VIVA VOICE QUESTIONS FOR THEORY & PRACTICE OF GST

1. What is GST?
Ans: Goods and Services Tax, is an indirect tax imposed on the supply of goods and
services. It is a destination based tax & unified tax system that replaced multiple indirect taxes
levied by both the Central and State Governments.

2. What is GSTN?
Ans: Goods and Services Tax Network (GSTN) has built Indirect Taxation platform for GST to
help taxpayers in India to prepare, file returns, make payments of indirect tax liabilities and
do other compliances.
3. What is GSTIN?
Ans: GSTIN, an abbreviation for Goods and Services Tax Identification Number, consists of a
distinct 15-digit identification code allotted to each taxpayer (mainly dealers, suppliers, or
any business entity) registered under the GST regime.
4. What are the components of GST?
Ans: There are 4 components of GST such as CGST, SGST, IGST, and UTGST. So, the kind of
tax to be paid under GST depends on whether the nature of supply is inter-state and intra-
state.

5. What is supply under GST?

Ans: a taxable event is called a Supply. For an event to be considered as a supply by the
government, it should have the following characteristics. Supply should be of goods or
services for consideration . Supply should be taxable. Supply should be made by a taxable
person.
6. Types of Supply under GST
 Mixed supply
 Composite supply
 Taxable Supply
 Deemed supply
 Zero rated supply
 Exempted supplies
 Outward &Inward Supply
7. What is mixed supply and composite supply?
Ans:
Mixed supply: A mixed supply is two or more independent products or services which are
offered together as a bundle but can also be sold separately. In a mixed supply, the item or
service with the highest GST rate is applicable on that unit of supply transaction.

Examples of Mixed Supply

1. Gift Package comprises chocolates, fruit juice, fruits, sweets, dry fruits, aerated drink,
etc sold at a single price. Since the items are not naturally bundled together and can
 be sold separately, this is a mixed supply. The aerated drinks attract the highest GST
rate of 28% and thus the tax rate for the entire gift package would be 28%.
2. Buy 1 Get 1 Free Sale – On buying one item, the other item is free. Since the items are
not naturally bundled together and can be sold separately, this is a mixed supply. The
GST rate applicable to this sale is the higher GST rate.

Composite supply: Composite supply means a supply is comprising two or more

goods/services, which are naturally bundled and supplied in with each other in the ordinary
course of business, one of which is a principal supply. It means that the items are generally
sold as a combination. The items cannot be supplied separately.
Examples of Composite Supply

1. Hotel Services – accommodation services and breakfast. These services are generally
provided as a combination and thus is considered a Composite Supply.
Accommodation service is the principal supply.
2. Booking a train ticket – transport services including meals. These services are
generally provided as a combination and thus is considered a Composite Supply.
Transport service is the principal supply.

8. What is Intra state and Inter state Supply under GST?

Ans:
Intra state supply of goods or services is when the location of the supplier and the place of
supply i.e., the location of the buyer are in the same state. In Intrastate transactions, a seller
has to collect both CGST and SGST from the buyer.

Interstate supply of goods or services is when the location of the supplier and the place of
supply are in different states. Also, in cases of export or import of goods or services or when
the supply of goods or services is made to or by an SEZ unit, the transaction is assumed to
be interstate.

9. What is Deemed Supply under GST?

Ans Deemed supply under GST - deemed supply is a type of supplies under GST in which
there is inadequate or no consideration for the supply of goods and services received. This
type of supply under GST is also known as barter supplies.

10. What is Composition Scheme?

Ans Composition schemes are voluntary schemes available for small businesses with annual
turnovers up to Rs. 1.5 crore who can opt for fixed tax rates instead of regular GST rates.
These schemes have less compliance requirements, making it easier for small businesses to
operate. The drawback for composite dealers is that they don’t get ITC benefit.

11. What is the process of registration in GST?

Ans
 Step 1: Visit the official GST Portal at www.gst.gov.in.
Step 2: Select 'Services' under Services tab and Click on 'Registration'.
Step 3: Now, Click on "New Registration" and enter all the requested details like valid email
address, mobile number and a PAN for the business.

12. What is the threshold limit for GST Registration?

Ans: Businesses with an annual aggregate turnover of more than Rs. 40 lakhs (Rs. 20 lakhs
for businesses in some special category states i.e., North East states (11)) are required to
register for GST.

13. What is Annual Aggregate Turnover (AATO) under GST?

Ans: “aggregate turnover” refers to the aggregate value of all taxable supplies (excluding
the value of inward supplies on which tax is payable by a person on Reverse Charge
Mechanism (RCM) basis), exempt supplies, exports of goods or services or both and inter-
state supplies of persons having the same Permanent Account Number (PAN) computed on
an all-India basis.

