CHAPTER - 1.

GST IN INDIA-AN INTRODUCTION

GENESIS OF GST IN INDIA a Deficiencies in the value added taxation system
1
The Constitution The Constitution (122nd Cascading of taxes on account of (i) levy of NonVATable CST and (ii)
In the year 2000, the then Prime Minister introduced
(122nd Amendment) Amendment) Bill was introduced inclusion of CENVAT in the value for imposing VAT
the concept of GST and set up a committee to design
Bill was introduced in in the Lok Sabha.
a GST model for the country.
2006 the Lok Sabha. Sep 2016
No CENVAT after manufacturing Non-integration of Double taxation of certain transactions as
stage VAT & service tax both goods and services
Announcement by 2014 The
Union Finance Constitution
Minister, during GST Council (101st
GST Council budget of 2006-07 Recommends Amendment
recommends that GST would be CGST, SGST, ) Act was
all the rules. introduced from 1 IGST, UTGST & enacted
April 2010. Compensation Cess
Bills.
Apr 2017 Sep 2016

Mar 2017 Mar 2017

CGST, IGST, 1st GST
UTGST and Council
All States Compensation Cess Meeting
except J & Acts passed.
K passed b GST – A cure for ills of existing indirect tax regime
30th June 2017
their SGST
Act 1st July 2017 8st July 2017
Journey continues GST – A cure for ills of existing indirect tax regime

GST launched SGST Act passed

by J&K; CGST and
IGST Ordinances
promulgated to
extend GST to A continuous chain of set-off from the
A comprehensive tax structure which integrates
original producer’s point/ service provider’s
J&K. taxes on goods and services thereby removing
point upto the retailer’s level/ consumer’s
cascading effects of CENVAT and service tax
level
2 NEED FOR GST IN INDIA
3 FRAMEWORK OF GST AS INTRODUCED IN INDIA
I. Concurrent Dual GST Model

Power granted to both

Centre also has the
Deficiencies A cure for the Centre and the
Adopted due to unique power to tax intra-
in the ills of States to concurrently
erstwhile have led to
Goods and
erstwhile
Federal Structure of State sales & States
Services Tax tax the complete supply
value added indirect tax India are also empowered to
chain from production to
taxation regime tax services.
distribution

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 CHAPTER - 1. GST IN INDIA-AN INTRODUCTION

II. Classification based on HSN III. GST Common Portal

Common GST Electronic Portal www.gst.gov.in

Classification determines the rate of tax applicable on a particular

supply of goods/services.
Functions of GSTN include
a website
managed
by Goods set by the
providing matching
Schedules of rate notification for goods under GST are based on First and Government providing
to establish a analysis of tax
Schedule to the Customs Tariff Act, 1975 Services of various MIS facilitating
uniform payment computation
Network taxpayers reports to the forwarding registratio
interface for details and
(GSTN) [a ' profile Central and the returns n
the tax payer with settlement
wholly the State to Central
and a common banking of IGST
owned Governments and State
and shared network
Government based on the authorities
Company] IT taxpayer
Indian Customs Tariff is based on HSN. infrastructure return
between the information
Centre and
States

HSN stands for Harmonized System of Nomenclature.

IV. GST E-way bill system

HSN is a multipurpose international product nomenclature developed by

managed by the
the World Customs Organization (WCO) for the purpose of classifying
National Informatics
goods across the World in a systematicmanner.
Centre, Ministry of
Electronics &
Information
Technology,
Under HSN, each product is identified by a 6 digit code which can be Government of India
extended.
common GST
Electronic Portal
www.ewaybillgst.gov
.in

India has extended the HSN codes upto 8-digits.

Electronic Portal
for furnishing
electronic way bill

Chapter 99 of the Tariff has been assigned to Services.

V. GST Invoice Registration Portal

• website for reporting of e-invoices by the notified persons

(with aggregate turnover more than ₹ 5 crore in preceding
Invoice Registration Portal (IRP) FY from 2017-18 onwards )
• managed by the National Informatics Centre, Ministry of
Electronics & Information Technology, Government of India

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 CHAPTER - 1. GST IN INDIA-AN INTRODUCTION

VI. GST Compensation Cess 5 Within GST or outside GST?

Objective is to provide for Levied on Specified LUXURY

levied under Goods and Services Tax Alcohol for human consumption Power to tax remains with the State.
compensation to the States for the items/DEMERIT goods, eg: pan
(Compensation to States) Cess Act,
loss of revenue arising on account of masala, tobacco, aerated waters,
2017
implementation of the GST. motor cars, etc,

five petroleum produces -crude

Initially levied till 30th June, 2022.
oil,diesel,petrol natural gas and ATF

Extended till 31st March, 2026 since

Levied on on value of supply Initially levied till 30th June, 2022. States have not yet been fully Power to tax remains with the local
Entertainment tax levied by local
compensated. bodies
bodies

4 TAXES SUBSUMED IN GST Tobacco Within the purview of GST.

Power to levy excise duties, also
Central Taxes State Taxes retained.

• State surcharges and cesses in so

6 BENEFITS OF GST
• Central Excise Duty & Additional
far as they relate to supply of

G
Excise Duties Benifits of Economy To create a unified common national market
• Service Tax goods & services To boost "Make in india campaign and india as a
• Excise Duty under Medicinal & • Entertainment Tax (except those "Manufacturing hub
Toilet Preparation Act, 1955 levied by local bodies) To boost Investments and Exports
• CVD & Special CVD • Tax on lottery, betting and To generate mare employment by increased activity
• Central Sales Tax gambling Entry Tax (All Forms) &
Advantages for Trade and Seamless flow of tax credit from manufacturer/supplier to
Purchase Tax VAT/ Sales tax
• Central surcharges & Cesses in so Industry user retailer to eliminate cascading of taxes.
far as they relate to supply of • Luxury Tax
More efficient neutralisation of taxes to make our exports
goods & services • Taxes on advertisements

S
more competitive Internationally.
Benefit of exemption compounding scheme for a large
segment of small scale suppliers to make their products
cheaper
Common procedures for registration, duty payment, return
filing and refund of taxes
Simplified Tax Structure Reduction in multiplicity of taxes now leviable on goods and
services leading to simplification

T
Simpler tax regime with fewer exemptions
Harmonisation of laws, procedures and rates of tax across
the country.
Common system of classification of goods and services to
ensure certainty in tax administration.
Tax Compliance Easy Greater use of IT will reduce human interface between tax
payer and tax administration.
Automated procedures for processes N registration, returns,
tax payments. refunds and credit verification.
Doing Business eased as multiple records to be maintained
for various takes.
Compliance burden to come down with or pon-India tax
replacing multiple taxes.

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 CHAPTER - 1. GST IN INDIA-AN INTRODUCTION

CONSTITUTIONAL PROVISIONS Constitution (101st Amendment Act), 2016

7 c
Concurrent powers on Parliament and State Legislatures to make laws governing taxes on goods and services.

25 Parts
(containing
GST to be levied on supply of all goods and services except alcoholic liquor for human consumption.
448 articles)
Preamble

Article 279A of the Constitution empowers the President to constitute GST Council.

12
schedules
GST to be leviable on Petroleum Crude, High Speed Diesel, Petrol, Natural Gas and Aviation Turbine Fuel, from
a date to be notified.

Centre to retain power to levy excise duty on above products as well as tobacco.

Compensation to States to be provided for loss of revenue on account of introduction of GST.

Constitution of India

Article 246A- Power to make laws with respect to GST

a Power to levy and collect taxes whether, direct or indirect, emerges from the Constitution of India. d
Power is granted to Centre and State Governments to make laws with respect to GST imposed by Centre
Seventh Schedule to Article 246 or such State.

List-I List -II List-III

UNION LIST STATE LIST CONCURRENT LIST Centre has the exclusive power to make laws with respect to GST in case of inter-State supply of goods and/or
services.

• It contains the matters in • It contains the matters in • It contains the matters respect
respect of which the Parliament respect of which the State in of which both the Central &
(Central Government) has the Government has exclusive the State Governments have power However, in respect Petroleum Crude, High Speed Diesel, Petrol, Natural Gas and Aviation Turbine Fuel, the
exclusive right to make laws. right to make laws. to make laws. aforesaid provisions shall apply from the date recommended by the GST Council

Goods and services tax means any tax on supply of

Article goods, or services or both except taxes on the
Need for constitutional amendment for introduction of GST 366(12A) supply of the alcoholic liquor for human
b consumption.

Separate powers were given under

Constitution to the Centre and the
States to impose various taxes.

There was a need to enable integration

of all taxes subsumed into a
comprehensive GST and to empower both
Centre and the States to levy and
collect it.

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 CHAPTER - 1. GST IN INDIA-AN INTRODUCTION

Article 279A- Goods & Services Tax Council

•(a) between Government of India (GoI) and State(s); or
•(b) between GoI and any State(s) on one side and other State(s) on the other side; or
•(c) between two/more States, arising out of the recommendations of the Council/implementation thereof.
It empowers President to constitute a joint forum of the Centre and States
namely, GST Council.

President constituted the GST Council on 15th September, 2016.

The GST Council consists of Union Finance Minister (Chairperson), Union Minister of
State in charge of Revenue/Finance and Minister in charge of Finance/Taxation/any
other Minister nominated by each State Government.

The GST Council shall make recommendations to the Union and the States on the
taxes, cesses and surcharges levied; exemptions; model GST Laws, principles of
levy, apportionment of GST levied on supplies in the course of inter-State trade
or commerce and the principles that govern the place of supply; rates of taxes;
special provision with respect to Special Category States, etc.

GST Council shall recommend the date on which the goods and services tax be
levied on petroleum crude, high speed diesel, motor spirit (commonly known as
petrol), natural gas and ATF.

One-half of the total number of Members shall constitute the quorum at

themeetings.

Every decision of the GST Council shall be taken at ameeting, by a majority of

not less than 3/4th of the weighted votes of themembers present and voting.

It shall establish a mechanismto adjudicate any dispute —

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 CHAPTER – 2 SUPPLY UNDER GST

The taxable event under GST is supply. The scope of supply under GST can be understood in terms of in course or
Consideration furtherance of
following parameters:
business

Supply should be of goods or services

Supply should be made for a consideration

Supply
Supply should be made in the course or furtherance of business

Activities/transactions between a person, other than an individual, and its members or constituents for
While these parameters describe the concept of supply, under certain circumstances, transactions have been 2
valuable consideration [Section 7(1)(aa)]
deemed as supply even when the supply is made without consideration or not in the course or furtherance of
Activities/transactions
business. Activities specified in Schedule I are deemed to be a supply even without consideration. Further,
import of services for a consideration, whether or not in the course or furtherance of business is treated as
supply.
Besides, some specified transactions/ activities are neither treated as supply of goods nor a supply of Person Members or
services. Furthermore, certain activities have been categorised as supply of goods or as supply of services. (association, Constituents
The discussion with respect to supply is broadly categorised into following: club, etc.)

Supply

Consideration

3 Importation of services for consideration whether or not in course or furtherance of business [Section
excludes includes 3
7(1)(b)]
Supply should be in course or furtherance of business. The exception to said rule is import of services is deemed
as supply even if the same has been imported not in course/furtherance of business.
Supply
Activities/tra
between a Activities/tra
nsactions Supply with Importation Supply in course or
person (other nsactions to
neither the consideration of services without Consideration furtherance of
than be treated as
supply of in course or with consideration business
individual), supply of
goods nor the furtherance consideration
and its goods or
supply of of business. whether or
members or supply of
services not in course
constituents services
or
for cash, Supply
furtherance
deferred
of business.
payment or
other
valuable
Importation of services
consideration

Sub-sections of section 7 alongwith related Schedules have been summarised as follows:

4
Supply for consideration in course or furtherance of business [Section 7(1)(a)] Supply without consideration – Deemed Supply [Section 7(1)(c) read with Schedule I]
1
This includes all supplies made to a taxable or non-taxable person, even if the same is without consideration.
Supply includes sale, These are specifically mentioned in Schedule I appended to the CGST Act.
transfer, barter, in the course or As per Schedule I, in the following four cases, supplies made without consideration will be treated as supply
for consideration
exchange, licence, furtherance of business under section 7:
rental, lease, disposal

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 CHAPTER – 2 SUPPLY UNDER GST

I. Permanent transfer/disposal of business assets

Third Person Agent Principal

Input Tax Deemed
Permanently
Business Assets Credit Supply
transferred/disposed
availed

Agent receives goods on behafe of principle and Supplies goods to principle

receives invoice in his own name
Deemed Supply

IV. Importation of services

II. Supply between related persons or distinct persons

Related/Distinct Person 1 Related/Distinct Person 2

Deemed Supply
Related persons

Deemed Supply
Supply of goods or services

in course or furtherance of business Person out of India supplies services

Person in India

Employer In course or furtherance of business

Gifts ≤ ₹ 50,000 in a
The combined provisions of relating to import of services [as stipulated under under section 7(1)(b) and section
FY
7(1)(c) read with Schedule I] have been depicted in the below mentioned diagram:
Not supply
Import of services

Employee
Import of
services
III. Supply between principal and agent

Deemed Supply with without

consideration consideration

supplies goods
in course or not in course or related
Agent futherance of futherance of person/distinct Other cases
Principal business person + in
business
course or
supplies goods on behalf of principal and issues futherance of
invoice to customer in his own name business

Supply Not a supply

buyer

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 CHAPTER – 2 SUPPLY UNDER GST
Activities or transactions to be treated as supply of goods or supply of services [Section 7(1A) read with 6. Actionable claims, other than specified actionable claims.
4 Schedule II] 7. Supply of goods from a place in the non-taxable territory to another place in the non-taxable territory
Para Activity/ Type Supply of goods/ without such goods entering into India.
No. Transaction Services 8. (a) Supply of warehoused goods to any person before clearance for home consumption.
1. Transfer (i) Title in goods Goods (b) Supply of goods by the consignee to any other person, by endorsement of documents of title to the
(ii) Title in goods under an agreement that property shall pass at goods, after the goods have been dispatched from the port of origin located outside India but before
a future date. clearance for home consumption.
Right/undivided share in goods without transfer of title in them Services The diagram on next page summarises the steps to determine whether an activity undertaken is supply or
2. Land and Lease, tenancy, easement, licence to occupy land Services not.
Building Lease/letting out of building including a commercial/ industrial/ Services
residential complex for business/ commerce, wholly/ partly. Is the activity a supply including supply of No
goods/services such as sale, transfer, barter,
3. Treatment or Applied to another person’s goods Services
exchange, licence, rental, lease or disposal?
Process
4. Transfer of Goods forming part of business assets are transferred/disposed of Goods
Business Assets by/under directions of person carrying on business so as no longer
Yes
to form part of those assets
Goods held/used for business are put to private use or are made Services No Is it an activity specified
available to any person for use for any purpose other than business, Is it for a
under Schedule I?
by/under directions of person carrying on the business consideration
Goods forming part of assets of any business carried on by a person Goods
who ceases to be a taxable person, shall be deemed to be supplied
by him, in the course or furtherance of his business,immediately
before he ceases to be a taxable person.
Is it in course or No
5. Renting of immovable property Is it in course or Is it import of No
furtherance of
Construction of complex, building, civil structure, etc. furtherance of service? business?
Exception: Entire consideration received after issuance of completion certificate or Services business?
after its first occupation, whichever is earlier.
Yes
Temporary transfer or permitting use or enjoyment of any intellectual property right Yes Yes
Development, design, programming, customisation, adaptation, upgradation,
enhancement, implementation of IT software
Agreeing to obligation to refrain from an act, or to tolerate an act or situation, or Is it an activity No Activity is Activity is NOT
to do an act. specified in Schedule Supply Supply
Transfer of right to use any goods for any purpose III or section 7(2)(b)?
6. Following composite supplies:- Services
 Works contract Yes
 Supply of goods, being food or any other article for human consumption or any drink.
Non-supplies under GST [Section 7(2)(a) read with Schedule III]
5Para Activities or transactions which shall be treated neither as a supply of goods nor a supply of services Composite and mixed supplies
6
No.
1. Services by an employee to the employer in the course of or in relation to his employment.
Mixed Supply
2. Services by any court or Tribunal established under any law for the time being in force. Composite Supply
3. a) Functions performed by Members of Parliament, Members of State Legislature, Members of
•Consist of two or more supplies
Panchayats, Members of Municipalities & Members of other local authorities; •Consist of two or more supply •Not naturally
b) Duties performed by any person who holds any post in pursuance of the provisions of the Constitution •Naturally bundled •In conjunction with bundled •Though can be supplied
in that capacity; or each other independently,

c) Duties performed by any person as a Chairperson or a Member or a Director in a body established by One of which is principal supply still supplied together
the Central Government or a State Government or local authority and who is not as an employee before •Tax liability shall be rate of principal •Tax liability shall be the rate applicable to
the commencement of this clause. supply the supply that attracts highest rate of tax
4. Services of funeral, burial, crematorium or mortuary including transportation of the deceased. •Example: Charger supplied alongwith •Example: A gift pack comprising of
5. Sale of land and, subject to paragraph 5(b) of Schedule II, sale of building. mobile phones. choclates, candies, sweets and balloons.

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 CHAPTER – 3 CHARG OF GST

Extent & commencement of CGST Act/ SGST Act/ UTGST Act/ IGST 2. Legal services An individual Advocate An Business entity
1 Applicability CGST SGST UTGST IGST individual Advocate a senior
Intra-State supply Inter-State supply advocate/firm of advocates.

