Proper electronic back-up of records shall
maintain such accounts and other be maintained and preserved in such
particulars in electronic form stored manner that, in the event of destruction of
on any electronic device and record so such records due to accidents or natural
maintained shall be authenticated by causes, the information can be restored
means of a digital signature. within a reasonable period of time.
Where the accounts and records are stored

The registered person maintaining electronically by any registered person, he
electronic records shall produce, on shall, on demand, provide the details of
demand, the relevant records or such files, passwords of such files and
documents, duly authenticated by explanation for codes used, where
him, in hard copy or in any necessary, for access and any other
electronically readable format. information which is required for such
access along with a sample copy in print
form of the information stored in such files.
B. Records may be Manual
Any entry All incorrect Each volume Every registered

in registers, entries, of books of person shall, on
accounts otherwise than account demand,
and those of clerical maintained produce the
documents nature, shall be manually by books of
shall not be scored out under the accounts which
erased, attestation and registered he is required to
effaced or there after person shall maintain under
overwritten correct entry be serially any law for the
shall be numbered. time being in
recorded. force.

3. Self-Certified Reconciliation statement leading to Omission of GST Audit by CA/CMA (Applicable from
F.Y:2020-21) [Section 35(5) read along with section 44(2) and rule 80]
Particulars Earlier Now (from F.Y:2020-21 )

Annual Return Form GSTR- 9 GSTR-9
Reconcilation Statement GSTR-9C GSTR-9
Turnover Limit GSTR-9 : If TO > 2 Crores Not yet specified . The term used in
GSTR-9C : If TO > 5 Crores Finance Act 2021 is “Every
Registered person paying tax”
Signing Authority 9 : Assessee Only Assessee because Self
9C : CA/CMA Certified Reconcilation Statement
What has to be Reconciled? Value of supplies in GST Returns Value of supplies in GST Returns
with Audited Financial with Audited Financial Statements
Statements (Same).
Here the term Audit is not Defined. There are different types of audit
like Tax Audit, Cost Audit, Company Audit, Energy Audit etc.., So
Government should notify a T.O limit to know the applicability
Non Applicability Commissioner shall by notification exempt any class of registered
persons from filing Annual return under this section
Exception specified in Section a) ISD
itself (Non applicability) b) GSTR-7 & 8 filers
c) Any SG or CG department whose books are audited by C & AGI
4. Failure to maintain the accounts [Section 35(6)]

Amendment
 Tax & Penalty to be determined u/s 73 or 74

 If there is no Tax violation but Records were not completely maintained then,
General penalty u/s 125 – Rs.50000 CGST & Rs.50000 SGST
5. Period for Retention of Books of Account (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.
 Records pertaining to the subject matter of such appeal or revision
One year after final disposal For the period specified

of such appeal or revision or Or
above, whichever is later.
proceedings or investigation,

CH.SUDHEER C.A, C.M.A Chapter 12 TAX PAYMENT, TDS, TCS
Chapter 12
TAX PAYMENT, TDS & TCS
1. Payment of Tax, Interest, Penalty and other amounts (Section 49)
A. ELECTRONIC CASH LEDGER
The Electronic Cash Ledger contains a summary of all the

deposits/payments made by a taxpayer. Electronic Cash Ledger is
maintained on the GST Portal. The Electronic Cash Ledger has to be
maintained in prescribed form on the common portal by a person liable to
pay tax.
MODE OF DEPOSIT IN ELECTRONIC CASH LEDGER

Online Payment Offline Payment
1. Internet Banking (No NEFT/ RTGS (No limit)
limit)
ELECTRONIC CASH 2. Credit/ Debit cards Over the counter- Rs.10000 per challan ,
LEDGER [SECTION (No Limit) per tax period by cash , cheque or
demand draft
49(1) & (3) READ
WITH RULE 87 OF Any other mode as may be prescribed
CGST RULES]
Note:Provided that the restriction for deposit up to ten thousand rupees
per challan in case of an Over the Counter payment shall not apply to
deposit to be made by –
a. Government Departments or any other deposit to be made by persons
as may be notified by the Commissioner in this behalf;
b. Proper officer or any other officer authorised to recover outstanding
dues from any person, whether registered or not, including recovery
made through attachment or sale of movable or immovable
properties;
c. Proper officer or any other officer authorised for the amounts
collected by way of cash, cheque or demand draft during any
investigation or enforcement activity or any adhoc deposit:

Some
important
terms
 CPIN stands for Common portal Identification Number. It is created for every Challan
successfully generated by the taxpayer. It is a 14-digit unique number to identify the
challan. CPIN remains valid for a period of 15 days.
 CIN or Challan Identification Number is generated by the banks, once payment in lieu of
a generated Challan is successful. It is a 17-digit number that is 14-digit CPIN plus 3-digit
Bank Code. CIN is generated by the authorized banks/Reserve Bank of India (RBI) when
payment is actually received by such authorized banks or RBI and credited in the relevant
government account held with them. It is an indication that the payment has been
realized and credited to the appropriate government account. CIN is communicated by
the authorized bank to taxpayer as well as to GSTN.
 BRN or Bank Reference Number is the transaction number given by the bank for a
payment against a Challan
 E-FPB stands for Electronic Focal Point Branch. These are branches of authorized banks
which are authorized to collect payment of GST. Each authorized bank will nominate only
one branch as its E-FPB for pan India transaction. The E-FPB will have to open accounts
under each major head for all governments. Any amount received by such E-FPB towards
GST will be credited to the appropriate account held by such E-FPB. For NEFT/RTGS
Are manual Challans applicable as How many types of Challans are

allowed earlier under the VAT prescribed for various taxes and payments
regimes? to be paid under the GST regime?
Ans Ans
There is single Challan prescribed Manual or physical Challans are

for all taxes, fees, penalty, not allowed under the GST regime.
interest, and other payments to It is mandatory to generate
be made under the GST regime. Challans online on the GST Portal.

Other Aspects
relating to Challan
 E- challan validity is for 15 days. The commission for making payment through echallan has to
be borne by the person making the payment.
 Any unregistered person has to make payment on the basis of temporary identification number
generatedthrough common portal.
 The mandate form obtained after making NEFT/RTGS payment has to be submitted in the
Bank. The validity of the mandate form is 15 days.
 On successful credit of amount in the concerned (Central/State) Government Account
maintained in the authorized bank, a Challan Identification Number (CIN) will be generated by
the collecting bank which will be indicated in the challan.
 The ‘deposit’ made by one of the modes and in the prescribed manner will be credited to the
Electronic Cash Ledger of the taxable person.
 On receipt of the CIN from the collecting bank, the said amount is credited into the electronic
cash ledger of the person on whose behalf the deposit is made and the common portal will
generate a receipt to this effect.
 If CIN is not generated even after making payment and submission of mandate form or when
after generation, it has not reflected in the common portal, the person making the deposit or
the person on whose behalf the deposit has been made, can make a representation in
prescribed form through the common portal or e-gateway through which the payment has
been made.
 Date of credit into the treasury of the State Government/Central Government is deemed to be
the date of deposit and not the actual date of debit to the amount of the taxable person.
 In case any discrepancy is noticed in electronic cash ledger, the registered person shall
communicate the same to the officer exercising jurisdiction in the matter, through the common
portal in prescribed form.
Manner of
Major • IGST ,CGST,SGST, UTGST, CESS
Heads
utilization
of amount
reflected in
Electronic
Minor
Cash Ledger
Heads • Tax, Interest, Penalty, Fee, Others

How can the cash available in the Electronic Cash Ledger be utilised? Can a taxpayer utilise the
amount available in any minor head of a major head for any other minor head of the same
major head?
The amount available in the Electronic Cash Ledger can be utilised for payment of any liability for
the respective major and minor heads. For example, liability for the tax under SGST/UTGST can
be settled only from the available amount of cash under SGST/UTGST Major head.
E.g.:An amount of ` 1,000 is available under minor head ‘tax’ of major head ‘SGST/UTGST’ and
the taxpayer has a liability of ` 200 for minor head ‘interest’ under the same major head
‘SGST/UTGST’. Since, there is no amount available under minor head ‘interest’ under major head
“SGST/UTGST”, therefore, interest payment cannot be made from the amount available under
‘tax’ of the same major head
E.g.:A taxpayer made a cash deposit of ` 1,000 to IGST – Tax, through net banking. The tax payer
can utilise this cash deposit of ` 1,000 in the cash ledger to make payment ONLY of the IGST –
Tax liability, by debiting the Cash Ledger
Amendment
Transfer of Amounts within Minor Heads/ Major Heads

A registered person may, on the common portal, transfer any amount of tax, interest,
penalty, fee or any other amount available in the electronic cash ledger under the Act
to the electronic cash ledger for integrated tax, central tax, State tax or Union
territory tax or cess in FORM GST PMT-09 (Implemented w.e.f.21/04/2020)
B. Electronic Credit Ledger
ELECTRONIC CREDIT LEDGER [SECTION 49(2),(4) & (5) READ WITH RULE 86 OF CGST RULES]
Input Tax Credit as self-assessed in monthly returns will be reflected in the ITC Ledger. The credit
in this ledger can be used to make payment of TAX ONLY and no other amounts such as interest,
penalty, fees etc. This is called as Electronic Credit Ledger or Electronic Input Tax Credit Ledger

ITC of ITC of ITC of

IGST CGST SGST/IT
GST
IGST CGST SGST/
UTGST
CGST IGST IGST
SGST/
UTGST
ITC of
ITC of
SGST/IT
CGST GST
SGST/
CGST
UTGST
Common Points for Electronic Cash & Credit Ledger
Electronic Cash & Credit Ledger
Where a person has claimed refund of any amount from the

electronic cash or credit ledger, the said amount shall be debited
to the electronic cash or credit ledger.
If the refund so claimed is rejected, either fully or partly, the

amount debited earlier, to the extent of rejection, shall be
credited to the electronic cash or credit ledger by the proper
officer by an order made in prescribed form

C.Electronic Liability Register
1. Electronic Liability Register will reflect the total tax liability of a

taxpayer (after netting) for the particular month
2. Order of discharge of tax and other dues
ELECTRONIC LIABILITY  Self -assessed tax and other dues for the previous tax periods
REGISTER [SECTION have to be discharged first.
49(7), (8) & (9) READ  The self -assessed tax and other dues for the current period have
WITH RULE 85 OF CGST to be discharged next.
RULES]  Demand determined under section 73 or section 74
3. Presumption that incidence of tax is passed on unless a GST Credit
note issued
How do the new payment systems benefit the taxpayer

and the Commercial Tax Department?
4 5 6
1 2 3
No more Instant Tax Single Revenue will
queues and online Consultants Challan form come earlier Greater
waiting for receipts for can make to be into the transparency
making payments payments on created Government
payments as made online. behalf of the online, Treasury as
payments clients. replacing the compared to
can be made three or four the old
online 24 X 7 copy system.
Challan.
Online payments made after 8 pm will be credited to the taxpayer’s account on

7 the same day.

2. Interest on Delayed payment of Taxes (Section 50)
Rate of interest shall be notified by the Government on the basis of recommendation

of the Council. However, such rate to be notified shall not exceed-
18% in case of belated payment of tax 24% on undue or excess claim of ITC
i.e on failure to pay tax (or part of or on such undue or excess
tax) to the Government’s accounts reduction in output tax
Notification No. 13/2017 CT dated liabilityNotification No. 13/2017 CT
28.06.2017 has notified the rate of dated 28.06.2017 has notified the
interest as 18% per annum. rate of interest as 24% per annum
Computation of period for calculation of interest

The period of interest will be from the date following the due date of payment to the actual date
of payment of tax.
Other relevant points relating to interest
1
The term “tax”
2
here means the
The payment of
3
Net tax payable
(i.e., after ITC) interest in case of
The interest
4
under the Act or belated payment
of tax should be payable under this The liability for
Rules made section shall be interest can be
thereunder. made voluntarily
i.e. even without a debited to the settled by
demand. Electronic Liability adjustment with
Amendment Register. balance in
Electronic Cash
Ledger but not
Exception (i.e., Interest levied on with balance in
Tax payable before ITC): where electronic credit
such return is furnished after ledger.
commencement of any proceedings
under section 73 or section 74 in
respect of the said period

3. Taxes wrongfully collected and paid to CG or SG (Section 19 of IGST ACT)
Payment of tax based on erroneous determination of ‘nature of supply’ is not

permitted to be adjusted because of the above appropriation of payments.
Remedy lies in refund.Taxable person who has paid tax in error is entitled to
refund by first restoring the discharge of the correct tax due so that the
incorrect tax paid reflects on the common portal as ‘paid in excess’ and
 IGST paid in error will be refunded subject to conditions prescribed
 IGST payable due to payment of CGST & SGST/UTGST is exempted from
payment of interest on IGST due.
4. GST TDS
TDS (Appl. from 01.10.2018)
The TDS provisions u/s 51 empower the Central Government to make it mandatory for the following
persons (the Deductor) to deduct tax at source from payments made to the suppliers of taxable
goods and/or services
Local Authority Governmental

[Section Agencies
51(1)(b)] [Section
51(1)(c)]
Central/State
Notified
Government
Persons/catego
department or
ry of persons
establishment
[Section
[Section
51(1)(d)]
51(1)(a)]

Notified persons:
a. An authority or a board or any other body, -
 set up by an Act of Parliament or a State Legislature; or
 established by any Government,
with 51% or more participation by way of equity or control, to carry out any function;
b. Society established by the Central Government or the State Government or a Local Authority
under the Societies Registration Act, 1860;
c. Public sector undertakings
Provided further that nothing in this notification shall apply to the supply of goods or services or
both from a public sector undertaking to another public sector undertaking, whether or not a
distinct person, with effect from the 1st day of October, 2018 (Ntn.61/2018-Central Tax ,dt. 05-11-
2018)
Note: Provided that with respect to persons specified under clause (a), nothing in this notification
shall apply to the authorities under the Ministry of Defence, other than the authorities specified in
the Annexure-A and their offices, with effect from the 1st day of October, 2018. Annexure-A consists
of 30 Departments of Defence. Students need not remember those names (Notification No. 57/2018
– Central Tax dt.23/10/2018)
1. Deductees
The Deductees are the suppliers whose total value of supply of taxable goods and/or services under a
contract exceeds ` 2,50,000 exclusive of tax & cess as per the invoice.
2. Standard Rate of deduction
1 • TDS-1% on net value of taxable supplies
• The tax would be deducted @ 1% of the payment made to the supplier (the
Deductee) of taxable goods and/or services, where the total value of such supply,
2 under a contract, exceeds ` 2,50,000 (excluding the amount of Central tax, State tax,
Union Territory tax, Integrated tax and cess indicated in the invoice).
• Thus, individual supplies may be less than ` 2,50,000/-, but if total value of supply
3 under a contract is more than ` 2,50,000/-, TDS will have to be deducted.
• The deductors have to deduct tax at the rate of 1% from the payment made or
4 credited to the supplier of taxable goods and/or services
• It may be noted that Section 20 of IGST Act provides that in the case of tax deducted
5 at source, the Deductor shall deduct tax at the rate of 2% from the payment made or
credited to the supplier.
• Further, the value of a supply shall include any taxes, duties, cesses, fees and charges
6 levied under any law for the time being in force other than this Act, and the Goods
and Services Tax (Compensation to States) Act, if charged separately by the supplier

3. No TDS
The Proviso to Section 51(1) lays down that when the location of the supplier and the place of supply
is in a State/ Union territory which is different from the State/ Union territory of registration of the
recipient, there will be no TDS.The above statement can be explained in the following situations
• It would be intra-State • In such cases, Integrated •The supply would be intra-State

supply and TDS (Central tax would be levied. TDS to supply and Central tax and State
plus State tax) shall be be deducted would be TDS tax would be levied. In such
case, transfer of TDS (Central tax
deducted. It would be (Integrated tax) and it + State tax of State B) to the
possible for the supplier would be possible for the cash ledger of the supplier
(i.e. the Deductee) to take supplier (i.e. the deductee) (Central tax + State tax of State
credit of TDS in his to take credit of TDS in his A) would be difficult. So, in such
electronic cash ledger. electronic cash ledger. cases, TDS would not be
deducted. Thus, when both the
supplier as well as the place of
supply are different from that of
the recipient, no tax deduction
at source would be made.
Supplier, place of Supplier as well as the

Supplier as well as place of supply are in
supply and recipient the place of supply State A and the
are in the same are in different recipient is located in
state. 1 states. 2 State B. 3
4. Deposit of TDS with the Government

The amount of tax deducted at source should be deposited to the Government account by Deductor
by 10th of the succeeding month.
5. TDS Certificate (GSTR-7A)
Includes
1. Contract Value .
2. Rate of Deduction TDS Certificate can be
3. Amount Deducted downloaded by Deductee from
GST Website after Login & click at
4. Amount paid to the appropriate option " View Certificates"
Government
5. Any other particulars as may be
prescribed

6. Non- remittance by the deductor

If the Deductor has not remitted the amount deducted as TDS to the Government within the
prescribed time limit, he is liable to pay penal interest under Section 50 in addition to the amount of
tax deducted
7. Reflection of amount of TDS after acceptance by Deductee

The amount of tax deducted is reflected in Electronic Cash Ledger of Deductee upon acceptance of
TDS amount in GST Website
8. Registration of TDS deductors: A TDS Deductor has to compulsorily register without any threshold
limit. The Deductor has a privilege of obtaining registration under GST without requiring PAN. He can
obtain registration using his Tax Deduction and Collection Account Number (TAN) issued under the
Income Tax Act, 1961.
9. TDS Return: The Deductor is also required to file a return in Form GSTR-7 within 10 days from the
end of the month. If the supplier is unregistered, name of the supplier rather than GSTIN shall be
mentioned in the return.
The details of tax deducted at source furnished by the Deductor in FORM GSTR-7 shall be made
available to each of the suppliers electronically through the common portal and the said supplier
may accept it after which such sum shall be credited to the Electronic Cash Ledger.
The supplier can take this amount as credit in his electronic cash register and use the same for
payment of tax or any other liability.
Eg:Suppose a supplier makes a supply worth ` 1000/- to a recipient and the GST at the rate of 18% is
required to be paid. The recipient, while making the payment of `1000/- to the supplier, shall deduct
1% viz ` 10/- as TDS.
The value for TDS purpose shall not include 18% GST. The TDS, so deducted, shall be deposited in the
account of Government by 10th of the succeeding month.The TDS so deposited in the Government
account shall be reflected in the electronic cash ledger of the supplier (i.e. Deductee) who would be
able to use the same for payment of tax or any other amount. The purpose of TDS is just to enable the
Government to have a trail of transactions and to monitor and verify the compliances.

5. GST TCS
TCS (Appl from 01.10.2018)
TCS refers to the tax which is collected by the electronic commerce operator when a supplier
supplies some goods or services through its portal and the payment for that supply is collected
by the electronic commerce operator. The nature of working of electronic commerce operator
can be better understood with the following example.
Eg: There are many e-Commerce operators [hereinafter referred to as an Operator], like
Amazon, Flipkart, Jabong, etc. operating in India. These operators display on their portal
products as well as services which are actually supplied by some other person to the consumer.
The goods or services belonging to other suppliers are displayed on the portals of the operators
and consumers buy such goods/services through these portals. On placing the order for a
particular product/service, the actual supplier supplies the selected product/service to the
consumer.
The price/consideration for the product/ service is collected by the Operator from the consumer
and passed on to the actual supplier after the deduction of commission by the Operator
1. Who is liable to collect TCS?

Every Electronic Commerce Operator (ECO), has been mandated to collect tax at source (TCS) from the
net value of taxable supplies made through it by other suppliers, whenever the ECO collects the
consideration on behalf of the supplier.
2. Rate of TCS
Not exceeding 0.5%(Notification No. 52/2018 dt.20/09/2018) of the net value of taxable supplies.
E.g.: Suppose a certain product is sold at ` 1000/- through an Operator by a supplier. The operator
would collect tax CGST@ 0.5% of the net value of ` 1,000/- i.e. ` 5/-. An equal amount of SGST Shall
also be collected
Exception to TCS Notified services under section 9(5) (Refer pg.3.7)

Notification 17/2017 CT (R)
3. Deposit of TCS by ECO to Government

The TCS amount collected by the ECO has to be remitted to the Government Treasury within 10 days
after the end of the month in which the collection was made. [Sub-section (3)]
Eg: If the TCS has been collected in the month of July, the amount has to be remitted into the
Government Treasury on or before 10 th August.

4. Filing of Monthly & Annual Statements by ECO
Monthly: An electronic statement has to be filed by the ECO containing details of the outward
supplies of goods and/ or services affected through it in GSTR-8
Annually : Additionally, the ECO is also mandated to file an Annual Statement on or before 31st day of
December following the end of the financial year. (GSTR-9B)
5. Rectification in Monthly Statement by ECO

If the ECO discovers any discrepancy on his own not being the result of any scrutiny, inspection or
enforcement proceedings, he has to rectify the statement.
However, the limit for rectification is earlier of the two:-
1. Due date for filing statement for the month of September following the end of the financial year.
Or
2. Actual date of furnishing of relevant annual statement.Interest provisions are applicable. [Sub-
section (6)]
6. Claim of Credit by Supplier in E.CASH LEDGER

Supplier can claim credit of the TCS amount in his electronic cash ledger upon his acceptance.
The details of TCS furnished in FORM GSTR-8 shall be made available to each of the suppliers
electronically through the common portal and the said supplier may accept it after which such sum
shall be credited to the Electronic Cash Ledger.
8.Mandatory Registration: Pg. 9.4 ( Point no.4)
9. What is the correct valuation methodology for ascertainment of GST on Tax collected at source
(TCS) under the provisions of the Income Tax Act, 1961?
Ans:
a. Section 15(2) of CGST Act specifies that the value of supply shall include “any taxes, duties cases,
fees and charges levied under any law for the time being in force other than this Act, the SGST Act,
the UTGST Act and the GST (Compensation to States) Act, if charged separately by the supplier.”
b. It is clarified that as per the above provisions, taxable value for the purposes of GST shall include
the TCS amount collected under the provisions of the Income Tax Act since the value to be paid to
the supplier by the buyer is inclusive of the said TCS

CH.SUDHEER C.A, C.M.A Chapter 13
Returns under GST
Chapter 13 `
RETURNS UNDER GST
3 Chapter IX of the CGST Act [Sections 37 to 48] prescribes the provisions relating to filing of returns as
under
Section 37 Furnishing details of outward supplies

Section 38 Furnishing details of inward supplies
Section 39 Furnishing of returns
Section 40 First return
Section 41 Claim of input tax credit and provisional acceptance hereof
Section 42 Matching, reversal and re-claim of input tax credit
Section 43 Matching, reversal and re-claim of reduction in output tax liability
Section 44 Annual Return
Section 45 Final Return
Section 46 Notice to return defaulters
Section 47 Levy of late fee
Section 48 Goods and services tax practitioners
1. Furnishing Details of Outward Supplies (Section 37)
(i) Who is required to furnish details of outward supplies? [Section 37(1) read with rule 59(1) of
CGST Rules]
ISD
Persons All registered NRTP
required to persons Composition
file GSTR-1 including casual taxpayer
registered Tax deductor
person ECO
Supplier of
OIDAR service
(ii) What is the form for submission of details of outward supplies? [Section 37(1) read with rule
59(1) of CGST Rules]
The details of outward supplies are required to be furnished, electronically, in Form GSTR-1. Such
details can be furnished through the common portal, either directly or from a notified Facilitation
Centre.

Returns under GST
(iii) What is the due date of submission of GSTR-1? [Section 37(1)]

GSTR-1 for a particular month is filed on or before the 10th day of the immediately succeeding
month. In other words, GSTR-1 of a month can be filed any time between 1st and 11th day of the
succeeding month.
The due date of filing GSTR-1 may be extended by the Commissioner/Commissioner of State
GST/Commissioner of UTGST for a class of taxable persons by way of a notification.
Outward Taxable
Supplies
B2B Supplies B2C Supplies
Inter-state Intra-state Inter-state Intra-state

Supplies Supplies Supplies Supplies
Invoices > Invoices ≤ Consolidate

Invoice-wise details of all ₹ 2, 50,000 ₹ 2, 50,000 d details of
supplies to be uploaded all supplies
to be
Invoice-wise State-wise
uploaded
details to be consolidated
uploaded details to be
(vii) How are the details of outward supply furnished in prior periods amended? [Section 37(3)]
By way of
Can be amended
Particulars Amendment
furnished in tables given in
GSTR-1 of prior GSTR-1 of
periods subsequent
periods

Returns under GST
EG
GSTR-1 for the month of August, 2017 was filed on 10th September, 2017 and the consolidated
return u/s 39 pertaining to the month of August, 2017 was filed on 20th September, 2017. The
said return is processed in the month of October, 2017 and errors discovered during matching
are communicated to the supplier in the mismatch report in the month of October, 2017.
The supplier has to rectify the said errors in GSTR-1 for the month of October, 2017 (due date of
submission of which is 10th November, 2017). If there is any tax liability because of the said
amendment/rectification, it will be automatically calculated in his return u/s 39 for the month of
October, 2017.
Time limit for rectification Maximum time limit

for rectification
 Date of filing GSTR-

To be rectified in the 1/3B for the month
Error/omission tax period when the of September
communicated in same are following the end
mismatch report communicated of the FY to which
such details pertain
(Or)
 Date of filing
annual return
WHICHEVER IS
EARLIER
GSTR-1 needs to be filed even if there is no business activity (Nil Return) in the tax period.
All values like invoice value, taxable value and tax amounts in GSTR-1 are to be declared up to 2
decimal digits. The rounding off of the self-declared tax liability to the nearest rupee will be done
in GSTR-3B
Taxpayer opting for voluntary cancellation of GSTIN will have to file GSTR-1 for active period.
In cases where a taxpayer has been converted from a normal taxpayer to composition taxpayer,
GSTR-1 will be available for filing only for the period during which the taxpayer was registered as
normal taxpayer.
The GSTR 1 for the said period, even if filed with delay would accept invoices for the period prior
to conversion.
For assessee’s with T.O less than 1.5 crores may opt to file GSTR-1 on Quarterly Basis (Here Due
date is month following the quarter i.e., 31 st July , 31st October, 31st January, 30th April)

Returns under GST
2. Furnishing details of Inward Supplies (Section 38) & (Rule 60)
Filing of GSTR-2 Concept is not yet implemented
3. GSTR 3B (Section 39)
Due date for payment of tax [Section 39(7)]

Due dates for payment of tax in respect of the persons required to file GSTR- 3B, GSTR CMP-08,
GSTR-5 and GSTR-7,8 are linked with the due dates for filing of such returns i.e., the last dates (due
dates) of filing such returns are also the due dates for payment of tax in respect of persons
required to file such returns.
GSTR-3B [Sub rules (5) and (6) of rule 61 of CGST Rules] FORM GSTR-3B is notified as the form for
return by the Commissioner when the due dates for furnishing GSTR-2 ,3 get extended. GSTR-3B is
a simple return containing summary of outward and inward supplies liable to reverse charge,
eligible ITC, payment of tax etc.
Thus, GSTR-3B does not require invoice-wise data of outward supplies. GSTR-3B can be submitted
electronically through the common portal, either directly or through a notified Facilitation Centre.
Rule 61(5)- GSTR 3B itself has legal recognition
Where the time limit for furnishing of Provided that where a return in FORM
details in FORM GSTR-1 under section 37 or GSTR-3B is required to be furnished by
in FORM GSTR-2 under section 38 has been a person referred to in sub-rule (1)
extended, the return specified in sub- then such person shall not be required
section (1) of section 39 shall be furnished to furnish the return in FORM GSTR-3
in FORM GSTR-3B electronically through
the common portal
✪ A taxpayer needs to electronically sign the submitted returns otherwise it will be considered
not-filed.
✪ Taxpayers can electronically sign their returns using a DSC (mandatory for all types of
companies and LLPs), or EVC (Electronic Verification Code sent to the registered mobile number
of the authorized signatory).

Returns under GST
NEW DUE DATES FOR GSTR-3B FILING
≥Rs. 5 Due date is 20th of every month

Crore
Annual
Turnover in
Previous F.Y
<Rs. 5
Crore
Due date is 22ndof every month Due date is 24thof every month
Chhattisgarh, Madhya Pradesh, Jammu and Kashmir, Ladakh,

Gujarat, Daman and Diu, Dadra and Himachal Pradesh, Punjab,
Nagar Haveli, Maharashtra, Karnataka, Chandigarh, Uttarakhand, Haryana,
Goa, Lakshadweep, Kerala, Tamil Delhi, Rajasthan, Uttar Pradesh, Bihar,
Nadu, Pondicherry, Andaman and Sikkim, Arunachal Pradesh, Nagaland,
Nicobar Islands, Telengana and Manipur, Mizoram, Tripura,
Andhra Pradesh Meghalaya, Assam, West Bengal,
Jharkhand and Odisha

Returns under GST
What are the precautions that a taxpayers is required to take for a hassle free compliance under
GST?
One the most important things under GST is the timely uploading of the details of outward supplies
in GSTR-1 by 11th of next month. How best this can be ensured will Depend on the number of B2B
invoices that the taxpayer Issues.
If the number is small, the taxpayer can upload all the information in one go. However, if the number
of invoices is large, the invoices (or debit/credit notes) should be uploaded on a regular basis.
GST common portal allows regular uploading of invoices even on a real time basis. Till the statement
is actually submitted, the system also allows the taxpayer to modify the
uploaded invoices. Therefore, it would always be beneficial for the
taxpayers to regularly upload the invoices. Last minutes rush makes
uploading difficult and comes with higher risk of possible failure and default.
The second thing would be to ensure that taxpayers follow up on uploading. The invoices of their
inward supplies by their supplier this would be helpful In ensuring that the ITC is available without
any hassle and delay . Recipients can also encourage their suppliers to upload their invoices on a
regular basis Instead of doing it on or close to the due date the system would allow recipients to see
if their suppliers have uploaded invoices pertaining to them.
4. Composition Tax payer (GST CMP-08 & GSTR-4)
Statement and Return for Composition suppliers (Rule 62)
Every registered person paying tax under section 10 or paying tax under Notn 02/2019– Central Tax
(Rate) shall electronically in common portal
(i) Furnish a statement, every quarter or, as the case may be, part thereof, containing the details of
payment of self-assessed tax in FORM GST CMP-08, till the 18th day of the month succeeding such
quarter; and
(ii) Furnish a return for every financial year or, as the case may be, part thereof in FORM GSTR-4, till
the 30th day of April following the end of such financial year
Note
 Every registered person furnishing the CMP-08 shall discharge his liability towards tax or
interest payable under the Act or the provisions of this Chapter by debiting the electronic
cash ledger
 No Late fee or penalty for late furnishing of GST CMP-08 (Only interest shall be levied for
late payment if any)

Returns under GST
Auto-population of inward supplies

The inward supplies of a composition supplier received from registered persons filing
GSTR-1 will be auto opulated in FORM GSTR-4A. The composition supplier can view the
auto-populated details of inward supplies in GSTR-4A
5. NON RESIDENT TAXABLE PERSON (GSTR-5) (Section 39(5))
Filing of Returns by Non- Non-Resident Taxable Persons (NRTPs) are those suppliers who do
Resident Taxable Persons not have a business establishment in India and have come for a
short period to make supplies in India. They would normally
import their products into India and make local supplies. The
concept of Non-Resident Taxable Person has been discussed in
detail in Chapter 7 – Registration
Monthly return A registered NRTP is not required to file separately the Statement
of Outward Supplies, Statement of Inward Supplies and Return for
a normal tax payer. In place of the same, a simplified monthly tax
return has been prescribed in Form GSTR-5 for a NRTP for every
calendar month or part thereof. NRTP shall incorporate the details
of outward supplies and inward supplies in GSTR-5.
Last date of filing return The details in GSTR-5 should be furnished within 20 days after the
end of the calendar month or within 7 days after the last day of
validity period of the registration, whichever is earlier.
Payment of interest, penalty, Payment of interest, penalty, fees or any other amount payable
fees or any other amount NRTP shall pay the tax, interest, penalty, fees or any other amount
payable payable under the CGST Act or the provisions of the Returns
Chapter under CGST Rules, 2017 till the last date of filing return.
6. INPUT SERVICE DISTRIBUTOR (GSTR-6) (Section 39(4))
Filing of return by an Input Service Distributor [Section 39(4) read with rule 60(5) and rule 65 of
CGST Rules, 2017] Input Service Distributor (ISD) means an office of the supplier of goods or
services or both which receives tax invoices issued towards the receipt of input services and
issues a prescribed document for the purposes of distributing the credit of central tax, State tax,
integrated tax or Union territory tax paid on the said services to a supplier of taxable goods or
services or both having the same PAN as that of ISD.
Thus, ISD can distribute the credit of “input services” (and not of inputs or capital goods) on
common invoices pertaining to input services to various units belonging to the entities having
same PAN (recipient of credit) in the prescribed manner, by issuing the ISD invoices.
An ISD is required to distribute both eligible as well as ineligible credit as per rule 39 of the CGST
Rules, 2017.

Returns under GST
A. Monthly Return B. Last date of filing return

The details in GSTR-6 should be furnished
ISD is not required to file separate on/before 13th of the month succeeding the
statements of outward and inward calendar month. GSTR-6 can only be filed after
supplies with its return. It needs to file 10th of the month and before 13th of the
only a monthly return in Form GSTR-6 month succeeding the tax period.
electronically through the common portal.
Form GSTR-6 contains the details of input Due date of By 13th day of
tax credit received for distribution, total filing monthly the month
ITC/ eligible/ ineligible ITC to be GSTR-6 succeeding the
distributed for the tax period, distribution calendar month
of ITC, details of debit/ credit notes, etc.
C. Auto-population of input tax credit D. ISD will not have reverse charge supplies
received for distribution
An ISD cannot accept any invoices on which
The details of input tax credit received for tax is to be discharged under reverse charge
distribution by an ISD will be auto mechanism. If ISD wants to take reverse
populated in Form GSTR-6A. Such details charge supplies, in that case it has to
are auto-populated in Form GSTR-6A when separately register as a Normal taxpayer.
the registered suppliers file their GSTR-1.
This is because the ISD mechanism is only to
ISD can view the auto-populated details of facilitate distribution of credit of taxes paid.
ITC received for distribution in GSTR-6A The ISD itself cannot discharge any tax
and, where required, after adding, liability (as person liable to pay tax) and remit
correcting or deleting the details, furnish tax to Government account. ISD will have late
GSTR-6. fee and any other liability only.
E. Details of GSTR-6 to be available in GSTR-2A of the recipients

The details of invoices furnished by an ISD in his return will be made available to the respective
registered recipients of credit in their GSTR 2A (Form GSTR 4A in case of composition supplier).
The recipients may include these in their GSTR-3B and take credit.