14. What is RCM?

Ans: The Reverse Charge Mechanism (RCM) is the process of GST Payment by the receiver
instead of the supplier. In this case, the liability of tax payment is transferred to the
recipient/receiver instead of the supplier.
15. Define Goods under GST.
Ans: Section 2(52) of CGST Act 2017 defines “goods” means every kind of movable property
other than money and securities but includes actionable claim, growing crops, grass and
things attached to or forming part of the land which are agreed to be severed before supply
or under a contract of supply.

16. Define Services under GST.

Ans: Section 2(102) of CGST ACT, 2017 - “services” means anything other than goods,
money and securities but includes activities relating to the use of money or its conversion by
cash or by any other mode, from one form, currency or denomination, to another form,
currency or denomination for which a separate consideration is charged.
17. Importance of Time of Supply
Ans: In order to calculate and discharge tax liability it is important to know the date when the
tax liability arises i.e. the date on which the charging event has occurred. In other words it
determine when the taxpayer is liable to pay taxes.
18. Importance of Place of Supply.
Ans: The place of supply determines whether a transaction is intra-state, inter-state, or
import-export. This in turn determines which taxes apply: a combination of central (CGST)
and state (SGST) taxes, or an integrated tax (IGST), with or without additional duties
 19. What is RNR?

 Ans: RNR is the rate at which tax revenue remains the same despite giving credit
of duty paid on inputs and other factors.
 It is the rate of tax that allows the Government to receive the same amount of
money despite changes in the tax laws.
20. Difference between nil rated, zero rated, exempted supply and Non- GST supply.

Subjected ITC
Supply Supply Type Examples
GST eligibility

Grains, Salt, Jaggery,

Nil Rated 0% Everyday items No
etc.

Bread, Fresh fruits,

Exempted – Basic essentials No
Fresh milk, Curd, etc.

Overseas supplies, Supply to Special

Zero
0% Economic Zones (SEZ) or SEZ Yes –
Rated
Developers

Supplies towards which no GST is

Non-GST – No Petrol, Diesel etc.
applicable but draws additional taxes

21. What is GST Council.?

Ans: Goods & Services Tax Council (GST Council) is a constitutional body for making
recommendations to the Union and State Government on issues related to Goods and
Service Tax.
22. What are HSN and SAC Codes?
Ans: The Harmonized System of Nomenclature (HSN) is an internationally accepted method
of naming, classifying and identifying products. HSN codes are used to classify goods to
calculate GST.
HSN code is a 6-digit uniform code that classifies 5000+ products and is accepted
worldwide. It was developed by the World Customs Organization (WCO) and it came into
effect from 1988

SAC – stands for Services Accounting Codes

SAC is used to classify services under the GST regime. It is a standard set of codes issued by
the CBEC (Central Board of Excise and Customs)
SAC is strictly numeric and is 6 digits. The first two digits are same for all services i.e. 99, the
next two digits represent the major nature of service and the last two digit represent
detailed nature of service.
 23. What is ITC?
Ans: Input Tax Credit or ITC is the tax that a business pays on a purchase and that it can use
to reduce its tax liability when it makes a sale.
In other words, businesses can reduce their tax liability by claiming credit to the extent of
GST paid on purchases. Goods and Services Tax (GST) is an integrated tax system where
every purchase by a business should be matched with a sale by another business. This makes
flow of credit across an entire supply chain a seamless process.
EXAMPLE OF ITC

24. What is the difference between Bill of Supply and Tax Invoice.

Tax Invoice Bill of supply

It is issued in case of taxable supply. It is issued in case of

exempt supply.

Input Tax Credit can be issued on the basis of Tax Input Tax credit cannot
Invoice. be claimed on the basis
of Bill of Supply.

Amount of tax & rate of tax is mentioned on Tax Invoice. Amount of tax & rate of
tax not mentioned on
Bill of supply.

Composition dealer cannot issue a Tax invoice. Composition dealer

issue Bill of supply.

In case the recipient is unregistered and value of supply No such information is

is more than Rs. 50,000, in that case following required in case of Bill
 information is mandatory on invoice : of supply

 Name & address of recipient

 Address of delivery
 Name of state and its code

25. Debit Note and Credit Note under GST

Ans: Section 34 of CGST Act, 2017 primarily address the issuance of debit note
& credit note
A debit note in GST is a document issued by the supplier in the following
cases: Increase in Taxable Value -When a supplier requires to increase the taxable
value of a supply, he/she has to issue a debit note to the recipient.
A Debit Note is also known as supplementary Invoice

A GST Credit Note is a document issued by a registered taxpayer to adjust or reduce

the tax liability due to errors or omissions in the original tax invoice. It includes
information about the original invoice, the amount credited, and the reason for
issuing the credit note
26. What is GST Return or Report?
Ans: GST return is a document that will contain all the details of registered persons
sales, purchases, tax collected on sales (output tax), and tax paid on purchases (input
tax).