States of India 3. Services by an arbitral tribunal Arbitral tribunal Business entity

✓ ✓ ✓ ✓ 4. Sponsorship services Any person Body corporate or
Union Territories with ✓ ✓ ✓ partnership firm
Legislature 5. Services by CG/SG/UT/LA excluding, - CG/SG/UT/LA Business entity
Union Territories without ✓ ✓ ✓ (1) renting of immovable property service, and
Legislature (2) (i) services by Department of Posts/ Ministry
Levy and collection of CGST/IGST of Railways
2 (ii) services in relation to aircraft/vessel;
Particulars CGST IGST
(iii) transport of goods/passengers.
Levied on Intra-State supplies of Inter-State supplies of
goods/services/both goods/services/both 5A. Renting of immovable property service CG/SG/UT/LA excluding the Registered person
Ministry of Railways
Collected and paid by Taxable person
5AA. Renting of residential dwelling service Any person Registered person
Supply outside purview of GST Alcoholic liquor for human consumption
5AB. Renting of any immovable property other than Any unregistered person Registered person
Value for levy Transaction value under section 15 of the CGST Act
residential dwelling
Rates Rates as notified by Government. Maximum IGST rate= CGST rate +
5B. Services supplied by way of TDR or FSI (including Any person Promoter
rate of CGST can be 20%. SGST/UTGST rate Maximum rate of
additional FSI) for construction of a project
IGST can be 40%.
5C. Long term lease of land (30 years or more) Any person Promoter
Supplies on which tax would be  petroleum crude
against consideration in the form of upfront
levied w.e.f. a notified date  high speed diesel
amount and/or periodic rent for construction of a
 motor spirit (commonly known as petrol)
project
 natural gas and
 aviation turbine fuel 6. Services by a director of a company/ body Director Company/ body
corporate corporate
Tax payable under reverse  Supply of goods or services or both, notified by the Government.
charge  Supply of specified categories of goods or services or both by an 7. Services supplied by an insurance agent Insurance agent Person carrying on
unregistered supplier to specified class of registered persons. insurance business

Tax payable by the electronic The Government may notify specific categories of services the tax on supplies of 8. Services supplied by a recovery agent Recovery agent Banking company/
commerce operator which shall be paid by electronic commerce operator (ECO) as if such services are financial
supplied through it. institution/NBFC
3 Services on which tax is payable under reverse charge 9. Services of transfer or permitting the use or Music composer, Music company,
enjoyment of a copyright covered under section photographer, artist, or the producer or the like
S. Category of supply of Services Supplier of Service Recipient of Service 13(1)(a) of the Copyright Act, 1957 relating to like
No. original dramatic, musical or artistic works
1. Supply of services of transportation of goods by Goods Transport Agency Any of the 9A. Services of copyright covered under section Author Publisher
road by GTA except where GTA exercises the option (GTA) following: 13(1)(a) of the Copyright Act, 1957 relating to
to pay tax under forward charge  Factory original literary works except where the author
 Society exercises the option to pay tax under forward
 Co-operative society charge
 Body corporate
10. Supply of services by the members of Overseeing Members of Overseeing RBI
 Partnership firm
Committee Committee constituted by the
 Casual taxable person
RBI
 Registered Person
11. Services supplied by individual Direct Selling Individual DSAs other than a Banking company/NBFC
(Referred as Specified
Agents (DSAs) body corporate, partnership
recipient.}
or LLP firm
Exception: Services provided by a GTA to
12. Services by business facilitator Business facilitator Banking company
(a) Department/ Establishment of CG/SG/UT; or
(b) Local Authority (LA); or 13. Services provided by an agent of business An agent of business Business correspondent
(c) Governmental agencies (GA), correspondent correspondent
which has taken registration only for the purpose of 14. Security services Exceptions: Services provided Any person other than a Registered person
deducting TDS by a GTA to body corporate
(I) (a) Department/ establishment of CG/SG/UT; or

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 CHAPTER – 3 CHARG OF GST

(b) LA; or Arbitral tribunal Business entity Turnover limit in preceding FY to opt for composition levy for services
7
(c) GA,
which has taken registration only for the • ₹ 50 lakh in preceding financial year
Turnover for composition levy for services
purpose of deducting TDS.
(II) Registered composition supplier
15.  Renting of motor vehicle service Non-body corporate who Body corporate Conditions and restrictions for composition levy
 Vehicle designed to carry passengers doesn’t issue an invoice Person opting for composition:
 Cost of fuel is included in consideration charging CGST @ 6% to
charged from recipient service recipient. is neither a casual taxable person nor a non-resident taxable person
16. Services of lending of securities under Lender Borrower
Securities Lending Scheme, 1997
All the above services have also been notified for reverse charge under IGST Act vide Notification No. 10/2017 shall pay tax under section 9(3)/9(4) on inward supply
IT (R) dated 28.06.2017 as amended. In addition to them, following additional services are also notified by said
notification for reverse charge under IGST purposes: is not engaged in the manufacture of notified goods** [or notified services also in case of composition
S. Category of Supplier of service Recipient of Service scheme under section 10(2A)]
No. supply of service
shall mention the words “composition taxable person, not eligible to collect tax on supplies” at the top
1. Any service Any person located in a Any person located in the of the bill of supply issued by him
nontaxable territory taxable territory other
than non-taxable online shall mention the words “composition taxable person” at a prominent place at his place of business
recipient.
4 Composition levy
** Goods notified for a registered person opting for composition scheme under section 10(1) are ice cream, pan
•An option for specified categories of small •Low rates of tax masala, tobacco, aerated waters fly ash bricks, fly ash aggregate, fly ash blocks, bricks of fossil meals or similar
levy
Composition

Advantages

taxpayers to pay GST at a very low rate •Hassel free simple procedures for siliceous earths, building bricks, earthen or roofing tiles.
on the basis of turnover. such taxpayers Rates of tax
8
•Simple calculation of tax based on Composition scheme Category of registered persons Rate
turnover For goods Manufacturer 1% (½% CGST + ½% SGST/UTGST) of
•A very simple annual return turnover
Restaurant service providers 5% (2½% CGST + 2½% SGST/UTGST)
of turnover
Composition Levy
Others 1% (½% CGST + ½% SGST/UTGST) of
turnover of taxable supplies
For services All service providers except restaurant service 6% (3% CGST + 3% SGST/UTGST) of
providers turnover
Composition levy provided under Composition levy provided
Who are NOT eligible to opt for composition scheme?
section 10(1) and 10(2) under section 10(2A) 9
Registered person who is not eligible for Registered person who is not eligible for composition
composition scheme under section 10(1). scheme under section 10(2A).
5 Procedure for opting for the scheme
Supplier engaged in making any supply of goods or Supplier engaged in making any supply of goods or
Category of persons How to exercise option Effective date of composition levy
services which are not leviable to tax i.e. non-taxable services which are not leviable to tax i.e. non-taxable
New registration under GST Intimation in the registration form From the effective date of registration
supplies supplies
Registered person opting for Intimation in prescribed form Beginning of the financial year
Supplier engaged in making any inter-State Supplier engaged in making any inter-State outward
composition levy
outward supplies of goods or services supplies of goods or services
Turnover limit for composition levy
6 Person supplying any servicesthrough an electronic Person supplying any services through an electronic
Turnover limit in preceding FY to opt for composition levy for goods commerce operator who is required to collect tax at commerce operator who is required to collect tax at
source under section 52 source under section 52
For Special Category States except
Manufacturer of ice cream, pan masala, tobacco, Manufacturer of notified goods or supplier of notified
Assam, Himachal Pradesh and J&K • ₹ 75 lakh
aerated waters fly ash bricks, fly ash aggregate, fly services
ash blocks, bricks of fossil meals or similar siliceous
• ₹ 1.5 crore
For remaining States earths, building bricks, earthen or roofing tiles.

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 CHAPTER – 3 CHARG OF GST

Supplier who is either a casual taxable person or a non- Supplier who is either a casual taxable person or a non-
resident taxable person resident taxable person.
Supplier of services, save as provided in section
10(1)**
**A registered person opting for composition scheme under section 10 (1) is allowed to supply services [other than
restaurant services] alongwith supply of goods or supply of restaurant services of value not exceeding 10% of the
turnover in the preceding financial year in a State/Union territory or ₹ 5 lakh, whichever is higher. Here, while
computing turnover in a State/UT, interest on loans/deposit/advances will not be taken into account.
Other points
10

Bill of supply shall be issued instead of tax invoice.

Tax shall not be collected from recipient of supply

Input tax credit shall not be availed

Composition Scheme if availed shall include all registered persons having

same PAN

Penalty shall be imposed in case of irregular availment of the composition

scheme

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 CHAPTER – 4 PLACE OF SUPPLY

Place of supply of goods other than import and export [Section 10 of the IGST Act, 2017] 4. Admission to an event or amusement park  Place where the event is actually held or where the park
A
S. Nature of Supply Place of Supply or the other place is located
.
No 5. Organisation of an event including  B2B: Location of such registered person
1. Where the supply involves the movement of Location of the goods at the time at which, the ancillary services and assigning of  B2C: Location where the event is actually held
goods, whether by the supplier or the movement of goods terminates for delivery to the sponsorship to such events
recipient or by any other person recipient If the event is held outside India: Location of the recipient
2. Where the goods are delivered to the Principal place of business of such third person If the event is held in more than one Each such State in proportion to the value of services
recipient or any person on the direction of State (in cases of unregistered recipient) provided in each State – Refer point (iii) below
the third person by way of transfer of title 6. Transportation of goods, including mails or  B2B: Location of such registered person
or otherwise courier  B2C: Location at which such goods are handed over for
3. Where there is no movement of goods either Location of such goods at the time of delivery to the their transportation
by supplier or recipient recipient 7. Passenger transportation  B2B: Location of such registered person
4. Where supply is made to unregistered Location as per address of unregistered person recorded  B2C: Place where the passenger embarks on the
persons and the address of such person is in the invoice conveyance for a continuous journey
recorded in the invoice. 8. Services on board a conveyance Location of the first scheduled point of departure of that
(Simply mentioning the State of such person instead of conveyance for the journey
complete address would be sufficient.) 9. Banking and other financial services  Location of the recipient of services in the records of
5. Where supply is made to unregistered Location of the supplier including stock broking supplier
persons and the address of such person is  Location of the supplier of services if location of recipient
not recorded in the invoice of services is not available
6. Where goods are assembled or installed at Place where the goods are assembled or installed 10. Insurance services  B2B: Location of such registered person
site  B2C: Location of the recipient of services in the records
7. Where the goods are supplied on-board a Place where such goods are taken on-board the of the supplier
conveyance like a vessel, aircraft, train or conveyance 11. Advertisement services to the Government  Each of States/Union territory where the advertisement
motor vehicle is broadcasted/ displayed/ run/ disseminated
8. Where the place of supply of goods Cannot To be determined in the prescribed manner  Proportionate value in case of multiple States – Refer
be determined in terms of the above point (iv) below
provisions 12. Telecommunication services  Services involving fixed line, leased and internet leased
B
Place of supply of goods imported into, or exported from India [Section 11] circuits, dish antenna etc: Location of such fixed
.
equipment
S.NO. Nature of Supply of Goods Place of Supply
 Post-paid mobile/ internet services: Location of billing
1 Import Location of importer
address of the recipient and if the same is not available,
2 Export Location of importer Location outside India location of supplier
Place of supply of services where location of supplier AND recipient is in India [Section 12 of  Pre-paid mobile/ internet/DTH services provided:
c
the IGST Act, 2017]  Through selling agent/ re- seller/ distributor:
.
In respect of the following 12 categories of services, the place of supply is determined with reference to a Address of such selling agent/ re-seller/ distributor
proxy; rest of the services are governed by the default provision. in the records of supplier at the time of supply
S.No. Nature of Service Place of Supply  By any person to final subscriber: Location where
pre-payment is received or place of sale of vouchers
1. Immovable property related-services  Location at which the immovable property or boat or
 When payment made through electronic mode
including accommodation in hotel/boat/vessel vessel is located or intended to be located
Location of recipient in records of supplier
 If located outside India: Location of the recipient
 Other cases: Address of the recipient in the records of
If the immovable property or boat or vessel  Each such State in proportion to the value of the supplier and if the same is not available, location of
is located in more than one State services provided in each State – Refer point (ii) supplier
below
If the leased circuit is installed in more Each such State in proportion to the value of services
2. Restaurant and catering services, personal Location where the services are actually performed than one State provided in each State – Refer point (v) below
grooming, fitness, beauty treatment and
(ii) Manner of determining proportionate value of immovable property related service attributable to
health service
different States/ Union territories – where the immovable property/ boat/ vessel is located - in the
3. Training and performance appraisal B2B: Location B2B: Location of such registered person absence of a contract or agreement in this regard.
B2C: Location where the services are actually performed

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 CHAPTER – 4 PLACE OF SUPPLY

S.No. Type of service in relation to immovable property Factor determining the proportionate value of 7. Advertisements on radio stations Amount payable to such radio station, which by virtue of its name is
service part of each State/Union territory
(a) Service provided by way of lodging accommodation Number of nights stayed in such property 8. Advertisement on television Amount attributable to each State/Union territory calculated on the
by hotel/ inn/guest house etc. and its ancillary channels basis of the viewership of such channel in each of such State/ Union
services (other than the cases where such property territory.
is a single property located in 2 or more contiguous Viewership figures for the last week of a given quarter as published by
States/ Union territories or both) BARC can be used for calculating viewership for the succeeding quarter.
(b) All other services provided relation in to immovable Area of the immovable property lying in each Figures Pertaining to more than one State/Union territory are
property including organising any marriage or State/ Union territories apportioned in ratio of the populations of those States/Union
reception etc., accommodation in a single property territories, as per the latest Census.
located in 2 or more contiguous States or/and Union 9. Advertisements in cinema halls Amount payable to a cinema hall or screens in a multiplex in each State/
territories, services ancillary to such services Union territory.
(c) Services by way of lodging accommodation by a Time spent by the boat or vessel in each such 10. Advertisements on internet It is Amount attributable to each State/Union territory calculated on the
house boat or vessel and its ancillary services State/ Union territories, to be determined on deemed that such service is basis of the internet subscribers in each of such State/ Union
the basis of declaration made by the service provided all over India. territory.
provider Internet subscriber figures for the last quarter of a given financial
(iii) Manner of determining proportionate value of service relating to organization of event, attributable year as published by TRAI can be used for calculating the subscribers
to different States/Union territories – where the event is held - in the absence of a contract or agreement in for the succeeding financial year. Figures pertaining to more than one
this regard State/Union territory are apportioned in the ratio of the populations of
those States/Union territories, as per the latest census.
11. Advertisements through SMS Amount attributable to each State/Union territory calculated on the
basis of the telecom subscribers in each of such State/ Union territory.
Organization of an event/ Telecom subscribers figures in a telecom circle for a given quarter as
Proportionate value of such Generally accepted published by TRAI can be used for calculating the subscribers for the
services ancillary thereto/ service to be computed by succeeding quarter. Figures pertaining to a telecom circle comprising of
assigning of sponsorship to such application of accounting principles
event more than one State/Union territory are apportioned in the ratio of the
populations of those States/Union territories, as per the latest census.
(v) Manner of determining proportionate value of service relating to installation of a leased circuit, attributable
to different States/Union territories – where the circuit is installed - in the absence of a contract or agreement
(iv) Manner of determining proportionate value of advertisement service attributable to different States/Union in this regard
territories – where the advertisement is broadcasted/ run /played/disseminated - in the absence of a contract
or agreement in this regard Proportionate value of such
Installation of leased Number of points lying in
S. Type of advertisement Proportionate value of service service computed on the
circuit the State/ Union territory
No. basis of
1. Advertisements in newspapers Amount payable for publishing an advertisement in all the editions of
publications and a newspaper or publication, which are published in each State/Union For a circuit between two points/places
territory
2. Advertisements through printed Amount payable for the distribution of a specific number of such Starting point/place of circuit and endpoint/place of circuit constitute two
material like pamphlets, leaflets, material in each State/Union territory points
diaries, calendars, Tshirts, etc.
Intermediate point/ place in circuit constitute a point if
3. Advertisements in hoardings Amount payable for the hoardings located in each State/ Union
(other than those on trains) territory
the benefit of the leased circuit is also available at that intermediate point
4. Advertisements on trains Amount attributable to each State/Union territory calculated in the
ratio of length of the railway track in each of such State/Union (vi) For the rest of the services other than those specified above, the default provision has been prescribed
territory, for that train as under:
5. Advertisements on the back of Amount payable to each State/Union territory for the Default provision for the services other than the 12 specified services
utility bills of oil and gas advertisements on bills pertaining to consumers having billing S. Description of Place of Supply
companies, etc. addresses in each of such State/Union territory No. Supply
6. Advertisements on railway tickets Amount attributable to each State/Union territory calculated in the 1. B2B Location of such registered person
ratio of number of Railway Stations in each of such State/Union 2. B2C  Where the address on record exists: Location of the recipient
territory  Other cases: Location of the supplier of services

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 CHAPTER – 4 PLACE OF SUPPLY

Place of supply of services where location of supplier OR location of recipient is outside India [Section (b) Services supplied on different Considering the ratio of the invoice value of goods in each
D
13] goods States/ Union territory, on which service is performed, as
(i)In respect of the following categories of services, the place of supply is determined with reference to a the ratio of the value of the service performed in each
proxy; rest of the services are governed by the default provision. State/Union territory
S. Nature of Service Place of Supply (c) Services supplied to individuals Applying generally accepted accounting principles.
No. 2. Services directly relating to In the same manner as is applicable for determining the
1. Services supplied in respect of goods which are Location where the services are actually performed immovable property proportionate value of services provided in relation to an
required to be made physically available immovable property under section 12(3)
Services supplied in respect of goods but from a Location where the goods are situated at the time 3. Services relating to admission In the same manner as is applicable for determining the
remote location by way of electronic means of supply of services to/organization of event proportionate value of services provided in relation to
Above provisions are not applicable in case of goods that are temporarily imported into India for organization of an event under section 12(7)
repairs/treatment/any process and exported after such repairs/treatment/any process without being put (iii) For the rest of the services other than those specified above, a default provision has been prescribed
to any other use in India as under:
2. Services which require the physical presence of Location where the services are Default provision for the cross-border supply of services other than nine specified services
the recipient or the person acting on his behalf actually performed S. Description of supply Place of Supply
with the supplier of services No.
3. Service supplied directly in relation to an Place where the immovable property is located or 1. Any • Location of the recipient of service
immovable property including accommodation in intended to be located • Location of the supplier of service, if location of
hotel, boat, vessel recipient is not available in the ordinary course of
4. Admission to or organisation of an event Place where the event is actually held business
If the above services are supplied at more than one location, i.e. (iv) Place of supply of services notified under section 13(13)
(i) Goods & individual related S. Description of supply Place of Supply
(ii) Immovable property-related No.
(iii) Event related 1. Specified research and development Location of recipient of services subject to fulfillment of
At more than one location, including a location in the Location in the taxable territory services related specified conditions
taxable territory to pharmaceutical
In more than one State Each such State in proportion to the value of sector supplied by a person located in
services provided in each State – Refer point (ii) taxable territory to a person located
below in the non-taxable territory
5. Services supplied by a banking company, or a Location of the supplier of services 2. B2B maintenance, repair or overhaul Location of recipient of service
financial institution, or a NBFC to account holders services of aircrafts, aircraft
engines/components/parts
Intermediary services
3. B2B MRO services of ships and other Location of recipient of service
Services consisting of hiring of means of
vessels, their engines and other
transport, including yachts but excluding aircrafts
components/ parts
and vessels, up to a period of one month
6. Passenger transportation Place where the passenger embarks on the
conveyance for a continuous journey
7. Services provided on-board a conveyance First scheduled point of departure of that
conveyance for the journey
8. Online information and database access or Location of recipient of service
retrieval services
(ii) Manner of determining proportionate value of service relating to (1) goods & individual (2) immovable
property (3) admission to/organization of event attributable to different State/Union territories– where such
services are supplied - in the absence of a contract or agreement in this regard
S. Cases Manner of computing the proportionate value of
No. service
1. Services relating to goods & individual
(a) Services supplied on the same goods Equally dividing the value of service in each of the
States/ Union territory where the service is
performed