Returns under GST
7. GST TDS Return (GSTR-7) (Section 51)
Whenever taxable goods or services or both are supplied to a Central/ State Government’s
Department/ establishment or, local authority, or Governmental agencies, recipient is required
to deduct tax at source under section 51.
Such deductor [person deducting TDS] is required to be compulsorily registered and deduct tax
@1% of the payment made to the supplier (the deductee) of taxable goods or services or both,
where the total value of such supply, under a contract, exceeds ` 2,50,000 (excluding the amount
of CGST, SGST, IGST, UTGST and cess indicated in the invoice).
A. Monthly return
Deductor shall furnish a monthly return in Form GSTR-7 electronically through the common portal.
B. Last date of filing return
The details in GSTR-7 should be furnished on/before 10th of the month succeeding the calendar
month in which tax has been deducted at source.
C. TDS details made available in GSTR-2A/4A
The details of TDS furnished by the deductor in GSTR-7 shall be made available electronically to each
of the suppliers in Part C of Form GSTR- 2A/ Form GSTR- 4A (in case of registered person opting for
composition levy) on the common portal after the due date of filing of Form GSTR-7.
D. Tax Deduction at Source (TDS) Certificate
Can be downloaded by Deductee in GST website after login under heading “View / Download
Certificates” (GSTR-7A)
8. GST TCS Return (GSTR-8) (Section 52(4))
Filing of Statement of Supplies effected through an e-commerce operator (TCS Statement)

[Section 52(4) read with rule 60(7) and rule 67 of CGST Rules, 2017]
When a supplier supplies some goods or services to the consumer through the portal of an
electronic commerce operator (ECO), the consideration for the product/ service is collected by
the ECO from the consumer and passed on to the actual supplier after the deduction of its
commission. The Government has placed the responsibility on ECO to collect the ‘tax’ at @ 0.5%
from the supplier under section 52. This shall be done by the ECO by paying the supplier, the
consideration of the product/services, less the tax, calculated at the rate of 0.5%. The amount
so collected by ECO [while making the payment to the supplier] is referred as Tax Collected at
Source (TCS). TCS will be calculated on the net value of the goods/services supplied through the
portal of ECO.
CGST @ 0.5% , SGST @ 0.5% or IGST @1% on VALUE OF SUPPLY

Returns under GST
A. Monthly return B. Last date of filing return C. TCS details made

The details in GSTR-8 should available in GSTR-2A
ECO shall furnish a monthly
return in Form GSTR-8 be furnished on/before 10th The details of TCS
electronically through the of the month succeeding the furnished by the ECO in
calendar month in which tax
common portal. Form GSTR-8 Form GSTR-8 shall be
has been collected at source.
contains the details of supplies of made available
goods or services or both effected Further, the amount of tax electronically to each of
through ECO, including the collected by ECO (TCS the suppliers in Part C of
supplies of goods or services or amount) is required to be Form GSTR- 2A on the
deposited by the 10th of the
both returned through it and the common portal after the
month succeeding the
amount of tax collected at source. due date of filing of
calendar month in which tax
has been collected at source Form GSTR-8.
9. FIRST RETURN (Section 40)
Every registered person who has made outward supplies in the period between the date on which he
became liable to registration till the date on which registration has been granted shall declare the
same in the first return furnished by him after grant of registration.
When a person becomes liable to registration after his turnover crossing the threshold limit of `
20 lakh (` 10 lakh in case of Special Category States), he may apply for registration within 30 days
of so becoming liable. Thus, there might be a time lag between a person becoming liable to
registration and grant of registration certificate.
During the intervening period, such person might have made the outward supplies, i.e. after
becoming liable to registration but before grant of the certificate of registration.
Now, in order to enable such registered person to declare the taxable supplies made by him for
the period between the date on which he became liable to registration till the date on which
registration has been granted so that ITC can be availed by the recipient on such supplies, firstly,
the registered person may issue Revised Tax Invoices against the invoices already issued during
said period within 1 month from the date of issuance of certificate of registration. Further,
section 40 provides that registered person shall declare his out ward supplies made during said
period in the first return furnished by him after grant of registration. The format for this return
is the same as that for regular return.

Returns under GST
Details of outward
supplies, after Details of outward
becoming liable to supplies made in first
registration but tax period after grant
First Return
before grant of the of the certificate of
certificate of registration
registration
10. Claim of ITC and provisional acceptance thereof (Section 41)
Not yet introduced
11. Matching, Reversal and Reclaim of ITC (Section 42)
Not yet introduced
12. Matching and Reversal of credit of the Amount collected and reflected in
TCS Statement (Section 52)
Not yet introduced
13. Matching , Reversal and Reclaim of reduction in Output Tax Liability

(Section 43)- CREDIT NOTES
Not yet introduced

Returns under GST
14. Annual Return (Section 44) (GSTR-9)
All taxpayers filing return in GSTR-1 & 3B, are required to file an annual
return. However, following persons are not required to file annual return:
This return
needs to be filed
by 31st
Due Date December of
the next
Financial Year .
Prescribed form for

Annual Return
Annual Return is to be
[Sec 44(1) read with filed electronically in Form
rule 80(1)]
GSTR-9 through the
common portal
Compositi
on
scheme A person paying
supplier tax under
composition
scheme is required
to file the Annual
Return in Form
GSTR-9A.

Returns under GST
Reconciliation Statement? [Section 44(2) read with section 35(5) and rule 80(3)] (GSTR-9C)
Section 35 contains the provisions relating to Accounts and Records.
Sub-section (5) of section 35 read along with section 44(2) and rule 80 of the CGST Rules, 2017
stipulates as follows:
(i) Every registered person must get his accounts audited by a Chartered Accountant or a
Cost Accountant if his aggregate turnover during a FY exceeds `5 crores.
(ii) Such registered person is required to furnish electronically through the common portal
along with Annual Return a copy of Audited annual accounts
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
Optional GSTR-9 in certain cases
Registered persons whose aggregate turnover in a financial year does not exceed 2 crore rupees
and who have not furnished the annual return before the due date, in respect of financial years
2017-18 and 2018-19, follow the special procedure such that the said persons shall have the
option to furnish the annual return
Provided that the said return shall be deemed to be furnished on the due date if it has not been
furnished before the due date
Non applicability of GSTR 9C

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.
15. Final Return (Section 45)
Who are required to furnish Final Return? [Section 45 read with rule 81]
Every registered person who is required to furnish return u/s 39(1) and whose registration has been
surrendered or cancelled shall file a Final Return electronically in Form GSTR-10 through the common
portal.

Returns under GST
What is the time-limit for furnishing Final Return? [Section 45]
Final Return has to be filed within 3 months of the:
(i) Date of Or (ii) Date of

cancellation order of
cancellation
Whichever is later
Question: What happens if GSTR-10 is not filed by the assessee within 3 months
from the cancellation of Registration? (Circular No. 69/43/2018 dt.26.10.2018)
Notice in FORM GSTR-3A has to be issued to the taxpayer.
If the taxpayer still fails to file the final return within 15 days of the receipt of
notice in FORM GSTR-3A, then an assessment order in FORM GST ASMT-13
under section 62 of the CGST Act to pay Tax liability on the basis of
information available with the proper officer.
If the taxpayer files the final return within 30 days of the date of service of the
order in FORM GST ASMT-13, then the said order shall be deemed to have
been withdrawn. However, the liability for payment of interest and late fee
shall continue.
16. Default in furnishing Return (Section 46 & 47)
Notice to return defaulters [Section 46 read with section 52 and rule 68]
A notice in prescribed form shall be issued, electronically, to a registered person who fails to furnish
return under section 39 [Normal Return] or section 44 [Annual Return] or section 45 [Final Return]
or section 52 [TCS Statement]. Such notice shall require such registered person him to furnish such
return within 15 days.
Late fees levied for delay in filing return [Section 47(1)]

–
– –

Returns under GST
Any registered person who fails to furnish following by the due date:
(A) Statement of (B) Statement of (C) Returns (D) Final

Outward Supplies Inward Supplies [Sec 39] Return
[Sec 37] [Sec 38] [Sec 45]
Shall pay a late fee
CGST Quantum of late fee
₹ 100 for every day

during which such
Quantum of failure continues Whichever is
late fee lower
₹ 5,000
1. FORM GSTR-1: Government has 4. FORM GSTR-6: Due date for filing
waived late fee in excess of Rs.25 for GSTR-6 for July 2017 to April 2018 has
every day and in case of NIL Return govt been extended upto 31/05/2018
waived late fee in excess of Rs.10 for
every day Not. No. 4 /2018 – Central Tax
5. FORM GSTR-4: Government has
Amendments
2. FORM GSTR-5: Government has waived late fee in excess of Rs.25 for
waived late fee in excess of Rs.25 for every day and in case of NIL Return govt
every day and in case of NIL Return govt waived late fee in excess of Rs.10 for
waived late fee in excess of Rs.10 for every day Not. No. 73 /2017 – Central
every day Not. No. 5 /2018 – Central Tax Tax
6. FORM GSTR-3B: Government has

3. FORM GSTR-6: Government has
every day and in case of NIL Return govt
every day and in case of NIL Return govt
every day Not. No. 64 /2017 – Central
every day Not. No. 7 /2018 – Central Tax
Tax

Returns under GST
Late fees levied for delay in filing annual return [Section 47(2)]
Any registered person who fails to furnish the Annual Return by the due date shall be liable to
pay a late fee.
CGST Quantum of late Fee

during which such
late fee lower
₹ 0.25% of Turnover
17. Goods and Service Tax Practitioners (Section 48)
Section 48 provides for the authorisation of an eligible person to act as approved Goods and
Services Tax Practitioner (GSTP).
A registered person may authorise an approved GSTP to furnish information, on his behalf,
to the Government.
The manner of approval of GSTPs, their eligibility conditions, duties and obligations, manner
of removal and other conditions relevant for their functioning have been prescribed in the
rules 83 and 84 of the CGST Rules, 2017.
GSTN will provide separate user ID and Password to GSTP to enable him to work on behalf
of his clients without asking for their user ID and passwords. They can do all the work on
behalf of taxpayers as allowed under GST Law.
A taxpayer may choose a different GSTP by simply unselecting the previous one and then
choosing a new GSTP on the GST portal.
Standardised formats from GST PCT-1 to GST PCT-5 have been prescribed for making
application for enrolment as GSTP, certificate of enrolment, show cause notice for
disqualification, order of rejection of application of enrolment, list of approved GSTPs,
authorisation letter and withdrawal of authorisation.
A GSTP enrolled in any State or Union Territory shall be treated as enrolled in the other
States/Union territories.
(i) What is the eligibility criteria for GSTP?
Eligibility criteria is A+B

Returns under GST
A: Type of Person (All must be fulfilled)
Not being
Not
Indian citizen Person of sound convicted by a
adjudicated as
mind competent
insolvent
court
B: Satisfies any of the following conditions
Enrolled as a Sales Tax Has acquired any of

Retired officer of Commercial
Tax Department of any State Practitioner or Tax the prescribed
Govt./CBEC who, during service Return Preparer under qualifications
under Government had worked the earlier indirect tax
in a post not lower than the rank law for a period of not
of a Group-B gazetted officer for less than 5 years
a period ≥ 2 years.
Graduate or Degree Any other Any degree Has passed

postgraduate examination of examination examination of final
degree or its any Foreign notified by the an Indian examination of
equivalent University Government, University or of ICAI/ ICSI/
examination recognised by on the any Foreign ICMAI of India
having a degree any Indian recommendati University
in Commerce, University as on of the recognized by
Law, Banking equivalent to Council, for any Indian
including Higher the degree this purpose University as
Auditing, or examination equivalent of
Business mentioned in the degree
Administration sub-clause (i) examination
or Business
Management
from any Indian
University

Returns under GST
What are the activities which can be undertaken by a GSTP?

Details of Outward & Inward supplies(GSTR-1,3B)
Furnish monthly, quarterly, annual or final return
make deposit for credit into the electronic cash ledger
file an application for claim of refund
file an application for amendment or cancellation of registration
Furnish information for generation of e-way bill
Furnish details of challan in FORM GST ITC-04
File an intimation to pay tax under the composition scheme or withdraw
from the said scheme
Furnishing returns through GSTP: When a registered person opts to furnish his return through
GSTP, such registered person:
Gives his consent to any GSTP to prepare and furnish his return
Before confirming submission of any statement prepared by GSTP, ensure that the facts
mentioned in the return are true and correct
Thus, the responsibility for correctness of any particulars furnished in the return or other details filed
by the GST practitioners shall continue to rest with the registered person on whose behalf such
return and details are furnished.
Rule 83A
Examination of Goods and Services Tax Practitioners.-

(1) Every person who is enrolled as a goods and services tax practitioner under sub-rule (2) of the said
rule, shall pass an examination.
(2) The National Academy of Customs, Indirect Taxes and Narcotics (hereinafter referred to as “NACIN”)
shall conduct the examination.
(3) Frequency of examination.- The examination shall be conducted twice in a year as per the schedule
of the examination published by NACIN every year on the official websites of the Board, NACIN, common
portal, GST Council Secretariat and in the leading English and regional newspapers.
(4) Period for passing the examination and number of attempts allowed.-
A person enrolled as a goods and services tax practitioner in terms of sub-rule (2) of rule 83 is
required to pass the examination within two years of enrolment:
Provided that if a person is enrolled as a goods and services tax practitioner before 1st of July
2018, he shall get one more year to pass the examination:

Returns under GST
(5) Nature of examination.-The examination shall be a Computer Based Test. It shall have one question
paper consisting of Multiple Choice Questions.
PAPER : GST Law & Procedures:

Time allowed: 2 hours and 30 minutes
Number of Multiple Choice Questions: 100
Language of Questions: English and Hindi
Maximum marks: 200
Qualifying marks: 100
No negative marking:
(6) Qualifying marks.- A person shall be required to secure 50% of the total marks.
(7) Disqualification of person using unfair means or practice.- If any person is or has been found to be
indulging in use of unfair means or practices, NACIN may, after considering his representation, if any,
declare him disqualified for the examination.
(8) Declaration of result.- NACIN shall declare the results within one month of the conduct of
examination on the official websites of the Board. The results shall also be communicated to the
applicants by e-mail and/or by post.
(9) Handling representations.- A person not satisfied with his result may represent in writing, clearly
specifying the reasons therein to NACIN or the jurisdictional Commissioner as per the procedure
established by NACIN on the official websites of the Board, NACIN and common portal.
Syllabus:
1 The Central Goods and Services Tax Act, 2017
2 The Integrated Goods and Services Tax Act, 2017
3 All the State Goods and Services Tax Act, 2017

4 The Union territory Goods and Services Tax Act, 2017
5 The Goods and Services Tax (Compensation to States) Act, 2017
6 The Central Goods and Services Tax Rules, 2017
7 The Integrated Goods and Services Tax Rules, 2017

8 All the State Goods and Services Tax Rules, 2017
9 Notification, Circulars and orders issued from time to time under the said Acts and Rules

Returns under GST
• This amendment allows the GST practitioner to perform

other functions such as, filing refund claim, filing
Powers of GST
application for cancellation of registration etc., apart from
Practioner
furnishing the details of outward and inward supplies and
various returns on behalf of a registered person
A goods and services tax practitioner seeking to surrender

his enrolment shall electronically submit an application in
FORM GST PCT-06, atthe common portal, either directly or
Rule through a facilitation centre notified by the Commissioner.
83B.Surrender
of enrolment
of goods and
services tax
practitioner The Commissioner, or an officer authorised by him, may
after causing such enquiry as deemed fit and by order in
FORM GST PCT-07, cancel the enrolment of such
practitioner.
18. Information Return (Section 150 & 123)
Information return is based on the idea of verifying the compliance levels of

registered persons through information procured from independent third
party sources.
Many authorities who is responsible for maintaining record of registration or
statement of accounts or any periodic return or document containing details
of payment of tax and other details of transaction of goods or services or both
or transactions related to a bank account or consumption of electricity or
transaction of purchase, sale or exchange of goods or property or right or
interest in a property under any law for the time being in force, shall furnish
an Information Return of the same in respect of such periods, within such
time, in such form and manner and to such authority/agency as may be
prescribed .

Returns under GST
The authorities required to furnish Information Return are as follows
State Government's Banking State Electricity

company Board or an Local
authority responsible for
within electricity Central authority
the collection of Income
Taxable the distribution or Government /other
VAT/sales tax/ State tax GSTN
person meaning transmission licensee or the State public
excise duty or Central authority
of section under the Electricity Government body/associ
Government's authority
45A (a) of Act, 2003 or any ation
responsible for the
collection of excise duty the RBI other entity
or customs duty Act, 1934 entrusted with such
Registrar/Su Registrar Registering Collector referred Recognis

b-Registrar within the Authority to in clause (c) of ed stock
appointed empowered section 3 of the Officer exchang Any other
meaning of UIN
under to register Right to Fair Depository of the e specified
the holder
section 6 of motor Compensation RBI person
Companies and Transparency
the Act, 2013 vehicles
in Land
Registration under the Acquisition,
Act, 1908 Motor Rehabilitation and
Vehicles Act, Resettlement Act,
1988 2013

Returns under GST
Defective Information Return [Section 150(2)]

Where the Commissioner, or an officer authorised by him in this behalf, considers that the
information furnished in the information return is defective, he may intimate the defect to the
person who has furnished such inf. return
He shall give such person an opportunity of rectifying the defect within a period of 30 days from the
date of such intimation
However, if the defect is not rectified within the said period of 30 days then, notwithstanding
anything contained in any other provisions of this Act, such information return shall be treated as not
furnished
Issuance of notice for failure to furnish the information return within stipulated time [Sec. 150(3)]
Where a person who is required to furnish information return has not furnished the same within the
specified time, the said authority may serve upon him a notice requiring furnishing of such
information return within a period not exceeding 90 days from the date of service of the notice and
such person shall furnish the information return.
Penalty for failure to furnish information return [Section 123]
CGST Quantum of penalty

during which such
penalty lower
₹ 5,000

Returns under GST
19. Introduction of GSTR 2B: V.V.IMPORTANT
 The statement will clearly show document-wise details of ITC eligibility. ITC information
will be covered from the filing date of GSTR-1 for the preceding month (M-1) up to the filing
date of GSTR-1 for the current month (M)filed within due date.
 For instance, GSTR-2B generated for July 2020 will contain documents filed by their
suppliers from 12 a.m. on 12th July 2020 up to 11:59 p.m. on 11th August 2020. The
statement for July 2020 will be generated on 12th August 2020.
 Note : Since for QRMP scheme holders due date for Filing GSTR-1 IFF is 13th of Following
month. Those details will be in GSTR 2B after 13 th . There are also covered under Eligible ITC
only
GSTR 2A vs 2B
GSTR 2A GSTR 2B
1. Type of statement A progressive auto-drafted A constant auto-drafted statement
statement that provides input that provides input tax credit (ITC)
tax credit (ITC) details to every details to every recipient of supplies,
recipient of supplies, based on based on the suppliers’ data.
the suppliers’ data.
2. Nature of the Dynamic, as it changes from Static, as the GSTR-2B for one month,
statement day to day, as and when a cannot change based on future
supplier uploads the actions of the supplier.
documents.
3. GSTN advisory on Does not contain Contains an advisory against each
ITC claims information/advisory on the section on whether the ITC is eligible,
action a taxpayer is supposed ineligible or reversible,
to take
4. When will ITC GSTR-1: Saved/filed/submitted GSTR-1, GSTR-5, or GSTR-6: Filed
entries get reflected GSTR-6: Submitted
from various GSTR-7 and GSTR-8: Filed
sources?
5. Cut-off date for Not applicable, as it’s a 11th/13th of the succeeding month
entries, to view the dynamic statement (depending on the type of return)
statement for a tax The statement will be generated on
period the 14th of the succeeding month
6. ITC eligibility while Should not be considered  Assessee shouldn’t claim ITC over
filing 3B and above GSTR 2B
 However as per Rule 36(4),
Assessee can claim Provisional ITC
of Invoices not uploaded upto a
maximum of 5% of GSTR 2B

Returns under GST
QRMP Sheme (Quarterly Return with Monthly Payment option) (From 01.01.21)
Amendment
1. Who is eligible for the QRMP who has an aggregate turnover of up to 5 crore rupees in the
scheme? preceding financial year, is eligible for the QRMP Scheme.
2. Frequency of GSTR-1? Type Frequency Due date
B2B Monthly filing 13th of the
under Following
IFF(Invoice Month
Furnishing
Facility)
B2C Quarterly 25th of the
month
following
the quarter
Summary :
Month 1 B2B Invoices, Cr & Dr Notes of
Month 1
Month 2 B2B Invoices, Cr & Dr Notes of
Month 2
Month 3 a) B2B Invoices, Cr & Dr Notes
Month 3
b) Previous Months Amendments
c) B2C of Month 1 ,2, 3
3. Payment of Taxes Option 1 : Fixed Sum Method
Type of Taxpayer Tax to be paid
Who furnished 35% of tax paid in
GSTR-3B quarterly cash in the
for the last quarter preceding quarter
Who furnished 100% of tax paid in
GSTR-3B monthly cash in the last
during the last month of the
quarter immediately
preceding quarter
Option 2 : Self Assessment Method (SAM)

The taxpayer has to manually arrive at the tax liability for the
month and has to pay the same in form GST PMT-06. For
ascertaining the amount of ITC available for the month the
taxpayer can use form GSTR-2B.
Interest @ 18% p.a applicable if tax is not paid as per quantum

specified in Option 1 or Option 2
4. Frequency of GSTR 3B? Quarterly

Returns under GST
Due date: 22nd/ 24th of the month following the quarter

(Depends upon state)
5 Cases where IFF not allowed Non filing of last month GSTR 3B
Restriction to file GSTR-1: (Rule 59(6))
QRMP Scheme:
GSTR- 1 will be
blocked if GSTR-3B
Normal Scheme: of last period is not
GSTR- 1 will be filed
blocked if GSTR-3B
of last two Preceding
months is not filed

Returns under GST
SUMMARY OF ALL THE GST RETURNS

Form No. Purpose Frequency Due date
th
GSTR-1 Details of outward supplies Monthly (T.O>1.5cr) 11 of the following month
Quarterly option if T.O1.5 cr) End of the month following quarter
GSTR-2 Details of inward supplies Monthly 15th of the following month (postponed upto 31-03-2020)
GSTR-3 Consolidated return of inward and outward Monthly Generally 20th of following month
supplies But Postponed upto 31-03-2020
GSTR-3B Summary of inward and outward supplies Monthly 20th /22nd /24th of the following month (Refer pg.13.5)
Assessee opting Composition scheme Quarterly 18th of the following month of quarter
(This form is cancelled from 31-03-2019)
GSTR-4
On or after 01-04-2019 Yearly 30th April of next year
GST CMP-08 for payment of taxes Quarterly 18th of the following month of quarter
GSTR-5 Non-Resident taxable person Monthly 20th of the following month
(Generally for NRTP : All inputs are blocked (or)7th day after the end of validity
except import of goods) Whichever is earlier
GSTR-5A OIDAR located outside India (B2C cases) Monthly (regular registration ) 20th of the following month
(In b2b cases RCM is applicable) (NoITC)
GSTR-6 ISD Monthly 13th of the following month
TDS return
(Service Provider-Any person
GSTR-7 Monthly 10th of the following month
Service Receiver- Government
Contract value- Exceeded Rs.2,50,000)
GSTR-8 TCS return Monthly 10th of the following month
(Eg: ECO where considered is received by ECO
on behalf of supplier)
GSTR-9 Annual return Yearly for Assessee with 31stDec from the end if the Relevant FY
T.O > 2 crores
GSTR-9A Annual return by dealer opting composition Yearly 31stDec from the end if the Relevant FY
scheme (upto 31-03-2019)

Returns under GST
GSTR-9B Annual statement by ECO (Not yet notified) Yearly 31stDec from the end if the Relevant FY
GSTR-9C Reconciliation statement Yearly for Assessee with 31stDec from the end if the Relevant FY
T.O > 5 crores
GSTR-10 Final return (after cancellation ) After cancellation Within 3 months from date of cancellation
GSTR-11 UIN holders for claiming refund of taxes paid on Monthly 20th of the following month
inward supplies
AUTO POPULATED FORM’S
GSTR-2A GSTR-4A GSTR-7A GSTR-3A
To view inward To view inward supplies TDS certificate issued by Notice for default in filing
supplies for dealers opting persons (Deductor’s) GSTR-3B Return / GSTR-
composition scheme filing GSTR-7 10 Return

CH.SUDHEER C.A, C.M.A Chapter 14 Refund
Chapter 14
REFUNDS
1. Types of Refunds
Refund of Refund in case Refund of case Refund of case Refund of case Refund of case
balance in of Inverted in exports of in supplies to in deemed in issuance of
electronic Duty Structure Goods & SEZ export refund
cash ledger Services voucher
Refund of case Refund of Refund as Refund as a Refund of Refund of IGST

in tax wrongly excess Finalization of consequence taxes on paid by tourist
collected & payment of tax provision of decrees of purchase by leaving India
paid to Assessment court UIN holders
Government

Amendment
2. Procedure for claiming Refund (Summary)
Issue sanction order to

Acknowledgement
No Discrepancies
in GSTRFD– 02 Within 60 days
form after due
Application in verification of all
GSTRFD - 01 aspects PAO/CBIC in To Assessee in
form GSTRFD – 05 GSTRFD – 06
Discrepancies Deficiency form form
found Memo in If application is
GSTRFD-03 form invalid
Fill complete
application Adjustment of
Issue SCN in refund in
GST RFD- 08 GST RFD – 07
Reply satisfactory
Attachments Again File GST RFD – 01 Reply by assessee
specified rectifying those defects in GST RFD - 09
If reply not satisfactory
 In case of export of Goods, then provisional Refund

@ 90% of refund claimed will be sanctioned within 7 Then issue rejection
days of application in GST RFD – 04, order in GSTRFD - 06
 Balance will be sanctioned GST RFD-05/06 after
complete verification.

3. Procedure for claiming Refund (Detailed) (Section 54)
1. Refund of Balance in Electronic Cash Ledger
S.N Particulars Special Points

1. Time limit for Filing Refund Claim Within 2 years from the date of Payment of Tax
2. Procedure Refund Application in GST RFD-01
3. What assessee is going to get Refund Balance in Electronic Cash Ledger
4. Attachments No Attachments
2. Refund in Case of Inverted Duty Structure

1. Meaning Tax Rate on Inward supply is higher than Outward Supply
2. Time limit for Filing Refund Within 2 yrs due date of Filing GSTR-3B
Claim
3. Procedure Application in GST RFD-01
4. What assessee is going to Unutilized ITC on Input & Input services used relating to
get Refund Inverted Duty Structure
Inverted Turnover
5. Unutilized ITC of Inverted (ITC on 𝐈𝐧𝐩𝐮𝐭𝐬 × )–(Tax paid on Inverted Turnover)
Total Turnover
Duty Structure
(Rule 89) (Here Turnover excludes Exempted Turnover)
Amendment
6. Maximum Refund a) Unutilized ITC calculated above
(or)
b) Balance in Electronic Credit Ledger
7. Attachments a) Statement 1 (i.e., Formula in Point 4)
b) Statement 1A (Details of Purchases &Sales)(JSON FILE)
(Unless otherwise c) Copy of GSTR 2A
specified, attachment d) Statement of Invoices in Annexure B
should be in PDF Format) (Given at end of chapter)
e) If refund amount does not exceed Rs.2,00,000 :
Self declaration that there is no Unjust Enrichment (i.e.,
duty burden has not been passed on to customer)
f) If refund amount exceeds Rs.2,00,000 :
Certificate from CA/CMA in Annexure 2 that there is no
Unjust Enrichment
(Given at end of this chapter)

3. Refund in Case of Exports of Goods
a) Export Without payment of Tax (i.e., LUT /Bond submitted)
1. Time limit for Filing Refund Claim Within 2 yrs from Export
2. Procedure Application in GST RFD-01 for each GSTIN. For the

purpose of calculation Turnover below, each GSTIN T.O
should be considered
3. What assessee is going to get Unutilized ITC on Input & Input services used for
Refund Exports
4. Unutilized ITC ZRS of Goods + ZRS of Services
ITC on Input & 𝐼𝑛𝑝𝑢𝑡 𝑆𝑒𝑟𝑣𝑖𝑐𝑒𝑠 ×
Adjusted Total Turnover
(Rule 89)
5. Maximum Refund a)Unutilized ITC calculated above
(or)
b)Balance in Electronic Credit Ledger
6. ZRS of Goods 1.5 times the value of like goods domestically
supplied by the same or, similarly placed,
Amendment supplier, as declared by the supplier
Ex: A supplier Export 1000 Watches @Rs.100 each &
the supplier selling the same watch in Indian Market
at Rs. 70.
The export value will be 70*1.5=105
Hence Value will be Rs.105
7. ZRS of Services Aggregate of the payments received during the
relevant period
(-)
(to be determined on Accural Advance Received during this year but service has not
Basis) been completed
(+)
Payment Received during last year but service has
been completed during current year
8. Adjusted Total Turnover Domestic T.O + ZRS of Goods (1.5 times TO) + ZRS of
Amendment
Services (to be calculated as per point 7) – Exempted
T.O
9. Attachments a)Statement 3A ( JSON Format)
b)Copy of GSTR 2A
(Unless otherwise specified, c)Statement of Invoices in Annexure B
attachment should be in PDF (Given at end of chapter)
Format) d)Self attested copies of invoices not found in
GSTR 2A
e)Copy of Shipping Bills
f) Bank Realization Certificate (BRC)
Amendment g) W.E.F.23/01/2020
1) Exporter to Submit ‘Annexure A’(Given at

end of this chapter) to Jurisdictional CGST

authorities for verification by them
2) Verification shall be completed by CGST
office within 14 Working Days (WD)
3) If not verified within 14 WD, then exporter
shall escalate the matter to Jurisdictional
PCCCT/CCCT by sending Email to id’s
specified in Circular.131/1/2020
4) PCCCT/CCCT should take appropriate action
to get verification completed within next 7
WD
5) If refund remains pending for more than
one month, the exporter may register his
grievance at www.cbic.gov.in/issue
6) All such grievances shall be examined by a
Committee headed by Member GST, CBIC
for resolution of the issue
b) Export with payment of Tax (i.e., LUT/Bond not submitted )
1. Time limit for Filing Refund Within 2 yrs from payment of Tax
Claim
2. Procedure a) Fill Shipping bill & Invoice details in GSTR-1 (Table 6A)
b) Fill Export Turnover details in GSTR – 3B (Table 3.1(b))
c) No need to File GST RFD – 01 because based on (a) &
(b) above automatic Refund shall be sanctioned by
Department of Customs
3. What assessee is going to IGST paid in GSTR 3B either by way of Cash or Credit Ledger
get Refund
4. Attachments -----

Amendment
Rule 96B Recovery of refund of unutilised input tax credit or

integrated tax paid on export of goods where export proceeds not
realised.–Where any
a. Refund of unutilised input tax credit on account of export of goods or

b. Refund of integrated tax paid on export of goods has been paid to an applicant
Sale proceeds in respect of such export goods have not been realised, in full or in
part, within the period allowed under the FEMA, 1999 (42 of 1999), including any
extension of such period,
The person to whom the refund has been made shall deposit the amount so
refunded, to the extent of non-realisation of sale proceeds, along with applicable
interest @ 18% p.a within 30 days of the expiry of the said period
Failing which the amount refunded shall be recovered in accordance with the
provisions of section 73 or 74 of the Act,
Exception to Rule 96B: Reserve Bank of India writes off the requirement of
realisation of sale proceeds on merits, the refund paid to the applicant shall not be
recovered.
Further Realized: Then Refund recovered shall be refunded: Applicant produces

evidence about such realisation within a period of three months from the date of
realisation of sale proceeds, the amount so recovered shall be refunded by the
proper officer, to the applicant to the extent of realisation of sale proceeds,
provided the sale proceeds have been realised within such extended period as
permitted by the Reserve Bank of India.