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 CHAPTER – 5 EXEMPTIONS FROM GST

1. Power to exempt from tax [Section 11 of the CGST Act/ section 6 of IGST Act] (a) agricultural operations directly related to production of any agricultural produce cultivation,
1 harvesting, threshing, plant protection or testing;
(b) supply of farm labour;
Power to exempt from tax (c) processes carried out at an agricultural farm including tending, pruning, etc. and such like
operations which do not alter the essential characteristics of agricultural produce but make it
only marketable for the primary market;
(d) renting or leasing of agro machinery or vacant land with/without a structure incidental to its
Notification Special Order use;
(e) loading, unloading, packing, storage or warehousing of agricultural produce;
(f) agricultural extension services;
(g) services by any Agricultural Produce Marketing Committee or Agricultural Produce Marketing
Exempt generally
exempt from payment of tax under Committee or Board or services provided by a commission agent for sale/purchase of
circumstances of an exceptional nature agricultural produce.
to be stated in such order, in public Education Services provided BY an educational institution (EI):
interest. services  to its students, faculty and staff; •
either absolutely or subject to such  by way of conduct of entrance examination against consideration in form of entrance fee
conditions as may be specified.
Services provided TO an EI, by way of,- These exemptions are
(i) transportation of students, faculty and staff; only applicable to an
(ii) catering, including any mid-day meals scheme sponsored by the institution providing
goods and/or services of any specified Central Government (CG), State Government (SG) or Union Territory services by way of
description (UT); pre- school education &
(iii) security/cleaning/housekeeping services performed in such EI; education up to higher
secondary school or
2. List of services exempt from GST
2 equivalent.
Exempt Services
(iv) Services relating to admission to, or conduct of examination by, such EI;
Services related Charitable activities BY an entity registered under section 12AA/12AB of Income-tax Act.
(v) supply of online educational journals or periodicals. This exemption is only applicable to an
to charitable Services by a person by way of-
institution providing services by way of education as part of a curriculum for obtaining
and religious (a) conduct of any religious ceremony;
qualification recognised by any law for time being in force.
activities (b) renting of precincts of a religious place meant for general public,owned/managed by
Services of affiliation provided by a Central or State Educational Board or Council or any other
institutions/entities/trusts, registered under section 12AA/12AB/10(23C)(v) of the income
similar body, by whatever name called, to a school established, owned or controlled by the Central
tax Act or body/authority covered under section 10(23BBA) of the said Act, except
Government, State Government, Union Territory, local authority, Governmental authority or
where-
Government entity.
(i) charges for renting of rooms ≥ ₹ 1,000 per day;
(ii) charges for renting of premises, community halls, kalyanmandapam, open area, etc. are ≥ Health care  Health care services BY a clinical establishment/ authorized medical practitioner/ para-medics
₹ 10,000 per day; services However, nothing in this entry shall apply to the services provided by a clinical establishment
(iii) charges for renting of shops/spaces for business/commerce are ≥ ₹ 10,000 per month. by way of providing room [other than Intensive Care Unit (ICU)/Critical Care Unit
(CCU)/Intensive Cardiac Care Unit (ICCU)/Neo natal Intensive Care Unit (NICU)] having room
Services by a specified organisation [KMVN/Haj Committee] in respect of
charges exceeding ₹ 5000 per day to a person receiving health care services.
a religious pilgrimage [Haj and Kailash Mansarovar Yatra].
 Transportation of a patient in an ambulance BY any person other than specified above.
Training/coaching in
Service BY a veterinary clinic in relation to Health care of animals/birds
(a) recreational activities relating to arts/culture, by an individual or
(b) sports by charitable entities registered under section 12AA or 12AB of the Income- Services Services by Governmental Authority (GA) by way of any activity in relation to any function
tax Act. provided by entrusted to a Municipality /Panchayat under article 243W/ 243G of Constitution
Governmen Services by the CG/SG/UT/Local Authority (LA) excluding following services—
Agriculture Loading, unloading, packing, storage or warehousing of rice.
(a) services by Department of Posts and the Ministry of Railways

specified services’
referred
hereinafter
a)
related services Warehousing of minor forest produce.
(Indian Railways);
Services by way of storage/ warehousing of cereals, pulses, fruits & vegetables.
(b) services in relation to an aircraft/a vessel, inside/outside precincts

to
Artificial insemination of livestock (other than horses).
of a port/airport;

as
Carrying out an intermediate production process as job work in relation to cultivation of plants (c) transport of goods/passengers; or
& rearing of animals [except horses], for food, fibre, fuel, raw material or other similar

(c)
(d) any service, other than ‘specified services’ above, provided to business entities.

‘
products or agricultural produce.
Services by the Department of Posts by way of post card, inland letter, book post and ordinary
Services relating to cultivation of plants & rearing of animals [except horses], for food, fibre, post (envelopes weighing less than 10 grams).
fuel, raw material or other similar products or agricultural produce by way of –
Services provided by CG/SG/UT/LA to a business entity (BE) with an aggregate turnover of up to
such amount in the preceding FY as makes it eligible for exemption from registration under the

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 CHAPTER – 5 EXEMPTIONS FROM GST

CGST Act, 2017. This exemption is not applicable to specified services and renting of immovable Construction Pure labour contracts of construction, erection, commissioning, installation, completion, fitting
property service. Services out,repair, maintenance, renovation, or alteration of a civil structure or any other original
Services provided by CG/SG/UT/LA to another CG/SG/UT/LA. This exemption is not applicable to works pertaining to the beneficiary-led individual house construction or enhancement under the
specified services. Housing for All (Urban) Mission/Pradhan Mantri Awas Yojana.
Services provided by CG/SG/UT/LA where consideration for such services does not exceed ₹ Services supplied by Electricity Distribution Utilities by way of construction, erection,
5,000. This exemption is not applicable to specified services**. commissioning, or installation of infrastructure for extending electricity distribution network
**In case of continuous supply of service*, the exemption shall apply only where the consideration upto the tube well of the farmer/agriculturalist for agricultural use.
charged for such service does not exceed ₹ 5,000 in a FY. Pure labour contracts of construction, erection, commissioning, or installation of original works
Supply of service by a Government Entity (GE) to CG/SG/UT/LA/any person specified by pertaining to a single residential unit otherwise than as a part of a residential complex.
CG/SG/UT/LA against consideration received from CG/SG/UT/LA, in the form of grants. Supply of TDR, FSI, long term lease (premium) of land by a landowner to a developer are
Services by an old age home run by CG/SG/an entity registered under section 12AA/12AB of exempted subject to the condition that the constructed flats are sold before issuance of
Income-tax Act to its residents (aged ≥60 years) against consideration upto ₹ 25,000 per month completion certificate and tax is paid on them.
per member, provided that the consideration charged is inclusive of charges for boarding, lodging Exemption of TDR, FSI,long term lease (premium) shall be withdrawn in case of flats sold
and maintenance. after issue of completion certificate, but such withdrawal shall be limited to 1% of value in
Services provided by Ministry of Railways (Indian Railways) to individuals by way of – case of affordable houses and 5% of value in case of other than affordable houses.
(a) sale of platform tickets Services of Such services provided by –
(b) facility of retiring rooms/waiting rooms; transport of (a) air in economy class, embarking from or terminating in an airport located in the state of
(c) cloak room services; passengers Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, or Tripura or
(d) battery operated car services (with/ without at Bagdogra located in West Bengal;
Services provided by one zone/division under Ministry of Railways (Indian Railways) to another accompanied (b) non-air conditioned contract carriage other than radio taxi, for transportation of
zone(s)/division(s) under Ministry of Railways (Indian Railways). belongings) passengers, excluding tourism, conducted tour, charter or hire; or
Services provided by SPVs to Ministry of Railways (Indian Railways) by way of allowing it to use (c) stage carriage other than air- conditioned stage carriage.
the infrastructure built and owned by them during the concession period against consideration and However, nothing contained in items (b) and (c) above shall apply to services supplied through
services of maintenance supplied by Ministry of Railways (Indian Railways) to SPVs in relation to an ECO, and notified under section 9(5) of the CGST Act.
the said infrastructure built and owned by the SPVs during the concession period against Such services provided to CG by air, embarking from or terminating at a Regional Connectivity
consideration. Scheme (RCS) airport, against consideration in the form of viability gap funding. This
Services supplied by CG/SG/UT to their undertakings or PSUs by way of guaranteeing the loans exemption shall apply only till expiry of a period of 3 years from date of commencement of
taken by such undertakings or PSUs from the banking companies and financial institutions. operations of the RCS airport as notified by the Ministry of Civil Aviation.
Services provided by CG/SG/UT/LA by way of- Such services provided by—
(a) registration required under any law for the time being in force; (a) railways in a class other than first class/an air-conditioned coach;
(b) testing, calibration, safety check or certification relating to protection or safety of workers, (b) metro, monorail or tramway;
consumers or public at large, including fire license, required under any law for the time being (c) inland waterways;
in force. (d) public transport, other than predominantly for tourism purpose, in a vessel between places
located in India; and
Services provided by CG/SG/UT/LA by way of issuance of passport, visa, driving license, birth
(e) metered cabs or auto rickshaws (including e-rickshaws).
certificate or death certificate.
However, nothing contained in item (e) above shall apply to services supplied through an ECO,
Services provided by CG/SG/UT/LA by way of tolerating nonperformance of a contract for which
and notified under section 9(5) of the CGST Act.
consideration in the form of fines or liquidated damages is payable to CG/SG/UT/LA under such
Goods Services by way of transportation of goods-
contract.
transportation (a) by road except the services of—
Services provided by CG/SG/UT/LA by way of assignment of right to use natural resources to an
services (i) a goods transportation agency (GTA);
individual farmer for cultivation of plants & rearing of all life forms of animals [except horses],
(ii) a courier agency;
for food, fibre, fuel, raw material or other similar products.
(b) by inland waterways.
Services provided by CG/SG/UT by way of deputing officers after office hours or on holidays
Exempt transportation of goods by rail/ vessel/ by GTA in a goods carriage
for inspection or container stuffing or such other duties in relation to import export cargo on
 Agricultural produce
payment of Merchant Overtime charges.
 milk, salt and food grain including flours, pulses and rice
Services supplied by a SG to Excess Royalty Collection Contractor (ERCC) by way of assigning the  organic manure
right to collect royalty on behalf of SG on the mineral dispatched by the mining lease holders  newspaper or magazines registered with the Registrar of Newspapers
subject to specified conditions.  Defence/ military equipments
Services provided by rehabilitation professionals recognised under the RCI Act, 1992 by way of  relief materials meant for victims of natural or man-made disasters, calamities, accidents
rehabilitation, therapy or counselling and such other activity as covered by the said Act at or mishap
medical establishments, educational institutions, rehabilitation centers established by Services provided by a GTA to an unregistered person, including an unregistered casual taxable person,
CG/SG/UT/an entity registered under section 12AA/12AB of the Income-tax Act, 1961. except following recipients, namely: -

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 CHAPTER – 5 EXEMPTIONS FROM GST

(a) a factory registered under Factories Act, (h) Restructured Weather Based Crop Insurance Scheme (RWCIS), approved by the Government of
(b) society registered under Societies Act, India and implemented by the Ministry of Agriculture;
(c) Co-operative society, (i) Jan Arogya Bima Policy;
(d) body corporate and (j) Pradhan Mantri Fasal Bima Yojana (PMFBY);
(e) partnership firm including AOP; (k) Pilot Scheme on Seed Crop Insurance;
(f) registered casual taxable person. (l) Central Sector Scheme on Cattle Insurance;
Services provided by a GTA, by way of transport of goods in a goods carriage, to, (m) Universal Health Insurance Scheme;
(a) a Department or Establishment of the CG/SG/UT; or (n) Rashtriya Swasthya Bima Yojana;
(b) local authority; or (o) Coconut Palm Insurance Scheme;
(c) Governmental agencies, which has taken registration only for the purpose of deducting tax (p) Pradhan Mantri Suraksha BimaYojna;
under section 51 and not for making a taxable supply of goods or services. (o)Niramaya Health Insurance Scheme implemented by the Trust constituted under the provisions
Banking and Services by way of— of the National Trust for the Welfare of Persons with Autism, Cerebral Palsy, Mental
financial (a) extending deposits, loans or advances in so far as the consideration is represented by way of Retardation and Multiple Disabilities Act, 1999.
interest or discount (other than interest involved in credit card services); (r) Bangla Shasya Bima.
(b) inter se sale or purchase of foreign currency amongst banks or authorised dealers of foreign Services provided to CG/SG/UT under any insurance scheme for which total premium (c)
exchange or amongst banks and such dealers. is paid by CG/SG/UT.
Services provided by a banking company to Basic Saving Bank Deposit (BSBD) account holders under Services by way of reinsurance of the insurance schemes specified in or (B) or
(A) (c)
Pradhan Mantri Jan Dhan Yojana (PMJDY). above.
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 Services Services by the Employees’ State Insurance (ESI) Corporation to persons governed under the ESI
card service. provided by Act, 1948.
specified
Services by an intermediary of financial services located in a multi services SEZ with International Services provided by the EPFO to the persons governed under the Employees Provident Funds (EPF)
bodies
Financial Services Centre (IFSC) status to a customer located outside India for international & Miscellaneous Provisions Act, 1952.
financial services in currencies other than Indian rupees Services by CMPFO to persons governed by Coal Mines Provident Fund and Miscellaneous Provisions
Services of Such services by way of annuity under the National Pension System by Pension Fund Regulatory and Act, 1948.
Life Development Authority of India (PFRDAI) under PFRDA Act, 2013. Services by NPS Trust to its members against consideration in the form of administrative fee.
insurance Pension Services by way of collection of contribution under: •
Such services by the Army, Naval and Air Force Group Insurance Funds to members of the Army,
business schemes  Atal Pension Yojana
Navy and Air Force, respectively, under the Group Insurance Schemes of CG.
 any pension scheme of SG
Services of life insurance provided/agreed to be provided by the Central Armed Police Forces Business Services by the following persons in respective capacities –
(under Ministry of Home Affairs) Group Insurance Funds to their members under the Group facilitator/ (a) business facilitator/business correspondent to a Banking Co. with respect to accounts in its
Insurance Schemes of the concerned Central Armed Police Force. corr rural area branch;
Such services by the Naval Group Insurance Fund to the personnel of Coast Guard under the Group espondent
(b) any person as an intermediary to a business facilitator or a business correspondent with
Insurance Schemes of CG. respect to services mentioned in entry (a); or
Such services under following schemes (A) (c) business facilitator/business correspondent to an insurance company in rural area.
(a) Janashree Bima Yojana; Services Following services provided to the CG/SG/UT/LA/GA/GE by way of any activity in relation to any
(b) Aam Aadmi Bima Yojana; provided to function entrusted to a Panchayat/Municipality under
(c) Life micro-insurance product** as approved by the Insurance Regulatory and Development Government articles 243G/243W of the
Authority (IRDA), having maximum amount of cover of ₹ 2,00,000; Constitution:
(d) Varishtha Pension BimaYojana;  Pure services
(e) Pradhan Mantri Jeevan Jyoti BimaYojana;  Composite supply of goods and services in which the value of supply of goods constitutes not
(f) Pradhan Mantri Jan DhanYogana; more than 25% of the value of the said composite supply.
(g) Pradhan Mantri Vaya Vandan Yojana. Services provided to a Governmental Authority by way of—
General Such services under following schemes – (a) water supply;
insurance (a) Hut Insurance Scheme; (b) public health;
business (b) Cattle Insurance under Swarnajaynti Gram Swarozgar Yojna76; (c) sanitation conservancy;
(c) Scheme for Insurance of Tribals; (d) solid waste management; and
(d) Janata Personal Accident Policy and Gramin Accident Policy; (a) slum improvement and upgradation.
(e) Group Personal Accident Group Personal Accident Women; Service provided by Fair Price Shops to CG/SG/UT by way of sale of food grains, kerosene, sugar,
(f) Agricultural Pumpset and Failed Well Insurance; edible oil, etc. under Public Distribution System (PDS) against commission/margin.
(g) premia collected on export credit insurance;

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 17
 CHAPTER – 5 EXEMPTIONS FROM GST

Services provided to CG/SG/UT under any insurance scheme for which total premium is paid by Right to Services by way of admission to:
CG/SG/UT. admission to (i) museum, national park, wildlife sanctuary, tiger reserve or zoo
Services provided to CG/SG/UT administration under any training programme for which 75% or various events (ii) protected monument declared under the Ancient Monuments and Archaeological Sites &
more of the total expenditure is borne by CG/SG/UT administration. Remains Act 1958/any of the State Acts, for the time being in force.
Leasing Upfront amount payable in respect of service by way of granting of long term lease of 30 (iii) following events/places where the consideration for right to admission is not more than ₹
services years, or more of industrial plots/plots for development of infrastructure for financial 500 per person:
business, provided by the State Government Industrial Development Corporations or (a) circus, dance, or theatrical performance including drama or ballet;
Undertakings or by any other entity having 20% or more ownership of CGS/SG/UT to the (b) award function, concert, pageant, musical performance or any sporting event other than
industrial units/developers in any industrial/financial business area subject to specified a recognised sporting event;
conditions. (c) recognised sporting event;
Legal Service provided by To (d) planetarium.
services  Arbitral tribunal any person other than BE Services by an Services by unincorporated body/ non- profit entity to its own members as reimbursement/share
 Partnership firm of advocates or an individual unincorporate of contribution:
BE with an aggregate turnover up to such
as an advocate other than a senior advocate d body or a (i) As a trade union (ii) for providing exempt activity
amount in the preceding FY as makes it
by way of legal services non- profit (iii) up to an amount of ₹ 7,500 per month per member for sourcing of goods/services from a
eligible for exemption from registration
 Senior advocate by way of legal services entity third person for the common use of its members in a housing society/residential complex
under the CGST Act
registered
CG/SG/UT/LA/GA/GE Services provided by such entity/body engaged in-
under any law (i) activities relating to the welfare of industrial/agricultural labour or farmers; or
Legal services provided by a partnership firm of advocates/ individual as an advocate other for the time
than a senior advocate to another advocate/ partnership firm of advocates providing legal (ii) promotion of trade, commerce, industry, agriculture, art, science, literature, culture, sports,
being in force education, social welfare, charitable activities and protection of environment, to its own
services
members against membership fee upto ₹ 1000/per member per year.
Sponsorship Sponsorship of sporting events organised
of sports (a) by a national sports federation, or its affiliated federations, where the participating Other exempt Transfer of a going concern, as a whole or an independent part thereof.
events teams or individuals represent any district, State, zone or Country; services Services associated with transit cargo to Nepal and Bhutan (landlocked countries).
(b) by Association of Indian Universities, Inter-University Sports Board, School Games Services by way of renting of residential dwelling for use as residence except where the
Federation of India, All India Sports Council for the Deaf, Paralympic Committee of India residential dwelling is rented to a registered person.
or Special Olympics Bharat; Explanation 1 — For the purpose of exemption under this entry, this entry shall cover services by
(c) by the Central Civil Services Cultural and Sports Board; way of renting of residential dwelling to a registered person where, –
(d) as part of national games, by the Indian Olympic Association; or (i) the registered person is proprietor of a proprietorship concern and rents the residential
(e) under the Panchayat Yuva Kreeda Aur Khel Abhiyaan Scheme. dwelling in his personal capacity for use as his own residence; and
Skill Any services provided by – (ii) such renting is on his own account and not that of the proprietorship concern.
Development (a) the National Skill Development Corporation (NSDC) set up by the GoI; Explanation 2.- Nothing contained in this entry shall apply to-
services (b) the National Council for Vocational Education and Training (NCVET); (a) accommodation services for students in student residences;
(c) an Awarding Body recognized by the NCVET; (b) accommodation services provided by Hostels, Camps, Paying Guest accommodations and the
(d) an Assessment Agency recognized by the NCVET; like.
(e) a Training Body accredited with an Awarding Body that is recognized by NCVET, Supply of accommodation services having value of supply less than or equal to ₹ 20,000 per
in relation to- person per month provided that the accommodation service is supplied for a minimum continuous
(i) the National Skill Development Programme or any other scheme implemented by the period of 90 days.
NSDC; or Satellite launch services
(ii) a vocational skill development course under the National Skill Certification and Monetary Services by way of transportation of goods by an aircraft from a place outside India upto the
Reward Scheme; or customs station of clearance in India.
(iii) any National Skill Qualification Framework aligned qualification or skill in respect of which Services by way of giving on hire –
NCVET has approved a qualification package (a) to a state transport undertaking (STU), a motor vehicle meant to carry more than 12
Services of assessing bodies empanelled centrally by DGT, Ministry of Skill Development and passengers;
Entrepreneurship by way of assessments under the SDI Scheme.
(aa) to a local authority, an Electrically operated vehicle (EOV) meant to carry more than 12
Services provided by training providers (Project implementation agencies) under DDUGKY passengers; or
implemented by Ministry of Rural Development, GoI by way of offering skill or vocational (b) to a GTA, a means of transportation of goods.
training courses certified by the National Council for Vocational Education and Training (c) motor vehicle for transport of students, faculty and staff, to a person providing services of
(NCVET). transportation of students, faculty and staff to an educational institution providing services
Performance Services by an artist by way of a performance in folk or classical art forms of music/ dance/ by way of pre-school education and education upto higher secondary school or equivalent.
by an artist theatre, if the consideration charged for such performance is not more than ₹ 1,50,000. This Service by way of access to a road or a bridge on payment of toll charges.
exemption shall not apply to service provided by such artists as a brand ambassador.

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 CHAPTER – 5 EXEMPTIONS FROM GST

Transmission/distribution of electricity by an electricity transmission/ distribution utility. Services by way of public conveniences such as provision of facilities of bathroom, washrooms,
Supply of services by way of providing metering equipment on rent, testing for lavatories, urinal or toilets.
meters/transformers/capacitors etc., releasing electricity connection, shifting of meters/service Above services have been exempted from both CGST and IGST. Apart from these services, list of services
lines, issuing duplicate bills etc., which are incidental or ancillary to the supply of transmission exempt from IGST also include following services:
and distribution of electricity provided by electricity transmission and distribution utilities to Services received from a provider of service located in a nontaxable territory by –
their consumers. (a) CG/SG/UT/LA/GA/ an individual in relation to any purpose other than commerce, industry
Services provided by an incubatee up to a total turnover of ₹ 50 lakh in a FY provided: or any other business or profession;
(a) total turnover had not exceeded ₹ 50 lakh during the preceding FY; and (b) an entity registered under section 12AA/12AB of the Income- tax Act, 1961 for the
(b) a period of 3 years has not elapsed from the date of entering into an agreement as an purposes of providing charitable activities; or
incubate way of supply of online educational journals or periodicals to an educational institution
Research and development services against consideration received in the form of grants supplied other than an institution providing services by way of-
by – (i) pre-school education and education up to higher secondary school or equivalent; or
(a) a Government Entity; or (ii) education as a part of an approved vocational education course;
(b) a research association, university, college or other institution, notified under clauses (ii) (c) person located in a non-taxable territory. However, the exemption shall not apply to
or (iii) of sub-section (1) of section 35 of the Income Tax Act, 1961. OIDAR services received by persons specified in entry (a) or entry (b).
The condition to be fulfilled in this case is that the research association, university, Import of services by an establishment of a foreign company in India, which is an airline
college or other institution, notified under clauses (ii) or (iii) of sub-section (1) of section company, from a related person or from any of its other establishments outside India, when
35 of the Income Tax Act, 1961 is so notified at the time of supply of the research and made without consideration subject to specified conditions.
development service. Services provided by a tour operator to a foreign tourist in relation to a tour conducted wholly
Taxable services, provided or to be provided, by a Technology Business Incubator/ Science and outside India.
Technology Entrepreneurship Par (TBI/STEP) recognised by NSTEDB or bio- incubators Services supplied by an establishment of a person in India to any establishment of that person
recognised by BIRAC. outside India, which are treated as establishments of distinct persons provided the place of
Services by way of collecting or providing news by an independent journalist, PTI or United News supply of the service is outside India.
of India. Import of services by UN or a specified international organisation for official use of UN or the
Services of public libraries by way of lending of books, publications or any other knowledge- specified international organisation.
enhancing content or material. Import of services by Foreign diplomatic mission or consular post in India, or diplomatic agents or
Services by an organiser to any person in respect of a business exhibition held outside India. career consular officers posted therein subject to specified conditions.
Tour operator service, which is performed partly in India and partly outside India, supplied by a Services provided by an intermediary when location of both supplier and recipient of goods is
tour operator to a foreign tourist, to the extent of the value of the tour operator service which outside the taxable territory subject to specified conditions.
is performed outside India.
However, value of the tour operator service performed outside India shall be such proportion of
the total consideration charged for the entire tour which is equal to the proportion which the
number of days for which the tour is performed outside India has to the total number of days
comprising the tour, or 50% of the total consideration charged for the entire tour, whichever is
less.
Further, in making the above calculations, any duration of time equal to or exceeding 12 hours
shall be considered as one full day and any duration of time less than 12 hours shall be taken as
half a day.
Services by way of pre-conditioning, pre- cooling, ripening, waxing, retail packing, labelling of
fruits and vegetables which do not change or alter the essential characteristics of the said fruits
or vegetables.
Services provided by the National Centre for Cold Chain Development under the Ministry of
Agriculture, Cooperation and Farmer’s Welfare by way of cold chain knowledge dissemination.
Services by a foreign diplomatic mission located in India.
Services by way of granting National Permit to a goods carriage to operate through-out India/
contiguous States.
Services by way of providing information under the RTI Act.
Services provided to a recognised sports body (RSB) by
(a) an individual as a player, referee, umpire, coach or team manager for participation in a
sporting event organised by a RSB;
(b) another RSB.

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 CHAPTER – 6 TIME OF SUPPLY

The provisions relating to time of supply of goods and services can be better understood if the same are studied (b) Other cases
simultaneously appreciating the similarities and differences between the two. Therefore, such provisions have  Date of redemption of the voucher
been summarised by way of a comparison table to help students remember and retain the provisions in a better 5 TIME OF SUPPLY OF GOODS AND SERVICES IN RESIDUAL CASES
and effective manner:
Supply of goods and services in residual cases [Sections 12(5) and 13(5)] i.e where it is not possible to
TIME OF SUPPLY WHERE TAX IS PAYABLE UNDER FORWARD CHARGE determine the time of supply under the other provisions
1
Time of supply of goods [Section 12(2)] Time of supply of services [Section 13(2)] (a) Where a periodical return is required to be filed
Earliest of the following: (a) Invoice issued within the time period prescribed  Due date of filing such return
 Date of issue of invoice by the supplier or the last under section 31 (b) Other cases
date on which he is required under section 31, to Earliest of the following:  Date of payment of tax
Issue the invoice under section 31(1) with respect  Date of issue of invoice by the supplier TIME OF SUPPLY FOR ADDITION IN VALUE BY WAY OF INTEREST/ LATE FEE/PENALTY FOR
6
to the supply  Date of receipt of payment (entering the DELAYED PAYMENT OF CONSIDERATION
 Date on which the supplier receives the payment payment in books of account or crediting of Addition in value by way of interest, late fee/penalty for delayed payment of consideration
(entering the payment in books of account or payment in bank account, whichever is earlier)
Time of Supply - Date on which the supplier receives such addition in value
crediting of payment in bank account, whichever is (b) Invoice not issued within the time period prescribed
CHANGE IN RATE OF TAX
earlier) with respect to the supply – presently under section 31 8 In case of change in rate of tax, determination of rate of tax depends upon three events namely,-
irrelevant for purpose of payment of tax Earliest of the following:
• Date of supply of goods or services,
No GST at the time of receipt of advance for supply of  Date of provision of service
• Date of invoice; and
goods: In case of supply of goods by a registered  Date of receipt of payment (entering the
• Date of receipt of payment
person under forward charge (excluding composition payment in books of account or crediting of
If any two of the above events occur before the change of rate, the time of supply is before the change of
supplier and registered persons making supply of payment in bank account, whichever is earlier)
rate. If any two of them occur after the change of rate, the time of supply is after the change of rate and the
specified actionable claims), GST is to be paid on the (c) When the above events are unascertainable
new rate becomes applicable to the supply. However, in case of supply of goods by a registered person (excluding
outward supply of goods on the date of issue of invoice  Date on which the recipient shows the receipt
composition supplier and registered persons making supply of specified actionable claims), GST is to be paid on the
or the last date on which invoice ought to have been of services in his books of account
date of issue of invoice or the last date on which invoice ought to have been issued in terms of section 31
issued in terms of section 31 [Notification No.
[Notification No. 66/2017 CT dated 15.11.2017].
66/2017 CT dated 15.11.2017].
Using this principle, time of supply of services, in case of change in rate of tax, can be determined as under:
TIME LIMIT FOR RAISING INVOICES
2 Supply Issue of invoice Receipt of payment Time of supply
Supply of goods [Section 31(1) Supply of services [Section 31(2)]
BEFORE BEFORE AFTER Date of issue of invoice
Before or at the time of, Before or after the provision of service but within 30
BEFORE AFTER BEFORE Date of receipt of payment
(a) removal of goods for supply to the recipient, days [45 days in case of insurance companies/banking
BEFORE AFTER AFTER Date of issue of invoice or date of receipt
where the supply involves movement of goods, or and financial institutions including NBFCs] from the
of payment, whichever is earlier
(b) delivery of goods or making available thereof to date of supply of services
AFTER AFTER BEFORE Date of issue of invoice
the recipient, in any other case
AFTER BEFORE AFTER Date of receipt of payment
TIME OF SUPPLY WHERE TAX IS PAYABLE UNDER REVERSE CHARGE
3 AFTER BEFORE BEFORE Date of issue of invoice or date of receipt
Time of supply of goods [Section 12(3)] Time of supply of services [Section 13(3)] of payment, whichever is earlier
Earliest of the following: Earliest of the following:
 Date of receipt of goods, or
 Date of payment as entered in the books of
 Date of payment as entered in the books of
account of the recipient or the date on which the
💡 The provisions relating to time of supply of vouchers that are exchangeable for goods are same as that
of the vouchers that are exchangeable for services. Similarly, the provisions relating to time of supply
account of the recipient or the date on which the payment is debited from his bank account,
of goods falling in the residual category are same as that of the time of supply of services falling in the
payment is debited from his bank account, whichever is earlier, or
residual category. Also, the provisions relating to time of supply for addition in value by way of interest, late
whichever is earlier, or  61st day from the date of issue of invoice by the
fee/penalty for delayed payment of consideration are same for goods and services. Furthermore, concepts like
 31st day from the date of issue of invoice by the supplier
meaning of “Date of receipt of payment”, significance of words “to the extent the invoice or payment covers
supplier
the supply” are also same for goods and services. Students may make a note of the above points as
Where the above events are not ascertainable, the time of supply shall be the date of entry in the books of it will help them in understanding and remembering the provisions in a better manner.
account of the recipient of supply
Import of service from associated enterprise Date of
entry in the books of account of the recipient or the
date of payment, whichever is earlier
4 TIME OF SUPPLY OF VOUCHERS EXCHANGEABLE FOR GOODS AND SERVICES
Supply of vouchers exchangeable for goods and services [Sections 12(4) and 13(4)]
(a) Supply of goods or services is identifiable at the time of issue of voucher
 Date of issue of the voucher

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 CHAPTER – 7 VALUE OF SUPPLY
s

RULE 31: Residual method (Best Judgement Method)

VALUE OF Value shall be determined using reasonable means consistent with the principles and general provisions of
SUPPLY section 15 & valuation rules. For services, rule 31 can be adopted before rule 30.
RULE 31A: Value of supply of lottery, chance to win in betting/ gambling/ horse racing in race club
Lottery organised by State Government - 100/128 of the face value of ticket OR 100/128 of the price as
notified in the Official Gazette by the organising State, whichever is higher
Actionable claim in form of chance to win in betting, gambling or horse racing in a race club - 100% of the
Supply made to Supply where Supply is a face value of the bet or the amount paid into the totalisator
unrelated person Supply made to price is not the notified supply
related person Organising State - State Government which conducts the lottery either within the State or outside the State
where price is the sole consideration u/s 15(5)
sole RULE 31B: Value of supply in case of online gaming including online money gaming = Total amount paid or
payable to or deposited with the supplier by way of money or money’s worth, including virtual digital assets,
by or on behalf of the player. Any amount returned/refunded to player including player not using the amount
paid/deposited with supplier for participating in any event, shall not be deductible from the value of supply of
Value to be determined under online money gaming.
Value of supply =
Chapter IV: Determination of RULE 31C: Value of supply of actionable claims in case of casino = Total amount paid or payable by or on
Transaction value Value of Supply of CGST behalf of the player for:
u/s 15(1) Rules (i) purchase of tokens, chips, etc., for use in casino; or
(ii) participating in any event, including game, scheme, etc., in the casino, in cases where the token, chips,
Inclusions in value u/s 15(2) etc., are not required.
 Taxes other than GST Any amount returned/refunded by the casino to the player on return of token, coins, chips, or tickets, or
 Third party payments made by recipient in relation to supply, which supplier was liable to pay and were not otherwise, shall not be deductible from the value of the supply of actionable claims in casino.
included in the price RULE 32: Value in respect of certain specific supplies ⇒ Purchase/sale of foreign currency:
 Incidental expenses including anything done by the supplier in respect of the supply till delivery of 1st method: Value = [Buying/Selling rate - RBI reference rate at that time] x total units of currency. If no
goods/supply of services, if charged to recipient RBI reference rate, value = 1% of INR received/provided. If the currencies exchanged are not in INR, value
 Subsidies directly linked to price of supply other than the ones given by Central/State Governments = lesser of the 2 amounts that would have been received by converting any of currencies into INR at RBI
 Interest/late fee/penalty for delay in payment of consideration reference rate OR 2nd method
Exclusions from value u/s 15(2)
 Discounts given before or at the time of supply and recorded in the invoice Currency Value
 Post supply discount/incentive, if known in advance & linked with invoices and proportionate input tax credit Upto ₹ 1,00,000 1% or ₹ 250 whichever is higher
reversed by the recipient From ₹ 1,00,001 to ₹ 10,00,000 ₹ 1,000 + 0.5%
VALUATION RULES From ₹ 10,00,001 ₹ 5,500 + 0.1% subject to maximum of ₹ 60,000
⇒ Booking of tickets by air travel agent: Value = 5% of basic fare for domestic bookings and 10% of the
RULE 27: Consideration not wholly RULE 28: Supply between distinct/ RULE 29: Supply made/received basic fare for international bookings.
in money Value shall be either of related persons, other than agent through an agent ⇒ Life insurance business: If amount allocated for investment is intimated - Value = Gross premium less
the following in the given order: Value shall be either of the Value shall be either of the amount allocated for investment; Single premium annuity policies where amount allocated for investment is
 open market value following in the given order: following in the given order: not intimated - Value = 10% of single premium; Other cases – Value = 25% of premium in 1st year and
 total of consideration in money  open market value  open market value or 90% of 12.5% of premium in subsequent years; Policy only towards risk cover – Value = Entire premium
+ amount equal  value of supplies of like kind price charged by recipient to his ⇒ Buying & selling of second hand goods: Value = Selling price – Buying price (ignore if value is negative);
 To the consideration not in and quality unrelated customer for supplies Purchase value of goods repossessed from unregistered borrower = Purchase price- 5% per quarter or part
money  value as per rule 30 or 31 in of like kind and quality; thereof from date of purchase till the date of disposal by the person making repossession
 value of supplies of like kind that order.  value as per rule 30 or 31 in ⇒ Coupon/voucher: Value = money value of supplies redeemable against such voucher/ coupon
and quality  Option to supplier to value that order. ⇒ Notified services between distinct persons without consideration: Value = Nil, if ITC is available
 consideration in money + money goods sold as such by
RULE 33: Supply as a pure agent Costs incurred by the supplier as a pure agent of recipient shall be
value of nonmonetary recipient⇒Value= 90% of price
excluded from value
consideration computed as per charged by recipient to its
RULE 34: Rate of exchange for determination of value Goods = Rate notified by CBIC under Customs Act on
rule 30 or 31 in that order unrelated customer
the date of time of supply of such goods; Services = Rate as per GAAP on the date of time of supply of
 Recipient eligible for ITC ⇒
such services
invoice value = open market
Rule 35: Value inclusive of taxes Where value of supply is inclusive of CGST, SGST/UTGST or IGST, the
value (taxable value)
tax amount is calculated by making back calculations. Tax amount = (Value inclusive of GST x GST rate in %
RULE 30: Value based on cost of IGST or CGST, SGST/UTGST)/100 + sum of applicable GST rates in %)
Value shall be 110% of cost of production/ acquisition/ provision of goods or services

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YZ
CHAPTER – 8 INPUT TAX CREDIT

I.I Definitions of certain key terms are summarized by way of diagrams as under:
b
a Goods Services
BUSINESS

includes CAPITAL
INPUTS INPUT SERVICES
GOODS
Any activity incidental/ancillary to it
Any trade/commerce, manufacture, profession,
vocation etc. even if there is no monetary Any activity of same nature even if no means means means
benefit volume/ continuity/frequency

Supply/acquisition of goods including capital in connection with commencement/ closure goods value of which is capitalized in the books goods other than
of business services
goods & services of account of person claiming ITC capital goods

Provision of facilities by to its members for consideration

club/association/society etc.
used/intended to be used in the course/furtherance of business

Admission to any premises for a consideration

c
INPUT TAX

Services as holder of an office accepted in course/ furtherance of trade,

profession/vocation

totalisator or a licence to book maker or Means includes Excludes

Activities of a race club including by way of
activities of a licensed book maker in such
club

Any activity by Government /local authority Government includes both Central and Tax payable under IGST leviable on Composition
means
as public authorities State Government reverse charge import of goods tax

a
EXEMPT SUPPLY
CGST SGST UTGST IGST

means includes d
means Principal

Supply attracting NIL rate of tax Supply wholly exempt from Non-taxable supply any person supplying goods
NON-RESIDENT TAXABLE as
and/or services occasionally Agent
PERSON

having NO fixed place of In any other

CGST IGST capacity
business/residence in India

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YZ
CHAPTER – 8 INPUT TAX CREDIT

e INWARD SUPPLY a
e

Time limit for availing ITC - ITC pertaining to

If depreciation
Goods received in lots- a particular FY can be availed by 30th
means claimed on tax
ITC allowed upon receipt November of next FY or filing of annual return,
component, - ITC not
of last lot whichever is earlier. Exception: Re-availment of
allowed.
ITC reversed earlier
receipt of goods and/or services by
b
* Proportionate ITC to be reversed/paid with interest if whole/part of value +
tax of goods and /or services is not paid within 180 days of the issuance of
invoice.
purchase acquisition any other means
* On payment to supplier, the ITC could be re-availed without time limit.

with/without consideration
EXCEPTIONS

Supply of goods and /or

* Reverse charge supplies
Export of goods and/or services for authorised
ZERO-RATED SUPPLY *Deemed supplies without consideration
services operations to SEZ
* Additions made to value of supplies on account of supplier’ sliability being
developer/ SEZ unit
incurred bythe recipient of the supply

III. Provisions of section 17 relating to apportionment of credit and blocked credits read with relevant
II.
II Provisions of section 16 relating to eligibility and conditions for taking ITC read with relevant rules are III
rules are summarized as under:
summarized below:
A. Apportionment of credit

Exempt supplies include reverse charge supplies & transactions in securities and exclude activities specified
in Schedule III except sale of land and sale of building when entire consideration is received post
completion certificate/first occupation, whichever is earlier and the value of such activities/transactions as
may be prescribed in respect of clause (a) of paragraph 8 of the said Schedule.