4. Refund in Case of Exports of Services
a) Export Without payment of Tax (i.e., LUT /Bondsubmitted)
1. Time limit for Filing Refund With in 2 yrs from

Claim a) Date of Invoice
b) Date of Receipt of payment
2. Procedure
3. What assessee is going to

get Refund
Same as in Goods
4. Unutilized ITC
(Rule 89)
5. Maximum Refund
6. Attachments a) Statement 3A ( JSON Format)

b) Copy of GSTR 2A
(Unless otherwise c) Statement of Invoices in Annexure B
specified, attachment (Given at end of chapter)
should be in PDF Format) d) Self attested copies of invoices not found in GSTR 2A
e) Copy of Foreign Inward Remittance Certificate (FIRC)
b) Export With payment of Tax (i.e., LUT /Bond not submitted)
1. Time limit for Filing Refund Within 2 yrs from Payment of Tax
Claim
3. What assessee is going to IGST paid in GSTR 3B either by way of Cash or Credit
get Refund Ledger
4. Attachments a) Copy of GSTR 2A
b) Statement of Invoices in Annexure B
(Unless otherwise (Given at end of chapter)
specified, attachment c) Self attested copies of invoices not found in GSTR
should be in PDF Format) 2A
d) Copy of Foreign Inward Remittance Certificate
(FIRC)
e) If assessee wants Provisional Refund :
Self-declaration regarding non-prosecution for
Tax evasion does exceeding 2.5 crores

5. Refund in Case of Supplies to SEZ
a) Supply Without payment of Tax (i.e., LUT /Bondsubmitted)
1. Time limit for Filing Refund With in 2 yrs fromDate of Invoice

Claim
3. What assessee is going to Unutilized ITC on Input & Input services used for Exports
get Refund
4. Unutilized ITC Supply of Goods or Services to SEZ
ITC on Input & 𝐼𝑛𝑝𝑢𝑡 𝑆𝑒𝑟𝑣𝑖𝑐𝑒𝑠 ×
Adjusted Total Turnover
(Rule 89)
5. Maximum Refund a)Unutilized ITC calculated above
(or)
b)Balance in Electronic Credit Ledger
6. Attachments a) Statement 5A ( JSON Format)
b)Copy of GSTR 2A
(Unless otherwise c)Statement of Invoices in Annexure B
specified, attachment (Given at end of chapter)
should be in PDF Format) d)Self attested copies of invoices not found in GSTR 2A
(But invoices not found in 2A were ineligible)
e) Endorsement(s) from the specified officer of the SEZ
regarding receipt of goods/services for authorized
operations
g) If refund amount does not exceed Rs.2,00,000 :
Self declaration that there is no Unjust Enrichment (i.e.,
duty burden has not been passed on to customer)
h) If refund amount exceeds Rs.2,00,000 :
Certificate from CA/CMA in Annexure 2 that there is no
Unjust Enrichment(Given at end of this chapter)
b) Supply With payment of Tax (i.e., LUT /Bond not submitted)
1. Time limit for Filing Refund Within 2 yrs from Payment of Tax
Claim
3. What assessee is going to IGST paid in GSTR 3B either by way of Cash or Credit
get Refund Ledger
4. Attachments Endorsement(s) from the specified officer of the SEZ
regarding receipt of goods/services for authorized
operations

6. Refund in Case of Deemed Exports
a) Refund to be claimed by Supplier (If Tax not collected)
1. Time limit for Filing Refund Claim Within 2 yrs from Date of filing GSTR 3B
3. What assessee is going to get IGST paid on supplies to

Refund a) Advance Authorization Holder
b) 100% EOU under FTP
c) EPCG Scheme holder
4. Attachments a)Statement 5B( JSON Format)
b)Acknowledgement from the specified officer of
(Unless otherwise specified, the Recipeint regarding receipt of goods/services
attachment should be in PDF c) Declaration from Recipient that ITC is not availed
Format) by such unit
b) Refund to be claimed by Recipient (If Tax collected)
1. Time limit for Filing Refund Claim Within 2 yrs from Date of filing GSTR 3B
3. What assessee is going to get IGST paid on supplies received by

Refund a) Advance Authorization Holder
b) 100% EOU under FTP
c) EPCG Scheme holder
4. Attachments a)Statement 5B( JSON Format)
b)Acknowledgement from the specified officer of
(Unless otherwise specified, the Recipient regarding receipt of goods/services
attachment should be in PDF c) Declaration from Recipient that ITC is not availed
Format) by such unit

Refund
7. Refund in Case of Refund Voucher
In GSTR 3B, Tax can be reduced in further Months File application in GST RFD-01 as
Excess payment of Tax
8. Tax wrongfully Collected& Paid
1. Meaning Refund of tax paid on intra-state supply which is

subsequently held to be an inter-state supply and vice
versa
2. Time limit for Filing Refund Claim Within 2 yrs from date of payment of Tax
4. What assessee is going to get Wrong Tax paid

Refund
5. Attachments Statement 6 (JSON)
9. Refund of Excess payment of Tax
1. Time limit for Filing Refund Claim Within 2 yrs from payment of Tax
3. What assessee is going to get Excess Tax paid in GSTR 3B

Refund
4. Attachments a) Statement 7 ( JSON Format)
b) If refund amount does not exceed Rs.2,00,000 :
(Unless otherwise specified, Self declaration that there is no Unjust
attachment should be in PDF Enrichment (i.e., duty burden has not been
Format) passed on to customer)
c) If refund amount exceeds Rs.2,00,000 :
Certificate from CA/CMA in Annexure 2 that
there is no Unjust Enrichment(Given at end of
this chapter)

Refund
S.No ISSUE Clarification

1. An advance is received by Supplier has two options here
a supplier for a Service a. Supplier is required to issue
contract which 1. A “credit note” in terms of section 34 of the CGST Act
subsequently got (If supplier issued the invoice )
cancelled 2. A “Refund Voucher” in terms of section 31 of the CGST
Act (If supplier issued the Receipt voucher but not
The supplier has issued invoice )
the invoice before supply b. Where there is no output liability against which a credit
of service and paid the note/ Refund voucher can be adjusted, registered persons
GST thereon may proceed to file a claim under “Excess payment of tax,
if any” through FORM GST RFD-01.
2. Goods supplied by a Supplier has two options here
supplier under cover of a a. Supplier is required to issue a “credit note” in terms of
tax invoice are returned by section 34 of the CGST Act
the recipient. b. where there is no output liability against which a credit
note/ Refund voucher can be adjusted, registered persons
may proceed to file a claim under “Excess payment of tax,
Amendment if any” through FORM GST RFD-01.
10. Refund after Finalization of Provisional Assessment/ Appeal or any other order
3. What assessee is going to get Excess Tax paid in GSTR 3B

Refund
4. Attachments a) Reference number of the order and a copy of
the Assessment / Provisional Assessment /
(Unless otherwise specified, Appeal / Any Other Order
attachment should be in PDF b) Reference number/proof of payment of pre-
Format) deposit made earlier for which refund is being
claimed
c) If refund amount does not exceed Rs.2,00,000 :
Self declaration that there is no Unjust
Enrichment (i.e., duty burden has not been
passed on to customer)
d) If refund amount exceeds Rs.2,00,000 :
Certificate from CA/CMA in Annexure 2 that
there is no Unjust Enrichment(Given at end of
this chapter)

Refund
11. Refund by UIN Holders (Section 55)
1. Frequency of Refund Claim Quarterly
2. Time limit for Filing Refund Claim Before the expiry of 18 months from the end of the
Quarter
3. Procedure Application in GST RFD-10 & Monthly filing of GSTR-11
4. What assessee is going to get  Supplies made to UN bodies and embassies may be
Refund exempted from payment of GST as per international
obligations.
 However, this exemption has been operationalized
by way of a refund mechanism. So, a taxable person
making supplies to such bodies would charge the
tax due and remit the same to Government
account.
 However, the UN bodies and other entities notified
under section 55 of the CGST Act, 2017 can claim
refund of the taxes paid by them on their
purchases.
 Canteen Stores Department (CSD), under the
Ministry of Defence, as a person who shall be
entitled to claim a refund of 50% of CGST paid by it
on all inward supplies of goods received by it for the
purposes of subsequent supply of such goods to the
Unit Run Canteens of the CSD
12. Refund to Tourist leaving India (Section 15 of IGST Act)
2. Procedure 
Application in GST RFD-01

For this purpose, he should register in GST
Portal as Unregistered dealer
3. What assessee is going to get Purchase of goods in India , which Tourist is going to
Refund take them outside India
4. Attachments  Copies of Invoices
 Export baggage rules Declaration
(Unless otherwise specified,
attachment should be in PDF
Format)

Refund
4. Grant of provisional refund [Section 54(6) read with rule 91]
The proper
officer may, in
Refund on the case of any
a claim for
provisional refund on
Where the amount of tax basis, 90% account of
evaded exceeds ` 2.5 crores, of the total zero-rated
the provisional refund shall amount so supply of
be granted subject to the claimed, goods or
The proper officer shall condition that the person excluding services or
make an order in GST claiming refund has, during the amount both made by
any period of 5 years registered
RFD-04, Sanctioning the of ITC
immediately preceding the
amount of refund due to tax period to which the claim provisionall persons
the said applicant on a for refund relates, not been y accepted
provisional basis within a prosecuted for any offence
period not exceeding 7 under the Act or under an
days from the date of the existing law.
acknowledgement.
5. Principal of Unjust Enrichment [Section 54(8) & (9)]
Theory of unjust enrichment postulates that only the person who has NOTpassed the
incidence of tax will be eligible to claim the refund. Under GST law, related provisions are
contained under section 54(8).
Under unjust enrichment, a presumption is always drawn that the businessman will shift the
incidence of tax to the final consumer. This is because GST is an indirect tax whose incidence
is to be borne by the consumer. It is for this reason that every refund claim if sanctioned is
first transferred to the Consumer Welfare Fund.
If the refund claim of refund passes the test of unjust enrichment, it is paid to the applicant.
For crossing the bar of unjust enrichment, if the refund claim is less than ` 2 lakh, then a self-
declaration of the applicant to the effect that the incidence of tax has not been passed to any
other person will suffice to process the refund claim.
For refund claims exceeding ` 2 lakh, a certificate from a Chartered Accountant/Cost
Accountant will have to be given in Annexure 2
Cases where refundable amount shall be paid to the applicant:Section 54(8) stipulates that
the refundable amount shall, instead of being credited to the Consumer Welfare Fund, be
paid to the applicant, if such amount is relatable to —
Refund of tax paid on zero rated supplies of goods or services or both or on inputs or

Refund
input services used in making such zero-rated supplies;

refund of unutilized ITC in case of zero rated supplies
refund of tax paid where a refund voucher has been issued;
refund of tax in pursuance of section 77, i.e. tax paid tax on a transaction treated to be
an intra-State supply, but which is subsequently held to be an inter-State supply or
vice-versa.;
Where the proper officer is satisfied that the amount refundable is not payable to the
applicant under section 54(8),he shall make an order in Form GST RFD-06 and issue an advice
for the amount of refund to be credited to the Consumer Welfare Fund[Rule 92(5)]
6. Withholding of refund claim [Section 54(10), (11) & (12)]
Where the proper officer/Commissioner is of the opinion that the amount of refund
is liable to be withheld under the provisions of section 54(10)/(11), he passes an
order informing the applicant the reasons for withholding of such refund [Rule
92(2)].
These provisions have been discussed in detail as under
Where an order giving rise to a However, where

Where any refund is
refund is the subject matter of an a refund is
due in case of zero
appeal or further proceedings or withheld under
rated supplies or
where any other proceedings section 54(11),
accumulated ITC on
under this Act is pending and the the taxable
account of inverted
Commissioner is of the opinion person shall be
duty structure, to a
that grant of such refund is likely entitled to
registered person who
to adversely affect the revenue in interest @ 6%
has defaulted in
the said appeal or other p.a.
furnishing any return
[Section 54(10)]. proceedings on account of
malfeasance or fraud committed
[Section 54(11)].
Minimum refund claim [Section 54(12)]

No refund shall be paid to an applicant, if the amount is less than
₹ 1,0 00.The limit of ₹ 1,000 shall apply for each tax head separately
and not cumulatively. Further, the limit would not apply in cases of
refund of excess balance in the electronic cash ledger

Refund
Credit of the amount of rejected refund claim [Rule 93]
Where any amount claimed as refund is rejected, the

amount debited, to the extent of rejection, shall be re
credited to the electronic credit ledger by an order made in
prescribed form [Rule 93(2)].
Options under GST in case of exports
Generally export of goods or services is zero rated .But any of the following two options have to
be choosed
If Bond/ letter of If LUT is not submitted

Undertaking is
submitted(LUT) binding
himself to pay the tax due if
export not made within the
specified time limit,
No need to pay any GST in Pay IGST at time of supply.

such case initially After making export-Claim
refund of IGST
Rule 96
If LUT is submitted but
a) Goods are not exported within 3m from the Date of Invoice

b) Consideration in respect of Export of Service is not realized within 1 yr form Date of Invoice
Then IGST which is not paid at time of Export of Good / Service to be paid now within 15 days of Expiry of
3months/ 1 year along with Interest @ 18% p.a .
However IGST paid now can be claimed as Refund after fulfilment of above conditions as per procedure
specified in pg 14.5

Refund
7. Clarification on issues related to furnishing of Bond/Letter of Undertaking for exports

[Circular No. 8/8/2017 GST dated 04.10.2017]
Time for
Validity acceptance Bank
of LUT guarantee
Documents of
for LUT LUT/Bond
Since the facility of

The LUT shall be valid Self-declaration by the Within a period of export under LUT has
for the whole financial exporter to the effect three working days of been extended to all
year in which it is that he has not been its receipt. If the LUT / registered persons,
tendered. prosecuted should bond is not accepted bond will be required
suffice. Verification, if within a period of to be furnished by
any, may be done on three working days those persons who
post-facto basis. from the date of have been prosecuted
submission, it shall for cases involving an
deemed to be amount exceeding `
accepted. 2,50,000. A bond, in all
cases, shall be
accompanied by a
bank guarantee of 15%
of the bond amount.
8. INTEREST ON DELAYED REFUNDS [SECTION 56 OF CGST ACT]
Interest on amount refundable

consequent to order passed in an
Interest is payable on such refund @ appeal or further proceedings Interest
6% p.a.* after the expiry of 60 days is payable on such refund @ 9% p.a.*
from the GST RFD-02 after the expiry of 60 days from the
date of receipt of application filed
consequent to such order

Refund
9. Supply to Outgoing International Tourist Amendment
Outgoing international tourist shall mean a person not normally resident in India, who
enters India for a stay of not more than six months for legitimate non-immigrant purposes
Refund of taxes to the retail outlets established in departure area of an international Airport beyond
immigration counters making tax free supply to an outgoing international tourist. (Rule 95A)
Retail outlet Retail outlet claiming The self-certified

established in refund of the taxes paid compiled
departure area of an on his inward supplies, information of The refund
international airport, shall furnish the invoices issued for of tax paid
beyond the application for refund the supply made by the said
immigration counters, claim in FORM GST RFD- during the month or retail outlet
supplying indigenous 10B on a monthly or the quarter, as the shall be
goods to an outgoing quarterly basis, as the case may be, along availableif-
international tourist case may be, through with concerned
who is leaving India the common portal purchase invoice
shall be eligible to either directly or shall be submitted
claim refund of tax through a Facilitation along with the
paid by it on inward Centre notified by refundapplication.
supply of suchgoods. theCommissioner.
b. The said goods were

a. The inward supplies supplied by the said
of goods were received retail outlet to an
by the said retail outlet outgoing international
from a registered person tourist against foreign
against a tax invoice exchange without
charging any tax
d. Such other
c. Name and Goods and restrictions/conditions,
Services Tax as may be specified, are
Identification Number of satisfied. The provisions
the retail outlet is of rule 92 (Refund
mentioned in the tax provisions) shall, mutatis
invoice for the inward mutandis, apply for the
supply sanction and payment of
refund under this rule

Refund
Clarification in respect of goods sent/ taken out of India for exhibition or on consignment
basis for export promotion [Circular No. 108/27/2019 GST dated 18.07.2019]
Amendment
1. The activity of sending/ taking the goods

out of India for exhibition or on consignment
basis for export promotion, do not
constitute supply as the said activity does
not fall within the scope of section 7 of the
CGST Act as there is no consideration at that
point in time.
2. Since such activity is not a supply, the
same cannot be considered as “Zero rated
supply” as per the provisions contained in
section 16 of the IGST Act.
Eg: M/s. ABC sends 100 units of specified goods out of India. The activity of merely sending/ taking
such specified goods out of India is not a supply. No tax invoice is required to be issued in this case
but the specified goods shall be accompanied with a delivery challan issued in accordance with
the provisions contained in rule 55 of the CGST Rules.
In case the entire quantity of specified goods is brought back within the stipulated period of 6
months from the date of removal, no tax invoice is required to be issued as no supply has taken
place in such a case.
In case, however, the entire quantity of specified goods is neither sold nor brought back within 6
months from the date of removal, a tax invoice would be required to be issued for entire 100 units
of specified goods in accordance with the provisions contained in section 12 and section 31 of the
CGST Act read with rule 46 of the CGST Rules within the time period stipulated under section 31(7)
of the CGST Act.
E.g.: M/s. ABC sends 100 units of specified goods out of India. The activity of sending/ taking such
specified goods out of India is not a supply. No tax invoice is required to be issued in this case but the
specified goods shall be accompanied with a delivery Challan issued in accordance with the provisions
contained in rule 55 of the CGST Rules. If 10 units of specified goods are sold abroad say after one
month of sending/ taking out and another 50 units are sold say after two months of sending/ taking
out, a tax invoice would be required to be issued for 10 units and 50 units, as the case may be, at the
time of each of such sale in accordance with the provisions contained in section 12 and section 31 of
the CGST Act read with rule 46 of the CGST Rules. If the remaining 40 units are not brought back
within the stipulated period of six months from the date of removal, a tax invoice would be required
to be issued for 40 units in accordance with the provisions contained in section 12 and section 31 of
the CGST Act read with rule 46 of the CGST Rules.
Further, M/s ABC may claim refund of accumulated input tax credit in accordance with the provisions

Refund

Refund

Refund

Refund
ANNEXURE – 2 (TO BE GIVEN BY CA/CMA)

CH.SUDHEER C.A, C.M.A Chapter 15 Job Work
Chapter 15 15. JOB WORK
1. JOB WORK PROCEDURE [SECTION 143]
Principal can send goods without payment of tax to job worker
However, Before supply of goods

A registered person Principal can In case the goods are
inputs and/or to the job-worker, the
(Principal) can send inputs/ send inputs not received back or Job worker
capital goods principal would be
capital goods under or capital not supplied from the can directly
intimation without
sent to a job- required to intimate the The
goods directly job worker’s premises sell the goods
payment of tax to a jobworker are Jurisdictional Officer responsibility
to the job- within specified time on behalf of
worker and from there to required to be containing the details of for keeping
worker proper limit, it shall be principal
another job-worker and returned to the description of inputs
without accounts for deemed to be a provided that
after completion of job- the principal intended to be sent by
bringing them the inputs supply from Principal principal
work bring back such goods within 1 year the principal and the to the Job worker declares the
to his or capital
without payment of tax. and 3 years, nature of processing to from the day when it job worker’s
premises and goods shall
respectively, be carried out by the was sent for job work. premises as
The principal is not can still avail lie with the
from the date job-worker. The said Accordingly, the ‘additional
required to reverse the ITC the credit of principal.
availed on inputs or capital
of sending intimation shall also Principal would be place of
tax paid on
goods dispatched to job- such goods to contain the details of liable to tax along with business’
such inputs or
worker. the job- the other job-workers, if interest
interest.
capital goods.
worker
worker. any.

a) Principal can take credit on goods (inputs and capital goods) sent for job work.
b) Credit can be taken even if the said goods are sent directly to job worker without being first
brought to the principal's place of business
Time limit for return of On failing to comply with the timelines, the Time-lines do not
goods sent for job goods will be deemed to have been supplied apply to moulds and
work/supply from job to the job worker on the day they were sent dies, jigs and fixtures
worker's place of business out. or tools sent out for
job work.
♦ Inputs - 1 year a) It should be declared in GSTR 1
b) Principal is liable to pay tax along with
♦ Capital goods - 3 years applicable interest on such supply.
from the date of sending the c) Subsequent return of the goods by the
same for job work / direct job worker will be treated as a separate
receipt by Job worker supply
Other Conditions:
a) Delivery challan to be issued by the principal under Rule 55
b) The challan needs to be issued for the inputs or capital goods sent directly to the job worker.
c) The responsibility for keeping proper accounts for the inputs or capital goods lies with the
principal.
d) The details of various challans relating to goods sent to /received from job worker or sent
from one job worker to another job worker are to be included in quarterly Form GST ITC 04
submitted by 25th day of the month succeeding the relevant quarter.
e) Details of goods sent by one jobworker to another jobworker need not uploaded in GST ITC-04
Return of goods by Job worker to Principal- period Extended
Original Time limit Extension on approval by commissioner
Inputs 1 year from date of sending One more year

goods to Job worker
Capital goods 3 years from date of sending 2 more years

goods to Job worker
3. Clarification on issues related to Job Work
Various issues relating to job work have been clarified vide Circular No. 38/12/2018
dated 26.03.2018 as under:

(1) Requirement of registration for the principal/ job worker
Registration for principal Registration for job

when Goods directly cleared worker
from Job worker premises
Principal In case the job If the job Supply of Further, the

can supply worker is worker is a goods, after value of such
the goods unregistered, registered completion of goods supplied
directly principal person/ job work, will be
from the should declare principal directly from a included in the
premises of job worker’s supplies registered job aggregate
the job premises as his notified goods, worker’s turnover of the
worker additional goods can be premises is principal and
without place of supplied treated as not job
bringing it business and directly from supply of worker.
back to his remove goods the premises goods by the
own from the same. of the job principal.
premises. worker.
Job worker is required to obtain registration only in cases where his aggregate
turnover, to be computed on all India basis, in a financial year exceeds the threshold
limit of Rs.20 lakhs regardless of whether the principal and the job worker are located
in
n the same State or in different States.
(2) Where goods are sent by pr

principal
incipal to only one job worker
The principal shall

prepare in triplicate, The job worker
should send one The FORM GST ITC-
the Delivery challan 04 will serve as the
for sending the goods copy of the said
challan along with intimation as
to a job worker. Two
the goods, while envisaged under
copies of the challan
may be sent to the job returning them to section 143 of the
worker along with the the principal. CGST Act, 2017.
goods.

(3) Where goods are sent from one job worker to another job worker
• In such cases, the goods may move under the cover of a challan issued either by the
principal or the job worker.
• In case of goods sent from one job worker to another job worker, the challan may be issued
either by the principal or the job worker sending the goods to another job worker
• In the alternative, the challan issued by the principal may be endorsed by the job worker
sending the goods to another job worker, indicating therein the quantity and description of
goods being sent.
• The same process may be repeated for subsequent movement of the goods to other job
workers.
(4) Where the goods are returned to the principal by the job worker
The job worker should send one copy of the challan received by
him from the principal while returning the goods to the principal
after carrying out the job work.
(5) Where the goods are sent directly by the supplier to the job worker
The buyer (i.e., the principal) shall issue the challan under rule 45 of the
CGST Rules and send the same to the job worker directly .
In case of import of goods by the principal which are then supplied directly from
the customs station of import, the goods may move from the customs station of
import to the place of business/premises of the job worker with a copy of the
Bill of Entry and the principal shall issue the challan under rule 45 of the CGST
Rules and send the same to the job worker directly.

(6) Where goods are returned in piecemeal by the job worker
In case the goods after carrying out the job work, are sent in piecemeal quantities
by a job worker to another job worker or to the principal, the challan issued
originally by the principal cannot be endorsed and a fresh challan is required to be
issued by the job worker.
(7) Submission of intimation
It is clarified that it is the responsibility of

the principal to include the details of all
the challans relating to goods sent by him
to one or more job worker or from one ITC-04
04 Waived for FY:17-18
FY:17 & 18-19)
job worker to another and its return
therefrom during a quarter in FORM GST
ITC-04 by the 25th day of the month
succeeding the quarter
Further, as per the provisions contained

in rule 138 of the CGST Rules, an e-way Further, the third proviso to rule 138(1) of
bill is required to be generated by every the CGST Rules provides that the e-way bill
registered person who causes movement shall be generated either by the principal or
of goods of consignment value exceeding by the registered job worker irrespective of
` 50,000 even in cases where such the value of the consignment, where goods
movement is for reasons other than for are sent by a principal located in one
supply (e.g. in case of movement for job State/Union territory to a job worker
work). located in any other State/ Union territory.

(8) Supply of waste and scrap generated during the job work
Sub-section (5) of At time of sale of such

section 143 of the If waste is retained by scrap, it shall be
CGST Act provides Jobworker, then it regarded as sale of
that the waste and shall be regarded as Goods & GST to be
scrap generated Consideration for paid as supply of
during the job work providing Jobwork goods
may be supplied by service & GST to be
the registered job paid on Supply of
worker directly from service
his place of business
or by the principal in
case the job worker is
not registered.
(9) Availability of input tax credit to the principal and job worker
Input tax credit (ITC) would be

available to the principal,
irrespective of the fact whether
the inputs or capital goods are
received by the principal and then
sent to the job worker for
processing, etc. or whether they
are directly received at the job
worker’s place of
business/premises, without being
brought to the premises of the
principal
principal.
It is also clarified that

If Jobworker charges the job worker is also
GST on services eligible to avail ITC on
provided by him, it can inputs, etc. used by
be availed as ITC by him in supplying the
Principal job work services if he
is registered

CH.SUDHEER C.A, C.M.A Chapter 16 E WAY BILL
Chapter 16 E WAY BILL
ELECTRONIC WAY BILL [SECTION 68 READ WITH RULES 138, 138A, 138B, 138C AND 138D]
(A) Information to be furnished prior to commencement of movement of goods

and generation of e-way bill [Rule 138]
(1) Applicability:
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,
shall, before commencement of such movement, furnish information relating to the said goods
as specified in Part A of FORM GST EWB-01, electronically and a unique number will be
generated on the said portal:
Principal in One state -Jobworker of Other state : E Way bill Mandatory
Provided that where goods are sent by a principal located in one State to a job worker located in
any other State, the e-way bill shall be generated by the principal irrespective of the value of the
consignment
Explanation
For the purposes of this rule, the consignment value of goods shall be the value, determined
in accordance with the provisions of section 15, declared in an invoice, a bill of supply or a
delivery challan, as the case may be, issued in respect of the said consignment and also
includes the central tax, State or Union territory tax, integrated tax and cess charged, if any,
in the document.
SUDHEER TAX CLASSES, Contact: 8688398888, 9491780817 16.1

(2) Transport through other than GTA :
(a) Information in Part B (b) The serial number and date of the Railway Receipt
And
of FORM GST EWB-01; or the Air Consignment Note or Bill of Lading, as the
(3) Transport through GTA:
The goods are handed over to a transporter for transportation by road, the registered person shall
furnish the information relating to the transporter on the common portal and the e-way bill shall be
generated by the transporter on the said portal on the basis of the information furnished by the
registered person in Part A of FORM GST EWB-01:
Provided also that where the goods are transported for a distance of less than ten kilometres 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 maybe, the
transporter may not furnish the details of conveyance in Part B of FORM GST EWB-01.
Explanation : The e-way bill shall not be valid for movement of goods by road unless the information
in Part-B of FORM GST EWB-01 has been furnished
(4) E Way bill Number:
Upon generation of the e-way bill on the common portal, a unique e-way bill number (EBN) shall be
made available to the supplier, the recipient and the transporter on the common portal.
(5) One conveyance to another Conveyance:
Where the goods are transferred from one conveyance to another, the consigner or the recipient, who
has provided information in Part- A of the FORM GST EWB-01, or the transporter shall, before such
transfer and further movement of goods, update the details of conveyance in the e-way bill on the
common portal in FORM GST EWB-01:
Provided that where the goods are transported for a distance of less than ten kilometres within
the State or Union territory from the place of business of the transporter finally to the place of
business of the consignee, the details of conveyance may not be updated in the e-way bill.
(6) Consolidated Eway bill:
Where multiple consignments are intended to be transported in one conveyance, the transporter may
indicate the serial number of e-way bills generated in respect of each such consignment electronically on
the common portal and 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.

(7) Raise of E Way bill through Transporter:
Where the consignor or the consignee has not generated FORM GST EWB-01 in accordance with the
provisions of sub-rule (1) and the value of goods carried in the conveyance is more than fifty thousand
rupees, the transporter shall generate FORM GST EWB-01 on the basis of invoice or bill of supply or
delivery challan, as the case maybe, and may also generate a consolidated e-way bill in
FORM GST EWB-02 on the common portal prior to the movement of goods
(8) Details imported in 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 details in FORM GSTR-1:
Provided that when the information has been furnished by an unregistered supplier or an
unregistered recipient in FORM GST EWB-01, he shall be informed electronically, if the mobile
number or the e-mail is available.
(9) Cancellation of E way bill:
Where an e-way bill has been generated under this rule, but 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 within 24 hours of generation of the e-way bill:
Provided further the unique number generated under sub-rule (1) shall be valid for 72 hours for updation
of Part B of FORM GST EWB-01.
(10) Validity of Eway bill:
S.N Distance Validity Period

1. Upto 200 km One day in cases other than Over Dimensional Cargo
2. For every 200 km. or One additional day in cases other than Over Dimensional Cargo
part
3. Upto 20 km One day in case of Over Dimensional Cargo
4. For every 20 km or One additional day in case of Over Dimensional Cargo
part
Provided further that where, under circumstances of an exceptional nature, including trans-shipment,
the goods cannot be transported within the validity period of the e-way bill, the transporter may extend
the validity period after updating the details in Part B of FORM GST EWB-01, if required.
Provided also that the validity of the e-way bill may be
Explanation extended within eight hours from the time of its expiry
Amendment
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 twenty-four hours.

(11) Information uploaded in Portal:
The details of e-way bill generated under sub-rule (1) shall be made available to the-
(a) Supplier, if registered, where the (b) Recipient, if registered, where the
information in Part A of FORM GST information in Part A of FORM GST
EWB-01 has been furnished by the Or EWB-01 has been furnished by the
recipient or the transporter; supplier or the transporter,
On the common portal, and the supplier or the recipient, as the case maybe, shall communicate his
acceptance or rejection of the consignment covered by the e-way bill.
(12) Deemed Acceptance:
Where the person to whom the information specified in sub-rule (11) has been made available does not
communicate his acceptance or rejection of the details being made available to him on the common
portal, it shall be deemed that he has accepted the said details.
(13) No need to raise Eway bill in the following circumstances:
Notwithstanding anything contained in this rule, no e-way bill is required to be generated—

(a) Where the goods being transported are specified in Annexure (Notn.27/2017 dt.30/08/2017)
(b) Where the goods are being transported by a non-motorised conveyance;
(c) 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; and
(d) Where the goods being transported are treated as no supply under Schedule III of the Act.
(e) Where the goods being transported are exempt from tax
(f) Where the consignor of goods is the Central Government, Government of any State or a local
authority for transport of goods by rail;
(g) Where empty cargo containers are being transported; and
(h) Where the goods are being transported upto a distance of twenty kilometers 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.
(i) Used personal and household effects
(j) Postal baggage transported by Department of Posts
(k) Jewellery, goldsmiths’ and silversmiths’ wares and other articles (Chapter 71)
(l) Liquefied petroleum gas for supply to household and non domestic

Storage of goods at Premises of Transporter (Circular No. 61/35/2018)
In case the Where the transporter’s Further, whenever the

consignee/recipient godown has been goods are transported
taxpayer stores his declared as the from the transporters’
goods in the godown of additional place of godown , which has been
the transporter, then business by the recipient declared as the additional
the transporter’s taxpayer, the place of business of the
godown has to be transportation under recipient tax payer, to any
declared as an the e-way bill shall be other premises of the
additional place of deemed to be recipient taxpayer then,
business by the recipient concluded once the the relevant provisions of
taxpayer. goods have reached the the e-way bill rules shall
transporter’s godown apply.
(recipient taxpayer’
additional place of Hence, whenever the
business). Hence, e-way goods move from the
bill validity in such cases transporter’s godown (i.e,
will not be required to recipient tax payer’s
be extended. additional place of
business) to the recipient
taxpayer’s any other place
of business; a valid e-way
bill shall be required, as
per the extant State-
specific e-way bill rules

“FORM GST EWB-01
E-Way Bill:
E-Way Bill No:
E-Way Bill date:
Generator:
Valid from:
Valid until:
PART-A
A.1 GSTIN of Supplier
A.2 GSTIN of Recipient
A.3 Place of Delivery
A.4 Document Number
A.5 Document Date
A.6 Value of Goods
A.7 HSN Code
A.8 Reason for Transportation
PART - B
B.1 Vehicle Number for Road
B.2 Transport Document Number
1. HSN Code in column A.6 shall be indicated

at minimum two digit level for taxpayers 3. Transport Document number indicates
having annual turnover upto five crore rupees Goods Receipt Number or Railway Receipt
in the preceding financial year and at four digit Number or Airway Bill Number or Bill of
level for taxpayers having annual turnover Lading Number.
above five crore rupees in the preceding
financial year.
2. Document Number may be of Tax Invoice, 4. Place of Delivery shall indicate the PIN Code
Bill of Supply, Delivery Challan or Bill of Entry. of place of delivery
5. Reason for Transportation shall be chosen from one of the following:-
Code Description
1 Supply
2 Export or Import
3 Job Work
4 SKD or CKD
5 Recipient not known
6 Line Return
7 Sales Return
8 Exhibition or fairs
9 For own use
10 Others

“FORM GST EWB-02

(See rule 138)
Consolidated E-Way Bill

Consolidated E-Way Bill No:
Consolidated E-Way Bill Date:
Generator:
Vehicle Number:
Number of E-Way Bills

E-Way Bill Number
(C) Verification of documents and conveyances [Rule 138B]
(1) The Commissioner or an officer empowered by him in this

behalf may authorise the proper officer to intercept any
conveyance to verify the e-way bill or the e-way bill number in
physical form for all inter-State and intraState movement of
goods.
(2)The Commissioner shall get Radio Frequency Identification

Device readers installed at places where the verification of
movement of goods is required to be carried out and 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.
However, on receipt of specific information on evasion of tax, physical
verification of a specific conveyance can also be carried out by any
officer after obtaining necessary approval of the Commissioner or an
officer authorised by him in this behalf.