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YZ
CHAPTER – 8 INPUT TAX CREDIT

B. Special provisions for banking companies and NBFCs

• Balance will be reversed in GSTR-

3B.
Option 1: Avail Option 2: Avail 50% of
• Restriction of 50% shall Not apply
proportionate ITC eligible ITC
to the tax paid on supplies
received from another registration
within the same entity.
Option once exercised cannot be
withdrawn during remaining part of
the year.

C. Apportionment of common credit in case of inputs and input services

 C3 will be computed separately for ITC of CGST, SGST/ UTGST and IGST.
T  ∑ (D1 + D2) will be computed for the whole financial year, by taking exempted
turnover and aggregate turnover year. for the whole financial If this amount
Total IT on I + IS is more than the amount already reversed every
 month, the differential amount will be reversed in any of the month till
September of succeeding year along with interest @ 18% from 1st April of
succeeding year till the date of payment. If this amount is less than the
T1 T2 T3 C1 amount reversed every month, the additional amount paid has to be claimed
back as credit in the return of any month till September of the succeeding
year.
IT on I+IS used IT on I+IS used Blocked credits u/s Remaining ITC  Exempt supplies include reverse charge supplies & transactions in securities.
exclusively for non- exclusively for exempt 17(5) credited to ECrL = T-  Exempt supplies exclude (i) activities specified in Schedule III except sale of
business purposes supplies (T1 + T2 + T3) land and sale of building when entire consideration is received post completion
certificate/first occupation, whichever is earlier, and supply of warehoused
goods before clearance for home consumption* (ii) services of accepting
deposits, extending loans/advances where the consideration is interest/discount
T1 T1 and the same are provided by persons other than banking company/financial
institution including NBFC, and (iii) the value of supply of Duty Credit Scrips
specified in Notification No. 35/2017 CT (R) dated 13.10.2017
Credit attributable to I + IS used exclusively
Common credit = C1 – T4  Value of supply of warehoused goods before clearance for home consumption
in taxable supplies including ZRS
includes the value of supply of goods from Duty Free Shops at arrival terminal
in international airports to the incoming passengers.
D1  Aggregate value of exempt supplies and total turnover exclude central excise
D2 C3
duty, state excise duty, central sales tax and VAT.
 Value of exempt supply in respect of land and building is the stamp duty value
Credit attributable to exempt supplies- and for security is 1% of the sale value of such security.
Credit attributable to non- Remaining common credit =
D1 = E x C2
business purpose if common C2 – (D1 + D2)
F
I + IS used partly for
E = Value of ES during tax period
business + non -business
F = Total turnover in the State during Eligible ITC attributable
purposes D2 = 5% x C2
tax period If no turnover during the tax to business & taxable
period/values not available, values for supplies including ZRS
IT = Input tax
last period may be used.
I = Inputs
Ineligible ITC
IS = Input services
Total eligible ITC =
ECrl =Electronic Credit Ledger
T4 + C3
ZRS = Zero rated supply
To be reversed
ES = Exempt supplies

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YZ
CHAPTER – 8 INPUT TAX CREDIT

D. Apportionment of common credit on capital goods

Total input tax (IT) on capital goods (CG)

(a) (b) (c)

IT on CG used IT on CG used IT on CG not covered under (a) &

exclusively for non- exclusively for taxable (b) denoted as ‘A’ and useful life  Tm is to be computed during the useful life of capital goods which is five years
business/exempt supplies including zero of such CG → 5 years from date from the date of invoice.
supplies rated supply (ZRS) of invoice  Tie and Te are to be computed separately for ITC of CGST, SGST/ UTGST
and IGST and declared in GSTR-3B
 Exempt supplies include reverse charge supplies & transactions in securities.
Not credited in Electronic  Exempt supplies exclude:
Credited to ECrL Credited to EcrL
Credit Ledger (ECrL)  (i) activities specified in Schedule III except sale of land and sale of building
when entire consideration is received post completion certificate/first
occupation, whichever is earlier, and supply of warehoused goods before
clearance for home consumption*
Tc
 (ii) services of accepting deposits, extending loans/advances where the
consideration is interest/discount and the same are provided by persons other
than banking company/financial NBFC, and
Tm Common credit on CG ⇒ Tc = ∑ (A of common CG whose  (iii) the value of supply of Duty Credit Scrips specified in Notification No.
useful life remains during the tax period) 35/2017CT (R) dated 13.10.2017
⇒ If CG under (a) subsequently gets covered under (c),  *Value of supply of warehoused goods before clearance for home consumption
then ‘A’ = IT on CG under (a), and ‘A’ to be credited to includes the value of supply of goods from Duty Free Shops at arrival terminal
ECrL. Tie = 5% of ‘A’ for every quarter or part thereof in international airports to the incoming passengers.
Common credit of CG for a tax when CG was under (a) and Tie to be added to output tax  Aggregate value of exempt supplies and total turnover exclude central excise
period during their useful life liability of the tax period when ‘A’ is claimed. duty, state excise duty, central sales tax and VAT.
Tm = Tc/60 ⇒ If CG under (b) subsequently gets covered under (c),  Value of exempt supply in respect of land and building is the stamp duty value
then IT claimed on CG under (b) to be added to Tc and for security is 1% of the sale value of such security.

Te

Common credit towards exempted supplies

Te = E x Tr
Added to output tax liability F
along with interest E → Aggregate value of exempt supplies during the tax period;
F → Total turnover in State during the tax period. If no
turnover during the tax period/values not available, values
period may be used. For last period may be used.
tax

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CHAPTER – 8 INPUT TAX CREDIT

BLOCKED CREDITS PART-B

Inward supplies received by taxable person for

WCS for construction of immovable
BLOCKED CREDITS PART-A construction of immovable property on his own account
property
including when such supplies are used in the course or
furtherance of business

EXCEPTIONS EXCEPTIONS
Ineligible Ves & GI, Servicing, R&M Leasing/renting/hiring of F&B, Outcat, BT,
MV AC relating to ineligible MV, Ves or AC on which HS, C&PS, LI &
MV, Ves, AC ITC is disallowed HI

(A) WCS for P & M (A) Construction of P & M

(B) WCS availed by a works (B) Construction of
EXCEPTIONS EXCEPTIONS EXCEPTIONS EXCEPTIONS EXCEPTIONS contractor for further supply of Credit available immovable property for
WCS [Sub-contracting] on such others
(C) Where value of WCS is not exceptions (C) Value of construction is
When used When used (i) When ineligible MV, (i) When used for (i) Where a particular capitalized not capitalised
for – for- Ves or AC are used making an outward category of such
(i) making (i) making for eligible purposes taxable supply of the inward supplies is used
further further taxable (ii) When received by same category for Making an outward
taxable supply of such manufacturer of (subcontracting) or as taxable supply of the
supplies of Ves or AC ineligible MV, Ves or an element of a same category - Goods lost/ stolen/ destroyed/
Inward supplies charged to Inward supplies
such MV (ii) passenger AC taxable composite or [Subcontracting] or as written off or disposed of by
composition levy used for personal
(ii) trptn of trptn service (iii) When received by mixed supply. an element of a way of gift or free samples consumption
passengers (iii) imparting a GI service provider (ii) When provided by taxable composite or
(iii) training training on in respect of such an employer to its mixed supply
imparting on navigating/flyin ineligible MV, Ves employees under (ii) When provided by
driving such g such Ves/AC Or AC insured by it statutory obligation an employer to its
ineligible (iv) trptn Employees under a Ineligible MV-Motor vehicle for transportation (A) Construction includes re-
MV of goods statutory obligation of persons with seating capacity of ≤ 13 persons construction/ renovation/ addition/
(including driver); Ves & AC-Vessel & Aircraft; alterations/ repairs to the extent of
GI-General insurance; R&M-Repairs & capitalisation to said immovable
maintenance; F&B-Food & beverages; Outdoor property.
Credit available on the above exceptions
catering; BT-Beauty treatment; HS-Health (B) P & M means apparatus, equipment,
services; C&PS-Cosmetic & plastic surgery; & machinery fixed to earth by
LILife insurance; HI-Health insurance; foundation or structural supports but
Membership of club Travel benefits to Inward supplies Tax paid u/s 74 (Tax
NRTPNon-resident taxable person; WCS-Works excludes land, building/ other civil
&health &fitness Centre employees on vacation received by NRTP short / not paid or
contract service; LTC-Leave Travel Concession; structures, telecommunication towers,
(LTC/HT) erroneously refunded
HT-Home town; trptn-transportation; P & and pipelines laid outside the factory
due to fraud etc.,) 129
MPlant & machinery premises.
(Amount paid for
EXCEPTION EXCEPTION EXCEPTION release of goods and
conveyances in transit IV. Provisions of section 18 read with relevant rules are summarized as under:
which are detained) and IV A. Special circumstances enabling availing of credit
When provided by an When provided by an Goods 130 (Fine paid in lieu of
employer to its employees employer to its imported by confiscation)
under a statutory obligation employees under a him
statutory obligation

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CHAPTER – 8 INPUT TAX CREDIT

B. Special circumstances leading to reversal of credit/payment of amount

Special circumstances enabling availing
of credit
Special circumstances leading to reversal of credit /payment of
amount

Registered person Registered Person applying Person

switching from person's for registration obtaining
within 30 days of voluntary Registered person (who has Supplies of Cancellation Supply of capital goods
composition levy to exempt supplies
regular scheme of becoming becoming liable registration availed ITC) switching from registered person of (CG)/ plant and
for registration regular scheme of payment getting wholly registration machinery (P& M) on
payment of taxes taxable
of tax to composition levy exempted from tax which ITC has been
taken

Amount to be reversed is equivalent to ITC on: Amount to be paid is

Credit entitled on Credit entitled on Inputs held in stock/inputs contained in semi-finished or finished goods equivalent to higher
Inputs as such held in stock Inputs as such held in stock held in stock of the following:
Inputs contained in semi-finished goods held in Inputs contained in semifinished Goods held Capital goods (i) ITC on CG or P&M
stock in stock on the day immediately preceding the date of switch over/ date of less 5% per quarter
Inputs contained in finished goods held in stock Inputs contained in finished goods held in exemption/date of cancellation of registration or part thereof from
Capital goods [In case of exempt supply the date of invoice
becoming taxable Capital goods used exclusively (ii) Tax on
for such exempt supply] reduced by 5% per transaction
quarter or part thereof from the date of value of such CG or P
Manner of reversal of credit on inputs and capital goods & other conditions
invoice & M
(i)Inputs⇒ Proportionate reversal based on corresponding invoices. If such
Note: ITC claimed shall be verified with the If amount at (i)
invoices not available, prevailing market price on the effective date of
corresponding details furnished by the corresponding exceeds (ii), then
switch over/ exemption/cancellation of registration should be used with due
supplier. reversal amount
certification by a practicing CA/ Cost Accountant
will be added to
(ii)Capital goods ⇒ Reversal on pro rata basis pertaining to remaining useful
output tax
life (in months), taking useful life as 5 years.
liability.
(iii) ITC to be reversed will be calculated separately for ITC of CGST,
Separate ITC
SGST/UTGST and IGST.
On the immediately On the day reversal is to be
On the day On the day (iv) Reversal amount will be added to output tax liability of the registered
Day preceding immediately done for CGST,
immediately immediately person.
the date from which preceding the SGST/UTGST and
preceding the preceding (v) Electronic credit/cash ledger will be debited with such amount. Balance
he becomes liable to date from which IGST
date from which the date of ITC, if any, will lapse.
pay tax under he becomes Tax to be paid on
such supply registration
regular scheme liable to pay tax transaction value
becomes taxable
when refractory
bricks, moulds,
ITC, in all the above cases, is to be availed within 1 year from the date of issue of invoice by the supplier. dies, jigs &
fixtures are
Conditions for availing above credit: supplied as scrap.
(i) Filing of electronic declaration giving details of inputs held in stock/contained in semi-finished goods and
finished goods held in stock and capital goods on the daysimmediately preceding the day on which credit becomes
eligible.
(ii) Declaration has to be filed within 30 days from becoming eligible to avail credit.
(iii) Details in (i) above to be certified by a practising CA/ Cost Accountant aggregate claim of CGST, SGST/
IGST credit is more than ₹ 2,00,000.

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CHAPTER – 8 INPUT TAX CREDIT

V.
V Provisions of section 20 and 21 read with relevant rules are summarized as under: VI.
VI Provisions relating to utilization of ITC are summarized as under:
ISD is basically an office meant to receive tax invoices towards receipt of input services and distribute the
credit of taxes paid on such input services to supplier units (having the same PAN) proportionately
I. ITC II. ITC III. ITC
An ISD is required to obtain a separate registration  ITC of input services is distributed only amongst
of IGST of CGST of SGST
even though it may be separately registered. The those recipients to whom the input services are
threshold limit of registration is not applicable to ISD. attributable. IGST CGST SGST
 ITC is distributed amongst the operational units only
and in the ratio of turnover in a State/UT of the
recipient during the relevant period to the aggregate
of turnover of all recipients during the relevant period
to whom input service being distributed is
attributable. CGST/SGST in IGST IGST, only
 Relevant period is previous FY or last quarter prior to any order & in when ITC of
the month of distribution for which turnover of all any proportion CGST = NIL
recipients is available.
 Distributed ITC should not exceed the credit available
for distribution.
ITC of IGST =
 ISD should issue an ISD invoice for distributing If the ISD has distributed excess credit to any recipient,
NIL
ITC. It should be clearly indicated in such invoice the excess will be recovered from the recipient with
that it is issued only for distribution of ITC. interest as if it was tax not paid. ITC of SGST/
 The ISD needs to issue a ISD credit note, for ITC of CGST UTGST
reduction in credit if the distributed credit gets
reduced for any reason.
SGST/ CGST
 ITC available for distribution in a month is to be
UTGST
distributed in the same month.
 Details of distribution of credit and all ISD
invoices issued should be furnished by ISD in
monthly GSTR-6 within 13 days after the end of
the month.
Transfer of unutilised ITC on account of change in onstitution of registered person
In case of sale, merger, In case of demerger, Details of change in Upon acceptance of such
amalgamation, lease or ITC is apportioned in constitution are to be details by the transferee on
transfer of business, the ratio of value of furnished on common the common portal, the
unutilised ITC can be entire assets (including portal along with request unutilized ITC is credited to
transferred to the new assets on which ITC to transfer unutilised his Electronic Credit Ledger.
entity if there is a specific has not been taken) of ITC. CA/Cost Accountant
provision for transfer of the new units as per certificate is to be
liabilities to the new entity. the demerger scheme. submitted certifying that
The inputs and capital goods change in constitution has
so transferred should be been done with specific
duly accounted for by the provision for transfer of
transferee in his books of liabilities.
accounts.
Transfer of unutilised ITC on obtaining separate registrations for multiple places of business ithin a State/UT
Registered person having Value of assets means The registered person Upon acceptance of such
separate registrations for the value of the entire should furnish the details by the newly
multiple places of business assets of the business prescribed details on the registered person
can transfer the unutilised irrespective of whether common portal within a (transferee) on the common
ITC to any or all of the ITC has been availed period of 30 days from portal, the unutilised ITC is
newly registered place(s) of thereon or not. obtaining such separate credited to his electronic
business in the ratio of the registrations. credit ledger.
value of assets held by them at
the time of registration.