(D) Inspection and verification of goods [Rule 138C]
(1) A summary report of every inspection of goods in transit shall be recorded online by the proper
officer in Part A of a prescribed form within 24 hours of inspection and the final report in Part B of
FORM GST EWB-03 shall be recorded within three days of such inspection.
Provided that where the circumstances so warrant, the Commissioner, or any other officer
authorized 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
(2) Where the physical verification of goods being transported on any conveyance has been done
during transit at one place within the State or in any other State, no further physical verification of
the said conveyance shall be carried out again in the State, unless a specific information relating to
evasion of tax is made available subsequently.
(E) Facility for uploading information regarding detention of vehicle [Rule 138D]
Note: For generating E way bill a website

‘www.ewaybillgst.gov.in’ has been
Where a vehicle has been
introduced (Notification No. 9/2018–
intercepted and detained for a
CentralTax
period exceeding thirty
minutes, the transporter may This website managed by the National
upload the said information in Informatics Centre, Ministry of Electronics
FORM GST EWB-04 on the & Information Technology, Government of
common portal India

Clarification regarding e-way bills
(1) Situation Clarification
It is clarified that in such a scenario, only

Consider a situation where a consignor is one e-way bill would be required. Part A can
required to move goods from City X to City be filled by the consignor and then the e-
Z. He appoints Transporter A for way bill will be assigned by the consignor to
movement of his goods. Transporter A Transporter A. Transporter A will fill the
moves the goods from City X to City Y. For vehicle details, etc. In Part B and will move
completing the movement of goods i.e. , the goods from City X to City Y.
from City Y to City Z, Transporter A now On reaching City Y, Transporter A will assign
hands over the goods to Transporter B. the said e-way bill to the Transporter B.
Thereafter, the goods are moved to the Thereafter, Transporter B will be able to
destination i.e. from City Y to City Z by update the details of Part B. Transporter B
Transporter B. How would the e-way bill will fill the details of his vehicle and move
be generated in such situations? the goods from City Y to City Z.
(2) Situation: - Consider a situation

Clarification: - It is clarified that the validity period of e-
where a consignor hands over his
way bill starts only after the details in Part B are
goods for transportation on Friday updated by the transporter for the first time.
to transporter. However, the In the given situation, Consignor can fill the details in
assigned transporter starts the Part A on Friday and handover his goods to the
movement of goods on Monday. transporter. When the transporter is ready to move
How would the validity of e-way bill the goods, he can fill the Part B i.e. the assigned
be calculated in such situations? transporter can fill the details in Part B on Monday and
the validity period of the e-way bill will start from
Monday.
Rule 138E- Restriction on furnishing of information in PART A of FORM GST EWB-01
Amendment
No person shall be allowed to furnish the information in PART A of FORM GST EWB-01 in respect of
a registered person, whether as a supplier or a recipient, who,—
(a) Being a person paying tax under section 10 has not furnished the statement in FORM GST CMP-
08 for two consecutive quarters; or
(b) Being a person other than a person specified in clause (a), has not furnished the returns for a
Two tax periods
(c) Registration is suspended under Rule 21A

CH.SUDHEER C.A, C.M.A Chapter 17 Assessment & Audit
Chapter 17
ASSESSMENT & AUDIT
1. Self-assessment [section 59]
2. Provisional assessment [section 60]
3. Scrutiny of returns [section 61]
4. Assessment of non-filers of returns [section 62]

TOPICS
5. Assessment of unregistered persons [section 63]
6. Summary assessment in certain special cases [section

64]
7. Audit by tax authorities [section 65]
8. Special audit [section 66]
1. SELF ASSESSMENT [SECTION 59]
Every person registered under the Act shall himself assess the tax payable by him for a
tax period and after such assessment he shall file the return required under section 39.
Question 1
2. PROVISIONAL ASSESSMENT [SECTION 60]
1) Situations Where the taxable person is unable to determine ─

demanding
Provisional a. Value of goods or services For the
Assessment or goods
supplied by
b. The rate of tax applicable
him
to the goods or services

2) Application to Assessee may furnish an application in GST ASMT-01 online , stating therein
Proper Officer reasons for payment of tax on a provisional basis along with the documents in
support of his request
The proper officer may, on receipt of the application, issue a notice in ASMT-02
requiring the registered person to furnish additional information or documents
in support of his request and the applicant shall file a reply to the notice(ASMT-
03), and may appear in person before the said officer if he so desires.
3) Allowance on The proper officer shall issue an order, allowing payment of tax on a provisional
Provisional basis (ASMT-04) indicating the value or the rate or both on the basis of which
Basis: the assessment is to be allowed on a provisional basis
4) Furnish of The payment of tax on provisional basis may be allowed, if the taxable person
Security executes a bond in the prescribed form along with a security in the form of a
(ASMT-05) bank guarantee for an amount as the proper officer may deem fit, binding the
taxable person for payment of the difference between the amount of tax as may
be finally assessed and the amount of tax provisionally assessed.
Bond is to be executed and security to be furnished not exceeding 25% of the

amount covered under the bond.
5) Time Limit for The final assessment order has to be passed by the proper officer within 6
Finalization of months from the date of the communication of the order of provisional
Provisional assessment.
Assessment Extension of Time Limit
However, on sufficient cause being shown and for

reasons to be recorded in writing, the above period of
6 months may be extended
By the Joint/Additional By the Commissioner

Commissioner for a for such further
further period not period as he may
exceeding 6 months, deem fit not
Thus, a provisional assessment can remain provisional for a maximum of 5

years.
6) Finalization of For finalization of assessment, Shall issue a final assessment

Assessment proper officer shall issue a order in ASMT-07 specifying
notice in ASMT-06, calling for the amount payable by the
such information and records, registered person or the
as may be required and amount refundable, if any

7) Tax Liability or a. Where the tax  Amount to be paid = Difference of Tax + Interest @
Refund after liability as per the 18% from first day after the due date of payment of
Finalization of final assessment is the tax till the date of actual payment
Assessment higher than in
provisional  Interest is to be paid even such amount is paid
assessment before or after the issuance of order for final
assessment.
b. Where the tax Assessee should apply for Refund in GST RFD-01
liability as per the Amount to be Refunded = Excess Tax paid + Interest
final assessment is @ 6% after the expiry of 60 days from the date of
less than in receipt of application in GST RFD-01 to the date of
provisional refund
assessment However here refund is subject to Doctrine of
Unjust Enrichment
8) Release of The applicant may file an application for release of security in ASMT-08 after
Security issue of final assessment order.
The proper officer shall release the security after ensuring that applicant has
paid the amount specified in final assessment order and issue an order
within a period of 7 working days from the date of receipt of the application.
3. SCRUTINY OF RETURNS [SECTION 61]
1) Verifying the correctness of return
The return furnished by a Where any return furnished by a

registered person may be selected registered person is selected for
for scrutiny by proper officer to scrutiny, the proper officer shall
verify its correctness. scrutinize the same with reference to
the information available with him.
Scrutinize
Return filed by Information available with

assessee proper officer

Issue of notice (ASMT-10) Reply to notice (ASMT-11) Action by Proper Officer

Question 2-4
The registered person to whom

– Where the explanation In case no
Proper officer for Proper office
shall issuenotice issues such furnished by the satisfactory
in ASMT- notice for registered person or the explanation is
10quantifying the Accept the Submit his information submitted is furnished by
informing him
amount of tax, discrepancy & explanation found to be acceptable, registered person,
of such pay the tax, regarding non-
interest and any the proper officer shall the proper officer
discrepancy interest and any Or acceptance of inform him accordingly may take recourse
other amount
and seeking his other amount discrepancy inASMT -12 and no to any of the
payable in
explanation arising from further action shall be following
relation to such
discrepancy. thereto such taken in this regard. provisions, namely:
discrepancy
Within a period of 30 days from 1.Proceed to conduct audit under section 65 of the
date of service of Notice Act;
2.Direct the conduct of a special audit under section 66 which is to be conducted

by a CA/CMA nominated for this purpose by the Commissioner; or
3.Undertake procedures of inspection, search and seizure under section 67 of

the Act; or
4.Initiate proceeding for determination of tax and other dues under

Section 73 or 74 of the Act.

4. ASSESSMENT OF NON-FILERS OF RETURNS [SECTION 62]
A.Best Judgment Assessment (GST ASMT-13) Question 5
Where a registered person−

a) fails to furnish the return under section 39 (monthly/quarterly) or under section 45 (final
return), and
b) a notice under section 46 has been issued by proper officer to the defaulting taxable person
requiring him to furnish the return within a period of 15 days and taxable person fails to file
return within the given time;
The proper officer may proceed to assess the tax liability of said person (i.e. Return Defaulter) to the
best of his judgement taking into account all the relevant material which is available or which he has
gathered.
B. Time Limit for Assessment Order
The order of Best Judgment assessment shall be issued b y Proper Officer in the ASMT - 13
The Assessment Order shall be issued by Proper Officer within a period of 5 years from the date
specified under section 44 for furnishing of the annual return for the financial year to which the tax
not paid relates.
Eg:- If a person defaults in filing of return for any tax period falling in F/Y 2017-18, period of 5 years
shall be reckoned from the due date of filing of Annual Return for F/Y 2017-18 i.e. 31.12.2018.
Accordingly, Best judgment Assessment can be made by Proper Officer on or before 31.12.2023.
C. Withdrawal of Assessment Order

Question 6
♦ Where the registered person ♦ But the liability for

furnishes a valid return for the payment of interest u/s
default period (i.e. files the return 50 or for payment of late
and pays the tax as assessed by fee under section 47 shall
him) within 30 days of the service continue.
of the assessment order, the said
assessment order shall be
deemed to have been withdrawn

5. ASSESSMENT OF UNREGISTERED PERSONS [SECTION 63]
Best Judgment Assessment
Notwithstanding anything to the contrary contained in section 73 or

section 74, where a taxable person−
i. Fails to obtain ii. Whose registration

registration even though has been cancelled
liable to do so; or suomoto by Proper
office u/s 29(2)
Issue of Notice
Before making the assessment, proper officer shall issue a

notice to a taxable person in ASMT-14 containing the
grounds on which the assessment is proposed to be made on
best judgment basis and shall be given 15 days’ time to
furnish his reply, if any.
However, no such assessment order shall be passed without
giving the person an opportunity of being heard.
Time Limit for Assessment Order
The assessment order shall be issued by proper officer in ASMT -15 within a period of 5 years from the
due date for furnishing the annual return for the financial year to which non-payment of tax relates.
Eg:- If the liability of a person to take registration arises at any time in the F/Y 2017-18 for the reason
that his turnover crosses the prescribed threshold limit, period of 5 years shall be reckoned from the
due date of filing of Annual Return for F/Y 2017-18 i.e. 31.12.2018. Accordingly, Best judgment
Assessment can be made by proper officer on or before 31.12.2023.

6. SUMMARY ASSESSMENT IN CERTAIN SPECIAL CASES [SECTION 64]
A.When Summary Assessment can be made in

ASMT-16
Summary Assessments can be initiated to protect the interest of revenue with the previous permission
of Additional Commissioner/Joint Commissioner when:
the proper officer has sufficient grounds to

the proper officer has evidence that a taxable
believe that delay in passing an assessment
person has incurred a liability to pay tax under
order may adversely affect the interest of
the Act, and
revenue.
Question 6
B. Withdrawal of Assessment Order
The Summary Assessment Order may be withdrawn by Additional

Commissioner/Joint Commissioner, –
(a) On an application filed by (b) on his own motion, where he

taxable person in ASMT-17 for finds such order to be erroneous
withdrawal of the summary and may instead follow the
assessment order within 30 days procedures laid down in sec 73 or
from the date of receipt of section 74 to determine the tax
order; or liability of such taxable person
C.Deemed taxable person in

case of supply of goods Question 7
Where the taxable person to whom the liability pertains is not ascertainable and such liability
pertains to supply of goods, the person in charge of such goods shall be deemed to be the taxable
person liable to be assessed and liable to pay tax and any other amount due under this section.
Eg:-
When goods are under transportation or are stored in a warehouse, and the taxable person in
respect of such goods cannot be ascertained, the person in charge of such goods shall be deemed to
be the taxable person and will be assessed to tax.

7. AUDIT BY TAX AUTHORITIES [SECTION 65] Question 8
Who may conduct the a) The Commissioner; or

audit? b) Any officer authorised by him, by way of a general or a specific order, may
undertake audit of any registered person at the place of business of the
registered person or in their office for a financial year or part thereof or
multiples thereof.
Where it is decided to undertake the audit of a registered person, the proper
officer shall issue a notice in ADT-01 not less than 15 working days prior to the
commencement of audit.
What is meant by Commencement of audit means the later of the following:

commencement of
a) The date on which the records/accounts called for by the audit authorities
audit?
are made available to them, or
b) The actual institution of audit at the place of business of the taxpayer.
Time limit for The audit is required to be completed within 3 months from the date of
completion of audit commencement of audit. The period is extendable for a further period of a
maximum of 6 months by the Commissioner.
How to conduct audit
The proper officer authorised to conduct audit of the records and books of account of the
registered person shall, with the assistance of the team of officers and officials accompanying him,
The correctness of the The documents on

turnover, exemptions the basis of which the
and deductions books of account are
claimed, maintained and
The rate of tax The returns and

applied in respect of statements furnished
supply of goods or under the Act and the
Verify
services or both, rules made thereunder,
Other relevant issues

The input tax credit
and record the
availed and utilized,
observations in his
Refund claimed, audit notes
and

During the course of audit, the authorised officer may require the registered person,—
a) to facilitate the verification of accounts/records available or requisitioned by the authorities,
b) to provide such information as the authorities may require for the conduct of the audit, and
c)to render assistance for timely completion of the audit.
The proper officer may inform the registered person of the discrepancies noticed, if any, as observations
of the audit and the said person may file his reply and the proper officer shall finalise the findings of the
audit after due consideration of the reply furnished.
Finalisation of Audit
The proper officer shall finalise the findings of the audit after due consideration of the reply furnished
by registered person to audit observation brought to his notice during the course of audit.
On conclusion of audit, the proper officer shall within 30 days inform the registered person in ADT-02
his rights and obligations and the reasons for such findings.
Where the audit results in detection of tax not paid or short paid or erroneously refunded, or input tax
credit wrongly availed or utilised, the proper officer may initiate action under section 73 or section 74.
8. SPECIAL AUDIT [SECTION 66]
When Special Audit may be directed and from

whom?
If at any stage of scrutiny, inquiry, investigation or any other proceedings before him, any officer not below the
rank of Assistant Commissioner, having regard to the nature and complexity of the case and the interest of
revenue, is of the opinion that –
a) the value has not been correctly declared; or

b) the credit availed is not within the normal limits,
he may, with the prior approval of the Commissioner, issue a direction to the registered person inADT-03to get
his records including books of account examined and audited by a chartered accountant or a cost accountant
as may be nominated by the Commissioner and specified in the said direction.
The provisions of special audit shall have effect even if the accounts of the registered person have been audited
under any other provisions of the GST Act or any other law for the time being in force.

Time limit within which audit to be completed
The Chartered Accountant or cost accountant as nominated by Commissioner shall submit a report
of such audit duly signed and certified by him within the period of 90 days to the said Assistant
Commissioner mentioning therein such other particulars as may be specified:
The Assistant Commissioner may extend the said period 90 days by a further period of 90 days −
a) On an application made to him in this behalf by the registered person or the chartered
accountant or cost accountant; or
b) For any material and sufficient reason.
Who will bear the expenses of audit?
The expenses of the examination and audit of records

including the remuneration of such Chartered Accountant
or Cost Accountant, shall be determined and paid by the
Commissioner and such determination shall be final.
How Special Audit Report to be dealt

with?
The registered person shall be given an opportunity of being heard in respect of any material
gathered on the basis of special audit which is proposed to be used in any proceedings against him
under this Act or the rules made thereunder.
On conclusion of special audit, the registered person shall be informed of the findings of special
audit in ADT-04
Where the special audit results in detection of tax not paid or short paid or erroneously refunded,
or input tax credit wrongly availed or utilised, the process of demand and recovery will be initiated
against the registered person under section 73 or section 74.

CH.SUDHEER C.A, C.M.A Chapter 18 Inspection, Search, Seizure & Arrest
Chapter 18 INSPECTION, SEARCH,

SEIZURE &ARREST
1. Power of inspection, search and seizure [section 67]
2. Inspection of goods in movement [section 68]
3. Power to arrest [section 69]

TOPICS
4. Power to summon persons to give evidence and produce
documents [section 70]
5. Access to business premises [section 71]
6. Officers to assist proper officers [section 72]
1. POWER OF INSPECTION, SEARCH AND SEIZURE [SECTION 67]
‘Inspection’ is a new provision under the Act. It is a softer provision than search
As per Section 67 of CGST Act, inspection can be carried out by proper officer
only upon a written authorization given by an officer of the rank of Joint
Commissioner or above.(GST INS-01)

Question 1
A. Circumstances for
carrying out inspection
A Joint Commissioner or an officer higher in rank can give such authorization

only if he has reasons to believe that
(a)Taxable person has (b) Any person engaged in (c) An owner or an

done one of the transporting of goods operator of a warehouse
following or a godown
I suppressed any transaction

of supply  Has kept goods which have escaped payment of tax or
ii Suppressed stock of goods
 Has kept his accounts or goods in a manner that is
iii Claimed excess ITC
likely to cause evasion of tax, whether or not he is a
iv Contravened any provision of registered taxable person.
the Act to evade tax
Reason to believe is to have knowledge of facts which, although not amounting to direct knowledge,
would cause a reasonable person, knowing the same facts, to reasonably conclude the same thing.
It has to be and must be that of an honest and reasonable person based on relevant material and
circumstances
For detailed provision

B. Confiscation of goods (Section 130)
Refer pg.21.6
Confiscation of Transfer of title in goods to Government. As per section 130 of CGST Act,
goods become liable to confiscation when any person does the following
i.Supplies or receives ii.Does not account iii.Supplies any iv.Contravenes any of

any goods in for any goods on goods liable to tax the provisions of the
contravention of any which he is liable to under this Act CGST Act or rules
of the provisions of without having made there under
pay tax under this
this Act/rules leading applied for the with intent to evade
Act;
to evasion of tax; registration; payment of tax
The person from whom documents and books of accounts are thus seized, shall have the right to
take copies of such documents and books of accounts, subject to the approval of the Proper Officer.

Question 2
C. Search Warrant and its contents
The written authority to conduct search is generally called search warrant. The competent
authority to issue search warrant is an officer of the rank of Joint Commissioner or above.
The The name The name Date and Serial

The Period of
violation and of the place of number of
premise to issuing validity i.e.
under the be designation issue,. the search
officer with a day or
Act, searched, of the warrant,
full two days
person
designation etc.
authorized
for search,. along with
his round
seal,

D. Procedure for conducting search
 Search Warrant: No search of premises should be carried out without a valid search warrant
issued by the proper officer.
 Team: There should invariably be a lady officer accompanying the search team to residence.
 Disclosure of Identity: The officers before starting the search should disclose their identity by
showing their identity cards to the person in-charge of the premises.
 Signature before commencement: The search warrant should be executed before the start of the
search by showing the same to the person in-charge of the premises and his signature should be
taken on the body of the search warrant in token of having seen the same. The signatures of at
least two witnesses should also be taken on the body of the search warrant.
 Presence of Witnesses: The search should be made in the presence of at least two independent
witnesses of the locality. If no such inhabitants are available /willing, the inhabitants of any other
locality should be asked to be witness to the search. The witnesses should be briefed about the
purpose of the search.
 Personal Search by Assessee: Before the start of the search proceedings, the team of officers
conducting the search and the accompanying witnesses should offer themselves for their personal
search to the person in-charge of the premises being searched. Similarly, after the completion of
search all the officers and the witnesses should again offer themselves for their personal search.
 Panchnama: A Panchnama / Mahazar of the proceedings of the search should necessarily be
prepared on the spot. A list of all goods, documents recovered and seized/detained should be
prepared and annexed to the Panchnama/Mahazar. The Panchnama / Mahazar and the list of
goods/ documents seized/detained should invariably be signed by the witnesses, the in-charge/
owner of the premises before whom the search is conducted and also by the officer(s) duly
authorized for conducting the search.
 Handover of Warrant to issuing officer :After the search is over, the search warrant duly executed
should be returned in original to the issuing officer with a report regarding the outcome of the
search. The names of the officers who participated in the search may also be written on the
reverse of the search warrant.
 Search warrant in Record: The issuing authority of search warrant should maintain register of
records of search warrant issued and returned and used search warrants should be kept in
records.
 Panchnama to owner: A copy of the Panchnama / Mahazar (GST INS-02) along with its annexure
should be given to the person in charge/owner of the premises being searched under
acknowledgement.

E. Powers of officer during search
Question 3
An officer carrying out a search has the power to search for and
seize goods and documents/books/things (relevant for any
proceedings under the Act) from the premises searched.
However, if it is not practicable to seize any such goods then

the same may be detained. The person from whom these are
seized shall be entitled to take copies/extracts of seized
records.
During search, the officer has the power to break open the
door of the premises authorized to be searched if access to the
same is denied.1
Similarly, while carrying out search within the premises, he can

break open any almirah or box if access to such almirah or box
is denied and in which any goods, account, registers or
documents are suspected to be concealed. He can also seal
the premises if access to it denied.
The seized documents/books/things shall be retained only till

the time the same are required for
examination/enquiry/proceedings and if these are not relied
on for the case then the same shall be returned within 30
days from the issuance of show cause notice
The searches and seizures shall be carried out in accordance with the provisions of
Criminal Procedure Code, 1973. Section 100 of the Code of Criminal Procedure describes
the procedure for search.

F. Manner of release of confiscated goods, documents
1. Provisional The seized goods shall be released on a provisional basis, on execution of bond
basis and furnishing of security or on payment of applicable tax, interest and penalty.
2. Actual return In case of seizure of goods, a notice has to be issued within six months, if no
of goods notice is issued within a period of six months then all such goods shall be
returned. However, this period of six months can be extended by Commissioner
for another six months on sufficient cause.
3. Disposal of The Government may, having regard to the perishable or hazardous nature of any
goods goods,constraints of storage space notify the goods which shall be disposed by
the proper officer . Government in Ntn no.27/2018 dt.13/06/2018 have notified
16 goods to be disposed off as per above reasons)
G. Safeguards provided for in respect of Search or Seizure
a. Seized goods or documents should not be retained beyond the period necessary
for their examination
b. Photocopies of the documents can be taken by the person from whose custody
documents are seized
c. For seized goods, if a notice is not issued within 6 months of its seizure, goods
shall be returned to the person from whose possession it was seized. This period of
6 months can be extended on justified grounds up to a further period of maximum 6
months
d. An inventory of seized goods shall be made by the seizing officer
e.Certain specified categories of goods such as perishable, hazardous etc. can be

disposed of immediately after seizure
f.Provisions of Code of Criminal Procedure 1973 relating to search and seizure

shall apply. However, one important modification is in relation to sub-section (5)
of section 165 of Code of Criminal Procedure – instead of sending copies of any
record made in course of search to the nearest Magistrate empowered to take
cognizance of the offence, it has to be sent to the Principal Commissioner/
Commissioner of CGST.

2. INSPECTION OF GOODS IN MOVEMENT [SECTION 68]
Inspection can also be done of the conveyance, carrying a consignment of value exceeding
specified limit. The person in charge of the conveyance has to produce prescribed
documents/devices for verification and allow inspection. Eway Bill has been prescribed for the
said purpose.Inspection during transit can be done even without authorisation of Joint
Commissioner.
For detailed provision

Refer pg.21.6
Question 4
3. POWER TO ARREST [SECTION 69]
The term ‘arrest’ has not been defined in the GST Act. However, as per judicial pronouncements, it
denotes ‘the taking into custody of a person under some lawful command or authority’. In other
words, a person is said to be arrested when he is taken and restrained of his liberty by power or
colour of lawful warrant.
Arrests can be carried out only where the person is accused of offences specified for this purpose and
the tax amount involved is more than specified limit. Further, the arrests under GST Act can be made
only under authorisation from the Commissioner. Whenever the Commissioner has reason to believe
that any person has committed any such offence, he can authorize any other officer subordinate to
him, to arrest such person.
The Commissioner can authorize an officer to arrest a person if he has reasons to believe that the
person has committed an offence attracting a punishment prescribed under section
132(1)(a)/(b)/(c)/(d) or section 132(2) of the CGST Act. (Refer Page 21.13)
This essentially means that a person can be arrested only where the tax evasion is more than ` 1
crore. However, the monetary limit shall not be applicable if the offences are committed again even
after being convicted earlier i.e. repeat offender of the specified offences can be arrested irrespective
of the tax amount involved in the case.

A. Guidelines for arrest
Decision to arrest needs to be taken on case-to case basis considering various factors, such as,
nature and gravity of offence, quantum of duty evaded or credit wrongfully availed, nature and
quality of evidence, possibility of evidences being tampered with or witnesses being influenced,
cooperation with the investigation, etc. Power to arrest has to be exercised after careful
consideration of the facts of the case which may include:
a b c
To ensure proper To prevent such Prevention of the
investigation of person from possibility of
the offence absconding tampering with
evidence
d Intimidating or e large amounts of f Where the intent to

influencing evasion of tax evade duty is evident
witnesses; and and element of
mensrea/guilty mind
is palpable
g
Master minds or key operators effecting
proxy/ benami imports/exports in the name
of dummy or non-existent persons/IECs, etc;
B. Precaution taken during arrest
The provisions of the It is therefore necessary A person arrested without warrant shall be
C.Cr.P, 1973 relating to that all field officers of taken to before a Magistrate having
arrest and the CGST be fully familiar jurisdiction in the case within 24 hrs
procedure thereof must with the provisions of (excluding the journey time from place of
be adhered to in all the Code of Criminal
arrest to the Magistrate’s court)
situations amounting to Procedure, 1973.
arrest.

Question 5
4. POWER TO SUMMON PERSONS TO GIVE EVIDENCE AND
PRODUCE DOCUMENTS [SECTION 70]
During the course of any enquiry under this Act, the proper officer may summon any person, to
appear before him and give evidence or produce documents. The person to whom such summon
has been issued is duty bound to appear before the officer and bound to tender evidence. He is also
bound to produce all documents which were required to be furnished.
A person who is issued summon is legally bound to attend

either in person or by an authorized representative and he is
Responsibilities of the person bound to state the truth before the officer who has issued the
so summoned summon upon any subject which is the subject matter of
examination and to produce such documents and other things
as may be required.
Consequences of non-appearance
to summons
The proceeding before the official who has issued summons is

deemed to be a judicial proceeding. If a person does not appear on
the date when summoned without any reasonable justification, he
can be prosecuted u/s 174 of the Indian Penal Code (IPC).
If he absconds to avoid service of summons, he can be prosecuted

under section 172 of the IPC and in case he does not produce the
documents or electronic records required to be produced, he can be
prosecuted under section 175 of the IPC.
In case he gives false evidence, he can be prosecuted under section

193 of the IPC. In addition, if a person does not appear before a
CGST/ SGST officer who has issued the summon, he is liable to a
penalty upto ` 25,000 under section 122(3)(d) of the Act.

Guidelines for issue of summons
Summons are to be issued as a last resort where assesses are not co-operating and
this section should not be used for the top management
The language of the summons should not be harsh and legal which causes
unnecessary mental stress and embarrassment to the receiver;
Summons by Superintendents should be issued after obtaining prior written

permission from an officer not below the rank of Assistant Commissioner with the
reasons for issuance of summons to be recorded in writing;
Where for operational reasons, it is not possible to obtain such prior written
permission, oral/ telephonic permission from such officer must be obtained and the
same should be reduced to writing and intimated to the officer according such
permission at the earliest opportunity
Senior management officials such as CEO, CFO, General Managers of a large

company or a Public Sector Undertaking should not generally be issued summons at
the first instance. They should be summoned only when there are indications in the
investigation of their involvement in the decision making process which led to loss
of revenue.
5. ACCESS TO BUSINESS PREMISES [SECTION 71]
During the course of any enquiry under this Act, the duly empowered officer can have
access to any business premises, which may be required for the purpose of such
enquiry. During such access, the officers can inspect the books of accounts, documents,
computers, computer programs, computer software and such other things as may be
required.
It is the duty of the persons in charge of such premises to furnish the required
documents. Similarly, the persons in charge of business premises are also duty bound
to furnish such documents to the audit party deputed by the proper officer or the
Chartered Accountant or Cost Accountant, who has been deputed by the
Commissioner to carry out special audit. The following records are covered by this
provision and are to be produced, if called for.

i.Trial
v.Any other
balance or vi.The records prepared relevant
its and maintained by the record
equivalent registered person and
declared to the proper
officer in the prescribed
manner
ii.Statements
of annual iv.The
financial income - tax
accounts, duly audit report,
audited if any
iii.Cost audit
report, if any.
6. OFFICERS TO ASSIST PROPER OFFICERS [SECTION 72]
Under section 72 of CGST Act, the following officers have been

empowered and are required to assist CGST officers in the execution of
CGST Act. The categories specified are as follows:
Officers of
Officers of Any other State/UT/
State/UT/ class of Central
officers as
Central Govt.
may be
Govt. notified engaged in
engaged in by the collection
All village collection Central/St of land
Police Customs Railways officers of GST ate Govt revenue

Chapter 19 Offences &Penalities
CH.SUDHEER C.A, C.M.A
Chapter 19
DEMANDS & RECOVERY
1. DETERMINATION OF TAX NOT PAID/SHORT PAID/ERRONEOUSLY

REFUNDED/ITC WRONGLY AVAILED/UTILISED [SECTION 73 &
SECTION 74]
2. GENERAL PROVISIONS RELATING TO DETERMINATION OF TAX
[SECTION 75]
3. TAX COLLECTED BUT NOT DEPOSITED [SECTION 76]
4. New Procedure before Issue of SCN
5. Procedure for recovery of dues under existing laws (Rule 142A)
6. DIN (Document Identification number)
TOPICS 7. TAX WRONGFULLY COLLECTED AND PAID TO CENTRAL
GOVERNMENT OR STATE GOVERNMENT [SECTION 77]
8. RECOVERY PROCEEDINGS [SECTIONS 78 & 79]
9. PAYMENT OF TAX AND OTHER AMOUNT IN INSTALMENTS
[SECTION 80]
10. TRANSFER OF PROPERTY TO BE VOID IN CERTAIN CASES [SECTION
81]
11. TAX TO BE FIRST CHARGE ON PROPERTY [SECTION 82]
12. PROVISIONAL ATTACHMENT TO PROTECT REVENUE IN CERTAIN
CASES [SECTION 83]
13. CONTINUATION AND VALIDATION OF CERTAIN RECOVERY
PROCEEDINGS [SECTION 84]

1. DETERMINATION OF TAX NOT PAID/SHORT PAID/ERRONEOUSLY

REFUNDED/ITC WRONGLY AVAILED/UTILISED [SECTION 73 & SECTION 74]
Section 73 and section 74 of the CGST Act deal with the manner in which the tax liability of a
person should be determined in case of
• Short
2 • Erroneous
4 • Wrong
payment • Non- refund • Wrong utlisation
payment of availment of ITC.
tax
1 3 5
The incidence of short payment/non-payment of tax or erroneous refund or wrong

availment/utilisation of ITC may be because of an inadvertent bonafide mistake (Normal Cases)
or it may be a deliberate attempt (Fraud Cases) to evade the tax.

1. SHOW CAUSE NOTICE
In order to adhere to the principles of natural justice, before raising any

tax demand, a notice has to be issued (generally referred to as Show
Cause Notice)in DRC-01, asking the person chargeable with tax to show
cause as to why the specified amount of tax should not be demanded
from him.
The issuance of SCN grants an opportunity to such person to

defend himself before adjudication.
The person to whom such notice has been issued can contest the
demand by filing a reply to the show cause notice in DRC-06 and
also by appearing before the adjudicating authority personally.
After considering the reply filed by the person as well as the

submissions made during the personal hearing, the adjudicating
authority shall pass a speaking order, either confirming the tax
demand or dropping the same in DRC-05
2. Same default in other periods
1. Where a notice has been issued for any period on a

person chargeable with tax, if such person commits
such default in some other period also, instead of
issuing a detailed notice, a mere statement in DRC-02
Same containing the details of tax not paid/short
paid/erroneously refunded/ITC wrongly
default availed/utilised for such periods, can be issued.
in
other
periods 2. The Service of such Statement shall be deemed to
be Service of SCN on such person, subject to the
condition that the grounds relied upon for such tax
periods [as covered in the Statement] are the same as
are mentioned in the earlier notice.

3. Fixing monetary limits for issuance of show cause

notices by different level of officers u/s 74 or 75
S.No Officer CGST not paid/ IGST not paid/ CGST & IGST not
short paid etc.., short paid etc.., paid/ short paid
etc..,
1 Superintendent of Not exceeding Rs. 10 Not exceeding Not exceeding Rs. 20
Central Tax lakh Rs.20 lakh lakh
2 Deputy or Assistant Above Rs. 10 lakh and Above Rs. 20 lakh Above Rs. 20 lakh and
Commissioner of not exceeding Rs. 1 and not exceeding not exceeding Rs. 2
Central Tax crore Rs. 2 crores crores
3 Additional or Joint Above Rs. 1 crore Above Rs. 2 crores Above Rs. 2 crores
Commissioner of without any limit without any limit without any limit
Central Tax
In case show cause notices have been issued on similar issues to a notice(s) and made answerable
to different levels of adjudicating authorities within a Commissionerate, such show cause notices
should be adjudicated by the adjudicating authority competent to decide the case involving the
highest amount of central tax and/or integrated tax (including cess)
4. TIME LIMIT FOR ISSUING SCN IN DRC-01 & order in DRC-07
S.No Nature of Case Time for Issuance of Notice Time for Issuance of
Order
1 Normal Cases Within 2 years and 9 months from Within 3 years from the due
the due date of filing annual Return date of filing of Annual Return
for the Financial Year to which the for the Financial Year to which
demand pertains or from the date of the demand pertains or from
erroneous refund the date of erroneous refund
2 Fraud Cases Within 4 years and 6 months from Within 5 years from the due
the due date of filing of Annual date of filing of Annual Return
Return for the Financial Year to for the Financial Year to which
which the demand pertains or from the demand pertains or from
the date of erroneous refund the date of erroneous refund
3 Any amount Within 1 Year from the date of
collected as tax but No time limit issue of notice (to be discussed
not paid subsequently in this chapter)
4 Non-Payment of Recovery proceedings can be
Self-Assessed tax started directly (to be
No need to issue a SCN
discussed subsequently in this
chapter)

5. Quantum of Penalty in Different Scenarios
S.No Amount of penalty payable

Action by tax payer Normal Fraud cases Remarks
cases
1 Tax amount, along with No penalty and no 15% of the tax amount
the interest, paid before notice shall be issued payable as penalty and
issuance of notice no notice shall be not The penalty shall
be issued also be not
2 Tax amount, along with No penalty. All 25% of the tax amount chargeable in
the interest, paid within proceedings deemed payable as penalty. All cases where the
30 days of issuance of to be concluded proceedings deemed to self-assessed tax
notice be concluded or any amount
3 Tax amount, along with 10% of the tax 50% of the tax amount collected as tax
the interest, paid within amount or Rs. payable as penalty. All is paid (with
30 days of 10,000/- , whichever proceedings deemed to interest) within
communication of order is higher be concluded 30 days from the
4 Tax amount, along with 10% of the tax 100% of the tax amount due date of
the interest, paid after amount or Rs. payment
30 days of 10,000/-, whichever
communication of order is higher
Demand amount in SCN/Order to be paid by assessee in DRC-03 & Obtain Acknowledgment in DRC-04
Question : If GSTR-3B is filed beyond due date, but tax is paid

along with interest & late fee. Shall penalty be levied u/s
73(11)? (Circular No. 76/50/2018 dt.31.12.2018)
As per the provisions of Sec. 73(11)of the CGST Act,

penalty is payable in case self-assessed tax or any amount
collected as tax has not been paid within a period of thirty
days from the due date of payment of such tax
Sec. 73(11) only if SCN is issued and later assessee had

filed return
Hence Sec. 73(11) shall not apply. However general penalty

u/s 125 shall be levied in this case (i.e,CGST penalty
extendable to Rs.25000) because tax has been paid late in
contravention of the provisions of the CGST Act

2. GENERAL PROVISIONS RELATING TO DETERMINATION OF TAX

[SECTION 75]
Sec. 75
General provisions relating to determination of tax are contained in section 75 of CGST Act. These
provisions are applicable both in case of determination of tax not paid/short paid/ erroneously
refunded/ITC wrongly availed/ utilised whether by reason of fraud/any wilful
misstatement/suppression of facts or otherwise.These provisions have been discussed are as follows:
1. Period of stay order to be excluded in computing the limitation period [Section 75(1)]
2. In case charges of fraud/any wilful misstatement/suppression of facts are not established for a
notice issued in a fraud case, tax to be determined deeming the demand notice to be issued in
normal case [Section 75(2)]
3. Adjudication order issued in pursuance of Appellate Authority/ Appellate Tribunal/ Court’s
direction be issued with 2 years from date of communication of the said direction [Section
75(3)]
4. Opportunity of being heard [Section 75(4)]
An opportunity of hearing shall be granted where a request is received in writing from the person
chargeable with tax or penalty, or where any adverse decision is contemplated against such
person.
5. Adjournment of hearing to grant time to person chargeable with tax [Section 75(5)]
The proper officer shall, if sufficient cause is shown by the person chargeable with tax, grant time
to the said person and adjourn the hearing for reasons to be recorded in writing.
However, such adjournment shall be granted for a maximum of 3 times to a person during the
proceedings.
6. Adjudication order should be a speaking order [Section 75(6)]
The proper officer, in his order,Shall set out the relevant facts and the basis of his decision.
7. Tax, interest and penalty demanded in order not to exceed amount specified in notice [Section
75(7)]
The amount of tax, interest and penalty demanded in the order shall not be in excess of the
amount specified in the notice and no demand shall be confirmed on the grounds other than the
grounds specified in the notice
8. Payment of interest mandatory even if not specified in the adjudication order [Section 75(9)]
The interest on the tax short paid or not paid shall be payable whether or not specified in the
order determining the tax liability
9. Adjudication order to be passed mandatorily within stipulated time [Section 75(10)]
The GST law ensures timely disposal of cases by providing that if the adjudication order is not
issued within the stipulated time limit of 3 years in normal cases or 5 years in fraud cases, as the
case may be, the adjudication proceedings shall be deemed to be concluded.
10. Amount of self-assessed tax or interest remaining unpaid shall be recovered under section 79
[Section 75(12)]: For difference b/w GSTR-1 & 3B
11. In case of penalty being imposed under section 73/74, no other penalty to be imposed for the
same act/omission [Section 75(13)]

3. TAX COLLECTED BUT NOT DEPOSITED [SECTION 76]
Situation 1 Situation 2
Where tax is collected on supplies on which the Where tax is collected on supplies on which tax
tax is leviable, but such tax is not deposited with is not leviable at all, and tax collected is not
the Government deposited with the Government.
Amount representing tax collected from any person to be paid to the Central Government [Section 76(1)]
Issue of SCN [Sec. 76(2)] Where any amount is required to be paid to the Government, which has not been so paid, the proper officer may serve
on the person liable to pay such amount a notice in DRC-01 requiring him to show cause as to why the said amount as
specified in the notice, should not be paid by him to the Government
Penalty Equivalent to the amount specified in the notice
Determination of amount The proper officer shall, after considering the representation, if any, made by the person on whom SCN is served,
due [Sec. 76(3)] determine the amount due from such person and thereupon such person shall pay the amount so determined.
Interest to be payable on From the date such amount was collected by him to the date such amount is paid by him to the Government.
the amount @ 18% p.a
Opportunity of being An opportunity of hearing shall be granted where a request is received in writing in DRC-06 from the person to whom
heard [Sec. 76(5)] SCN was issued.
Time limit for issuance of The proper officer shall issue an order within 1 year from the date of issue of the notice (period of such stay shall be
order [Sec. 76(6) & (7)] excluded in computing the period of 1 year)
Order must be a speaking The proper officer, in his order, shall set out the relevant facts and the basis of his decision.
order [Sec. 76(8)]

4. New Procedure before Issue of SCN

Amendment
The proper officer shall, before service of notice to the

person chargeable with tax, interest and penalty, under
1 sub-section (1) of Section 73 or sub-section (1) of
Section 74, as the case may be, shall communicate the
Notice and
order for details of any tax, interest and penalty as ascertained by
demand of the said officer, in Part A of FORM GST DRC-01A.
amounts
payable under
the Act- Rule Where the person referred to in sub-rule (1A) has made
142
2 partial payment of the amount communicated to him or
desires to file any submissions against the proposed
liability, he may make such submission in
Part B of FORM GST DRC-01A.
5. Procedure for recovery of dues under existing laws (Rule 142A)
Procedure for recovery of dues under

existing laws (Rule 142A)
• Issue demand in FORM GST DRC-07A & any
modification in GST DRC-08A

6. DIN (Document Identification number)
Generation and quoting of Document Identification Number (DIN) on any communication issued by
the officers of the Central Board of Indirect Taxes and Customs (CBIC) to tax payers and other
concerned persons: (Circular No.122/41/2019-GST dt.05/11/2019)
1. What is meant by DIN?
DIN stands for Document Identification Number. It is a 20-digit unique number generated
digitally in an alphanumeric code. The Central Board of Indirect Taxes and Customs (CBIC)
have come up with an initiative to secure all the communication sent by the tax officials to the
registered taxpayers by digitizing the communication. A unique document identification
number will be used on all communications sent to the taxpayers.
Structure of DIN with example the structure of DIN is “CBIC-YYYY MM ZCDR NNNN” wherein;
3. ZCDR
denotes Zone
1. YYYY denotes Commissionerate
the year of the Division Range
generation of DIN Code
2. MM denotes 4. NNNN denotes

the month of the alphanumeric
generation of DIN randomly
generated code

2. Purpose and benefits of document identification number under GST

Below benefits will be enjoyed by the taxpayer from a document identification
number on any communication from GST department
Creation of a proper
audit trail of all the
communications sent
Transparency in all by the department.
communications with
the department
avoiding the receipt of Protect the rights of the
fake notices, and easy taxpayers.
identification of such
fake notices
Purpose&
benefits of
document
identification
number
under GST
3. Usage of DIN
 As of now, the document identification number will be used in the GST cases where
inquiries are going on, and arrest/search warrants have been issued.
 The use of document identification number on such communication will confirm its
authenticity.
 A taxpayer can confirm the genuineness of the communication by typing such DIN on
“VERIFY CBIC-DIN” window on www.cbic.gov.in.
 The window will report the information only if the communication is genuine.

4. Why is DIN important for a

taxpayer/business to know?
Many times it happens that notices/summons are issued through Non-official Email IDs.
Implementation of Document Identification Number ensures the authenticity of such notices
and protects a taxpayer from unnecessary harassment. Thus, it is important for a taxpayer to
confirm Document Identification Number before responding to any notice.
5. Consequences/ implications/ validity of a

notice not having DIN and actions available
 DIN is a mandatory requirement for all communications with the taxpayer. Any such
communication issued without document identification number holds no validity.
 They are considered invalid to the extent that they were never issued.
 However, under exceptional circumstances, communication may be issued without a
document identification number. In such cases, the tax officials should state that it is
issued without document identification number and the reasons for the same.
 There may be cases where communication is issued without a document
identification number, for instance:
 Technical glitches
 The authorized officer is outside the office discharging his official duties and
the notice needs to be issued immediately.
In such scenarios, the tax officials can issue document identification number within 15 days
of the issue of communication.

7. TAX WRONGFULLY COLLECTED AND PAID TO CENTRAL

GOVERNMENT OR STATE GOVERNMENT [SECTION 77]
A registered person who has paid the GST and SGST or, as the case may be, the CGST
and the UTGST on a transaction considered by him to be an intra-State supply, but
which is subsequently held to be an inter-State supply, shall be refunded the amount
of taxes so paid if application is made in GST RFD-01
A registered person who has paid IGST on a transaction considered by him to be an

inter-State supply, but which is subsequently held to be an intra-State supply, shall
not be required to pay any interest on the amount of CGST and SGST or, as the case
may be, the CGST and the UTGST tax payable.
Similar provisions are contained in section 19 of the IGST Act, 2017.
8. RECOVERY PROCEEDINGS [SECTIONS 78 & 79]
Initiation of Recovery of
recovery tax [Section
proceedings 79]
[Section 78]
Within a period of 3 months from The options for recovery of

the date of service of such order, If Government dues include
a taxable person fails to pay, deduction of money from any
recovery proceedings are initiated amount payable to such tax payer,
against him by issuing notice in detaining and selling any goods,
DRC-09 directing any other person from
However, where the proper officer whom the money is due to such
considers it expedient in the person, attaching any property
interest of revenue, he may belonging to the defaulter etc
require the said taxable person to
make such payment within such
period less than a period of 3
months

MODES OF RECOVERY OF TAX [SECTION 79(1)]
1. Recovery by
deduction from
any money
owed
2. Recovery by
10. Recovery of sale of goods
taxes from under the
Distinct person control of
proper officer
3. Garnishee
proceedings -
9. Recovery Recovery from a
from company third person
in liquidation [Section 79(1)(c)
MODES OF read with rule
RECOVERY 145]( Box)
OF TAX
[SECTION
8. Recovery 79(1)] 4. Recovery by
sale of Movable
through surety or Immovable
property
7. Recovery
through 5. Recovery as
execution of a arrears of land
decree, etc. revenue
6. Recovery as
fine imposed by
Magistrate

1. Recovery by When any refund is due to the assessee who had made application in GST
deduction from RFD-01, such Refund shall be set off against Demand raised now
any money owed
1. Notice for
auction shall be
issued in DRC -10
2. Recovery by sale
of goods under
the control of 3. After Sale, a
Sale Certificate
proper officer
2. Successful shall be issued
bidder shall be by Proper
intimated in officer to
DRC-11 Assessee in
DRC-12
1. Issue of Notice: The proper officer may, by a notice in DRC-13, in writing,

require any other person:
 From whom money is due/may become due to such person or
 Who holds/may subsequently hold money for/on account of such
person to pay to the Government
 Either forthwith upon the money becoming due or being held, or
 Within the time specified in the notice not being before the money
becomes due or is held,so much of the money as is sufficient to
pay the amount due from such person or the whole of the money
when it is equal to or less than that amount.
2. Bound to Comply :Every person to whom the notice is issued hereunder
shall be bound to comply with such notice.
3. Garnishee
3. Garnishee Notice can also be issued to post office, banking company or
proceedings -
an insurer
Recovery from a
4. Failure to make payment: Garnishee shall be deemed to be a defaulter in
third person
respect of the amount specified in the notice and all the consequences of
[Section 79(1)(c)
this Act or the rules made thereunder shall follow.
read with rule
5. Amendment or Revocation of Notice: The officer issuing such notice may,
145]( Box)
at any time, amend or revoke the notice or extend the time for making
any payment in pursuance of the notice.Where a person on whom a
notice is served hereunder proves to the satisfaction of the officer issuing
the notice that:
 The money demanded/any part thereof was not due to the person in
default or
 He did not hold any money for/on account of the person in default, at
the time the notice was served on him, nor is the money demanded or
any part thereof, likely to become due to the said person/be held
for/on account of such person,nothing contained in this section shall
be deemed to require the person on whom the notice has been served
to pay to the Government any such money or part thereof.

6. Compliance: Any person making any payment in compliance with the

notice issued hereunder shall be deemed to have made the payment
under the authority of the person in default.Further, such payment being
credited to the Government shall be deemed to constitute a good and
sufficient discharge of the liability of such person to the person in default
to the extent of the amount specified in the receipt.
7. Payment to Defaulter: Any person discharging any liability to the person
in default after service on him of the notice shall be personally liable to
the Government to the extent of the liability discharged or to the extent
of the liability of the person in default for tax, interest and penalty,
whichever is less.
8. Where the third person makes the payment of the amount specified in the
notice, the proper officer shall issue a certificate in DRC-14 to the third
person clearly indicating the details of the liability so discharged.
1. In case, any part of the said amount payable remains unpaid for a period
of 30 days next after any such distress, may cause the said property to be
sold [through auction] and with the proceeds of such sale, may satisfy the
amount payable and the costs including cost of sale remaining unpaid and
shall render the surplus amount, if any, to such person [Section 79(1)(d)].
2. The proper officer shall prepare a list of movable and immovable property
belonging to the defaulter, estimate their value as per the prevalent
market price and issue an order of attachment or distraint and a notice for
sale prohibiting any transaction with regard to such movable and
immovable property as may be required for the recovery of the amount
due in DRC-16.
3.
4. Recovery by sale In case of

of Movable attachment/distrait
/Immovable Of
property An immovable Order shall be affixed on the
property property till the confirmation of
[Section 79(1)(d) sale
read with rules A movable property Proper officer shall seize the
147, 148, 149, property and take its custody.
150 & 154]
4. Stamp duty/any other tax/fee payable on transfer of such property shall
be paid by the transferee to the Government.
5. The amounts so realised from the sale of goods, movable or immovable
property, for the recovery of dues from a defaulter shall,:-
a. first, be appropriated against the administrative cost of the recovery
process;
b. next, be appropriated against the amount to be recovered;
c. next, be appropriated against any other amount due (Penalties & Fine)
from the defaulter under the CGST Act or the IGST Act or the UTGST
Act or any of the SGST Act and the rules made thereunder; and
d. any balance, be paid to the defaulter
6. Any officer/other person who has a duty to perform in connection with
such sale will not acquire any interest in property sold.
7. No such sale will take place on Sundays/other general holidays recognized

by Government
8. Proper officer may seek assistance from jurisdictional police station.
5. Recovery as
arrears of land • The proper officer may prepare a
revenue certificate in DRC-18, signed by him
[Section 79(1)(e) 1 specifying the amount due from such
person and send it to the Collector of
read with rule the district
155]
• Collector on receipt of such certificate

2 shall proceed to recover from such
person the amount specified thereunder
as if it were an arrear of land revenue.
6. Recovery as fine Proper officer may file an application to the appropriate Magistrate in DRC-19
imposed by to recover from the person concerned the amount specified thereunder
Magistrate
[Section 79(1)(f)
read with rule
156]
7. Recovery Where any amount is payable to the defaulter in the execution of a decree of
through a Civil Court for the payment of money or for sale in the enforcement of a
execution of a mortgage or charge, the proper officer shall send a request to the said court
decree, etc. and the court shall, subject to the provisions of the Code of Civil Procedure,
[Rule 146] 1908, execute the attached decree, and credit the net proceeds for
settlement of the amount recoverable in DRC-15
8. Recovery Where any person has become surety for the amount due by the defaulter, he
through surety may be proceeded against under this Chapter as if he were the defaulter.
[Rule 157]
9. Recovery from Where the company is under liquidation as specified in section 88, the
company in Commissioner shall notify the liquidator for the recovery of any amount
liquidation [Rule representing tax, interest, penalty or any other amount due under the Act in
160] DRC-24.
10. Recovery of Recovery of taxes, interest, fine, penalty etc. can be made from distinct
taxes from persons, even if such distinct persons are present in different State/Union
Distinct person territories.

9. PAYMENT OF TAX AND OTHER AMOUNT IN INSTALMENTS [SECTION 80]
A taxable person, seeking extension of time for

the payment of taxes or any amount due Commissioner shall call for a report from the
under the Act or for allowing payment of such jurisdictional officer about the financial ability of
taxes or amount in instalments, shall furnish the taxable person to pay the said amount.
an application for the same in DRC-20
PAYMENT OF
TAX AND
OTHER
AMOUNT IN
INSTALMENTS
[SECTION 80]
Commissioner may, upon consideration of the
same, for reasons to be recorded in writing,
However, where there is default in payment of
extend the time for payment or allow payment of
any one instalment on its due date, the whole
any amount due under this Act, other than the
outstanding balance payable on such date shall
amount due as per the liability self-assessed in
become due and payable forthwith and shall,
any return, by such person in monthly
without any further notice being served on the
instalments not exceeding 24, subject to
person, be liable for recovery.
payment of interest under sec. 50 and issue
order in DRC-21
Facility of payment in instalments not allowed

in certain cases
The taxable person has already

defaulted on the payment of any
amount under the CGST Act or
IGST Act or UTGST Act or any of
the SGST Act, for which the
recovery process is on
The amount for which

instalment facility is
sought is less than `
25,000.

10. TRANSFER OF PROPERTY TO BE VOID IN CERTAIN CASES [SECTION 81]
1
Where a person, after any amount has
2
become due from him, creates a charge on or
parts with the property belonging to him or in However, such charge or transfer shall not be
his possession by way of sale, mortgage, void if it is made for adequate consideration,
exchange, or any other mode of transfer in good faith and without notice of the
whatsoever of any of his properties in favour pendency of such proceedings under this Act
of any other person with the intention of or without notice of such tax or other sum
defrauding the Government revenue, such payable by the said person, or with the
charge or transfer shall be void as against any previous permission of the proper officer
claim in respect of any tax or any other sum
payable by the said person.
11. TAX TO BE FIRST CHARGE ON PROPERTY [SECTION 82]
Notwithstanding anything to the contrary contained in any law for the time being in force, save as
otherwise provided in the Insolvency and Bankruptcy Code, 2016, any amount payable by a
taxable person or any other person on account of tax, interest or penalty which he is liable to pay
to the Government shall be a first charge on the property of such taxable person or such person.

12. PROVISIONAL ATTACHMENT TO PROTECT REVENUE IN CERTAIN

CASES [SECTION 83]
S.No Question Solution

1. When can During pending of any proceedings u/s 62,63,64,67,73 or 74
Provisional
Attachment be
done?
2. Why Provisional Commissioner is of the opinion that for the purpose of protecting the interest of
Attachment is the Government revenue, it is necessary so to do, he may, by order in writing
done? attach provisionally any property, including bank account, belonging to the
taxable person in such manner as may be prescribed
3. Validity of Every such provisional attachment shall cease to have effect after the expiry of a
Attachment period of one year from the date of the order made
4. Steps for Step1: Commissioner shall pass an order in FORM GST DRC-22 with proper
Attachment? Document Identification Number (DIN) mentioning therein the details of
property being attached.
Step2 : Such order shall be sent to Concerned Revenue Authority to place an
Emcumbrance
Step3: Copy sent to Assessee to file objections if any. If commissioner is
satisfied with the objections raised by Assessee, he shall pass release order in
GST DRC-23
5. Reason for Where taxable person has:
Attachment? a) supplied any goods or services or both without issue of any invoice with an
intention to evade tax; or
b) issued any invoice or bill without supply of goods or services or both
c) availed ITC using the invoice or bill referred to in clause (b) or fraudulently
availed input tax credit without any invoice or bill; or
d) collected any amount as tax but has failed to pay the same to the
Government beyond a period of three months from the date on which
such payment becomes due; or
e) fraudulently obtained refund;
6. Special points a) More than one property may be attached in case value is not sufficient to
cover the estimated amount of pending revenue
b) Movable property should normally be attached only if the immovable
property, available for attachment, is not sufficient to protect the interests
of revenue.
c) As far as possible, it should also be ensured that such attachment does not
hamper normal business activities of the taxable person. This would mean
that raw materials and inputs required for production or furnished goods
should not normally be attached
d) Share in property: Where the property to be provisionally attached
consists of the share or interest of the concerned taxable person in
properly belonging to him and another as co-owners, the provisional
attachment shall be made by order to the concerned person prohibiting
him from transferring the share or interest or charging it in any way.

Type Order issued to Instruction is

In the case of a debt Creditor Not to recover the debt
Debtor Not to make payment
In case of Shares, Company a. Not to Transfer Share
Debentures etc.., b. Not to receive
Dividend
Fixed Deposits/ RD etc.., Banker Not to give it to Defaulter
Investment in Partnership Firm Not to
Firm a. Allow Drawings
b. Draw Profits
c. Draw Interest
d. Draw Remuneration
13. CONTINUATION AND VALIDATION OF CERTAIN RECOVERY PROCEEDINGS [SECTION 84]
Where any notice of demand in respect of any tax, penalty, interest or any other amount payable
under this Act is served upon any taxable person and any appeal or revision application is filed or
any other proceedings is initiated in respect of such Government dues, then:
Where such Government dues Where such Government dues

are enhanced in such appeal, are reduced in suchappeal,
revision or other proceedings, revision or in other proceedings
the Commissioner shall serve ––
upon the taxable person or any
other person another notice of
demand without the service of
any fresh notice of demand, be It shall not be necessary The Commissioner
continued from the stage at for the Commissioner to shall give intimation
which such proceedings stood serve upon the taxable of such reduction to
immediately before such person a fresh notice of him in DRC-25
disposal; demand;

CH.SUDHEER C.A, C.M.A Chapter 20 Liability to pay in certain cases
Chapter 20
LIABILITY TO PAY IN
CERTAIN CASES
1. Liability to pay in case of transfer of business [Sec. 85 of the CGST

act]
2. Liability of agent and principal [Sec. 86 of the CGST act]
3. Liability to pay in case of an amalgamation/merger [Sec. 87 of the
CGST act]
4. Liability in case of company in liquidation [Sec. 88 of the CGST
act]
TOPICS 5. Liability of directors of private company [Sec. 89 of the CGST act]
6. Liability of partners of firm to pay tax [Sec. 90 of the CGST act]
7. Liability of guardians, trustees etc. [Sec. 91 of the CGST act]
8. Liability of court of wards etc. [Sec. 92 of the CGST act]
9. Special provisions regarding liability to pay tax, interest or
penalty in certain cases [Sec. 93]
10. Liability in other cases [Sec. 94 of the CGST act]
Question 1
1. LIABILITY TO PAY IN CASE OF TRANSFER OF
BUSINESS [SEC 85 OF THE CGST ACT]
a) Where a taxable person, b) Where the transferee c) Further, if he is a

liable to pay tax under CGST of a business referred to in registered person
Act, transfers his business in sub-section (1) carries on under this Act, he
by sale, gift, lease, leave and such business either in his shall apply within the
license, hire then, own name or in some prescribed time for
 The taxable person and other name, he shall be amendment of his
 Transferee liable to pay tax on the certificate of
Shall, jointly and severally, supply of goods or services registration [Section
be liable to pay the tax, or both effected by him 85(2)].
interest or any penalty due with effect from the date
from the taxable person upto of such transfer [Section
the time of such transfer, 85(2)].

Question 2
2. LIABILITY OF AGENT AND PRINCIPAL [SECTION 86 OF THE CGST ACT]
Where an agent supplies or receives any taxable goods on

behalf of his principal, such agent and his principal shall,
jointly and severally, be liable to pay the tax payable on such
goods under this Act.
3.LIABILITY TO PAY IN CASE OF AN AMALGAMATION/MERGER [SEC 87 OF THE

CGST ACT]
Question 3
c. any two or more of such

companies have supplied
or received any goods or
b. The order is to take services or both to or from
effect from a date earlier each other during the
to the date of the order period commencing on the
and date from which the order
a. Two or more companies
takes effect till the date of
are amalgamated or
the order,
merged in pursuance of an
order of court or of then such transactions of
Tribunal or otherwise and supply and receipt shall be
included in the turnover of
supply or receipt of the
respective companies and
they shall be liable to pay
tax accordingly [Sec 87(1)].
For the purposes of this Act, the said two or more companies shall be treated as
distinctcompaniesfor the period up to the date of the said order [Section 87(2)].
The registration certificates of the said companies shall be cancelled with effect from the date of the
said order [Section 87(2)].

Question 4
4.LIABILITY IN CASE OF COMPANY IN LIQUIDATION [SEC 88 OF THE CGST ACT]
a) Initiation by liquidator of a company of his appointment to Commissioner: When any

company is being wound up whether under the orders of a court or Tribunal or otherwise,
every person appointed as receiver of any assets of a company (hereafter referred to as the
“liquidator”), shall, within 30 days after his appointment, give intimation of his appointment
to the Commissioner [Section 88(1)].
b) Estimation of any tax, interest or penalty payable/likely to become payable by the

company in liquidation by Commissioner: The Commissioner shall,
i. After making ii. Notify the liquidator within iii.The amount which in the
such inquiry or 3 months from the date on opinion of the Commissioner
calling for such which he receives intimation would be sufficient to provide for
information as he of the appointment of the any tax, interest or penalty which
may deem fit, liquidator is then, or is likely thereafter to
become, payable by the company
[Sec 88(2)].
c) Director of a private company to be jointly and severally liable for the payment of such tax,
interest or penalty not recovered: When any private company is wound up and any tax, interest or
penalty determined under CGST Act on the company for any period, whether before or in the course
of or after its liquidation, cannot be recovered, then every person who was a director of such
company at any time during the period for which the tax was due shall, jointly and severally, be
liable for the payment of such tax, interest or penalty.
However, director shall not be so liable if he proves to the satisfaction of the Commissioner
that such non recovery cannot be attributed to any gross neglect, misfeasance or breach of
duty on his part in relation to the affairs of the company [Section 88(3)].

5.LIABILITY OF DIRECTORS OF PRIVATE COMPANY [SEC 89 OF THE CGST ACT]
a) Director of a private company to be jointly and severally liable for the payment of any
tax, interest or penalty due from the company &not recovered:
Notwithstanding anything contained in the Companies Act, 2013,
Then, every person Unless he proves that

Where any tax, the non-recovery
who was a director
interest or penalty cannot be attributed
of the private
due from a private to any gross neglect,
company during
company in respect misfeasance or
such period shall,
of any supply of breach of duty on his
jointly and severally,
goods or services or part in relation to the
be liable for the
both for any period affairs of the
payment of such tax,
cannot be recovered company [Sec. 89(1)].
interest or penalty
b) Director not jointly and severally liable for the payment of any tax, interest or penalty due
from a private company & not recovered, if such private company gets converted into a public
company:
Where a private company is converted into a public company and the tax, interest or penalty in
respect of any supply of goods or services or both for any period during which such company was a
private company cannot be recovered before such conversion, then, nothing contained in sub-
section (1) shall apply to any person who was a director of such private company in relation to any
tax, interest or penalty in respect of such supply of goods or services or both of such private
company.
However, nothing contained in this sub-section shall apply to any personal penalty imposed on
such director [Section 89(2)].

6.LIABILITY OF PARTNERS OF FIRM TO PAY TAX [SEC 90 OF THE CGST ACT]
a. Partners of the firm jointly and severally liable to pay any tax, interest or penalty of the firm:
• Notwithstanding any contract to the contrary and any other law for the time being in force,
where any firm is liable to pay any tax, interest or penalty under this Act, the firm and each of the
partners of the firm shall, jointly and severally, be liable for such payment.
b. Retiring partner liable to pay any tax, interest or penalty of the firm due up to the date of his
retirement:
• Where any partner retires from the firm, he or the firm, shall intimate the date of retirement of
the said partner to the Commissioner by a notice in that behalf in writing and such partner shall
be liable to pay tax, interest or penalty due up to the date of his retirement whether determined
or not, on that date
• However, if no such intimation is given within 1 month from the date of retirement, the liability
of such partner shall continue until the date on which such intimation is received by the
Commissioner.
7.LIABILITY OF GUARDIANS, TRUSTEES ETC. [SEC 91 OF THE CGST ACT]
a. Where the business in respect of which any tax, interest or penalty is payable under this
Act is carried on by any guardian, trustee or agent of a minor or other incapacitated person
on behalf of and for the benefit of such minor or other incapacitated person, the tax,
interest or penalty shall be levied upon and recoverable from such guardian, trustee or
agent.
b. Tax, interest or penalty shall be levied and recoverable in like manner and to the same
extent as it would be determined and recoverable from any such minor or other
incapacitated person, as if he were a major or capacitated person and as if he were
conducting the business himself and all the provisions of this Act or the rules made
thereunder shall apply accordingly.

8.LIABILITY OF COURT OF WARDS ETC. [SEC 92 OF THE

CGST ACT] Question 5
a. Where the estate or any portion of b. Tax, interest or penalty shall be

the estate of a taxable person owning levied and recoverable in like manner
a business in respect of which any tax, and to the same extent as it would be
interest or penalty is payable under determined and be recoverable from
this Act is under the control of the the taxable person as if he were
Court of Wards, conducting the business himself and
(I) the Administrator General, all the provisions of this Act or the
rules made thereunder shall apply
(II)the Official Trustee or accordingly.
(III)any receiver or manager
appointed by or under any order of a
court, the tax, interest or penalty shall
be levied upon and be recoverable
from such person only
9.SPECIAL PROVISIONS REGARDING LIABILITY TO PAY TAX, INTEREST OR

PENALTY IN CERTAIN CASES [SECTION 93]
Question 6, 7
Special provisions regarding liability to pay tax, interest or penalty in
certain cases have been discussed as under:
A. On death of a person liable to pay tax, interest or penalty [Section 93(1)]:
Save as otherwise provided in the Insolvency and Bankruptcy Code, 2016 where a person, liable
to pay tax, interest or penalty under CGST Act, dies, then:
(i) Business is continued after his (ii) Business is discontinued after his death:
death: If the business carried on by the person is
If a business carried on by the person discontinued, whether before or after his
is continued after his death by his death, his legal representative shall be liable to
legal representative or any other pay, out of the estate of the deceased, to the
person, such legal representative or extent to which the estate is capable of
other person, shall be liable to pay meeting the charge, the tax, interest or penalty
tax, interest or penalty due from due from such person under this Act, whether
such person under this Act. such tax, interest or penalty has been
determined before his death but has remained
unpaid or is determined after his death

B. On partition of HUF or AOP [Section 93(2)]:
Save as otherwise provided in the Insolvency and Bankruptcy Code, 2016,
Property of the Then, each Up to the time of Whether such

Where a taxable
HUF or AOP is member/group the partition tax, penalty or
person, liable to
partitioned of members interest has been
pay tax, interest
amongst the shall, jointly and determined
or penalty under
various members severally, be before partition
CGST Act, is a
or groups of liable to pay the but has remained
Hindu Undivided
members, tax, interest or unpaid or is
Family (HUF) or
penalty due from determined after
an association of
the taxable the partition.
persons (AOP)
person under
and
said Act
C. On dissolution of a firm [Section 93(3)]:
2 3 4
1
Where a taxable Such firm is Then, every Up to the time
person, liable to dissolved, person who was of dissolution.
pay tax, interest a partner shall,
or penalty jointly and
under CGST Act, severally,
is a firm, and beliable to pay
the tax, interest
or penalty due
from the firm
under said Act

D. On termination of guardianship or trust [Section 93(4)]:
1 2 3 4 5
where a taxable
person liable to
pay tax, interest
or penalty under Then, if the The ward or the Upto the time of Whether such
this Act, — guardianship or beneficiary shall the termination tax, interest or
trust is be liable to pay of the penalty has been
is the guardian of the tax, interest
terminated, guardianship or determined
a ward on whose or penalty due trust, before the
behalf the from the taxable termination of
business is person guardianship or
carried on by the
trust but has
guardian; or
remained unpaid
is a trustee who or is determined
carries on the thereafter.
business under a
trust for a
beneficiary,
10.LIABILITY IN OTHER CASES [SEC 94 OF THE CGST ACT]
A. Discontinuation of business by a firm/AOP/HUF [Section 94(1)]:
Where a taxable person is a firm/AOP/HUF and such firm, association or family has discontinued
business —
a.The tax, interest or penalty b. every person who, at the time of such discontinuance,
payable under this Act by was a partner of such firm, or a member of such
such firm, association or association or family, shall, notwithstanding such
family up to the date of such discontinuance, jointly and severally, be liable for the
discontinuance may be payment of tax and interest imposed prior to or after such
determined as if no such discontinuance and subject as aforesaid, the provisions of
discontinuance had taken this Act shall, so far as may be, apply as if every such
place; and person or partner or member were himself a taxable
person.

CH.SUDHEER C.A, C.M.A Chapter 21 Offences & Penalties
Chapter 21 OFFENCES &

PENALITIES
1. Penalty for certain offences [section 122]

2. Penalty for failure to furnish information return [section 123]
3. Fine for failure to furnish statistics [section 124]

4. General penalty [section 125]
5. General disciplines related to penalty [section 126]
6. Power to impose penalty in certain cases [section 127]

7. Power to waive penalty or fee or both [section 128]
8. Detention, seizure and release of goods and conveyances in
transit [section 129]
9. Confiscation of goods or conveyances and levy of penalty
TOPICS [section 130]
10. Confiscation or penalty not to interfere with other punishments
[section 131]
11. Punishments for certain offences [section 132]
12. Liability of officers and certain other persons [section 133]

13. Cognizance of offences [section 134]
14. Presumption of culpable mental state [section 135]

15. Relevancy of statements under certain circumstances [section
136]
16. Offences by companies [section 137]
17. Compounding of offences [section 138]

1. PENALTY FOR CERTAIN OFFENCES [SECTION 122] Question 1-5
Sec.122
As per the provisions of sub-section (1) of section 122, there are 21 offences, for which a taxable
person may be held liable to penalty. The list of said offences is as under:
1. Supply of any goods or services or both without issue of any invoice or issue of an incorrect or
false invoice with regard to any such supply;
2. Issue of any invoice or bill without supply of goods or services or both
3. Collects any amount as tax but fails to pay the same to the Government beyond a period of three
months from the date on which such payment becomes due;
4. Collects any tax in contravention of the provisions of this Act but fails to pay the same to the
Government beyond a period of three months from the date on which such payment becomes
due;
5. Fails to deduct the tax in accordance with the provisions of sub-section (1) of section 51, or
deducts an amount which is less than the amount required to be deducted under the said sub-
section, or where he fails to pay to the Government under sub-section (2) thereof, the amount
deducted as tax;
6. Fails to collect tax in accordance with the provisions of sub-section (1) of section 52, or collects
an amount which is less than the amount required to be collected under the said sub-section or
where he fails to pay to the Government the amount collected as tax under sub-section (3) of
section 52;
7. Takes or utilises input tax credit without actual receipt of goods or services or both either fully or
partially, in contravention of the provisions of this Act or the rules made thereunder;
8. Fraudulently obtains refund of tax under this Act;
9. Takes or distributes input tax credit in contravention of section 20, or the rules made there
under;
10. Falsifies or substitutes financial records or produces fake accounts or documents or furnishes any
false information or return with an intention to evade payment of tax due under this Act;
11. Is liable to be registered under this Act but fails to obtain registration;
12. Furnishes any false information with regard to registration particulars, either at the time of
applying for registration, or subsequently;
13. Obstructs or prevents any officer in discharge of his duties under this Act;
14. Transports any taxable goods without the cover of documents as may be specified in this behalf;
15. Suppresses his turnover leading to evasion of tax under this Act;
16. Fails to keep, maintain or retain books of account and other documents
17. Fails to furnish information or documents called for by an officer
18. Supplies, transports or stores any goods which he has reasons to believe are liable to
confiscation under this Act;
19. Issues any invoice or document by using the registration number of another registered person;
20. Tampers with, or destroys any material evidence or document;
21. Disposes off or tampers with any goods that have been detained, seized, or attached under this
Act,

Amount of Penalty
Rs. 10,000/-; Whichever An amount equivalent to, any

or is higher? of the following (applicable as
the case may be)
Tax not Tax not Input tax

deducted under collected under credit availed Refund
Tax section 51 or section 52 or of or passed claimed
evaded short deducted short collected on or fraudule
or deducted but or collected but distributed ntly
not paid to the not paid to the
irregularly;
Government; Government;
Persons who retained the benefit in 1,2,7,9 points : Penalty shall be equal to ITC availed
As per Section 122 (2), any registered person

–
Amount of Penalty
1 If above 21 offences are for any reason, other than Shall be liable to a penalty for–
the reason of fraud or any wilful misstatement or a. ` 10,000/-; or
suppression of facts to evade tax b. 10% of the tax due from such person
Whichever is higher
As per section 122 (3) , penalty may extend to Rs.25000 in any of the following offences committed
1. Aids or abets any of the 3.In any way concerns himself 4.receives or is in 5. Fails to
21 Offences specified in in any way appear before
section 122 (1)  Transporting concerned with the officer of
 Removing the supply of, central tax,
 Depositing services which he when issued
2. Fails to issue invoice in  Keeping knows or has with a
accordance with the  Concealing reasons to believe summon for
provisions of this Act or  Supplying or are in appearance to
the rules made  Purchasing contravention of give evidence
thereunder or fails to Any goods which he knows any provisions of or produce a
account for an invoice in are liable to confiscation this Act or the document in
his books of account, under this Act or the rules rules made an inquiry;
made thereunder; thereunder;

2. PENALTY FOR FAILURE TO FURNISH INFORMATION

RETURN [SECTION 123]
Sec.123
Where a person who is required to furnish information return under section 150, has not
furnished the same may serve upon the defaulting person a notice under section 150(3) requiring
him to furnish the information return within a period not exceeding 90 days from the date of
service of notice.
If the said person still fails to furnish the return within the period specified in notice issued under
section 150(3), proper officer may direct that such person shall be liable to pay a penalty of:
 One hundred rupees for each day of the period during which the
failure to furnish such return continues,
 subject to a maximum of five thousand rupees.
3. FINE FOR FAILURE TO FURNISH STATISTICS [SECTION 124]
Sec.124
If any person required to furnish any information or return under section 151,—
a. Fails to furnish such information or return as may be required under that
section without reasonable cause; or
b. wilfully furnishes or causes to furnish any information or return which he
knows to be false,
 He shall be punishable with a fine which may extend to ten thousand rupees and
 In case of a continuing offence to a further fine which may extend to 100 rupees
for each day after the first day during which the offence continues subject to a
maximum limit of Rs.25,000

4. GENERAL PENALTY [SECTION 125]
Any person, who contravenes any of the provisions of this Act or any rules
made thereunder for which no penalty isseparately provided for in this Act, Sec.125
shall be liable to a penalty which may extend 25,000 rupees.
Question 6
5. GENERAL DISCIPLINES RELATED TO PENALTY [SECTION 126]
The levy of penalty is subject to a certain disciplinary regime which is based on jurisprudence,
principles of natural justice and principles governing international trade and agreements. Such
general discipline is enshrined in section 126 of the Act. According to which –
1.No penalty shall be imposed by 3.No penalty shall be

any officer under this Act for – 2.The penalty imposed imposed on any person
 Minor breaches of tax under this Act shall
regulations, or without giving him an
 Procedural requirements of the depend on the facts opportunity of being heard
law, or and circumstances of i.e. Issue of SCN and proper
 Any omission or mistake in each case and shall be hearing in the matter,
documentation which is easily commensurate with the affording an opportunity to
rectifiable or an error is easily
rectifiable if it is an error degree and severity of the person proceeded against
apparent on the face of record] the breach. is must to rebut the
and made without fraudulent allegations levelled against
intent or gross negligence him,.
4.The officer under this Act

shall while imposing penalty 6.The provisions of this
5.When a person voluntarily
in an order for a breach of section shall not apply in
discloses to an officer under this
any law, regulation or such cases where the
Act, officer may consider this
procedural requirement, penalty specified under
fact as a mitigating factor when
specify the nature of the this Act is either a fixed
quantifying a penalty for that
breach under which the sum or expressed as a
person.
amount of penalty for the fixed percentage.
breach has been specified.