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CHAPTER – 9 REGISTRATION

Nature of registration Compulsory registration in certain cases

1 4
The registration in GST is PAN based and State specific.
Casual taxable person who
One registration per State/UT. does not have a fixed A person receiving supplies
Persons making any place of business in the on which tax is payable by
interState taxable supply State or Union Territory recipient on reverse charge
However, a business entity having separate places of business in a State from where he wants to basis
may obtain separate registration for each of its places of business . make supply

GST identification number called “GSTIN” - a 15-digit number and a certificate Those ecommerce Non-resident taxable
of registration incorporating therein this GSTIN is made available to the Persons who are required
operators who are notified persons who do not have a
applicant on the GSTN common portal. to deduct tax under
as liable for tax payment fixed place of business in
section 51 (TDS)
under section 9(5) India

Registration under GST is not tax specific, i.e. single registration for all the
taxes i.e. CGST, SGST/UTGST, IGST and cesses.
A person who supplies on Suppliers other than
Every e-commerce operator
behalf of some other notified under section 9(5)
who is required to collect
taxable person (i.e. an who supply through an e-
Persons liable to registration TCS
2 Agent of some Principal) commerce operator

In case of transfer of In case of amalgamation/ Every person

Those who exceed Person supplying
demerger by an order of supplying OIDAR Input Service
threshold limit business on account of online money Person/ class of
High Court etc. services from a Distributor,
succession, etc. gaming from a persons notified by
place outside India whether or not
place outside India the Central/ State
to a person in separately
to a person in Government
India other than a registered
Transferee liable to be registered India
Threshold limit Transferee liable to registered person
from the date on which Registrar of
elaborated be registered from
Companies issues incorporation
separately in the the date of succession 5
certificate giving effect to order of Persons not liable for registration
diagram below. of business
High Court etc.
Persons making only reverse charge supplies Persons making inter-State supplies of taxable
services up to ₹ 20 lakh**

Taxable Exempt Inter State Aggregate Persons making inter-State taxable supplies of Casual Taxable Persons making inter-State
Exports
Supplies supplies supplies Turnover notified handicraft goods and notified hand-made taxable supplies of notified handicraft goods
goods up to ₹ 20 lakh** and notified handmade goods up to ₹ 20 lakh**

Aggregate Turnover will be computed on All-India basis for same PAN

3 Person engaged exclusively in supplying goods/ Agriculturist limited to supply of produce out
Applicable threshold limit
services/ both not liable to tax/ wholly exempt from of cultivation of land
tax

Persons making intra-State supplies of goods through Persons making intra-State supplies of goods
an ECO with aggregate turnover not exceeding through an ECO with aggregate turnover not
threshold limit and not making supply in more than one exceeding threshold limit and not making supply
State/UT, with one enrolment no. in more than one State/UT, with one enrolment
no.

** ₹ 10 lakh in case of Special Category States of Mizoram, Tripura, Manipur & Nagaland

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CHAPTER – 9 REGISTRATION

Where and by when to apply for registration? Procedure for registration has been depicted by way of a diagram below:
6 9
Person who is liable to be A casual taxable
A person who makes a supply from Procedure for registration
registered under section 22 or person or a nonresident
the territorial waters of India
section 24 taxable person

in the coastal State/UT

in every such State/UT in Part I
in every such State/UT in where the nearest point
which he is so liable
which he is so liable of the appropriate base
line is located.

Every person liable to get registered and person seeking voluntary registration shall, before
applying for registration, declare his Permanent Account Number (PAN) and State/UT in Part A of
within 30 days from the at least 5 days prior to within 30 days from the
FORM GST REG-01 on GST Common Portal.
date on which he becomes the commencement of date on which he becomes
liable to registration business liable to registration

PAN is validated online by Common Portal from CBDT database and is also be verified through
Voluntary Registration and UIN separate OTPs sent to the PAN linked mobile number and e-mail address.
7

Person not liable to be registered under

Voluntary Registration sections 22/24 may get himself
registered voluntarily. Temporary Reference Number (TRN) is generated and communicated to the applicant on the
validated mobile number and e-mail address.

In respect of supplies to some notified

Unique Identification agencies of United Nations organisation, Using TRN, applicant shall electronically submit application in Part B of application form, along
Number (UIN) multinational financial institutions and other with specified documents at the Common Portal.
organisations, a UIN is issued. Part B of application contains the details, such as, constitution of business, jurisdiction, option
for composition, date of commencement of business, reason to obtain registration, address of
PPoB and nature of activity carried out therein, details of APoB, details of bank account(s),
Effective date of registration
8 details of authorized signatory, aadhaar authentication, etc.

Application submitted within 30

days of the Effective date is the date on which
the person becomes liable to
applicant becoming liable to registration On receipt of such application, an acknowledgement in the prescribed form shall be issued to the
registration applicant electronically. A Casual 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 said deposit.*

Application submitted after 30

Effective date is date of grant of
days of the applicant becoming
registration
liable to registration
Application shall be forwarded to the Proper Officer.

Deemed registration
Grant of registration/UIN under any SGST Act/ Rejection of application for The procedure after receipt of application by the Proper Officer is depicted in Part II.
UTGST Act is deemed to be registration/UIN registration/UIN under SGST Act/UTGST Act
granted under CGST Act provided application for is deemed to be rejection of application for
registration has not been rejected under CGST Act. registration under CGST Act. * Discussed in detail in subsequent paras.

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CHAPTER – 9 REGISTRATION

10 Part-II

Proper Officer examines the application and accompanying documents.

If same are found in order?

Yes

Registration No
Yes Proper Officer issues notice thereby
granted within
Registration is granted within 30 seeking clarification**,information or
7 working days
days of application after documents from the applicant
from the date
verification of site & prescribed electronically
of submission
of application documents
without site
verification

If applicant has furnished

within 30 days within 7 the
from working days clarification**,information
where application from or documents within 7
if applicant applicant where PO submission application
where a person, working days’ time from
successfull fails to deem s it date submission date
who has receipt of notice?
y validates undergo fit to
Aadhaar undergone
his carry out (c)
authentic Aadhaar Yes
aadhaar site
at ion/ authentication, is
authenticat verific
does not identified on
ion, ation
opt for common portal, where PO deems If proper Proper officer
Aadhaar based on data it fit to carry
(B) officer is may reject the
authentic analysis & risk out site
(A) where a where PO satisfied with application for
atio parameters, to verification Other
person fails deems it fit it? reasons to be
carry out site undergone cases
verification to undergo to carry out Aadhaar recorded in
(B) Aadhaar site Yes writing.
authentication, is
authenticat verification identified on
(B) ion/does common portal,
not opt for Proper officer will grant
based on data
Aadhaar registration within 7 working
analysis & risk
authenticat days from the date of receipt
parameters, to
ion of information/ clarification/
carry out site
documents
verification

**Clarification includes modification/correction of particulars declared in the application for registration other than PAN, State Mobile No. & E-mail address.
**Clarification includes modification/correction of particulars declared in the application for registration other than PAN, State Mobile No. & E-mail address.

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CHAPTER – 9 REGISTRATION
Cancellation or suspension of registration and revocation of cancellation of registration
13
Special procedure for registration of CTP and NRTP
11 Registratio --Business discontinued/ Registratio A registered person has contravened
n can be Transferred/ Amalgamated n can be the prescribed provisions
Casual Taxable Person Non-resident Taxable Person cancelled with other legal cancelled
A registered person has not filed
either by entity/Demerged or by the
A Casual taxable person is one who has returns for continuous 6 months or 2
proper Otherwise disposed of proper
a registered business in some State in A Non-Resident taxable person is one who tax periods (return for a F.Y. beyond 3
officer or officer on
India, but wants to effect supplies from is a foreigner and occasionally wants to months from due date of furnishing the
on Change in the constitution his own
some other State in which he is not effect taxable supplies from any State in said return for composition supplier)
application of the business
having any fixed place of business. India, and for that he needs GST of the Voluntarily registered person has not
registration. registered
Taxable person no longer commenced the business within 6
person months from the date of registration
Such person needs to register in the liable to be registered or
State from where he seeks to supply as intends to opt out of
a Casual taxable person. voluntary registration Registration was obtained by means
of fraud, wilful misstatement or
suppression of facts

Once a registered person has applied for cancellation of registration or the proper officer seeks to cancel his
Casual Taxable Person Non-resident taxable person
registration, proper officer may suspend his registration during pendency of proceedings relating to cancellation
of registration filed by such registered person.

GST law prescribes special procedure for registration, as also for extension of the operation period of such 14 Procedure for cancellation
Casual or Non-Resident taxable persons.

Where the registered person applies for Where the proper officer cancels the registration
cancellation
They have to apply for registration at least 5 days in advance before making any
PO shall issue a SCN to the registered person who
Registered person seeking cancellation has to reply to said notice within 7 days.
shall apply for the same within 30 days
of occurrence of the event warranting
Registration is granted to them or period of operation is extended only after they make advance deposit of cancellation, in prescribed form, Cancellation
the estimated tax liability. Proceedings shall be dropped order shall
furnishing the details of inputs held in
stock or inputs contained in be issued
semifinished/finished goods held in within 30
Registration is granted to them for the period specified in the registration application or 90 days from the stock and of capital goods held in Where instead of days of reply
stock on the date from which If reply to replying to SCN, to SCN
effective date of registration.
cancellation of registration is sought, SCN is person furnishes all where
liability thereon, payment, if any made pending returns & registration
satisfactory makes full payment of
& relevant documents. is liable to
tax along with interest be cancelled
12 Amendment of Registration & late fee.
Proper officer (PO) shall issue the order of cancellation
Except for the changes in some core information in the registration application, a taxable person shall be able to within 30 days of submission of application for the
make amendments without requiring any specific approval from the tax authority. same.

In case there is change in core fields of information, the taxable person will apply for amendment within 15 days
of the event necessitating the change. The Proper Officer, then, will approve the amendment within the next 15
days.

For changes in non-core fields, no approval of the Proper Officer is required, and the amendment can be affected by the
taxable person on his own on the common portal.

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CHAPTER – 9 REGISTRATION

15
Revocation of cancellation
In case where registration is cancelled suo-motu by the proper officer, the taxable person can apply within 90 days (extendible by 180 days by Commissioner or officer authorised not below the rank of Additional/Joint
Commissioner) of service of cancellation order, requesting the officer for revoking the cancellation ordered by him.
However, before so applying, the person has to make good the defaults (by filing all pending returns, making payment of all dues and so) for which the registration was cancelled by the officer.
If satisfied, the proper officer will revoke the cancellation earlier ordered by him.
However, if the officer concludes to reject the request for revocation of cancellation, he will first observe the principle of natural justice by way of issuing notice to the person and hearing him on the issue.
However, there shall be deemed revocation of cancellation upon furnishing of pending GST returns subject to the condition that the registration has not been cancelled by the proper officer under rule 22.

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CHAPTER – 10 TAX INVOICE, CREDIT AND DEBIT NOTES

Who can raise a tax invoice?

1
due date of payment is on/before due date of
ascertainable from the payment
contract

In case of continuous supply of not so ascertainable before/at the time of

services receipt of payment

payment is linked to the on/before the date of

completion of an event completion of that event

3 Important contents of tax invoice

Consecutive Name, address Name & address of

Name, address & Serial & GSTIN of recipient alongwith delivery
GSTIN of supplier Number & recipient, if address ,name & State
date of issue registered code, if not registered

Time limit for issuance of invoice Description of

2 Quantity in Total Value of supply
HSN goods or
case of goods
services
Taxable supply

Tax rate – Central

Taxable Value of tax & State tax or Amount of tax
Goods Services Place of supply
supply Integrated tax, charged
cess

Within 30 days Address of Signature of supplier or QR code having

Involving Tax payable
No Sale or delivery where authorised signatory - not embedded IRN in
from the supply of on reverse
movement movement different than req. if e-invoice issued as it - in case if e-
return services charge basis
of goods of goods place of supply per IT Act, 2000 invoice issued
supplies

4 Manner of issuing the invoice

Insurance, Supply of Goods Supply of services

At the At the
time of Before or at the Banking - Triplicate Duplicate
time of
removal time of supply, or 45 days Original copy for recipient Duplicate copy for Original copy for recipient; and Duplicate copy for
delivery
within 6 months transporter; and Triplicate copy for supplier supplier
from the removal – The serial number of invoices issued during a month / quarter shall be furnished electronically in FORM GSTR-
whichever is earlier 1.
E-invoicing
5
A. Class of persons mandatorily required to issue e-invoice [Notified Taxpayers]

All registered businesses

In case of
continuous • before/at the time each successive statements of accounts is issued
supply of goods or each successive payment is received with an aggregate turnover (based on PAN) greater than ₹ 5 crore Required to issue Einvoice

in any preceding financial year from 2017-18 onwards

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 34
XYZ
CHAPTER – 10 TAX INVOICE, CREDIT AND DEBIT NOTES

B. Important terms
Early payment
E-invoice schema

Cost reduction

Improved efficiency of business

Uniform standard
Form GST INV-1 Reduction of tax evasion
format

Elimination of fake invoices

D. Situations in which e-invoices are applicable

containing
mandatory Supply of goods and/or services to a registered person by notified
applicable for all
specified fields to person [B2B supplies]
businesses across
be reported in
the country
electronic format Applicable
to IRP

Exports by notified persons

Invoice Registration Portal [IRP] Applicable

website
for uploading or reporting of invoices
by notified persons B2C supplies by notified persons
Invoice Reference Number [IRN]
Unique reference number Not applicable

Invoices issued by Input Service Distributor

generated and returned by IRP
Not applicable

Supplies made by notified person, tax on which is payable under

on successful registration of e-invoice reverse charge under section 9(3)

Applicable

GST invoice will be valid only with a valid IRN Where specified category of supplies are received by notified
persons from unregistered persons [attracting reverse charge under
section 9(4)] or through import of services
C. Advantages of e-invoicing Not applicable
Auto-reporting of invoices into GST return
Auto-reporting of invoices into GST return

Auto-generation of e-way bill Import of goods (Bills of Entry)

Substantial reduction in transcription errors Not applicable

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 35
XYZ
CHAPTER – 10 TAX INVOICE, CREDIT AND DEBIT NOTES

E. No requirement of issuing invoice copies in triplicate/duplicate I. Cancellation of reported invoice

No need of issuing invoice copies in

Where e-invoicing is applicable
triplicate/duplicate

F. Exemption from e-invoicing

Special Economic Zone units

Insurer/banking company/financial institution including NBFC

GTA supplying services in relation to transportation of goods by road in a J. Amendment of reported invoice
goods carriage

Supplier of passenger transportation service

Possible
only on GST
Person supplying services by way of admission to exhibition of Amendment portal
cinematograph films in multiplex screens of e-invoice
already
Government Department and local authority uploaded on
IRP Not
possible
through the
G. Overall work flow of e-invoice IRP

Taxpayers (suppliers) create 6

GST invoices on their own
Taxpayers upload the e-
Accounting/Billing/ERP IRP generates IRN Revised Tax Invoice
invoice schema to IRP
systems as per e-invoice
schema [Form GST INV-01]
Revised Tax Invoices to be issued in respect of taxable supplies
effected during this period

Supplier shares the e-

IRP returns e-invoice to IRP digitally signs the e- Effective date of registration Date of issuance of certificate of registration
invoice with recipient (along
supplier invoice and add QR code
with QR code)
Consolidated Revised Tax Invoice (CRTI) may be issued in respect of taxable supplies made to an
unregistered recipient during this period

H. Generation of e-way bill/populating relevant parts of GST return through e-invoicing data
In case of Inter-State supplies, where the value of a supply does not exceed ₹ 2,50,000, a CRTI may be
IRP sends e-invoice data along with IRN issued separately in respect of all unregistered recipients located in a State.

7 Consolidated Tax Invoice

GST System E-way bill system
Value of supply < ₹ 200 Consolidated Tax Invoice issued
supplies at shall be for such the
Auto-populate Tax invoice is not required to be close of each day in respect of all
Auto-populate data data into Parameters e.g. ‘Transporter ID’ and Recipient is unregistered
into GSTR-1 of ‘Vehicle Number’, etc. reported in issued such supplies
Recipient does not require such
GSTR-2A of einvoice schema facilitate generation of
supplier invoice
respective e-way bill
receiver

8YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 36
XYZ
CHAPTER – 10 TAX INVOICE, CREDIT AND DEBIT NOTES

Bill of Supply 11 Invoice and payment vouchers to be issued by recipient of supply liable to pay tax under reverse charge

x Payment Voucher

Where Recipient is registered Receives the supplies taxable on Reverse

Charge basis

under section 9(3) under section 9(4)

Supplier is registered Supplier is unregistered Supplier is unregistered

Recipient will issue a Payment Voucher at the time of making payment to supplier.

12 Invoice

Receipt Voucher
9 Receives the supplies taxable on Reverse
Where Recipient is registered
Charge basis
Advance payment
Supplier Recipient

Receipt Voucher
under section 9(3) under section 9(4)

determinable
Where at the time of receipt of advance, rate of tax/ nature of supply is not determinable
Supplier is registered Supplier is unregistered Supplier is unregistered
Where at the time of receipt of advance
(i) rate of tax is not determinable tax shall be paid at the rate of 18%
(ii) nature of supply is not determinable same shall be treated as inter-State supply

Refund Voucher
10 Recipient shall issue Invoice
Advance payment
Credit Notes
13
Advance payment Where one or more tax invoices have issued for supply of any goods or services or both
Supply Taxable value in invoice
Supplier Recipient >Taxable value in respect of such
supply OR where the goods supplied are OR where goods or services
Tax Invoice returned by the recipient or both supplied are
Tax charged in invoice
Refund Voucher >Tax payable in respect of such found to be deficient
supply

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 37
XYZ
CHAPTER – 10 TAX INVOICE, CREDIT AND DEBIT NOTES
Registered Supplier of goods or may issue one or more credit notes Recipient of goods or services or
services or both for supplies made in a FY both
Debit Notes
14
Where one or more tax invoices have been issued for supply of any goods or services or both

Taxable value in invoice <Taxable value in respect of such supply

Taxable value in invoice <Taxable value in respect of such supply

may issue one or more debit notes Recipient of goods or

Registered Supplier of goods or
for supplies made in a FY service or both
services or both

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 38
XYZ CHAPTER – 11 ACCOUNTS AND RECORDS & -ARHAM INSTITUTE
9039600091

1 Who is required to maintain his books of accounts and at which place? 4 Records to be additionally maintained by a manufacturer and service provider

Every registered person

raw materials/services used in manufacture
is required to maintain his books of accounts at and
Monthly production
APoB PPoB APoB Manufacturer accounts showing
quantitative details of

2 Accounts and records required to be maintained goods so manufactured including waste

and by-products

A true and correct account of following is to be maintained:

quantitative details
Production or Inward and Stock of ITC Output of goods used in the
Records
manufacture outward supply provision of services
goods availed tax prescribed
of goods of goods or payable by rules Service provider Accounts showing
services or and paid
both details of input
services utilised and
A true and correct account of: services supplied

Reverse charge Goods/ services 5

Suppliers of Separate records for works contract to be maintained by a person executing works contract
supplies along imported/
goods/services with relevant exported
chargeable to tax documents Names and addresses
of
Separate
Recipient of Names and account of
goods/services addresses of advances

Persons on whose Separate records to

Supplier from whom be maintained by a
Address of behalf the works
goods/services are person executing works
the premises contract is
received
where goods executed contract
are stored

3 Description, value and quantity

Records which are to be maintained only by a supplier other than a supplier opting for composition levy Details of payment
of goods/services received
Account of stock of goods received and supplied including Account of details of tax payable,collected and paid, received in respect of each
for/utilised in the execution of
works contract
opening balance, receipt, supply, goods lost/stolen, ITC claimed, together with register of tax invoice, works contract
destroyed, written off, gifted, free samples, stock credit-debit notes, delivery challan issued/received
balance. during any tax period
Records to be maintained by owner or operator of godown or warehouse and transporters provider
Records to be maintained by agent 6
Records to be maintained by owner or operator of godown or warehouse and transporters
Authorisation received from each principal to Particulars of goods/services received/supplied on
receive/supply behalf of every principal whether registered or not
goods/services on behalf his behalf;
Details of accounts furnished to every principal Tax paid on receipts/supply of goods/services records of the consigner, consignee and other relevant details of the goods in such manner as may be
effected on behalf of every principal prescribed

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 39
XYZ CHAPTER – 11 ACCOUNTS AND RECORDS & -ARHAM INSTITUTE
9039600091

Failure to maintain the accounts

10
goods transported, delivered
7
goods stored in transit by him

Transporter Records of PO shall determine the tax payable on the

GSTIN of the registered consignor and unaccounted goods and/or services, as if the
consignee same had been supplied by such person
Failure to
•Provisions of section 73/74 shall, mutatis
maintain the accounts
for each of his branches mutandis, for apply determination of such tax

for the period for which particular goods

Owner or operator remain in the warehouse
Books
of godown or
accounts of
warehouse
including the particulars relating to dispatch,
movement, receipt, and disposal of such goods
11 Period of retention of accounts

8 How the accounts and records will be maintained? 72 months from the due date of furnishing of annual return for the year pertaining to such accounts
and records

Records in electronic form be authenticated by a Proper electronic back-up of records be maintained

Where an appeal/ revision/ any other 1 year after final disposal of such
digital signature and preserved
proceedings before any Appellate/ appeal/revision/proceedings/investigation
Appellate Revisional Authority or Tribunal Or
or Court, or an investigation is going on 72 months from the due date of furnishing of annual return
Records in electronic form
for the year pertaining to such accounts and records
(Books of account include any electronic whichever is later
form of data stored on any electronic
device.)

Details of files, their passwords and

Such records need to be prodcued, on demand, in
hard copy or in any electronically readable format explanation for codes, and any other info required for
access

9 No entry to be erased/overwritten

Incorrect entries, other than those of clerical nature, be scored out under attestation and there after
correct entry be recorded.

In case electronic records beng maintained, a log of every entry edited or deleted shall be maintained.

Books of account maintained manually be serially numbered

Books of accounts, are required to be produced, on demand.

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 40
XYZ
CHAPTER – 12 PAYMENT OF TAX

The provisions relating to payment of tax, interest and other amounts have been summarised by way of table and Key Features of Payment process
diagrams to help students remember and retain the provisions in a better and effective manner:- 3
Electronically generated challan from GSTN common portal in all modes of payment and no use of
Definitions of certain key terms manually prepared challan;
1 Facilitation for the tax payer by providing hassle free, anytime, anywhere mode of payment of tax;
Convenience of making payment online;
Output Tax Real time data for tax collection in electronic format;
Faster remittance of tax revenue to the Government Account;
Paperless transactions;
Speedy Accounting and reporting;
means excludes Electronic reconciliation of all receipts;
Simplified procedure for banks;
Warehousing of Digital Challan.
4 What are E-Ledgers/register?
Electronic ledgers or E-Ledgers are statements of cash and input tax credit in respect of each registered
GST chargeable on taxable supply of goods and /
tax payable on reverse charge basis taxpayer. In addition, each taxpayer shall also have an electronic liability register.
or services Types of Electronic ledgers/register

Electronic
by taxable person Cash
by agent of taxable person
Ledger

under section
22 of CGST Act
who is registered
under section Electronic Ledgers
Taxable Person means a person
24 of CGST Act
liable to be
registered Electronic Electronic
Liability Credit
Payments to be made in GST regime Register Ledger
2

For Intra-state supply A. Electronic Cash Ledger

CGST & SGST are to be paid.
Electronic Cash Ledger
Cash Receipts (Credit) ➕ ➖ Liability Payments(Debit)

IGST CGST SGST/UTGST CESS IGST CGST SGST/UTGST CESS

For Inter-state supply Cash Receipts using Online mondel or OTC Payment of
IGST to be paid, For Inter-state supply having Deposite (CIN) Tax
components of both CGST & SGST Tax Deducted at Source (TDS) Interest
Tax Collected at Source (TDS) Penalty
Fee
Other Amount

Modes of deposit in Electronic cash ledger

Wherever applicable Interned banking No limit
Interest, penalty, fees and any other Credit/Debit card No limit
amount also to be
UPI No limit
NEFT/RTGS/IMPS No limit
Over the counter ₹ 10,000 per challan per tax period
b
YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 41
XYZ
CHAPTER – 12 PAYMENT OF TAX

Date of deposit of tax dues Electronic Electronic Liability Register will reflect the total tax liability of a taxpayer (after
Which date is considered as date of deposit of the tax dues ? Liability Register netting) for the particular month.
(i) Date of presentation of cheque × Payment of tax via Electronic Ledger
(ii) Date of presentation of cheque × 7
A. Electronic Cash Ledger
(iii) Date of credit of amount in the account of government by Debit of Electronic Cash √ (Assume it as an account statement provided by bank, for easy understanding)
Ledger/Electronic credit ledger Debit Amount (DR) Credit Amount (CR)
Major and minor Heads of payment Credit amount of this ledger may be used for payment Any deposit made towards tax, interest,
Major Heads Each of these Major Heads have the five following of tax, interest, fees etc. penalty late fee etc. via internet banking,
IGST Minor Heads Remaining credit balance amount after payment of RTGS, IMPS, fund transfer etc.
CGST Minor Heads above tax etc can be claimed as refund by taxable TDS/TCS claimed
SGST/UTGST Tax person
CESS Interest B. Electronic Credit ledger
Penalty Debit Amount (DR) Credit Amount (CR)
Fee
Credit amount of this ledger may be used for payment Input Tax credit as self-assessed in the
Others
of output tax viz IGST, CGST, SGST, UTGST, CESS return in the form of IGST, CGST,
Cross utilization of funds across major or minor heads – Possible SGST, UTGST, CESS
B. Electronic credit ledger
Order of utilisation of input tax credit available in electronic credit ledger C. Electronic Liability Register
ITC Order of utilisation Debit Amount (DR) Credit Amount (CR)
(1) (2) Amount payable towards tax, interest, fees etc. Electronic cash ledger
IGST IGST CGST/SGST/UTGST- any order Tax or interest payable
ITC of IGST to be completely exhausted first, mandatorily Any other dues
CGST CGST IGST Amount payable towards output tax Electronic credit ledger
ITC of CGST has been utilized fully before utilizing SGST for payment of IGST
SGST/UTGST SGST/UTGST IGST 8 Interest on delayed payment of tax [Section 50]
💡The CGST credit cannot be utilized for payment of SGST/UTGST. The SGST/UTGST credit cannot be utilized
for payment of CGST. If person pays the unpaid amount 18% per annum
Interest Rate is
C. Electronic liability register on his own
Order of discharge of liability of taxable person
Interest payable on the net cash liability of taxes [Section 50(1)]
Interest payable on tax declared and paid in GSTR-3B filed after due date
3. Any other
dues including
Tax paid through Credit Tax Paid through Cash Interest applicable only on
2. All dues demand
Ledger Ledger the Cash portion of Tax
related to determined
1. All dues current tax under section
related to period 73 and 74 Interest payable on the gross tax liability [Section 50(1)]
previous tax 7
Interest payable on gross liability where returns is furnished within due date
period

Interest applicable on the

5 Manner of making payment Tax paid through Credit Tax Paid through Cash
tax paid through Cash and
Through debit of Electronic Credit Ledger In cash, by debit in the Electronic Cash Ledger Ledger Ledger
Credit Ledger
Through debit of Credit Ledger of the tax payer Payment can be made in cash, by debit in the Cash
maintained on the Common portal – ONLY Tax can be Ledger of the tax payer maintained on the common Interest payable due to wrongful availment and utilisation of ITC [Section 50(3)]
paid. portal
E-Ledgers/Register
6
Electronic It will reflect all deposits made in cash, and TDS/TCS made on account of the tax payer.
Liability This ledger can be used for making ANY PAYMENT towards tax, interest, penalty, fees or
Register any other amount on account of GST.
Electronic It will reflect Input Tax Credit as self-assessed in monthly returns.
Credit Ledger The credit in this ledger can be used to make payment of ONLY TAX i.e. output tax and
not other amounts such as interest, penalty, fees etc.

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 42
XYZ
CHAPTER – 12 PAYMENT OF TAX

9 Applicability of TDS
TDS

Situations

Rate of TDS

Supplier, place of Supplier and place of

Supplier & place of supply -
under CGST under IGST supply & recipientsame supply-different
same State & recipient located
State States
in another State

1% 2%
Intra-State Inter-State
supply supply Intra-State
supply
TDS
TDS (CGST TDS (IGST)
+ SGST) to to be
be deducted deducted NO TDS
Person liable Rate of Due date of
Threshold
to deduct tax deduction NO TDS payment of
limit 9 Consequences of not complying with TDS provisions
at source under CGST TDS to
Government S. No. Event Consequence

When location 1. TDS not deducted Interest to be paid along with the TDS amount; else the
Central and amount shall be determined and recovered as per the law
Total value of of supplier
State 1%
supply under and place of Within 10 2. TDS deducted but not paid to the Interest to be paid along with the TDS amount; else
Government
a contract > supply is days from the Government or paid later than 10th of the amount shall be determined and recovered as per the law
₹ 2.5 lakhs, different end of month the succeeding month
exclusive of from the
GST as per state of
Local 10 Transfer of input tax credit [Section 53 of CGST Act & section 18 of IGST Act]
invoice registration
authority of recipient
Amount equivalent to IT of
CGST Used for payment of
Used for IGST ITC so used is
ITC of CGST
payment of IGST transferred by Central
Governmental
Government (CG) from CGST
agencies
account to IGST account.

Notified used for payment

of CGST Amount equivalent to ITC so used is
persons
transferred by CG from IGST account to
CGST/UTGST account.
Manner of account of TDS by TDS deductor used for ITC of
Such deductor need to get compulsorily registered under section 24 of the CGST/SGST Act. ITC of IGST IGST payment of
UTGST
They need to remit such TDS collected by the 10th day of the month succeeding the month in which TDS was
collected. Amount equivalent to ITC so used is
used for payment transferred by CG from IGST account
The amount deposited as TDS will be reflected in the electronic cash ledger of the supplier.
of SGST to the respective SGST account of the
Manner of account of TDS by supplier State Government .
• Any amount shown as TDS will be reflected in the electronic cash ledger of the concerned supplier.
• He can utilize this amount towards discharging his liability towards tax, interest fees and any other amount.

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 43
XYZ -
CHAPTER - 13 ELECTRONIC COMMERCE TRANSACTIONS

The provisions relating to TDS & TCS have been summarised by way of table and diagrams to help students
remember and retain the provisions in a better and effective manner:-
Definition of Key terms TCS
1

Electronic Commerce
Person liable to Threshold limit Value on Due date of
collect TCS which TCS to deposit of
be computed TCS to
means including digital roducts over Government
ECO
ECO

supply of supply of goods electronic Net value of

supply of goods digital network
services and services network taxable supply 10th day of the
month succeeding
the calendar
month in which
Electronic Commerce Operator TCS has been
collected

means
3
NET VALUE OF TAXABLE SUPPLIES

Any person who

Other than
notified service
manages Aggregate value of
owns operates
taxable supplies of
goods and/or services

digital/ electronic facility/ platform for electronic commerce

Net value of Taxable
2 Supplies
TDS

Rate of TCS
Taxable supplies
Rate of TCS returned to supplier

under
under IGST
CGST/SGST/ UTGST

0.5%
0.5%

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 44
XYZ -
CHAPTER - 13 ELECTRONIC COMMERCE TRANSACTIONS
•

E-commerce taxability and

registration (Where supplier supplies
goods or services through ECO)

Supply of services Supply of goods

Supplier
Supply of other than notified services Supply of notified service ECO
supplying goods
through ECO

In case of (A)
Supplier ECO In case of (B) Can take
(D) and (E) Required to
supplying and (C) credit of
services obtain Require
services services the TCS
compulsory d to
through ECO collected Required to
Require registration collect
by ECO obtain
May not d to Supplier is (except TCS u/s
Required to and pay compulsory
collect TCS collect Supplier is entitled to ECO is where 52 @ 1
obtain ECO is liable to rest of registration
Can take if supplier is TCS u/s entitled to threshold liable to aggregate
Entitled to pay tax on such the tax
credit of unregistered. 52 @ compulsory threshold limit of ₹ 20 pay tax in turnover of
threshold services only
the TCS 0.5% registration limit of ₹ 20 lakh/ ₹ 10 all cases intra-State
limit of ₹ when the person
collected by lakh/ ₹ 10 lakh for supplier with
20 lakh/ ₹ supplying such
ECO and lakh for registration enrollment
10 lakh for services is NOT
pay rest of registration no. in
registration liable to
the tax preceding FY
registration & current FY
does not
exceed
threshold
limit)

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 45
 XYZ
CHAPTER - 14 RETURNS

1. Meaning of Returns Due Dates for Submission of Form GSTR-1

1 A statement of information furnished by the taxpayer, to tax administrators, at b Class of registered person Time limit for furnishing the details of outward supplies
regular intervals.
in Form GSTR-1 for each quarter/month
Filing of returns constitutes the most important compliance procedure which enables

Return
Registered persons opting for QRMP scheme 13th day of the month succeeding such quarter
the Government/ tax administrator to estimate the tax collection for a particular
Others 11th day of the month succeeding said month
period and determine the correctness and completeness of the tax compliance of the
taxpayers. Invoice Furnishing Facility [IFF] for taxpayers opting for QRMP Scheme
c
2. Modes of filing returns
2 All the returns are to be filed online.
an optional facility

Modes of filing return

GSTN portal (www.gst.gov.in) provided to quarterly taxpayers who are in QRMP scheme,

Offline utilities provided by

GSTN
to file their details of outward supplies in first 2 months of the
quarter,
GST Suvidha Providers (GSPs)

IFF
between the 1st day of the succeeding month till the 13th day of
the succeeding month
3. Furnishing details of outward supplies [Section 37 read with rule 59]
3 Who is required to furnish the details of outward supplies? upto a cumulative value of ₹ 50 lakh in each of the first 2 months
of the quarter
Return of Outward supply of Goods and

to pass on the credit to their recipients

All registered persons including Casual
To be Filed by
registered person
What are the cases where a registered person is debarred from furnishing details of outward supplies in
Input Service Distributor (ISD)
d GSTR-1/IFF?
Services

Non-resident taxable person

Registered person not allowed to furnish

Composition taxpayer
GSTR-1/IFF GSTR-1
Exclusions Person deducting tax at source

Person collecting tax at source

return not
person, opting furnished in
Supplier of OIDAR services located in non- person to whom
for QRMP Form GSTR-
taxable territory providing services to non- intimation has
scheme, has 3B for the
taxable online recipient been issued under
not furnished preceding
rule 88C unless
GSTR-3B for month
he deposits the
What is the form for submission of details of outward supplies? amount mentioned preceding tax
a
in intimation or period
FORM for filing Return of Outward Supply furnishes a reply
explaining reasons
for unpaid amount
GSTR-1 Can be furnished electronically on portal

or through a Facilitation centre

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 46
 XYZ
CHAPTER - 14 RETURNS

What kind of details of outward supplies are required to be furnished in GSTR-1/GSTR-1A and IFF? Maximum time limit within which such amendments are permissible is earlier of the following dates:
e Details to be furnished in GSTR-1/GSTR-1A 30th day of November following the end of the financial year to which such details pertain or
Date of filing of the relevant annual return
Filing of Nil GSTR-1
h
Outward Taxable ]
Supplies Filing of GSTR-1 is mandatory for all normal and casual taxpayers,
Nil GSTR-1 even if there is no business activity in any particular tax period.

B2B supplies B2C supplies Furnishing details of inward supplies [Section 38 read with rule 60]
4

Inter-state Autogenerated statement

Inter-state supplies Intra-state supplies Intra-state
supplies
supplies

Details of supplies in respect of which such

Invoices > ₹ Invoices ≤ ₹ Details of inwardsupplies in
Invoice-wise Rate-wise ITC cannot be availed, whether wholly or
1,00,000 1,00,000 respect of which ITC may
details of all consolidated partly, by the recipient, on account of the
supplies to be details of all be available to the recipient
details of the said supplies being furnished by
uploaded invoices to be a registered supplier (A)
Invoice-wise State-wise rate-wise uploaded
details to be consolidated details to
uploaded be uploaded
who has defaulted who has whose output
in discharging his availed ITC tax payable as who is a new
Details to be furnished through IFF
f other tax liability in of an amount per who has registrant.
specified accordance with that exceeds GSTR1/IFF defaulted (Specified
Outward Taxable Supplies exceeds the
classes of the provisions of the credit in period from
persons section 49(12) read that can be output tax paid payment taking
with rule 86B, i.e. availed by in GSTR-3B of tax for registration
B2B supplies who has discharged him as per for a a will be
more tax liability GSTR-2B particular tax prescribed prescribed
from electronic during period by period. for this
credit ledger than prescribed prescribed
purpose.)
Inter-State supplies Intra-State supplies prescribed under period and by limit.
rule 86B. prescribed
limit.

• Invoice-wise details of all supplies to be uploaded

Form and manner of ascertaining details of inward supplies – GSTR-2A and GSTR-2B
• Debit/credit notes issued during the month for such invoices issued previously to be uploaded

GSTR- 2A and its features

an optional facility
GSTR-1A to add new records which taxpayer missed out while filing in form GSTR-1, and/or
a

to amend records which were already reported in same period in form GSTR-1 System generated read only statement of inward Updated on Real Time basis

after furnishing GSTR-1 for a tax period but before filing GSTR-3B for said tax period. supplies

Rectification of errors in GSTR-1 filed for previous periods

g Reflects details of invoices furnished by a Reflects details of invoices furnished by Input
non-resident taxable person in Form GSTR5 Service Distributor in Form GSTR-6
Particulars furnished in by way of Amendment
GSTR-1 of prior periods can be Tables given in GSTR-1 of subsequent
Reflects details of TDS by deductor furnished in Form Reflects details of TCS by an e-commerce
amended periods
GSTR-7 operator furnished in Form GSTR-8

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CHAPTER - 14 RETURNS

Due dates for furnishing Form GSTR-3B

GSTR- 2B and its features a
GSTR-3B can be filed monthly or quarterly and due date for filing are as follows:
b
Monthly GSTR-3B on or before 20th of the month succeeding the month for which return is furnished.
Auto-generated statement containing the details of Available once a month Quarterly GSTR-3B on or before 22nd and 24th of the month (Depending upon State) succeeding the
eligible ITC quarter for which return is furnished in case of a taxpayer opting for QRMP scheme.