6. POWER TO IMPOSE PENALTY IN CERTAIN CASES [SECTION 127]
For the following cases, penalty shall not be levied under above Section 122-125.
Because these sections have specific penalties under those provisions
Assessment Determination under Determination

Assessment section 73 of tax not under section 74 of
of non- of Summary paid or short paid or tax not paid or short
filers of unregistered Assessment erroneously refunded paid or erroneously
Returns, persons, under or ITC wrongly availed refunded or ITC
under under section 64 or utilized for any wrongly availed or
section 63 reason other than utilized by reason of
section 62 fraud or any wilful fraud or any wilful
misstatement or misstatement or
suppression of facts suppression of facts
Detention, Confiscation of goods or conveyances and levy

seizure and of penalty under section 130 and proper
release of goods officer is of the view that such person is liable
and conveyances to a penalty; he may issue an order levying
in transit under such penalty after giving a reasonable
section 129 opportunity of being heard to such person.
7. POWER TO WAIVE PENALTY OR FEE OR BOTH [SECTION 128]
The Government may, by notification, waive in

part or full, any penalty referred to in section 122
or section 123 or section 125 or any late fee
Sec.128 referred to in section 47 (for delay in filing of
return) for such class of taxpayers and under such
mitigating circumstances as may be specified
therein on the recommendations of the Council.

8. DETENTION, SEIZURE AND RELEASE OF GOODS AND 9. CONFISCATION OF GOODS OR CONVEYANCES AND
CONVEYANCES IN TRANSIT [SECTION 129] & LEVY OF PENALTY [SECTION 130]
Question 7-9
Sec. 68-Inspection of goods in movement
Proper Officer (P.O) asks person in charge of conveyance to produce

Invoice , E-way bill, Delivery Challan etc.
If Person in charge of conveyance (PIC)
Produce relevant Fails to produce

documents relevant documents
P.O may undertake

P.O shall leave
Inspection
conveyance
Procedure for
Inspection is

Step 1
PIC shall record the statement of documents produced in GST MOV-01
Step 2
a. P.O shall issue order for inspection in GST MOV-02
b. P.O shall mention place where the conveyance to be stationed
c. P.O within 24 Hrs. from MOV-02, prepares a report in GST EWB-03 regarding
inspection in movement
No Discrepancies
Found
P.O issues Release Step 3

Order in GST MOV-05 P.O shall conclude inspection proceedings within 3 working days
P.O shall issue Extention shall be granted by commissioner in GST MOV-03 if circumstances
order of warrant & request made by P.O
detention in
Discrepancies After Conclusion of inspection, a report shall be prepared in GST MOV-04
GST MOV-06
Found
P.O shall issue

SCN in MOV-07 Tax means
to Pay Tax + normal GST
Penalty
within 7 days of
seizure Penalty

Penalty
Owner Comes Owner does

Forward not Comes
Forward
Taxable Goods Exempted Taxable Goods Exempted

Goods Goods
Penalty = 200% of Tax Penalty = 2% of Penalty = 5% of Value of

Penalty = 50% of Value of Goods
(Amended by Finance act 2021) Value of Goods (or) Goods
(Earlier 100% of Tax) or 25,000 200% of Tax payable or
25,000
Transporter to pay Penalty equal to

a. Now assesse within 15 days is required to show a cause why above tax & penalty should not be levied 200% of tax or 1 lakh whichever is
b. P.O directs assessee to appear before P.O on DD/MM/YYYY at HH/MM
less
Based on reply P.O shall issue Demand of Tax & Penalty in GST MOV-09

Assessee pays Furnishes security Assessee does not pay Tax +

equivalent to amount Penalty with 15 days from
Tax + Penalty in DRC-03 (or) payable in GST MOV -08 GST MOV-06
Action u/s 130 begins i.e.

Confiscation of goods
P.O issues Release Order
in GST MOV-05
In lieu of Confiscation, SCN

shall be issued to
Assessee in GST MOV-10 to pay Transporter to pay Fine equal to tax

Tax + Penalty equal to 100% of Tax payable + Fine u/s 130 payable on Goods being transported
(Maximum Fine = Value of goods - Tax Amount)
a. Now assesse within 3 months is required to show a cause why Tax + Penalty + Fine should not be levied
b. P.O directs assessee to appeal before P.O on DD/MM/YYYY at HH/MM
Based on reply P.O shall issue Demand of Tax + Penalty + Fine in GST MOV-11

Assessee pays Assessee does not payTax + Transporter does not

Tax + Penalty + Fine in Transporter pays fine in Penalty + Finein DRC-03 payFinewithin 3M from
DRC-03 within 3M from (or) DRC-03 within 3M from GST MOV- GST MOV-11
GST MOV-11 11
Goods shall be confiscated

Conveyance shall be
i.e. title on goods passes to
confiscated
Government
P.O passes release order in
GST MOV-05
Govt. shall auction

Govt. shall auction goods
Conveyance
P.O remit the sale proceeds

Special Points to account of CG
1. In case of unregistered dealers, temporary ID (related by proper officer on GSST
Portal shall be used to pay taxes)
2. First Sec. 129 to be executed& later Sec. 130 to be executed
3. But where P.O is of opinion that movement of goods is being affected to evade
payment of tax, he may directly invoice Sec. 130
4. Redemption Fine u/s 130+ Penalty u/s 129 should be > Tax payable

Qn. Who will be considered as the „owner of the goods

“for the purposes of section 129(1)of the CGST Act?
(Circular No. 76/50/2018 dt.31.12.2018)
Answer
It is hereby clarified that if the invoice or any other specified

documents accompanying the consignment of goods, then
either the consignor or the consignee should be deemed to be
the owner.
If the invoice or any other specified document is not
accompanying the consignment of goods, then in such cases,
the proper officer should determine who should be declared as
the owner of the goods.
Circular Nos. 41/15/2018-GST dated 13.04.2018and 49/23/2018-GSTdated 21.06.2018 –regarding

Further, in case a consignment of goods is accompanied with an invoice or any other specified
document and also an e-way bill, proceedings under section 129 of the CGST Act may not be initiated,
inter alia, in the following situations:
 Spelling mistakes in the name of the consignor or the consignee but the GSTIN, wherever
applicable, is correct;
 Error in the pin-code but the address of the consignor and the consignee mentioned is
correct, subject to the condition that the error in the PIN code should not have the effect of
increasing the validity period of the e-way bill;
 Error in the address of the consignee to the extent that the locality and other details of the
consignee are correct
 Error in one or two digits of the document number mentioned in the e-way bill;
 Error in 4 or 6 digit level of HSN where the first 2 digits of HSN are correct and the rate of tax
mentioned is correct;
 Error in one or two digits/characters of the vehicle number.
Note: In case of the above situations,penalty to the tune of Rs.500/-each undersection 125ofthe CGST
Act and the respective State GST Act should be imposed (Rs.1000/-under the IGSTAct) in FORM GST
DRC-07for every consignment.

10. CONFISCATION OR PENALTY NOT TO INTERFERE WITH OTHER

PUNISHMENTS [SECTION 131]
Without prejudice to the provisions contained in the Code of Criminal Procedure, 1973, no
confiscation made or penalty imposed under the provisions of this Act or the rules made
thereunder shall prevent the infliction of any other punishment to which the person affected
thereby is liable under the provisions of this Act or under any other law for the time being in
force.
Question 10,11
11. PUNISHMENTS FOR CERTAIN OFFENCES [SECTION 132]
Sec.132
According to the provisions of Section 132(1), whoever commits any of the followingoffences,
namely: —
1. Supplies any goods or services or both without issue of any invoice, in violation of the provisions
of this Act or the rules made thereunder, with the intention to evade tax;
2. Issues any invoice or bill without supply of goods or services or both in violation of the provisions
of this Act, or the rules made thereunder leading to wrongful availment or utilisation of input tax
credit or refund of tax;
3. Avails input tax credit using such invoice or bill referred to in clause (b);
4. Collects any amount as tax but fails to pay the same to the Government beyond a period of three
months from the date on which such payment becomes due;
5. Evades tax, fraudulently avails input tax credit or fraudulently obtains refund and where such
offence is not covered under clauses (a) to (d);
6. Falsifies or substitutes financial records or produces fake accounts or documents or furnishes any
false information with an intention to evade payment of tax due under this Act;
7. Obstructs or prevents any officer in the discharge of his duties under this Act;
8. Acquires possession of, or in any way concerns himself in transporting, removing, depositing,
keeping, concealing, supplying, or purchasing or in any other manner deals with, any goods which
he knows or has reasons to believe are liable to confiscation under this Act or the rules made
thereunder;
9. Receives or is in any way concerned with the supply of, or in any other manner deals with any
supply of services which he knows or has reasons to believe are in contravention of any
provisions of this Act or the rules made thereunder;
10. Tampers with or destroys any material evidence or documents;
11. Fails to supply any information which he is required to supply under this Act or the rules made
thereunder or (unless with a reasonable belief, the burden of proving which shall be upon him,
that the information supplied by him is true) supplies false information; or
12. Attempts to commit, or abets the commission of any of the offences mentioned in clauses (a) to
(k) of this section, shall be punishable with the previous sanction of Commissioner, as under:

Offence Involving Amount Involved Punishment Imprisonment

in (Rs.) minimum 6 months in the
absence of special and adequate
reasons to the contrary to be
recorded in the judgment of the
Court and extending to- -)
>5 Crores 5 years and with fine
Exceeds 2 Crores 3 years and with fine
Tax evaded or input tax credit
but≤5 Crores
wrongly availed or utilized or
refund wrongly taken Exceeds 1 Crores 1 year and with fine
but≤2 Crores
Commits or abets the - 6 months or with fine or with both

commission of an offence
specified in clause (f) or clause
(g) or clause (j)
For second and every No Limit 5 Years and with fine
subsequent offence under
section 132
Cognizable vs. Non- cognizable Offence
No Points of Cognizable Offence Non-cognizable

Distinction Offence
1 Meaning Generally, as per Cr. PC, cognizable offence Non-cognizable offence
means serious category of offences in respect of
means relatively less serious
which a police officer has the authority to make
offences in respect of which a
an arrestwithout a warrant and to start an police officer does not have
investigation with or without the permission ofthe authority to make an
a court. arrest without a warrant and
an investigation cannot be
However, GST being a special legislation, only initiated without a court
the officers, duly empowered under the Act can order, except as may be
act as above authorized under special
legislation.
2 Bailable/Non- Non-Bailable Bailable
Bailable

12. LIABILITY OF OFFICERS AND CERTAIN OTHER PERSONS [SECTION 133]
Where any person engaged in connection with

a. The collection of statistics under section 151 or compilation or computerisation thereof
b. If any officer of central tax having access to information specified u/s 150
c. If any person engaged in connection with the provision of service on the common portal
d. The agent of common portal
Wilfully discloses any information or the contents of any return furnished under this Act
or rules made thereunder otherwise than in execution of his duties under the said
sections; or
He shall be punishable with imprisonment for a term which may extend to

6 months or with fine which may extend to 25,000 rupees, or with both.
13. COGNIZANCE OF OFFENCES [SECTION 134]
Sec.134
No court shall take cognizance of any offence punishable under this Act or the rules made
thereunder except with the previous sanction of the Commissioner, and no court inferior to
that of a Magistrate of the First Class, shall try any such offence.

14. PRESUMPTION OF CULPABLE MENTAL STATE [SECTION 135]
In any prosecution for an offence under this Act which requires a culpable mental state on the part of
the accused, the court shall presume the existence of such mental state.
While committing an act, a “culpable mental state” is a state of mind wherein-
The person
The person committing
believes or the act was
has reasons not coerced
The act and its to believe and even
implications that the act overcomes
are understood is contrary hurdles to
& controllable to law. the act
The act is committed;
intentional
It shall, however, be a defence for the accused to prove the fact that he had no such mental state
with respect to the act charged as an offence in that prosecution. As per Explanation (ii) to Section
135, a fact is said to be proved only when the court believes it to exist beyond reasonable doubt and
not merely when its existence is established by a preponderance of probability.
15. RELEVANCY OF STATEMENTS UNDER CERTAIN CIRCUMSTANCES [SECTION 136]
Sec.136
A statement made and signed by a person on appearance in response to any summons issued
under section 70 during the course of any inquiry or proceedings under this Act shall be
relevant for the purpose of proving the truth of the facts which it contains, in any prosecution
for an offence under this Act,–

When the person who made the

statement is examined as a
witness in the case before the
court and the court is of the
When the person who made the opinion that, having regard to
statement is dead or cannot be the circumstances of the case,
found, or is incapable of giving the statement should be
evidence, or is kept out of the admitted in evidence in the
way by the adverse party, or interest of justice.
whose presence cannot be
obtained without an amount of
delay or expense which, under
the circumstances of the case,
the court considers
unreasonable
16. OFFENCES BY COMPANIES [SECTION 137]
Where an offence under this Act has been committed by a taxable person being a company
(means a body corporate and includes a firm or other association of individuals), every person
who, at the time the offence was committed was in charge of, and was responsible to, the
company for the conduct of business of the company, as well as the company, shall be deemed
to be guilty of the offence and shall be liable to be proceeded against and punished accordingly.
However, for an offence that has been committed –
1. With the consent or connivance of, or
2. Is attributable to any negligence on the part of, any director,

manager, secretary or other officer of the company, such director,
manager, secretary or other officer shall also be deemed to be
guilty of that offence and shall be liable to be proceeded against
and punished accordingly. [Sub-Section (1) and (2) of Section 137]

Where an offence under this Act has been committed by a taxable person being a partnership
firm or a Limited Liability Partnership or a Hindu Undivided Family or a trust, the partner or
karta or managing trustee shall be deemed to be guilty of that offence and shall be liable to be
proceeded against and punished accordingly. However, for an offence that has been committed
With the consent or connivance

of, or
Is attributable to any negligence on the part of, any

partner/member/trustee, manager, secretary or
other officer of the partnership firm or a Limited
Liability Partnership or a Hindu Undivided Family or
a trust, such partner/member/trustee, manager,
secretary or other officer shall also be deemed to
be guilty of that offence and shall be liable to be
proceeded against and punished accordingly. [Sub-
Section (3) of Section 137]
Nothing contained in this section shall render any such person liable to any
punishment provided in this Act, if he proves that the offence was
committed without his knowledge or that he had exercised all due
diligence to prevent the commission of such offence. [Sub-Section (4) of
Section 137]
17. COMPOUNDING OF OFFENCES [SECTION 138]
As per the provisions of Section 138(1), Any offence, other than the following, may be
compounded by the Commissioner, either before or after the institution of prosecution, upon
payment of such compounding amount insuch manner as may be prescribed, by the person
accused of the offence, to the Central Government or the State Government, as the case be:

Offence specified in clauses (a) to (f) of sub-section (1) of

section 132, if the person charged with offence had been
1 allowed to compound earlier in respect of any of the
said offences
Aiding/abetting offences specified in clauses (a) to (f) of

2 sub-section (1) of section 132, if the person charged with
offence had been allowed to compound earlier in
respect of any of the said offences;
Any offence (other than the above offences) under this

Act or under the provisions of any SGST Act/UTGST
3 Act/IGST Act, in respect of supplies of value > ` 1 crores, if
the person chargd with offence had been allowed to
compound earlier in respect of any of the said offences;
4 A person who has been convicted for an offence under

this Act by a court;
A person who has been accused of committing an

5 offence under this Act which is also an offence under any
other law for the time being in force;
A person who has been accused of committing an

6 offence specified in clause (g) or clause (j) or clause (k) of
sub-section (1) of section 132; and
7 Any other class of persons or offences as may be

prescribed

Compounding shall be allowed only after making payment of tax, interest and penalty involved in
such offences. Further, any compounding allowed under the provisions of this section shall not
affect the proceedings, if any, instituted under any other law.
COMPOUNDING FEE
The minimum
limit for
compounding
50% of tax
involved, or
Rs. 10,000 amount is to be
the higher of
the following
amounts:-
The upper limit

for
compounding
150% of tax
involved or
Rs. 30,000 amount is to be
higher of the
following
amounts: -
On payment of such compounding amount as may be determined by the Commissioner, no

further proceedings shall be initiated under this Act against the accused person in respect of
the same offence and any criminal proceedings, if already initiated in respect of the said
offence, shall stand abated. [Sub-Section (3) of Section 138]

CH.SUDHEER C.A, C.M.A Chapter 22 Appeals & Revision
Chapter 22
APPEALS AND REVISION
Topics to be dealt in this chapter
1. Appeals to Appellate Authority (AA) [section 107]

A. Appeal by Assessee
B. Appeal by Department
C. Appeal Process followed by AA
D. Appointment of Appellate Authority (AA)
2. Powers of Revisional authority [section 108]
A. Orders which can be revised
B. Fetters to the powers of revision
C. Period to be excluded in computing limitation period of 3 years
3. Appellate tribunal under GST laws [sections 109-111]
A. Constitution and structure of Appellate Tribunal [Section 109]
B. Procedure before Appellate Tribunal[Section 111]
4. Appeal to appellate tribunal [sections 112 & 113]
A. Appeal by the assessee
B. Appeal by the Department
C. Orders of the Appellate Tribunal [Section 113]
D. Rectification of errors [Section 113(3)]
5. Mandatory pre-deposit
6. Production of additional evidence before the appellate authority or the appellate tribunal
7. Appearance by authorised representative [section 116]
8. Appeal to the high court [section 117]
9. Appeal to the supreme court [sections 118 - 119]
10. Sums due to be paid notwithstanding appeal etc. [section 119]
11. Appeal not to be filed in certain cases [section 120]
12. Non appealable decisions and orders [section 121]

22.1
INTRODUCTION
Tax law recognizes that on any given set of facts and laws, there can be different opinions or
viewpoints. Hence, it is likely that the taxpayer may not agree with the “adjudication order” so passed
by the tax officer
India has adopted a dual GST i.e., to say every supply attracting the levy will be leviable to both CGST
and SGST. So, does this mean that if a taxpayer is aggrieved by any such transaction, he will have to
approach both the authoritiesfor exercising his right of appeal? The answer is a plain NO.
The Act makes provisions for cross empowerment between CGST and SGST/UTGST officers so as to
ensure that if a proper officer of one Act (say CGST) passes an order with respect to a transaction, he
will also act as the proper officer of SGST for the same transaction and issue the order with respect to
the CGST as well as the SGST/UTGST component of the same transaction.
The Act also provides that where a proper officer under one Act (say CGST) has passed an order, any
appeal/review/ revision/rectification against the said order will lie only with the proper officers of that
Act only (CGST Act).
So also, if any order is passed by the proper officer of SGST, any appeal/review/revision/rectification
will lie with the proper officer of SGST only.
HIERARCHY OF APPEALS & REVISION
Order passed by Adjudicating Authority (Assessing Officer)
1stAPPEAL to APPELLATE AUTHORITY Order may be Revised by REVISIONAL AUTHORITY
2nd APPEAL to APPELLATE TRIBUNAL 1st APPEAL to APPELLATE TRIBUNAL
Orders passed by Orders passed by

the National / the State Bench /
Regional Area Bench of the
Bench(Issues relating Tribunal
HIGH COURT
SUPREME COURT

22.2
1.APPEALS TO APPELLATE AUTHORITY [SECTION 107]
Question 1, 2
A. Appeal by Assessee
(i) Orders (ii) Time limit for (iii) Form for (iv) Mandatory
appealable to AA filing appeal appeal to AA by pre-deposit for
the assessee filing appeal
An appeal against a A person aggrieved
decision/order by any The appeal to the No appeal can
passed by any decision/order of an AA shall be filed in be filed before
adjudicating Adjudicating GST APL-01 either the AA unless a
authority under the Authority can file an electronically or specified
CGST Act or SGST appeal before the AA otherwise as may amount of pre
Act/UTGST Act lies within 3 months be notified by the deposit is made
before the AA. from the date of Commissioner and by the appellant.
communication of a provisional
It is important to (Refer pg. )
such decision/order. acknowledgement
note that it is only
shall be issued to
the aggrieved The AA can condone
the appellant
person who can file the delay in filing of immediately
the appeal. Also, appeal by 1 month if
the appeal must be it is satisfied that
against a decision there was sufficient
or order passed cause for such delay
under the Act. [Section 107(4)].
Question 3
B. Appeal by Department
At times, the Department itself is not in agreement with the decision or order passed by the
adjudicating authority.
Section 107(2) provides that in such cases, the Department can file what is commonly known as a
“review application/appeal” with the Appellate Authority.

22.3
a b
Orders against which the application can be Time limit for filing the application
filed before the AA
The Commissioner may, by order, direct any
The Commissioner may, on his own motion, or officer subordinate to him to apply to the AA
within 6 months from the date of
upon request from the SGST/UTGST
communication of the decision/order for the
Commissioner, examine the record of any
determination of such points arising out of the
proceedings in which an adjudicating authority said decision/order as may be specified him.
has passed any decision/order under the CGST
Act or SGST Act/UTGST Act to satisfy himself The AA can condone the delay in filing of
appeal by 1 month if it is satisfied that there
about the legality or propriety of the said
was sufficient cause for such delay.
decision/order
d
c
Application to be treated as appeal
Form for application Such application shall be dealt with by the AA as if it
were an appealmade against the decision/order of
The application shall be made in GST APL-03 the adjudicating authority.
either electronically or otherwise as may be
There is no requirement of making a pre-deposit in
notified by the Commissioner.
case of departmentalappeal.
C. Appeal Process followed by AA
Orders of the AA
1. The AA has to follow the principles of natural justice – such as
1. hearing the appellant,
2. allowing reasonable adjournments (not more than 3),
3. permitting additional grounds (if found reasonable), etc.
2. The AA can also make further inquiry and pass its (Order-in-Appeal) which may confirm, modify
or annul the decision/order appealed
3. The AA can also increase the “rigour” of the order appealed against by enhancing any fee or
penalty or fine (But this can only be done after the AA has given to the appellant a reasonable
opportunity of showing cause against the proposed order)
4. The Order-in-appeal shall be a “speaking order”i.e., it shall state the points for determination,
the decision thereon and the reasons for the decision.
5. The law provides an advisory time limit of 1 year from date of filing of appeal for the AA to
decide the appeal. The period of stay ordered by any Court or Tribunal shall be excluded in
computing the period of one year.

22.4
APPEALS TO APPELLATE AUTHORITY {SECTION 107}- Summary
The Commissioner may direct any Any person aggrieved by any decision / order passed by
Office subordinate to him to apply an adjudicating authority passed under the GST laws
to the AA to determine specified
points relating to legality &
propriety of an order of any
Time limit – Within 3 months from the date of
adjudicating authority passed under
the GST laws communication of the said decision / order to the
appellant Delay of 1 month can be condoned by the AA
Time limit – Within 6 months from
the date of communication of the Form of Appeal – GST APL 01
said decision / order Delay of 1
month can be condoned by the AA Deposit of tax, interest, fine, fee and penalty arising
Form of Application – GST APL 03 from the impugned order, as admitted by the appellant
along with 10% of the “tax in dispute”
The AA will give the appellant a chance to be heard
The AA may allow the appellant during the hearing to go in to any ground of
appeal not specified in the grounds of appeal and grant upto 3 adjournments
The AA may confirm, modify, annual the decision or order appealed against after making further
inquiry, as necessary
D. Rule 109A. Appointment of Appellate Authority
If assessee wants to appeal

Decision passed by Appellate Authority
Additional CCT/ JCCT Commissioner (Appeals)
DCCT / Assistant JCCT (Appeals) or above
CCT/Superintendent
If Department wants to appeal

Decision passed by Appellate Authority
Additional CCT/ JCCT JCCT (Appeals) or above
DCCT / Assistant CCT/Superintendent Additional CCT (Appeals)

22.5
2.POWERS OF REVISIONAL AUTHORITY [SECTION 108]
Question 4
A.ORDERS WHICH CAN BE REVISED
a The GST laws also provides for the mechanism of revision, by the Revisional Authority (RA), of
the orders passed by its subordinate officers.
b The RA may, on his own motion, or upon information received by him or on request from the
SGST/ UTGST Commissioner, call for and examine the record of any proceedings. ‘Record’ shall
include all records relating to any proceedings under the CGST Act available at the time of
examination by the RA.
c On examination of the case records, if RA is of the view that the decision or order passed under
the CGST Act/ SGST Act/ UTGST Act by any officer subordinate to him is
 Erroneous, in so far as it is prejudicial to the interest of the revenue, and
 Is illegal or improper or
 Has not taken into account material facts, whether available at the time of issuance of
the said order or not or in consequence of an observation by the Comptroller and Auditor
General of India
d The RA, after giving the person concerned an opportunity of being heard and after making such
further inquiry as may be necessary, pass such order, as he thinks just and proper, including
enhancing or modifying or annulling the said decision or order. ‘Decision’ shall include
intimation given by any officer lower in rank than the RA.
e Every revision order shall be, subject to further appeal to the Tribunal, High Court or Supreme
Court, be final and binding on the parties.
B.FETTERS TO THE POWERS OF REVISION
The RA shall not exercise the power of revision if

a) The order has been subject to an appeal before AA/AT/HC/SC
Exception :The RA may pass an order on any point which has not been decided in an appeal
before the expiry of a period of
(i) 1 year from the date of the order in such appeal or

(ii) 3 years from the date of initial order, whichever is later.
b) The order has already been taken for revision at an earlier stage
c) The period of 6 months (from the date of communication of order) has not yet expired or
more than 3 years have expired after the passing of the decision/order sought to be revised
d) The order sought to be revised is a revisional order in the first place

22.6
Rule 109B
Notice to person and order of revisional authority in case of revision
(1) Where the Revisional

Authority decides to pass (2) The Revisional
an order in revision under Authority shall, along
section 108 which is likely with its order under sub-
to affect the person section (1) of section
adversely, the Revisional 108, issue a summary of
Authority shall serve on the order in FORM GST
him a notice in FORM GST APL-04 clearly indicating
RVN-01and shall give him the final amount of
a reasonable opportunity demand confirmed
of being heard.
Amendment
Who is Revisional Authority?
Decision passed by Revisional Authority
Additional CCT/ JCCT PCCT/ CCT
DCCT / Assistant CCT Additional CCT/ JCCT

22.7
3.APPELLATE TRIBUNAL UNDER GST LAWS [SECTIONS 109-111]

Question 5
A.Constitution and structure of Appellate Tribunal [Section 109]
The law envisages If place of supply is one of the An appeal from the decision of In the absence of a Member in any
constitution of a Two issues in dispute, then the Bench due to vacancy or otherwise, any
the National Bench will lie
tier Tribunal i.e. National Bench/ Regional appeal may, with the approval of the
directly to the Supreme Court
a) National Bench benches of the Tribunal will have President or, as the case may be, the
/Regional Benches and an appeal from the State President, be heard by a Bench of
jurisdiction to hear the appeal.
and decision of the State Bench two Members.
b) State Bench/ Area will lie to the jurisdictional
Benches. If the dispute relates to issues High Court on substantial However, any appeal where the tax or
other than the place of supply, questions of law. ITC involved or the difference in tax or
Jurisdiction of the then the State/Area Benches ITC involved or the amount of fine, fee
two constituents of
will have the jurisdiction to hear or penalty determined in any order
the GST Tribunal is
also defined. the appeal. appealed against, does not exceed `
5,00,000 and which does not involve
any question of law may, with the
approval of the President, be heard by a
bench consisting of a single member.
A diagrammatic representation of the structure of the Appellate Tribunal is shown below.

President - Appellate
Tribunal (Center)
National Bench Regional Bench
Technical Member Tecnical Member Technical Tecnical Member

(Center) (State)
Judicial Member
Member (Center) (State)
President - Appellate
Tribunal (State)
State Bench Area Bench
Technical Technical Member Technical Technical Member

Judicial Member Judicial Member
Member(Center) (State) Member (Center) (State)

B. Procedure before Appellate Tribunal [Section 111]
i. The Appellate Tribunal shall be guided by the principles of natural justice and shall have
power to regulate its own procedure.
ii. The Appellate Tribunal shall have the same powers as are vested in a civil court under the
Code of Civil Procedure, 1908 while trying a suit in respect of the following matters, namely:—
a.Summonin b.Requiring c. d. Issuing e. f.Any other

g and the Receiving commissions Dismissing matter
enforcing discovery evidence for the a which may
the and be
on examination representat
production prescribed.
of affidavits of witnesses ion for
documents or default or
documents deciding it
ex parte
g. Subject to the provisions of h.setting aside any order of

sections 123 and 124 of the Indian dismissal of any representation for
Evidence Act, 1872, requisitioning default or any order passed by it
ex parte
any public record or document or
a copy of such record or document
from any office
iii. Order of the Appellate Tribunal may be enforced in the same manner asif it were a decree
made by a court in a suit pending therein.

22.10
4. APPEAL TO APPELLATE TRIBUNAL (SECTION 112 & 113)
A. Appeal by the assessee
• Any person aggrieved by an order passed against him by an AA

(i) Orders appealable to or RA under CGST Act/SGST Act/ UTGST Act may appeal to the
Appellate Tribunal Appellate Tribunal
• The appeal can be filed before the Appellate Tribunal

within 3 months from the date on which the order sought
(ii) Time limit for filing appeal to be appealed against is communicated to the person
preferring the appeal. (or)
(Condonation of Additional 3
months is permissible) • Date on which the President or the State President, as
the case may be, of the Appellate Tribunal enters office
Amendment
• The appeal shall be filed in GST APL-05 electronically

(iii) Form for filing Appeal
(iv) Power of Tribunal to

refuse to admit an appeal
Question 6
The The amount of

The Appellate difference in fine, fee or
Tribunal can The tax or ITC
involved does tax or ITC penalty
refuse to admit involved does determined by
not exceed `
an appeal if 50,000. or not exceed ` such order does
50,000.or not exceed `
50,000.
(v) Memorandum of
cross objections
It is provided that on receipt of notice that an appeal has been filed (by the appellant), the party against
whom the appeal has been preferred (i.e. the respondent) may file within 45 days a memorandum of
cross-objections in GST APL-06 against any part of the order appealed against and such memorandum
shall be disposed of by the Appellate Tribunal as if it were an appeal presented within the time specified
for the initial appeal. The Tribunal can condone the delay of up to 45 days beyond the specified time
period of 45 days, if it is satisfied that there was sufficient cause for the delay

22.11
D. Appeal by the Department
i. The Commissioner may, on his own ii. The Commissioner may, by order,
motion, or upon request from the direct any officer subordinate to him
SGST/UTGST Commissioner, examine to apply to the Appellate Tribunal
the record of any order passed by the within 6 months from the date on
AA or RA under the CGST Act/SGST Act/ which the said order has been
UTGST Act for the purpose of satisfying passed for determination of such
himself as to the legality or propriety of points arising out of the said order
the said order as may be specified him
vi. Such application shall be

iii. The application shall be made in dealt with by the Appellate
GST APL-07 either electronically or Tribunal as if it were an
otherwise on the common portal. appeal made against the
order of the AA or RA.
v. There is no requirement of making

a pre-deposit in case of departmental
appeal.
E. Orders of the Appellate Tribunal [Section 113]
i. The Tribunal, after hearing both sides may
Pass such orders thereon as it Refer the case back to the AA or to the RA, or to the
thinks fit, confirming, modifying original adjudicating authority, with such directions as
or annulling the decision or order it may think fit, for a fresh adjudication or decision
appealed against or after taking additional evidence, if necessary.
ii. For reasons of natural justice (reasonable opportunity) it is also provided that the Tribunal may, if
sufficient cause is shown, grant up to 3 adjournments to hearing of appeal to either side.
iii. The law provides an advisory time limit of 1 year from the date of filing of appeal for the Tribunal
to decide the appeal.
iv.
The Tribunal shall send a copy of its order
to
AA/RA/Original Appellant Jurisdictional Commissioner or the

adjudicating authority SGST/UTGST Commissioner

22.12
D. Rectification of errors [Section 113(3)]
• The Tribunal b •No amendment which

can correct its has the effect of
own order for enhancing an
any apparent •The Tribunal may amend any order passed assessment or reducing
mistakes but by it so as to rectify any error apparent on a refund or ITC or
the face of the record if such error is otherwise increasing the
it has no
noticed in the order by its own accord, or is liability of the other
power of brought to its notice by the Commissioner party, shall be made,
review. or SGST/UTGST Commissioner or the other unless the party has
party to the appeal within a period of 3 been given an
months from the date of the order. opportunity of being
heard.
a c
5.MANDATORY PRE-DEPOSIT
Question 7-11
Pre deposit Ceiling limit for Appeals
Appeal to AA : 10% of the disputed tax amount

subject to maximum limit of INR 25 crores.
Appeal to AT : 20% of the disputed tax amount

along with the amount deposited u/s 107(6) subject
to maximum of INR 50 crores
Note :Interest on refund of pre-deposit u/s 115 from Date of payment to the date of refund if order
passed by AA/AT in favour of Assessee
Note :For Orders u/s 129(3) i.e.,Inspection during Movement of goods, Minimum Predeposit of 25%
of Penalty is required (Amended by Finance Act ,2021)

22.13
6.PRODUCTION OF ADDITIONAL EVIDENCE BEFORE THE APPELLATE AUTHORITY

OR THE APPELLATE TRIBUNAL
(ii) Rule 112 of the CGST Rules lays down that the appellant shall not be allowed to produce before
the AA or the Tribunal any evidence, whether oral or documentary, other than the evidence
produced by him during the course of the proceedings before the adjudicating authority or, as the
case may be, the AA.
(ii) Exceptions
However, the rule provides exceptional circumstances where the production of

additional evidence before the AA or the Tribunal will be allowed as under:
a. Where the adjudicating authority b. Where the appellant was prevented by sufficient
or, as the case may be, the AA has cause from producing the evidence which he was
refused to admit evidence which called upon to produce by the adjudicating authority
ought to have been admitted; or or, as the case may be, the AA; or
c. Where the appellant was d. Where the adjudicating authority or, as the case
prevented by sufficient cause from may be, the AA has made the order appealed against
producing before the adjudicating without giving sufficient opportunity to the
authority or, as the case may be, the appellant to adduce evidence relevant to any ground
AA any evidence which is relevant to of appeal.
any ground of appeal; or
(iii)No additional evidence shall be admitted unless the AA or the Appellate Tribunal records in writing
the reasons for its admission.
7.APPEARANCE BY AUTHORISED REPRESENTATIVE [SECTION 116]
Any person who is entitled or required to appear before a
a) GST Officer
b) AA may appear through an authorised representative
c) Tribunal
Exception: When Assessee is required to appear personally for examination on oath

22.14
(i) Who can be authorized representative?
1. Relative
2. Regular employee
3. An advocate,
4. CA/ CMA/CS
5. GST Practitioner.
6. Indirect tax gazetted officers can appear as authorised representative after one year
from retirement/resignation.
(ii) Disqualifications for authorized representative
(a) who has been dismissed or removed from Government service; or

(b) who is convicted of an offence under the Current or Earlier Indirect Tax laws
(c) who is found guilty of misconduct by the prescribed authority;
(d) who has been adjudged as an insolvent
Here (a),(b),(c) persons- Always Disqualified

Here (d) – Disqualified during Insolvency continues i.e., after solvency he is Eligible
8.APPEAL TO THE HIGH COURT [SECTION 117]
(i) Appealable orders The law provides that either side (department or party), if aggrieved by any
order passed by the State Bench or Area Bench of the Tribunal, may file an
appeal to the High Court.
The High Court may admit such appeal if it is satisfied that the case involves
a substantial question of law.
(ii) Time limit for filing Appeals to the High Court are to be filed within 180 days from the date on
appeal which the order appealed against is received by the aggrieved person.
However, the High Court has the power to condone the delay on being
satisfied of sufficient cause for the same.
(iii) Form of appeal The appeal shall be filed in GST APL 08.
(iv) Decision of the High  On being satisfied that a substantial question of law is involved, the
Court High Court shall formulate that question, and the appeal shall be
heard only on the question so formulated.
 However, the High Court has the power to hear the appeal on any
other substantial question of law, if it is satisfied that the case
involves such question.
 The Code of Civil Procedure relating to appeals to High Court shall
apply to the appeals before the High Court under this section.

22.15
 The appeal shall be heard by a bench of not less than two judges,
and the points on which they differ, if any, shall, then, be heard,
upon that point only by one or more judges of the High Court. The
final judgment on the point shall be decided by majority of all
Judges who heard the case, including those first heard it.
(v) Pre-deposit of Taxes  Pre-deposit of all tax dues is required to be made;
 Exception: Inherent powers of the High Court have to be invoked
for obtaining a stay pending disposal of the appeal.
(vi) Fresh grounds It can also remand the matter for fresh consideration.
9.APPEAL TO THE SUPREME COURT [SECTIONS 118 - 119]
(i) Appealable orders Any judgment or order passed by the HighCourt, the High Court certifies
to be a fitone, for appeal to the Supreme Court
(ii) Direct Appeal A (direct) appealshall also lie to the Supreme Court from any orders passed
by the National/Regional Bench of the Tribunali.e,
(Place of supply disputes)
(iii) Time limit for filing The provision of the Code of Civil Procedure relating to appeals to the
appeal Supreme Court shall apply to appeals before the Supreme Court
(iv) Pre-deposit of  Pre–deposit of all tax dues will be required
Taxes
 Exception: Stay is obtained from the Supreme Court pending the
disposal of the appeal.
(v) Fresh grounds It can also remand the matter for fresh consideration.
10.SUMS DUE TO BE PAID NOTWITHSTANDING APPEAL ETC. [SECTION 119]
Sums due to the Government as a result of an order passed by the Appellate Tribunal
or the High Court, notwithstanding that an appeal has been preferred to the High
Court or the Supreme Court, shall be payable in accordance with the order so passed

22.16
11.APPEAL NOT TO BE FILED IN CERTAIN CASES [SECTION 120]
Non-filing of appeal/application by a
The Board may, on the recommendations CGST officer on account of such
of the GST Council, issue orders or monetary limits fixed by the Board shall
instructions or directions fixing not preclude such officer from filing
monetary limits for regulating filing of appeal or application in any other case
appeal or application by the CGST officer. involving the same or similar issues or
questions of law.
APPEAL NOT TO BE FILED
The Appellate Tribunal or Court hearing

No person, who is a party in application such appeal or application shall have
or appeal can contend that the CGST regard to circumstances for non-filing of
Officer has acquiesced in the decision on appeal or application by the CGST officer
the disputed issue by not filing an appeal on account of monetary limits fixed by
or application (on account of monetary the Board.
limits).
12.NON APPEALABLE DECISIONS AND ORDERS [SECTION 121]
An order of the Commissioner or

other authority empowered to
direct transfer of proceedings from
one officer to another officer;
An order pertaining to the seizure

or retention of books of account,
register and other documents; or
An order sanctioning prosecution

under the Act; or
An order passed under section 80

(payment of tax in instalments).

22.17
CH.SUDHEER C.A, C.M.A Chapter 23 Advance Ruling
23. ADVANCE RULING
1. Objectives for setting up advance ruling
2. Questions for which Advance Ruling can be sought [sec 97]

3. Authority for advance ruling (AAR) and appellate authority for
advance ruling (AAAR) [sec 96 and 99]
4. Procedure for obtaining advance ruling [section 98]
TOPICS 5. Appeals against order of AAR to the appellate authority [sec 100
& 101]
6. Rectification of mistakes [section 102]
7. Applicability of advance ruling [section 103]
8. Advance ruling to be void in certain circumstances [sec.104]
9. Powers and procedure of AAR and AAAR [section 105 and 106]
Chapter 23

1. Objectives for setting up Advance Ruling

Chapter 23
Chapter 24
Why an assessee should apply for Advance Ruling?
 An advance ruling helps the applicant in planning his activities which are liable for payment of
GST, well in advance.
 It also brings certaintyand transparency in determining the tax liability, as the ruling given by the
Authority for Advance Ruling is binding on the applicant as well as Government authorities.
 Further, it helps in avoiding long drawn and expensive litigation at a later date.
 Seeking an advance ruling is inexpensive and the procedure is simple and expeditious.
 AAR:A legally constituted body called Authority for Advance Ruling (AAR) can give a binding
ruling to an applicant who is a registered taxable person or is liable to be registered.
 AAAR :The advance ruling given by the Authority can be appealed before an Appellate authority for
Advance Ruling (AAAR).
The broad objectives for setting up a mechanism of Advance Ruling are
Provide Attract Pronounce ruling

certainty in tax Foreign Reduce expeditiously in a
liability in Direct litigation transparent and
advance in Investment inexpensive
relation to an (FDI) manner
activity
proposed to be
Qualification and appointment of members of the Authority for Advance Ruling.-The
Government shall appoint officers not below the rank of Joint Commissioner as member of the
Authority for Advance Ruling.

2. QUESTIONS FOR WHICH ADVANCE RULING CAN BE SOUGHT [SEC 97]
Admissibility of
input tax credit
Determination of time of tax paid or Determination of the
and value of supply of deemed to liability to pay tax on any
goods or services or both have been paid goods or services or both
Applicability of Whether
a notification applicant is
issued under required to be
the provisions registered
of CGST Act
Whether any particular

thing done by the applicant
Classification Advance Ruling with respect to any goods
of any goods can be sought or services or both
or services or for the following amounts to or results in a
both questions supply of goods or services
or both, within the
meaning of that term.
Rule 104. Form and manner of application to the Authority for Advance Ruling.-(1)An application
for obtaining an advance ruling under sub-section (1) of section 97 shall be made on the common
portal in FORM GST ARA-01and shall be accompanied by a fee of 5000 rupees
3. AUTHORITY FOR ADVANCE RULING (AAR) AND APPELLATE AUTHORITY FOR ADVANCE
RULING (AAAR) [SEC 96 AND 99]
AAR & AAARis An appeal

Govt shall constituted under the against the
appoint AAAR AAR shall be
AAR constituted constituted SGST Act and not the
officers not CGST Act. This would made by an
under the under the
provisions of below the mean that the ruling applicant on
provisions of a the common
SGST Act shall rank of JC as given by the AAR & AAAR
SGST Act shall portal in FORM
be deemed to member of be deemed to will be applicable only
be the Authority the Authority within the jurisdiction of GST ARA-02and
be the shall be
under CGST Act, for Advance Appellate the concerned state or
2017 also. union territory. accompanied
Ruling. Authority by a fee of
under the CGST Questions on
determination of place Rs.10,000
Act, 2017 also.
of supply cannot be
raised with the AAR or
AAAR.

4. PROCEDURE FOR OBTAINING ADVANCE RULING [SECTION 98]
a The applicant desirous of obtaining advance ruling should make application to AAR in a
prescribed form and manner.
b Upon receipt of an application, the AAR shall send a copy of application to the officer in whose
jurisdiction the applicant falls and call for all relevant records.
c The AAR may then examine the application along with the records and may also hear the
applicant. Thereafter he will pass an order either admitting or rejecting the application.
d Application for advance ruling will not be admitted in cases where the question raised in the
application is already pending or decided in any proceedings in the case of an applicant under
any of the provisions of this Act.
e If the application is rejected, it should be by way of a speaking order giving the reasons for
rejection.
f If the application is admitted, the AAR shall pronounce its ruling within 90 days of receipt of
application. Before giving its ruling, it shall examine the application and any further material
furnished by the applicant or by the concerned departmental officer.
g Before giving the ruling, AAR must hear the applicant or his authorized representative as well
as the jurisdictional officers of CGST/SGST.
h If there is a difference of opinion between the two members of AAR, they shall refer the point
or points on which they differ to the AAAR for hearing the issue. If the members of AAAR are
also unable to come to a common conclusion in regard to the point(s) referred to them by
AAR, then it shall be deemed that no advance ruling can be given in respect of the question on
which difference persists at the level of AAAR.
i A copy of the advance ruling duly signed by members and certified in prescribed manner shall
be sent to the applicant, the concerned officer and the jurisdictional officer.
5. APPEALS AGAINST ORDER OF AAR TO THE APPELLATE AUTHORITY

[SEC 100 & 101]
a. If the applicant is b. In normal c.Any appeal must be filed

aggrieved with the circumstances, the within 30 days from the
finding of the AAR, he concerned officer will be receipt of the advance
can file an appeal with the officer in whose ruling. The Appellate
AAAR. Similarly, if the jurisdiction the Authority may allow for
concerned or applicant is located. an additional 30 days for
jurisdictional officer of Thus, it can be seen that filing an appeal, if it is
CGST/SGST does not a decision of the satisfied that there was a
agree with the finding of Appellate authority is sufficient cause for delay
AAR, he can also file an also treated as an in presenting the appeal.
appeal with AAAR. advance ruling.

d. The e. The f. If members g. The said h. A copy of the advance

appeal has Appellate of AAAR differ authority ruling pronounced by the
to be in the Authority on any point can either
Appellate Authority
GST ARA -02 must pass an referred to in confirm or
should be signed by the
and has to order after modify the
appeal, it shall members, certified in the
be verified ruling
hearing the be deemed prescribed manner, and
appealed
parties to the that no communicated to the
against.
appeal within advance ruling applicant, the concerned
a period of is issued in officer, the jurisdictional
90 days of respect of the officers and to the
the filing of question under Authority.
an appeal. appeal.
6. RECTIFICATION OF MISTAKES [SECTION 102]
a. The law gives power to b. Such mistake may be

AAR and AAAR to amend noticed by the authority
their order to rectify any on its own accord or may
mistake apparent from be brought to its notice
the record within a by the applicant or the
period of 6 months from concerned or the
the date of the order. jurisdictional officer.
c. If a rectification has
the effect of enhancing
the tax liability or
reducing the quantum of
input tax credit, the
applicant must be heard
before the order is
passed.
7. APPLICABILITY OF ADVANCE RULING [SECTION 103]
An advance ruling pronounced by AAR or AAAR shall be binding only on the applicant and on the
concerned officer or the jurisdictional officer in respect of the applicant. This clearly means that an
advance ruling is not applicable to similarly placed other taxable persons in the State. It is only
limited to the person who has applied for an advance ruling.
The law does not provide for a fixed time period for which the ruling shall apply. Instead, it has been
provided that advance ruling shall be binding till the period when the law, facts or circumstances
supporting the original advance ruling have not changed.

8. ADVANCE RULING TO BE VOID IN CERTAIN CIRCUMSTANCES [SEC 104]
a. Section 104 b. If the Authorities c. Consequently, all d. An order e. A copy of the

states the (AAR and Appellate the provisions of the declaring advance order so made shall
circumstances Authority) find that the CGST Act shall apply to ruling to be void be sent to the
under which advance ruling the applicant as if such can be passed applicant, the
the ruling pronounced has been advance ruling had only after hearing concerned officers
would be obtained by the never been made (but the applicant/ and the
considered as applicant/appellant by excluding the period appellant. jurisdictional
void and hence fraud or suppression when advance ruling officer.
would lose its of material facts or was given and up to
binding value. misrepresentation of the period when the
facts, it may, by order, order declaring it to be
declare such ruling to void is issued).
be void ab-initio.
9. POWERS AND PROCEDURE OF AAR AND AAAR [SECTION 105 AND 106]
Any proceeding before the

a) Discovery and authority shall be deemed
Both the
inspection, to be judicial proceeding
authorities are
b) Enforcing the deemed to be a under section 193 and 228
attendance of a person civil court for the and for the purpose of
and examining him on purposes of section 196, of the Indian
oath, and section 195 of the Penal Code, 1860. The AAR
c) Compelling production Code of Criminal and AAAR also have the
of books of account and Procedure, 1973. power to regulate their own
other records. procedure.
Rule 107A Manual filing and processing.–In respect of any process or procedure
prescribed herein, any reference to electronic filing of an applicationinclude manual
filing of the said application, intimation, reply, declaration, statement or issuance of the
said notice, order or certificate in such Forms as appended to these rules
Refer Questions 1-7 for Practice

CH.SUDHEER C.A, C.M.A Chapter 24 Misc.Provisions
Miscellaneous Provisions of
Chapter 24
GST
1. Presumption as to documents in certain cases [Sec 144]

2. Admissibility of micro films, facsimile copies of documents and computer
printouts as documents and as evidence [Sec 145]
3. Power to collect statistics & bar on disclosure of information [Sec’s 151 &
152]
4. Disclosure of information by a public servant [Sec 158]
5. Publication of information in respect of persons in certain cases [Sec 159]
6. Taking assistance from an expert [Sec 153]
7. Assessment proceedings, etc. not to be invalid on certain grounds [Sec 160]
8. Rectification of errors apparent on the face of record [Sec 161]
9. Rounding off of tax etc. [Sec 170]
10. Removal of difficulties [Sec 172]
11. Power of government to make rules & regulations [Sec’s 164 & 165]
12. Laying of rules, regulations and notifications [Sec 166]
13. Delegation of powers [Sec 167]
Topics to 14. Power to issue instructions or directions [Sec 168]

be dealt 15. Omission and repeal of earlier laws [Sec’s 173 and 174]
in this 16. Common portal [Sec 146]
chapter 17. Deemed exports [Sec 147]
18. Special procedure for certain processes [Sec 148]
19. Goods and services tax compliance rating [Sec 149]
20. Power to take samples [Sec 154]
21. Burden of proof [Sec 155]
22. Persons deemed to be public servants [Sec 156]
23. Protection of action taken under this act [Sec 157]
24. Bar on jurisdiction of civil courts [Sec 162]
25. Levy of fee [Sec 163]
26. Service of notice in certain circumstances [Sec 169]
27. Anti-profiteering measure [Sec 171]
28. Application of provisions of central goods and services tax act [Sec 20 of
the IGST Act]
29. Apportionment of tax and settlement of funds [chapter viii of the IGST Act]
30. Administration under GST
31. Manner of determination of commencement and termination of time [Sec 9
of the general

1. PRESUMPTION AS TO DOCUMENTS IN CERTAIN CASES [SECTION 144]
Presumption generally means ‘an act of accepting that something is true until it is proved not true’.
Section 144 lays down the following presumptions when certain DOCUMENTS are submitted as
evidence by the prosecution in a proceeding under the GST Act against any person.
Documents
Produced by any Seized from the custody Received from any place
person under the or control of any person outside India in the
CGST Act or any under the CGST Act or course of any proceedings
other law any other law
Tendered by the prosecution in evidence against such person or

any other person who is tried jointly with such person
As per the Evidence Act, 1872,
a) Contents of a document must be proved by evidence and signature or handwriting of a person on

the document must be proved to be of the person of whom it is alleged to be.
b) A document which is required by law to be attested shall not be used as evidence until at least one
attesting witness has been called for the purpose of proving its execution.
Section 144 enables the court of law to make departure from the above general principles, in respect of
the documents given in the diagram above, and presume:
a) Truth of the b) That the signature which c)Execution or attestation in the

contents of the purports to be in the document has been executed or
document handwriting of any particular attested by the person by whom
person is in that person’s it purports to have been so
handwriting executed or attested
This implies such documents, if the said person claims that the document is not true or not
signed or handwritten by him or not attested by him, the burden of proof shall lie on him.
Further, the Stamp Act, 1899 provides that a document which is not duly stamped shall be
inadmissible in evidence. However, sec 144 allows the Court to depart from such provision by
providing that a document shall be admissible in evidence even if it is not duly stamped.

2. ADMISSIBILITY OF MICRO FILMS, FACSIMILE COPIES OF DOCUMENTS AND

COMPUTER PRINTOUTS AS DOCUMENTS AND AS EVIDENCE [SECTION 145]
‘Document’ has been defined in section 2(41) of the CGST

Act to include written or printed record of any sort and
electronic record as defined in the Information
Technology Act, 2000.
Deemed Documents
Micro film Facsimile copy Computer Information

printout stored
electronically
A
Microfilms are A facsimile is a
statementcont
films containing copy or In any device or
ained in a
microphotographs reproduction of a media,
document and
of a document. document that is including any
included in a
Such images are as true to the hard copies
printed
generally provided original source as made of such
as negatives. material
possible information.
produced by a
computer

Question 1 3. POWER TO COLLECT STATISTICS & BAR ON

DISCLOSURE OF INFORMATION [S. 151 & 152]
Section 151 lays down as under
a) If the Commissioner b) It may be noted that the c) Upon such notification being issued,
considers necessary to do so, statistics can be collected only the Commissioner, or any person
he may direct that statistics be for the purpose of better authorized by the Commissioner in this
collected relating to any matter administration of the Act. behalf may call upon all concerned
dealt with, by or in connection persons to furnish such information or
with the Act. returns as may be specified therein
relating to any matter in respect of
which statistics is to be collected.
Bar on disclosure of information [Section 152]
No information of any individual return with respect to any matter given for the purpose of sections
150 or 151 shall, without the previous consent in writing of the concerned person or his authorised
agent, be published in such manner as to enable any particulars to be identified as referring to a
particular person.
Exception
reporting
No restriction shall apply to the publication of

any information relating to a class of dealers
or class of transactions, if in the opinion of the
Commissioner, it is desirable in the public
interest, to publish such information.

4. DISCLOSURE OF INFORMATION BY A PUBLIC SERVANT [SEC 158]
Section 158 lays down the provisions for disclosure of information as also maintaining the
confidentiality of the same and related penal provisions in the event of contravention of the same.
The following shall be treated as confidential:
(i)
Information/ (i)All particulars (ii)All particulars (iii) All particulars
documents contained in any contained in any record of contained in any
to be treated statement made, evidence given in the record of any
as return furnished or course of any proceedings proceedings under
confidential accounts or under the Act (other than the Act.
[Sec. 158(1)] documents produced proceeding before a
in accordance with
Criminal Court), or
the Act, or
Section 158(3) lays down that notwithstanding anything contained in

section 158, the following information may be disclosed:
 For prosecution
(ii) Exceptions  For carrying out the objects of the Act
to Sec 158(1) -  For service of notice or recovery of demand
Particulars  For furnishing to Court in a proceeding where Government is a party
that can be  For audit of tax receipts or refunds
disclosed [Sec  For inquiry into the conduct of GST officer
158(3)]  For enabling levy/realisation of any tax or duty
 For inquiry into a charge of misconduct by any professional
 For data entry on automated system
 For any other law: Any particulars to an officer of the Government as may be
necessary for the purposes of any other law in force in India; and
 In public interest: Any information relating to any class of taxpayers or class
of transactions for publication, if, in the opinion of the Commissioner, it is
desirable in the public interest, to publish such information.

Question 2
5. PUBLICATION OF INFORMATION IN RESPECT OF
PERSONS IN CERTAIN CASES [S.159]
Section 159 confers powers on the Commissioner for publishing names and
other particulars of persons in certain cases.
What type of information can be The name of any person and any other particulars relating to
published? any proceedings or prosecutions under the Act in respect of
such person.
Who can publish such Commissioner, or any other officer authorized by him in this
information? behalf
What is the manner of publication The information shall be published in such manner as the
of information ? commissioner/authorized officer thinks fit.
When can the information be Such information shall be published if the Commissioner, or
published? any other officer authorized by him in this behalf is of the
opinion that it is necessary or expedient in the public
interest to do so.
Is there any additional In cases of firm, company or association of persons, names of
information which can be the partners of the firm, directors, managing agents,
published? secretaries and treasures or managers of the company, or the
members of the association, as the case may be may also be
published, if in the opinion of the Commissioner/authorized
officer, circumstances of the case justify it.
What is the limitation on No publication under this Sec shall be made in relation to any
publication of information penalty imposed under the Act:
relating to penalty? Until the time for presenting an appeal to the Appellate
Authority under Sec 107 has expired (three months
extendable to further one month) without an appeal
having been presented; or
The appeal, if presented, has been disposed of.
6. TAKING ASSISTANCE FROM AN EXPERT [SECTION 153]
Section 153 enables an officer, not below the rank of Assistant commissioner, to take
assistance of any expert at any stage of scrutiny, inquiry, investigation or any other
proceedings before him. It may be noted that such decision shall be taken having
regard to the nature and complexity of the case and the interest of revenue.

7. ASSESSMENT PROCEEDINGS, ETC. NOT TO BE INVALID ON CERTAIN

GROUNDS [SECTION 160]
Which proceeding The following proceeding done, accepted ,made issued , initiated , or,
are covered under purported to have been done, accepted, made, issued , initiated in
this provision? pursuance of any provision of the Act are covered:
Assessment
Re- assessment
Adjudication
Review
Revision
Appeal
Rectification
Notice
Summons
Other proceeding
On which grounds, Such proceeding shall not be held invalid for mere reasons of :
will such proceeding Mistake
be not held as Defect
invalid? Omission
If such proceeding are in substance and effect in conformity with or
according to the intents, purpose and requirements of the Act or any earlier
law.
When will the service The service of any
of any notice, order, Notice
or communication be Order
not called in Communication
question? Shall not be called in question if:
The notice, order or communication has already been acted upon by
the person to whom it is issued or
When such service has not been called in question at or in the
earliest proceedings commenced, continued or finalized pursuant to
such notice, communication or order.

Question 3
8. RECTIFICATION OF ERRORS APPARENT ON THE FACE OF
RECORD [SEC 161]
Which documents are Decision

covered under Sec.161? Order
Any notice
Certificate
Any other documents
Who can rectify the errors Any authority who has passed or issued any decision or order or
apparent on the face of notice or certificate or any other document may rectify any error
records? which is apparent on the face of record in such documents
What type of mistake or  Errors or mistake which or apparent on the face of record may be
errors can be rectified? rectified.
 Rectification can only be of error apparent from record. It is a
settled law that a decision on a debatable point of law is not a
mistake apparent from the record.
When does the Authority The authority may rectify the mistake/ error:
rectify the Suo moto
mistakes/errors? When such error or mistake is brought to its notice by a GST officer.
When such error or mistake is brought to notice by the affected
person within a period of 3 months from the date of issue of such
decision or order or notice or certificate or any other documents,
as the case may be
What is the time limit for Six months from the date of issue of such decision /
rectification? order/notice/certificate/any other documents
However, such time limit does not apply in cases where the
rectification is purely in the nature of correction of a clerical or
arithmetical error or mistake, arising from any accidental slip or
omission.
What type of precaution Principle of natural justice should be followed by the authority
should be taken at the carrying out such rectification, if such rectification adversely affected
time of rectification? any person.
9. Rounding Off (Section 170)
Tax, interest, penalty, fine, any other sum payable under the provisions of the Act, refund, any other
sum due under the provisions of the Act.
Amount contains part of a rupee consisting of paise, and such part is Increase to one rupee
fifty paise or more
Amount contains part of a rupee consisting of paise, and such part is Ignore such part
less than fifty paise

10. REMOVAL OF DIFFICULTIES [S. 172 of CGST Act & S.25 of IGST Act ]
 Sec 172 lays down the procedure that may be followed by the Government in case of any difficulty
in giving effect to any provision of the Act.
 In such cases, the Central Government may, on the recommendations of the GST Council, by
general or special order publish in the Gazette for the purpose of removing the said difficulty.
 The time limit for making such order shall be 5 years from the date of commencement of the Act.
Every order so made shall be laid, as soon as may be, after it is made, before the Parliament.
11. POWER OF GOVERNMENT TO MAKE RULES &REGULATIONS [S. 164 & 165]
Section 164 empowers the Government to make rules on the recommendations of the GST
Council for carrying out the provisions of the Act. The following are noteworthy in this regard:
a.The Government may b.The rules may also be c. The rules may provide for a
make rules for all or any of issued with retrospective penalty not exceeding Rs. 10,000/-
the matters which by the effect but not from a date for committing breach of any rule.
Act are required to be, or earlier than the date on Section 165 empowers the Board to
may be, prescribed or in which the provisions of make regulations consistent with
respect of which the Act have come into the Act and the rules made
provisions are to be or force. thereunder to carry out the
may be made by rules. provisions of the Act.
Thus, while the rule making power lies with the Government, the regulation making power has
been delegated to the CBIC (Board)
The Central Government and the Board have been vested with the similar powers of making rules
and regulations respectively under sections 22 & 23 of the IGST Act also.

12. LAYING OF RULES, REGULATIONS AND NOTIFICATIONS [SECTION 166]
Section 166 provides that the following delegated legislation under the Act shall be laid before
each house of the Parliament, while it is in session, for a total period of 30 days which may be
comprised in one session, or in two or more successive sessions:
a) Every rule made by b) Every regulation

the Government made by the c) Every notification d) Any modification
Board issued by the be made in the rule
Government If both / regulation /
the Houses agree that notification; or
Similar provisions relating to laying of rules, regulations and notification etc. have also been
prescribed under section 24 of the IGST Act.
13. DELEGATION OF POWERS [SECTION 167]
Section 167 prescribes that the powers conferred on any authority/officer can also be exercised
by another authority/officer, if the Commissioner so directs by way of notification, subject to
such conditions as may be specified in the notification.
14. POWER TO ISSUE INSTRUCTIONS OR DIRECTIONS [SECTION 168]
Section 167 empowers the Board (CBEC) to issue orders, instructions or directions to the CGST
officers for the purpose of uniformity in the implementation of the Act.
All officers and all other persons employed in the implementation of the Act shall observe and
follow such orders, instructions or directions.
The binding nature of such orders, instructions and directions has been a matter of debate and
scrutiny. The general understanding that prevails now is that a circular is binding on the officers,
but not on the assessee. However, in case such circular states something contrary to the law,
the law shall prevail over the circular.

15. OMISSION AND REPEAL OF EARLIER LAWS [SECTIONS 173 AND 174]
Repeal and saving [Section 174]
The following legislations shall stand repealed from July 1, 2017 i.e., the date of
commencement of the CGST Act
• The Central Excise Act, 1944 laid (except in respect of goods included in Entry 84 of Union List
– petroleum crude, high speed diesel, motor spirit, natural gas, aviation turbine fuel, tobacco
and tobacco products)
• The Medicinal and Toilet Preparations (Excise Duties) Act, 1955
• The Additional Duties of Excise (Goods of Special Importance) Act, 1957
• The Additional Duties of Excise (Textiles and Textile Articles) Act, 1978
• The Central Excise Tariff Act, 1985
The repeal under section 174 or amendment under section 173 shall
a. Not affect the previous operation of the amended Act or repealed Acts and orders or anything
duly done or suffered thereunder - No effect on previous position
b. Not affect any right, privilege, obligation, or liability acquired, accrued or incurred under the
previous law - No effect on rights or liabilities under previous law.
c. Not affect any duty, tax surcharge, fine, penalty, interest as are due or may become due or any
forfeiture or punishment incurred or inflicted in respect of any offence or violation committed
against the provisions of the previous law – No effect on tax etc. due under previous law
d. Not affect any investigation inquiry, verification, adjudication and assessment proceedings,
recovery proceedings, other legal proceedings or tax, penalty etc. -No effect on legal
proceedings and tax, penalty etc.under previous law
e. Not Affect any proceedings including that relating to an appeal, review or reference, instituted
before, on or after the appointed day under the previous law – No effect on any appellate
proceeding under previous law.
f. The provisions of Sec 6 of the General Clauses Act, 1897 with regard to the effect of repeal will
apply for repeal provided under Sec 174.

16. COMMON PORTAL [SECTION 146] Question 4
Registration
Other Payment
functions of Tax
and
prescribed
purposes
Furnishing
Electronic of returns
way bill
Computation
and
settlement
of integrated
tax
CBEC has notified www.gst.gov.in as the GST common portal. All the above stated functions shall
be carried out on such common portal.
Refer pg.26.4
17. DEEMED EXPORTS [SECTION 147] also
Goods supplied do not

leave India
Payment for such
supplies is received
either in Indian rupees
or in convertible foreign
exchange
Such goods are
manufactured in India
It may be noted that this provision is

applicable only in case of supply of goods, and
not supply of services.

Deemed exports notified
Section 147 of the CGST Act lays down the provisions for deeming certain supplies as exports. The
following supplies have been notified as deemed exports:
Supply of capital
Supply of goods goods by a
by a registered registered person
person against against Export
Advance Promotion Capital
Authorisation Goods
Authorisation
[Notification No. 48/2017 CT
dated 18.10.2017]
Supply of gold by a
bank or Public Supply of goods
Sector by a registered
Undertaking person to Export
specified in the Oriented Unit
Notification
Supply to Advance authorization holder is a deemed export- Here is amendment is (Not1/2019-CT)
Provided that goods so supplied,

when exports have already been
made after availing input tax credit
on inputs used in manufacture of
such exports, shall be used in Provided further that no such
manufacture and supply of taxable certificate shall be required if input
goods (other than nil rated or fully tax credit has not been availed on
exempted goods) and a certificate inputs used in manufacture of
to this effect from a chartered export goods
accountant is submitted to the
jurisdictional commissioner of GST
or any other officer authorized by
him within 6 months of such
supply,

18. SPECIAL PROCEDURE FOR CERTAIN PROCESSES [SECTION 148]
Section 148 is an enabling provision for prescribing special procedures for

certain processes. The following are noteworthy in this regard:
a) Such procedures shall be b)The conditions and c) The special procedures

prescribed by way of a safeguards and the classes of may be prescribed with
notification issued by the registered persons to whom regard to the following
Government, on such procedures will be matters
recommendations of the applicable shall be stated in
GST Council. the notification itself.
Filing of Payment
Registration Administration
returns of Tax
Question 5
19. GOODS AND SERVICES TAX COMPLIANCE RATING [SECTION 149]
 As per section 149, every registered person shall be assigned a

compliance rating based on the record of compliance in respect of
specified parameters.
 Such ratings shall not be permanent and will be revised from time to
time. The ratings shall be intimated to the taxable person and will
also be placed in the public domain.
 A prospective client will be able to see the compliance ratings of
suppliers and take a decision as to whether to deal with a particular
supplier or not.
 This will create healthy competition amongst taxable persons. It shall
be measured in 10 scale

20. POWER TO TAKE SAMPLES [SECTION 154]
Section 154 authorizes the Commissioner or an officer authorized by him to take

samples of goods from the possession of any taxable person, where he considers it
necessary. Such officer shall provide a receipt for any samples so taken.
21. BURDEN OF PROOF in case of ITC [SECTION 155]
‘Burden of proof’ normally refers to the obligation to prove one’s

assertion. Section 155 lays down that where any person claims that
he is eligible for input tax credit under this Act, the burden of
proving such claim shall lie on such person.
Thus, this provision empowers the officer to presume that a person

is not eligible for input tax credit and it shall be the onus of the
such person to rebut the Department’s contention.
22. PERSONS DEEMED TO BE PUBLIC SERVANTS [SECTION 156]
Section 156 deems all persons discharging functions under the Act as public servants within the
meaning of section 21 of the Indian Penal Code. This implies that all officers shall be governed
by the provisions of Indian Penal Code, wherever so applicable.
23. PROTECTION OF ACTION TAKEN UNDER THIS ACT [SECTION 157]
Section 157 grants immunity to the following persons against legal

proceedings for anything done or intended to be done in good faith:
a)President / Members of the Appellate Tribunal
b)Officers or other employees of the Appellate Tribunal
c)Any other person authorised by the Appellate Tribunal
d)Any officer appointed or authorised under the Act

24. BAR ON JURISDICTION OF CIVIL COURTS [SECTION 162]
Taxes are a civil liability. The basic rule is that every dispute which is civil in nature can be tried by
the Civil Court. However, since tax laws generally provide a specific machinery for appeals in terms
of Tribunals, the jurisdiction of civil courts is barred in tax laws.
Therefore, as per section 162, no civil court shall have jurisdiction to deal with or decide any
question arising from or relating to anything done or purported to be done under the Act.
However, this bar does not apply in case of appeals to High Court and Supreme Court as provided
under sections 117 and 118 respectively.
25. LEVY OF FEE [SECTION 163]
Section 163 provides that a copy of any order or document can be provided to any person on an
application made by him for that purpose after paying a prescribed fee.
26. SERVICE OF NOTICE IN CERTAIN CIRCUMSTANCES [SECTION 169]
Any notice, decision, order, summons, or any other communication under the Act and the related
rules are served on the assessee in consonance with the provisions of section 169. Modes of
service [Section 169(1)] Sub-section (1) of section 169 provides that a notice, decision, order,
summons, or any other communication can be served by any one of the following methods:
Giving/tendering Registered
Regd. Email At common portal
directly post/speed
post/courier
Deemed date of serving [Sec Deemed date of receipt [Sec

169(2)] 169(3)]
When a decision, order, summons,

Every notice or any communication is sent by
decision/order/summons/notice/comm registered post or speed post, it shall be
unication shall be deemed to have been deemed to have been received by the
served on the date on which it is addressee at the expiry of the period
tendered or published or a copy thereof normally taken by such post in transit
unless the contrary is proved.

Question 6,7
27. ANTI-PROFITEERING MEASURE [SECTION 171]
 The burden of indirect taxation ultimately falls on the consumers.

 The concern that benefit of such increased input tax credit may not be passed on by certain entities to the consumers is not unreasonable.
 Section 171 makes it mandatory that any reduction in rate of tax on any supply of goods or services or the benefit of input tax credit shall be
passed to the recipient by way of commensurate reduction in prices.
Anti Profiteering (Section 171)
a) Constitution of the b) Constitution of the Standing Committee c)Appointment, salary, d)Secretary to the
Authority (Rule 122) and Screening Committees (Rule 123) allowances and other Authority (Rule 125)-
The Authority shall consist of,- (1)Standing Committee on Anti-profiteering terms and conditions of An officer not below the
which shall consist of such officers of the CG service of the Chairman rank of Additional
(a) A Chairman or SG and Members of the Commissioner working in
(b) Four Technical Members Authority (Rule 124)- the Directorate General of
(2) A State level Screening Committee shall be
Anti-profiteering shall be
constituted in each State by the State
The Chairman and the Secretary to the
Governments which shall consist of-
Members of the Authority Authority.
(a) One officer of the State Government, to be shall be appointed by the
nominated by the Commissioner, and Central Government on
the recommendations of a
(b) One officer of the Central Government, to Selection Committee to be
be nominated by the Chief Commissioner. constituted for the
purpose by the Council.

e) Power to determine the f) Cooperation g) Confidentiality of information (Rule h) Power to summon persons to give
methodology and procedure with other 130) evidence and produce documents (Rule
(Rule 126)-The Authority agencies or (1) The provisions of section 11 of the 132)
may determine the statutory Right to Information Act, 2005 (22 of (1)Director General of Anti-profiteering, or
methodology and procedure authorities.(Rule 2005), shall apply mutatis mutandis to the an officer authorized by him in this behalf,
for determination as to 131) -Where the disclosure of any information which is shall be deemed to be the proper officer to
whether the reduction in the Director General of provided on a confidential basis. exercise the power to summon any person
rate of tax on the supply of Anti-profiteering whose attendance he considers necessary
goods or services or the deems fit, he may (2) The Director General of Anti-
either to give evidence or to produce a
benefit of input tax credit has seek opinion of any profiteering may require the parties
document or any other thing under section
been passed on by the other agency or providing information on confidential basis
70 and shall have power in any inquiry in
registered person to the statutory to furnish non-confidential summary
recipient by way of authorities in the the same manner, as provided in the case of
thereof and if, in the opinion of the party
commensurate reduction in discharge of his a civil court under the provisions of the
providing such information, the said
prices. duties. Code of Civil Procedure
information cannot be summarized, such
party may submit to the Director General (2) Every such inquiry referred to in sub-rule
of Anti-profiteering a statement of reasons (1) shall be deemed to be a judicial
as to why summarization is not possible. proceedings
i) Decision to be taken by the majority (Rule 134) j) Compliance by the registered k) Monitoring of the
(1) A minimum of three members of the Authority person (Rule 135) order (Rule 136)
shall constitute quorum at its meetings. Any order passed by the The Authority may require
(2) If the Members of the Authority differ in their Authority under these rules shall any authority of central
opinion on any point, the point shall be decided be immediately complied with tax, State tax or Union
according to the opinion of the majority of the by the registered person failing territory tax to monitor
members present and voting, and in the event of which action shall be initiated to the implementation of the
equality of votes, the Chairman shall have the recover the amount u/s 79 order passed by it.
second or casting vote

l) Examination of application by the Standing m) Initiation and conduct of proceedings (Rule 129)
Committee and Screening Committee (Rule 128) (1)Where the Standing Committee is satisfied that there is Anti Profiteering , it shall
(1) The Standing Committee shall, within a period of two refer the matter to the Director General of Anti-profiteering for a detailed
months from the date of the receipt of a written investigation.
application from an interested party examine the (2) The Director General of Anti-profiteering shall conduct investigation and collect
accuracy and adequacy of the evidence provided in the evidence necessary to determine Anti Profiteering
application
(3) The Director General of Anti-profiteering shall, before initiation of the
(2) All applications from interested parties those investigation, issue a notice to the interested parties
forwarded by the StandingCommitteeshall be examined (4) The Director General of Anti-profiteering may also issue notices to such other
by the State level Screening Committee persons as deemed fit for a fair enquiry into the matter.
(3) The Screening Committee shall, within two months (5) The Director General of Anti-profiteering shall make available the evidence
presented to it by one interested party to the other interested parties, participating in
from the date of receipt of a written applicationforward
the proceedings.
the application with its recommendations to the Standing
Committee for further action. (6) The Director General of Anti-profiteering shall complete the investigation within a
period of 6 months of the receipt of the reference from the Standing Committee
&furnish to the Authority, a report of its findings along with the relevant records.

n) Order of the Authority (Rule 133)

(1) The Authority shall, within a period of 6 months from the date of the receipt of the report from the Director General of Anti -
profiteering determine whether there is Anti Profiteering
(2) An opportunity of hearing shall be granted to the interested parties by the Authority where any request is received in writing
from such interested parties.
(2A) The Authority may seek the clarification, if any, from the Director General of Anti Profiteering on the report submitted
under sub-rule (6) of rule 129 during the process of determination under sub-rule (1)
(3) Where the Authority determines that a registered person has not passed on the benefit of the reduction in the rate of tax on
the supply of goods or services or the benefit of input tax credit to the recipient by way of commensurate reduction in prices, the
Authority may order-
(a) Reduction in prices;
(b) Return to the recipient, an amount equivalent to the amount not passed on by way of commensurate reduction in
prices along with interest @ 18% from the date of collection of the higher amount till the date of the return
(c)If Recipient is not found, then transfer 50% of the amount determined to Central Consumer Welfare Fund & Balance
50% to State Consumer Welfare Fund Amendment
(d)Impose of penalty @ 10% of amount so Profiteered(Provided that no penalty shall be leviable if the profiteered
amount is deposited within thirty days of the date of passing of the order by the Authority.)
(e) Cancellation of registration under the Act.
(4) NAAR shall furnish a performance report to the Council by the 10 th day of the close of each quarter
The Authority shall cease to exist after the expiry of 4 yearsfrom the
Tenure of Authority (Rule 137) date on which the Chairman enters upon his office unless the
Council recommends otherwise.

Summary of Anti Profiteering Procedure

Amendments in Anti Profiteering Procedure (section 171) [Notification No.
31/2019 CT dated 28.06.2019]
Online Complaint by Interested parties in
http://www.naa.gov.in/login.php#
1. Time period of 2 2. Screening Committee 3. Time limit for

months available with the to examine issues of completing Standard committee after examining the accuracy
Standing Committee for investigation by DGAP &adequacy of the evidence provided in the
examination of an local nature and those
application forwards it to Screening committee
application under rule 128 forwarded by Standing increased from 3
within 2 months
can be extended up to a Committee within months to 6months
further period of 1 month twomonths
Screening committee sends its recommendations
to Standing Committee within 2 months
5. Time limit for passing
6. Authority may seek
4. Authority empowered the order by the
clarification from DGAP Standing committee now refers matter to
to summonpersons Authority increased from
on hisreport DGAP for detailed investigation
3 months to 6months
DGAP completes the investigation &

report to NAAR within 6 months
7. Investigation of matter other 8. Profiteered amount to
than those covered in report of 9. Tenure of Authority
DGAP (Such investigation/ be deposited in
enquiry shall be deemed to be a Consumer Welfare Fund extended from 2 years to NAAR issues order to within 6 months to
new investigation/enquiry &all 4years (a) Reduction in prices;
the provisions of rule 129 shall along with
(b) Return AP amount to the recipient/CWF
mutatis mutandis apply to such Interest@18%
investigation/enquiry) (c) Penalty @ 10% of AP amount
(d) Cancellation of Registration
Amendment NAAR issues performance Report to GST

council by 10th of each quarter ending

28. COMMON PROVISIONS OF CGST & IGST ACT

[SECTION 20 OF THE IGST ACT]
The following provisions of CGST Act apply to IGST Act also-
Scope of Composite Time and Input tax Tax invoice, Accounts Returns, Job
supply supply & mixed value of Registration credit and other than
credit and records work
supply supply debit notes late fee
Payment Tax deduction at Collection of tax at source Inspection, Demands

[TCS rate under IGST – not Assessment Refunds Audit
of tax source [TDS rate search, seizure and recovery
under IGST – 2%] exceeding 2%] & arrest
Liability to Advance Appeals Presumption Offences Electronic Transitional Miscellaneous provisions including
pay in and as to &penalti the provisions relating to the
ruling commerce provisions
imposition of Interest &Penalty
certain cases revision documents es

29. APPORTIONMENT OF TAX AND SETTLEMENT OF FUNDS [IGST ACT]
a) When IGST credit is b) When IGST credit is c)When IGST credit is

utilised for payment of utilised for payment utilised for payment of
CGST, the amount of UTGST, the amount SGST, the amount
collected as IGST shall collected as IGST shall collected as IGST shall
stand reduced by the stand reduced by the stand reduced by the
amount equal to such amount equal to such amount equal to such
credit. credit. credit
CG shall transfer an CG shall transfer an CG shall transfer the IGST

amount from the IGST amount from the IGST amount so apportioned to
account to the CGST account to the UTGST the account of the
account. account. appropriate SG
Tax wrongfully collected and paid to Central Government or State

Government [Section 19 of the IGST Act]
Section 19 provides that a registered person who has paid IGST on a supply
considered by him to be an inter-State supply, but which is subsequently held
to be an intra-State supply, shall be granted refund of the amount of IGST so
paid. (Assessee has to apply for Refund in GST RFD-01)
A registered person who has paid CGST and SGST/UTGST on a transaction
considered by him to be an intra-State supply, but which is subsequently held
to be an inter-State supply, shall not be required to pay any interest on the
amount of IGST payable.

30. ADMINISTRATION UNDER GST (Section 3 of CGST Act)
A. The Govt shall, by Notification, appoint following officers for the purposes of CGST Act, namely:
a b c d e f g h
PCCCT CCCT Addition Joint Deputy Assistant

PCCT CCT - CCT - CCT - CCT - CCT
PDGCT DGCT
- DGCT - DGCT - DGCT - DGCT
• Any other class of officers as it may deem fit

• However, the officers appointed under the Central Excise Act, 1944 shall be deemed to be
the officers appointed under the provisions of CGST Act.
B. Appointment of officers under CGST Act [Section 4 of the CGST Act]
The Board may, in addition to the officers as may be notified by the Government under section 3
above, appoint such persons as it may think fit to be the officers under CGST Act [Section 4(1)].
Without prejudice to the provisions of section 4(1), the Board may, by order, authorise any officer to
appoint officers of central tax below the rank of Assistant Commissioner of centraltax for the
administration of CGST Act [Section 4(2)].
C. Powers of officers under CGST Act [Section 5 of the CGST Act]
CBIC shall specify the powers & duties: The Board may impose, an officer of central tax may
exercise the powers and discharge the duties conferred or imposed on him under CGST Act
[Sec 5(1)].
Exercise of Subordinate officer Powers & Duties also:An officer of central tax may exercise
the powers and discharge the duties conferred or imposed under CGST Act on any other
officer of central tax who is subordinate to him [Sec 5(2)].
Delegation of powers by Commissioner:The Commissioner may, subject to such conditions
and limitations as maybe specified in this behalf by him, delegate his powers to any other
officer who is subordinate to him [Sec 5(3)].
Appellate Authority have separate Powers:Notwithstanding anything contained in this Sec, an
Appellate Authority shall not exercise the powers and discharge the duties conferred or
imposed on any other officer of central tax [Sec 5(4)].

D. Authorisation of officers of State tax or Union territory tax as proper officer in certain
circumstances [Section 6 of the CGST Act]
1) SGST officers to act as CGST officers : The officers appointed under the SGST Act or the
UTGST Act are authorised to be the proper officers for the purposes of CGST Act , if
Government shall by notification, specifies
2) Orders passed by CGST officers should also contain SGST Act also : where any proper officer
issues an order under CGST Act, he shall also issue an order under the SGST Act or the UTGST
Act
3) Orders passed by SGST officers should also contain CGST Act also : where any proper officer
issues an order under SGST Act, he shall also issue an order under the CGST Act
E. Appointment of officers under IGST Act [Section 3 of the IGST Act]
The Board may appoint such central tax officers as it thinks fit for exercising the powers under IGST
Act.
F. Authorisation of officers of State tax or Union territory tax as proper officer in certain
circumstances [Sec 4 of the IGST Act]
The officers appointed under the SGST Act or the UTGST Act are authorised to be the proper
officers for the purposes of IGST Act, if Government shall, on the recommendations of the
Council, by notification, specify.

G. Jurisdiction of Assessee [Section 6 of the CGST

Act]
1) Recommended by GST Council : The Goods and Services Tax (GST) Council has put in place an elaborate
framework for division of taxpayers between the state and central tax authorities, in a move aimed at
bringing clarity and effectiveness in the administration of the new indirect tax regime.
2) Jurisdiction allotted to either Center or State: The guidelines for the division of the taxpayer base
between the Centre and states will ensure that a taxpayer faces only one GST authority – either the
Centre or the state. "The list of taxpayers will be made public," said an official, adding that this would
clear the air for not just the taxpayers but also the tax authorities.
3) Selection Criteria:
Turnover Jurisdiction
90% of Assessees : Control of States

Turnover ≤ 1.5 crores
10% of Assessees : Control of Centre
Turnover > 1.5 crores The division will be 50:50.
4) Computer stratified random sampling :The division of taxpayers at each state level will be done
randomly by a computer using stratified random sampling to ensure there is no cherry-picking or
selection or exclusion for some other reason or consideration.
5) Action plan by Govt: The government has already set up state-level committees of central and state
officials who will take forward the process of dividing taxpayers. Separately, the government will also
issue notifications to cross-empower state and central tax officials.
6) Practically how to know Jurisdiction:

Step 1: Go to this website - https://services.gst.gov.in/services/searchtp
Step 2: Enter GSTIN
Step 3: Red Colour decides the JURISDICTION

31. MANNER OF DETERMINATION OF COMMENCEMENT AND TERMINATION OF

TIME [SECTION 9 OF THE GENERAL]
Section 9 of the General Clauses Act, 1897 lays down the provision relating to
commencement and termination of time.
 Meaning of Term ‘ FROM ‘ : In simple words, while computing time, the rule
is to exclude the first day and to include the last day. Courts have held that
the word “from” is akin to “after” and that the word “from” if used for the
purpose of and in reference to the computation of time, as for example, from
a stated date, that stated date is prima facie excluded from computation.
 Meaning of Term ‘ MONTH ‘ :Section 3(35) of the General Clauses Act, 1897
defines the expression “month” to mean a month reckoned according to the
British calendar. Where the legislature has stipulated the period of limitation
in terms of months, such a stipulation can only mean a calendar month and
not 30 days.

CH.SUDHEER C.A, C.M.A Chapter 25 REALESTATE SECTOR
REAL ESTATE SECTOR

Chapter 25
TYPES OF CONSTRUCTION PROJECTS & IT’S TAXABILITY
Builder purchasing a Builder entering Works contractor Labour Contractor

Land& Constructs into agreement
flats for the Purpose with L.O
of the Sale & Who provides construction Who only supplies
both L.O, services without purchase of land. labour
Builder Sharing i.e., Land held by Owner & Builder
flats in agreed provides only construction service
Sale During Sale after ratio (i.e. JDA) In this case material cost is
construction completion incurred by Owner only
phase of const Rate of Tax
Refer in
page 25.3
GST liability No GST
Exists @ liability For single Any other case
5%/1%/12% residential unit
Affordable Non
Housing Affordable
No ITC
Exempt Taxable @18%
Tax @ 1% / 5%: No ITC 12% 18%
Tax @ 12% : ITC Eligible under
Notn.12/2017
Follow Rule 42 ITC Eligible
SUDHEER TAX CLASSSES : Contact 8688398888, 9491780817 25.1

TAX RATES IN CASE OF REAL ESTATE SECTOR (w.e.f.01/04/2019)
1% 5% 12% 18%
Affordable a) Non affordable a) Commercial a) Works

residential residential houses complex contractor of
houses commercial &
Non Affordable
housing project
b) Works
b) Commercial house but which
contractor of
is part of residential real estate affordable
project(where commercial housing projects b) Labour
carpet area does not exceed contractor.
15% of total carpet area).
Meaning of Affordable Residential house
Affordable Housing Properties
Metropolitan cities Non-Metropolitan

(Bangalore, Chennai, Delhi, Noida, cities
Ghaziabad, Gurgaon, Faridabad,
Hyderabad, Kolkata, Mumbai)
GST@1% if
a. Carpet area ≤90 Sq. mts. &
GST@1% if b. Cost of flat ≤ 45 Lakhs
a. Carpet area ≤60 Sq. mts. &
b. Cost of flat ≤ 45 Lakhs
90 Sq. Meters = 107.6391 Sq Yards = 968.752 SFT

60 Sq. Meters = 71. 7594 Sq. Yards = 645. 835 SFT
Note 1: On commercial Properties GST@12% (old rate)continues

Note 2: If building-Residential or Commercial or sold after construction then NO GST (old provision only)

TDR & its TAX LIABILITY (w.e.f 01/04/2019)
Supply3
Supply1 Supply2
Builder Customer
Land owner Builder Builder Land owner
(S) Construction of flats(R) (S)Sale of flats(R)
(S) TDR (R)
Shall be regarded as supply It is a supply of service by B to L.O

During construction Construction
phase completed
But this is an exempt supply Value of supply of service =SDV of flats
(Entry 41A/B) Notn. 04/2019 constructed by builder to land owner GST payable=
SC*12%/5%/1% (-) ITC
Upon
At time
But if there are unsold flats lying with This GST is to be paid irrespective of sale of completion
of sale
builder after issuance of CC, then flatland owner to his customers RCM on TDR
GST payable =SDV of unsold flats lying 12%- 5%/1%o unsold flats
with Builder x 5%/1%/18% output utput
rate rate
If land owner sells any If land owner does No
Refer at
flats during construction not sell flats during GST
But this tax is payable by Builder phase (B2B) Construction end of
under RCM ITC-Yes ITC-No supply 1
Land owner should get Tax payable

Whether ITC eligible for Builders registration under GST by L.O = 0
Tax payable by L.O =

5% or 1% -No 18%-Yes Sale consideration *5% /1% /12%
(-) ITC on Tax paid by Builder on construction service.

Amendments in GST in real estate sector (Section 9(4))- RCM
Earlier, the effective rate of GST on real estate sector was 8%/12% with ITC. With effect from
01.04.2019, the effective rates of GST for the new projects have been brought down to a large
extent.
However, the promoters/builders have been given a one-time option to continue to pay tax at the
old rates on ongoing projects (buildings where construction and actual booking both have started
before 01.04.2019) which have not been completed by 31.03.2019.
New effective rates of GST for the new projects by promoters

are as follows
New rate of 1% without ITC on

construction of affordable houses (area New rate of 5% without ITC shall be
60 sq m in metros/ 90 sq m in non- applicable on construction of
metros and value upto `45 lakh)
All houses other Commercial apartments such as shops, offices etc. in

than affordable a residential real estate project (RREP) in which the
houses, and carpet area of commercial apartments is not more
than 15% of total carpet area of all apartments.
Conditions: Above tax rates shall be available subject to following conditions
A. Input tax credit shall not be available.
B. 80% of inputs and input services used in supplying the service shall be purchased from
registered Persons . In case of shortfall, RCM u/s 9(4) @ 18%. However on cement @ 28%
28%: To be paid in Monthly GSTR 3B
18%: To be paid by 30 th June of next year vide DRC-03
Moreover, GST on capital goods shall be paid by the promoter on reverse charge basis, u/s 9(4)
of the CGST Act at the applicable rates
Additional conditions in case of JDA

C. Promotor i.e, Builder is liable to pay GST on construction of houses w.r.t. Landlord share
D. Upon completion of construction, TDR on unsold portion is liable to GST , but under RCM i.e., Tax to be paid by Promotor(Builder)

What a real estate dealer should do upon completion of construction?
Amendments in Rule 42 – In case of assessee under business of

construction (Notn no. 16/2019-CT dt. 29.03.2019)
a. D1 shall be calculated for each project separately

b. E = Aggregate carpet area of apartments which are exempt from tax
F = Aggregate carpet area of apartments in the project
c. E shall include aggregate carpet area of apartments which have not been booked till the
date of issuance of completion certificate or first occupation of project, whichever is earlier
d. While calculating ‘E’, carpet area of apartment on which tax @1%, 5% is to be paid shall also
be included. Because in those cases ITC cannot be availed. If availed, then reversal shall be
made under this rule.
e. D1 & D2 shall be reversed either in GSTR 3B or through GST DRC-03
F. No. 354/32/2019-TRU
Government of India
Ministry of Finance
Department of Revenue
(Tax Research Unit)
Dated the 7th May, 2019, New Delhi

Subject: FAQs on real estate- reg.
A number of issues have been raised regarding the new GST rate structure notified for real estate
sector effective from 01-04-2019. A compilation of Frequently Asked Questions (FAQs) is presented
below. The answers to the FAQs have been given in simple language for guidance and easy
understanding of all stakeholders in the real estate sector. They do not have force of law. In case of
conflict, the gazette notifications, which have legal force, shall haveprecedence.

S.N Question Answer

1. What is a Residential Real Estate A “Residential Real Estate Project” means a „RealEstate
Project? Project” in which the carpet area of the commercial
apartments is not more than 15 per cent. Of the total
carpet area of all the apartments in the project.
2. Does a promoter/ builder have to A promoter shall purchase at least eighty percent. of the
purchase all goods and services value of input and input services, from registered
from registered suppliers only? suppliers. For calculating this threshold, the value of
services by way of grant of development rights, long
term lease of land, floor space index, or the value of
electricity, high speed diesel, motor spirit and natural gas
used in construction of residential apartments in a
project shall be excluded.
3. If value of purchases as prescribed Promoter has to pay GST @ 18% on reverse charge basis
above from registered supplier is on all such inward supplies (to the extent short of 80% of
less than 80%, what would be the inward supplies from registered supplier) except cement
applicable GST rate on such on which tax has to be paid (by the promoter on reverse
purchases? charge basis) at the applicable rate, which at present is
28% (CGST 14% + SGST 14%)
4. What is the rate of GST applicable TDR or FSI or long term lease of land used for
on transfer of development rights, construction of commercial apartments shall attract GST
FSI and long term lease of land? of 18%. The above shall be applicable to supply of TDR or
FSI or long term lease of land used in the new projects
where new rate of 1% or 5% is applicable.
5. Who is liable to pay GST on TDR? The promoter is liable to pay GST on TDR supplied on or
after 01-04-2019 on reverse charge basis.
6. At what point of time, the The liability to pay GST on development rights shall arise
promoter should discharge its tax on the date of completion or first occupation of the
liability on TDR. project, whichever is earlier. Therefore, promoter shall be
liable to pay tax on reverse charge basis, on supply of TDR
on or after 01-04-2019, which is attributable to the
residential apartments that remain un-booked on the
date of issuance of completion certificate, or first
occupation of the project.
7. Whether the option to pay tax at No, there is no option to pay tax at the effective rate of
the applicable effective rate of 12% 12% or 8% with ITC on construction of residential
or 8% (with ITC) is available to the apartments in projects which commences on or after 01-
Promoter in respect of the New 04-2019.
Project, which has been
commenced on or after 1st April
2019?
8. Whether the GST is leviable on the Yes, GST is payable on transfer of development rights by
output supply of Transferrable a developer to another developer or promoter or to any
Development rights by a developer other person under reverse charge mechanism @ 18%
(usually evidenced by TDR with ITC under Sl. No. 16, item (iii) of Notification No.
Certificate issued by the 11/2017 – Central Tax (Rate) dated 28-06-2017

authorities). If yes, under which

entry and at what rate?
9. Can a developer take deduction of No. Valuation mechanism prescribed in paragraph 2 of
actual value of Land involved in the notification No. 11/2017- CTR dated 28.06.2017
sale of unit instead of taking clearly prescribes one- third abatement towards value of
deduction of deemed value of Land land.
as per Paragraph 2 to Notification
No. 11/2017-CTR ?
10. Land Owner being an individual is The term business has been assigned a very wide
not engaged in the business of land meaning in the CGST Act and it includes any trade,
relating activities and thus whether commerce, manufacture, profession, vacation,
the transfer of development rights adventure, or any other similar activity whether or not it
by an individual to a promoter is is for a pecuniary benefit irrespective of the volume,
liable for GST and whether the frequency, continuity or regularity of such activity or
same will fall within the scope of transaction.Therefore, the activity of transfer of
„Supply‟ as defined in Section 7 of development rights by a land owner, whether an
CGST / SGST Act, 2017? Position of individual or not, to a promoter is a supply of service
such a transaction may be clarified subject to GST.
in light of amendments recently
made.
Reverse Charge Mechanism on real estate (w.e.f.01/04/2019)
5B Services supplied by any person by way of transfer of development rights or Floor Promoter
Space Index (FSI) (including additional FSI) for construction of a project by a
promoter on unsold flats by Promoter (However RCM is to the extent of unsold
portion)
5C Long term lease of land (30 years or more) by any person against consideration in Promoter
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 a promoter on unsold flats by Promoter (However RCM is to the extent of
unsold portion)
Exemptions in Notification 12/2017 (W.e.f.01/04/2019)
41A Service by way of transfer of development rights (herein refer TDR) or Floor Space Index (FSI)
(including additional FSI) on or after 1st April, 2019 for construction of residential apartments
by promoter in a project ( Provided that the promoter shall be liable to pay tax at the applicable
rate, on reverse charge basis)
41B Upfront amount (called as premium, salami, cost, price, development charges or by any other
name) payable in respect of service by way of granting of long term lease of thirty years, or
more, on or after 01.04.2019, for construction of residential apartments by a promoter in a
project ( Provided that the promoter shall be liable to pay tax at the applicable rate, on reverse
charge basis)

CH.SUDHEER C.A, C.M.A Chapter 26 IMPORTS & EXPORTS
IMPORTS & EXPORTS

Chapter 26
1. Import of goods under GST
a. As per Sec 7 of IGST Act, it is an Interstate Supply. Hence IGST shall be levied on Imports
b. But IGST shall be levied as per sec 3(7) of Customs Tariff Act.
Particulars ₹
Assessable Value (Customs) XXX
(+) BCD @ (Rate in Customs Tariff Act) XXX
(+) Social Welfare Surcharge @ 10% on BCD XXX
XXX
(+) IGST @ Rate in HSN Code XXX
(+) GST compensation less @ Rate in HSN Code XXX
Landed Value XXX
c. Place of supply in case of Imports u/s 11 is location of importer
d. Negative list (Schedule II):
Imported goods if sold by importer
 Before they reach India (or)

 At customs ware house.
Then GST need not be paid by importer. However buyer if location in India pays GST as
per below point
e. Value for purpose of Levying IGST on Sale at Customs Warehouse
Existing Section 3(8)/3(10) of Customs Tariff Act

Particulars ₹
Assessable Value XXX
(+) BCD XXX
(+) SWC @10% (on BCD) XXX
Assessable value for leving IGST & GST Comp.cess XXX
Note: IGST is levied u/s 3(7) of CTA & GST comp. Cess is levied u/s 3(9) of CTA. But Value is
computed u/s 3(8) of CTA & 3(10) of CTA as mentioned above
New Section 3(8A)/3(10A) of Customs Tariff Act

Buyer is liable to pay IGST & GST compensation cess on
a. Above value u/s 3(8) or
b. Transaction value (i.e new sale price)

Imported by SEZ Exempt

Taxability of goods imported by EOU Exempt upto 31.03.2020
Import as Baggage Baggage Rules applies where BCD @35% + SWS
@ 10% shall be levied
2. Import of Services under GST
Import of Services under GST & its taxability Refer page .4.38
OIDAR Services Refer page. 3.18
3. Export of Goods & Services under GST
Refund in case of Export of Goods /Services Refer pg.14.4 – 14.7

Submission of LUT & its validity Refer pg.14.11 – 14.12
4. Merchant exporter
Merchant
Export
Merchant exporter is a person who is engaged in trading activity. The goods bought for
export or intending to export. He is not involved in any manufacturing activity, he intended
to aggregated suppliers and the exporters.
On implementation of GST the faculty of procurement of good without payment of tax by

the merchant export for export has been dispensed with merchant exports had working
capital issues since they had to buy the goods with tax.
To ease the cash flow subjects to certain condition government brought relief by way of
the notification no. 40/2017- central tax (rate) dated 23.10.2017 subjects to fulfillment if
the certain conditions.

Tax rate on supply to Merchant Exporter
Tax rates would be CGST is 0.05% and CGST is 0.05% for intra –state supply and IGST would be
@0.1% in case of inter-state supply.
Conditions
1. Registered suppliers shall supply the goods to the registrated recipient on a tax
invoice
2. Goods to be export within 90 days from the date of issue of tax invoice
3. Merchant exporter shall mention GSTIN and invoice number of suppliers in
shipping bill.
4. He shall be registered with an export promotion council or a commodity board
recognize by the department of commerce,
5. He shall place Purchase order for producing goods at concessional rate of duty
and send copies of same to the jurisdictional tax officer of the registered supplier.
6. Goods shall be directly moved to port, ICD , airport or land custom station or
where house of port, ICD or LCS from place of registered supplier
7. If he intends to aggregate supplies from multiple resisted suppliers, goods shall
be aggregated at warehouse and then moved for export.
8. Tax invoice and receipt of good in registered warehouse to be issued
9. Shipping bill with GSTIN of suppliers, tax invoice along with EGM to be given to
suppliers and jurisdictional tax office of such suppliers.
Example: A production which is ordinary sold at 12% rate of tax Rate of Tax
Customer 12%
Regular Trade Supplied to 
Merchant Exporter 0.1%

5. Deemed exports
Deemed
Export
While merchant export facility is on procurement, deemed export benefits is on supply.

Export of goods means taking goods out of India to a place outside India. In the transaction
of deemed export the goods do not leave India through the goods are finally meant to be
exported, the payment for such supplies is received in INR.
Benefit of deemed export are like Zero rated supplies with payments of tax, where the tax
component paid would be refunded by the government , overall there is no GST impact on
this supply, notification 47/2017 and 4/2017 of central tax dated 18th Oct 2017 describes
more on these supplies.
Applicability: Following are the DTA supplies to be categorized as deemed export
1. Supply of goods by a registered person against

advance authorization
2. Supply of capital good by registered person against

export promotion capital goods authorization
3. Supply of goods by a registered person to

export oriented unit
4. Supply of good by a bank or public sector under taking
specified in the notification no. 50/2017 customs, dated the
30th June 2017(as amended) against advance authorization.

Refund can be claimed either by
Supplier Recipient
No collection of Tax from Recipient Paid Tax to Supplier
Pay Tax & Claim Refund of Tax under Claim refund of ITC
Rule 89(1) under Rule 89(4A)
Key points of distinction between Merchant exports & Deemed exports
Merchant exports Deemed exports
 Benefit of lower tax procurement to an  Extension of Zero-rated supply benefits to

exporter a domestic trader
 Recipient shall be registered with an export  Supply should be against advance

promotion council or a commodity board authorization or EPCG or to EOU
recognize by the department of commerce
 CONCESSIONAL RATE OF DUTY  Regular rate of tax

(CGST @ 0.05% & SGST @0.05%
OR
IGST @0.1%)
 Conditions exist to charge lower rate of tax  Conditions exist for claiming refund
 This transaction can treated as party exempted  Either the supplier or recipient can claim
supplies and are not to be included as exempts refund of the taxes paid
supplies for the purpose of rule 42.

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CH.SUDHEER C.A, C.M.

CHAPTER TITLE No.of Pages

SUDHEER TAX CLASSES, CONTACT: 8688398888 - 9491780817

SUDHEER TAX CLASSES, CONTACT: 8688398888 - 9491780817

Chapter 1 INTRODUCTION &

State levies to subsumed

Taxable event - is the supply of goods or services or both

SUDHEER TAX CLASSES CONTACT: 8688398888, 9491780817 1.1

Broadly there will be 2 forms of GST in India.

Imports shall be considered as inter-state supply.

Exports shall be zero rated.

Supplies to SEZ will be Zero-rated

Supply of Goods or Services

Within the State Within Union Outside the State or

CGST+ SGST CGST+ UTGST IGST (Equal to

SUDHEER TAX CLASSES CONTACT: 8688398888, 9491780817 1.2

INVOICES UNDER EARLIER AND CURRENT SYSTEMS

Before Introduction of GST After Introduction of GST

1. Issue of invoice by Manufacturer

Sales Value 1,00,000

3. Issue of Invoice by Service Providers

Service Value 1,00,000 Sales Value 1,00,000

SUDHEER TAX CLASSES CONTACT: 8688398888, 9491780817 1.3

Article 246 It gives the respective authority to Union and State

Article 246A (Newly Inserted)

(1) Notwithstanding anything (2)Parliament has exclusive power

SUDHEER TAX CLASSES CONTACT: 8688398888, 9491780817 1.4

Rates for levy of GST

Article 279A of the Constitution empowers the President to constitute a joint

2 The goods and services that may be subjected to or exempted

4 Model GST laws, principles of levy, apportionment of IGST and

5 The threshold limit of turnover below which the goods and

7 Any special rate or rates for a specified period to raise additional

8 Special provision with respect to the North East States, J&K,

SUDHEER TAX CLASSES CONTACT: 8688398888, 9491780817 1.5

Decisions be taken by GST Council

Every decision of the GST Council shall be taken at a meeting by a majority

Goods and services be classified under GST regime

HSN (Harmonized System Services Accounting Code

SUDHEER TAX CLASSES CONTACT: 8688398888, 9491780817 1.6

GENESIS OF GST IN INDIA

SUDHEER TAX CLASSES CONTACT: 8688398888, 9491780817 1.7

COMMODITIES PROPOSED TO BE KEPT OUTSIDE THE PURVIEW OF GST

Five petroleum products

Why is Dual GST required?

Value added Continuous Burden borne No cascading

SUDHEER TAX CLASSES CONTACT: 8688398888, 9491780817 1.8

NEED FOR GST IN INDIA

Non-inclusion of several local Cascading of taxes on account of (i) levy of Non-VAT

No CENVAT after Double taxation of a

How to avail INPUT TAX CREDIT UNDER GST

ITC on account of IGST Payable CGST Payable SGST Payable

(III) ITC on account of IGST to be completely exhausted mandatorily

SUDHEER TAX CLASSES CONTACT: 8688398888, 9491780817 1.9

Changes in Availment of ITC-New section 49B & New rule 88A

1 ITC of IGST should first be utilized towards payment of IGST.

ITC of CGST, SGST/UTGST can be utilized towards payment of IGST, CGST,

CGST 300 200