Static statement Reflects details of outward supplies furnished by the b QRMP scheme
suppliers in Form GSTR-1, 5 & 6, between the cut-
off dates
Optional return filing scheme
Details of outward supplies furnished by the supplier
Reflects details of IGST paid on the import of goods,
who has opted for QRMP scheme, in Form GSTR-1 or
goods brought in the DTA from SEZ unit/developer
using the IFF between the cut off dates Quarterly Return

c • System generated statement of inward

GSTR-6A Monthly payment
supplies for an ISD

• System generated statement of inward

GSTR-4A supplies for composition taxpayer
Taxpayers having aggregate turnover of up to ₹5 crore in the
Furnishing of returns under section 39 Eligibility
preceding financial year
5

Condition to be
Taxpayer must have furnished the last return, as due on the
fulfilled for
date of exercising such option
becoming eligible

Taxpayers can opt in for any quarter from 1st day of 2nd month
Manner of
of preceding quarter to the last day of the first month of the
Exercising option
quarter for which the option is being exercised

Taxpayers are not required to exercise their option every

Validity of option quarter. Where such option has been exercised once, they shall
once exercised continue to furnish the return as per the selected option for
future tax periods, unless they revise the said option.

Opting of QRMP
Scheme is GSTIN wise A person may avail QRMP
scheme option for some
GSTIN(s) and not for other
GSTIN(s)

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 48
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CHAPTER - 14 RETURNS

Opting out of the QRMP Scheme Form GSTR-5: For Non-Resident Taxable Person (NRTPs)
c f

Due Date:
Taxpayers opting out of the QRMP Aggregate turnover has exceeded ₹ 5 crore in the (i) within 13 days after
Scheme financial year Details to be furnished: the end of the calendar
(i) Details of inward Frequency: month, or (ii) within 7
GSTR-5
supplies (ii) Details of Monthly days after the last day
outward supplies of validity period of
the registration
whichever is earlier
Availability of facility of opting out Available from from 1st day of 2nd month of preceding
of QRMP Scheme for a quarter quarter to the last day of the first month of the quarter
Note: A NRTP is not required to file an Annual Return.
Form GSTR-6: Return for Input Service Distributors (ISDs)
d Nil GSTR-3B g
Details to be furnished: (i) ITC
received for distribution (ii) Total
Filing of GSTR-3B is mandatory for all normal and casual ITC/ eligible/ ineligible ITC to be Due Date: within 13
Frequency
Nil GSTR-3B taxpayers, even if there is no business activity in any GSTR-6 distributed for the tax days after the end
particular tax period.
: Monthly
of the calendar
period (iii) Debit/credit notes
received

e Form GSTR-4 and GST CMP-08: For Composition dealers

A composition supplier is required to file the return GSTR-4 annually and is required to Note: An ISD is not required to file an Annual Return.
pay the tax quarterly in Form GST CMP-08. Form GSTR-7: For Tax Deducted at Source (TDS)
h
GSTR-7 is a return for tax deducted at source, 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 and total value of supply exceeds ₹ 2,50,000.
GSTR-7A- Form for issue of TDS certificate by deductor to the deductee.
GSTR-4 Details furnished: GSTR-4 (Annual Return) Due Date:By 30th day
Frequency: of June following the
(Annual (i) Invoice wise inward supplies
Yearly end of such financial
Return) (ii) Consolidated outward supplies year Due Date:
On/before
GSTR-7 Frequency 10th of the
(For TDS) : Monthly month
succeeding the
calendar month

GST CMP-08
Due Date:By 18th day 6 6. Due date for payment of tax
(For quarterly Details to be furnished:Details of payment of Frequency:
of month succeeding
payment of self-assessed tax Yearly
such quarter
tax)

Due dates for payment

of tax for the person
required to file
Monthly GSTR-3B, GSTR-5
Last date of filing returns
Note: and GSTR-7
(1) The inward supplies of a composition supplier received from registered persons filing GSTR-
Tax for a quarter is to be paid by 18th
1 will be auto populated in FORM GSTR-4A for viewing. GSTR-4
of the month succeeding such quarter
(2) Filing of NIL GST CMP-08 is mandatory for all taxpayers who have opted to pay tax under
composition scheme if there is no business activity in any tax period.

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 49
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CHAPTER - 14 RETURNS

a Payment of tax under QRMP scheme Applicability of Interest -

(1) For Fixed Sum method taxpayers
Tax due in each of the first 2 months of the quarter

Where auto-calculated No interest would be applicable even if the liability for the said month
fixed sum amount for first was found higher
To be paid by depositing in pre filled Form GST PMT-06 2 months of quarter is paid If GSTR-3B of the quarter is filed by the due date by discharging
by due date the entire liability

Payment to be made by 25th of the succeeding month

Where tax payer makes Interest is payable at the applicable rate from due date of
monthly payment beyond furnishing GST PMT-06 till date of making payment
due date
Options for making monthly payment of tax under QRMP scheme
b

Where Form GSTR-3B is Interest payable as per provisions of section 50 of the CGST Act,
Options for making monthly payment of tax furnished beyond due 2017 for the tax liability net of ITC
date

(2) For Self-assessment method taxpayers

Fixed sum method Self assessment method

Interest payable as per provisions of section 50 of the CGST Act

Method 1: Fixed Sum Method

for tax or any part thereof (net of ITC) which remains unpaid/ paid
Pay tax due in each of the first two months of the Deposit in PMT06 by 25th day of the month beyond the due date
quarterz succeeding such month

Fixed sum method for the first 2 months of the quarter

35% of the tax paid in cash in the return for the Tax liability paid in cash in the return for the last
Rectification of errors/omissions
preceding quarter where the return was furnished month of the immediately preceding quarter 7
quarterly where the return was furnished monthly
Monthly tax payment through this method would not be available to those registered persons who have not Revision
furnished the return for a complete tax period preceding such month. of
return Rectification
Method 2: Self Assessment Method
on account of
scrutiny,
Self assessment method audit,
Rectifica
inspection or
tion in
enforcement
subseque
activities
nt return

Taxpayers can pay tax by considering tax

liability on inward and outward supplies and in Form GST PMT-06 Maximum time limit for rectification 30th day of November of
ITC available next FY OR
Actual date of filing annual return Whichever is earlier

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 50
 XYZ
CHAPTER - 14 RETURNS

OTHER RETURNS/ STATEMENTS

8
(i) First return Annual Self-certified Reconciliation Statement

Registered person to declare

outward supplies in the
period between the date on All registered persons are required to file furnish
First Return Prescribed
which he became liable to after grant of registration the statement alongwith annual return if their
(GSTR-10) registration till the date on aggregate turnover during a financial year exceeds form GSTR-9C
which registration has been ₹ 5 crores.
granted

(ii) GSTR – 8 - Statement for tax collection at source excluding

Monthly statement
Statement for E-Commerce Filed by:
for TCS Due date:10th of
Operator depicting ECommerce Person Person
the next month Casual Taxable
(GSTR-8) supplies effecting Operator ISD NRTP deducting tax collecting tax
through it Person
at source at source

(v) GSTR – 11 - Details of inward supplies of persons having UIN

(iii) Final return

Within 3 months of the date

Persons who have been
Taxable person whose Details of inward supplies
Final Return of cancellation or date of GSTR-11 issued a Unique Identity
registration has been of persons having UIN
(GSTR-10) order of cancellation, Number (UIN)
surrendered of cancelled.
whichever is later.

Information return
(iv) Annual Return & Annual Statement 9
(i) Who shall furnish the information return?
Taxable person
Local authority /other public body/association
Annual return State/Central Government's authority responsible for the collectiof VAT/sales tax/ State excise duty or excise
duty or customs duty respectively
Income tax authority
Furnished by: All
Prescribed Banking company
registered persons
form State Electricity Board or an electricity distribution or transmission or any other entity entrusted with such
functions
excluding Registrar/Sub-Registrar appointed under the Registration Act
Registrar within the meaning of the Companies Act, 2013
GSTR-9 GSTR- Registering Authority empowered to register motor vehicles under the Motor Vehicles Act, 1988
(For 9A GSTR-9B
Person Collector referred to in clause (c) of section 3 of the Right to Fair Compensation and Transparency in Land
Person registere (Composi (ECO) [not
Casual deduct Acquisition, Rehabilitation and Resettlement Act, 2013
ISD NRTP collecting d tion tax yet
Taxable ing tax Recognised stock exchange
tax at persons) payer) notified]85
Person at source Depository
source
Officer of the RBI
GSTN
UIN holder
Any other specified person

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 51
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CHAPTER - 14 RETURNS

(ii) Defective Information Return

Commissioner/ any
authorised Defect to be
He may intimate
rectified within 30 Otherwise,
officer, considers defect to the
days from the information return
information person who has
date of such shall be treated as
furnished in the furnished such
intimation or not furnished
information return information return
extended time
to be defective

(iii) Issuance of notice for failure to furnish the information return within stipulated time

within a
Where a person requiring him to
Commissioner/ any period not
required to furnish furnish
authorised officer, exceeding 90 days
information return
may serve a notice such information from the date of
has not furnished
on such person return service of the
it
notice

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 52
XYZ
CHAPTER - 15 REFUNDS

A. IMPORT OF GOODS
A

Import of goods
Import and export under GST

GST, being a business tax, IGST on

Place of supply of
impacts import and export too provide level playing field to imported
imported goods
domestic suppliers vis a vis goods

international suppliers in case

of import levied in leviable at
Provisions in the GST laws seek Location of addition to such rate
to importer levied and
other as is
levied under collected in
customs leviable
IGST Act, accordance
make export more competitive duties under the
2017 with
levied on IGST Act
Customs
the on a like
Act, 1962
imported article on
goods its supply in
India

1 IMPORTS UNDER GST

• when duties of customs are levied on the said goods under

Point when IGST is levied and the Customs Act, 1962
collected on imported goodsz • point when the bill of entry for home consumption is filed

Imports of
Inter-
goods or treated subject
State
services as to IGST
supplies
under GST
Value determined
Basic customs duty
under section 14 of the Customs Act, 1962
Value for levying IGST on
imported goods

any other sum leviable under any law for the time
IGST and GST Compensation Cess
being in force as
Imports under GST

Taxability of goods supplied while being deposited in a customs bonded warehouse

(i)

Import of goods Import of services Exception

Supply of
warehoused neither a
supply of in terms
goods to any
treated of
Importer of goods pays Import of OIDAR services person before goods nor
Importer of services pays IGST on as Schdeule
IGST by unregistered nontaxable clearance for a supply of
•when duties of customs are levied on the saidreverse
goods under
chargethe Customs Act, 1962
basis III
recipients home services
•point when the bill of entry for home consumption is filed consumption

Supplier located outside India pays

IGST
Value of such in-bond sales not included in the value of exempt supply for the purpose of reversal of ITC
under rules 42 and 43

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 53
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CHAPTER - 15 REFUNDS

When bill of entry is filed for imported goods (High Sea Sales)
When ex-bond bill of entry is filed for clearing such
warehoused goods for home consumption
IGST is payable on Basic customs duty is payable on

Basic IGST is leviable

customs Price paid by the last high sea sales buyer who files
duty is the bill of entry for home consumption
payable
Taxability of Third country shipments/ Triangular Trade
on the value as determined
below
(iii)

on the value • goods move from one country to another without touching
determined Third country shipments India
under section • only invoicing is done by the registered person in India
14 of the Value for levying IGST in case of supply
Customs Act, of warehoused goods
1962

treated as neither a
Third supply of in terms of
Value any other sum IGST and country goods nor Schdeule
determined at leviable under GST
value at the Basic shipments a supply of III
the time of any law for Compensation
time of filing customs services
filing into- the time being Cess
of the into- duty
bond bill of in force as
bond bill of entry under Value of such Third country shipments not included in the value of exempt supply for the purpose of reversal
entry customs duties
section 14 of of ITC under rules 42 and 43
the Customs
Act, 1962 whichever
OR is higher Taxability of supply of online money gaming by a person located outside the taxable territory to a
Transaction value (Sale
person in India [Section 14A]
value) (iv)
Supplier of Online Gaming Services located outside Taxable Territory.
Taxability of High Sea Sales
(ii) ‘ Such Supplier itself is liable to pay IGST after obtaining single registration under Simplified Registration
High Sea Sales’ is a common trade practice whereby the original importer sells the goods to a third
Scheme (SRS)*
person before the goods are entered for customs clearance.

treated as neither a If the Supplier of Online Gaming does not have a physical presence in India.
High supply of in terms of
Sea goods nor Schdeule
If person is available in India representing such If person is not available in India representing such
Sales a supply of III
overseas supplier of Online Gaming. overseas supplier of Online Gaming.
services

Such person is liable to pay IGST. Supplier of online gaming is required to appoint
a person in India for the purpose of paying tax
on such services.

Value of such High Sea Sale not included in the value of exempt supply for the purpose of reversal of NOTE: In case of failure to comply with the above provisions by the supplier of the online money gaming or a person
ITC under rules 42 and 43 appointed by such supplier or both, any information generated, transmitted, received or hosted in any computer
resource used for such supply shall be liable to be blocked for access by the public.

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 54
XYZ
CHAPTER - 15 REFUNDS

Taxability of goods imported by SEZ (ii) Meaning of import of service

(v) https

Import of services

Goods imported by a
unit/developer in SEZ for exempted from Whole of IGST leviable
authorised operations

Supply of any service where

10
(vi) Taxability of goods imported by EOU
0
0
Supplier of service is located Recipient of service is located Place of supply of service
OUTSIDE INDIA, IN INDIA, and is IN INDIA.
BCD, additional customs duty,
Goods imported by 100% EOU without payment of
IGST and compensation cess

Import as Baggage
(vii)
Passenger baggage

(in excess of the duty-free allowances) liable to exempted from

• basic customs duty at the rate of 35% • IGST as well as GST Compensation Cess
• applicable social welfare surcharge
services
Supplier Recipient
B IMPORT OF SERVICES +
(i) Taxability of import of service POS

Import of Services
(iii) Person liable to pay tax on importation of service

Importation of OIDAR services by a • IGST is payable by supplier of

Importation of services
nontaxable online recipient OIDAR services
with consideration without consideration
Importation of notified services through
ECO • IGST is payable by ECO

Services of transportation of goods by a • Contract is FOB basis -IGST is

In the course of furtherance of business Related /distinct person in the course of Other Cases payable by importer located in
vessel from a place outside India upto the
or not furtherance of business India
custom station of clearance in India by a
foreign shipping line • Contract is CIF basis - No IGST
is leviable on the ocean freight
Not a supply • IGST is payable by recipient of
Supply Residual cases of importation of services
Supply imported services in India

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 55
XYZ
CHAPTER - 15 REFUNDS

Provisions enabling supplier of OIDAR services located outside India to comply with the responsibilities
entrusted under GST laws
UOI v. Mohit Minerals Pvt. Ltd.
Gist of this case: There cannot be a 10
separate levy of IGST on the component 0
Supplier/intermediary
of ocean freight paid by the foreign • Only single registration is required under SRS
of OIDAR Services
exporter to the foreign shipping line in
the CIF contract, since it would be
treated as composite supply.

If representative • he shall get registered and pay IGST

(iv) Importation of OIDAR services [Section 14] available in India on behalf of supplier.

POS= Location of
Where both Supplier of
Recipient. (Tax payable by
OIDAR services and If the ECO has
supplier under Forward • OIDAR supplier may
recipient are in INDIA neither the physical
Charge)
presence nor any • appoint a person in
Importation of OIDAR services [Section

BY BUSINESS ENTITY India for paying

representative in the IGST.
Where Supplier of OIDAR POS= INDIA taxable territory
services is OUTSIDE
INDIA and Recipient IN (Tax payable by recipient MEANING OF OIDAR SERVICES
INDIA under RCM)
14]

Where both Supplier of POS= INDIA

OIDAR services and Services whose
(Tax payable by supplier delivery is mediated Services are
recipient is in INDIA under Forward Charge) by information impossible to
BY NON TAXABLE technology ensure in the OIDAR
ONLINE RECIPIENT or absence of Services
NTOR (Unregistered over the information
Person) Where supplier of OIDAR POS= INDIA internet/electronic technology
services is OUTSIDE network
INDIA and Recipient IN (Tax payable by Supplier
INDIA outside India)

(v) Services provided through ECO located outside India

Provision or facilitation of OIDAR services by intermediary located outside India

Intermediary

ELECTRONIC COMMERCE OPERATOR (ECO) LOCATED OUTSIDE INDIA

Located outside India. Arranges or facilitates supply of OIDAR services to NTOR.
* He would be treated as the supplier.
* Required to obtain compulsory registration in India and pay IGST on the supply.

If ECO supplies notified services through portal, ECO is required

Not involved in payment, terms & conditions and delivery of service. Invoice clearly identifies the
to pay IGST on notified services**
service and its supplier.
* Responsibility for registration remains with the supplier.

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 56
XYZ
CHAPTER - 15 REFUNDS

Inter State Supply [ Section 7(5) of IGST Act]

Where the ECO does not have a physical presence in India

To or by SEZ
If person is available in India If person is not available in India developer/ SEZ
representing such overseas supplier. representing such overseas supplier. unit.
OR
ECO is required to appoint a
Such person is liable to pay IGST person in India for paying tax on such When supplier is
Supply of located IN
notified services.
good or INDIA
services +
**Serviced notified under section 9(5) of the CGST Act, 2017/ Section 5(5) of the IGST Act, 2017. (G/S) or both POS= Outside
India

Registration and ITC in case of import of goods and services

In the taxable OR
RCM does not cover territory, not
importer of goods. No being an intra-
mandatory registration State supply and
For Import of required. not covered
goods elsewhere.
Mandatory to quote GSTIN
If importers are
in the Bill of Entry for
registered under
payment of IGST and for
GST. Establishments of Distinct Person
availing ITC.

Establishment in
Registration

Persons engaged PAN (which is India

exclusively in the authorized as +
For import of import or export of Not required to IEC by DGFT) of any other
exempted goods goods which are not obtain registration. the importer & establishment
liable to tax or are exporter would outside India. OR
wholly exempt. suffice.
Establishment in a
Where any
State/ UT
Liable to pay IGST on person has:
For importer of Required to obtain +
import of services under any other
services. compulsory registration.
RCM.
establishment
outside that
Input Tax Credit (ITC) in case of import of goods and services
State/ UT.

IGST paid on imported good. Available Establishment in a

OR
State / UT.
GST Compensation Cess Available +
any other
establishment
ITC of:

BCD and social welfare surcharge

Not Available registered within
paid on the imported good.
same State / UT.

IGST paid on
Since input tax includes Tax
importation of services Available
payable under RCM. Note: A person carrying on a business through a branch or an agency or a representational office in any
is available
territory shall be treated as having an establishment in that territory.

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 57
XYZ
CHAPTER - 15 REFUNDS

ZERO RATED SUPPLY (ZRF) EXPORT OF GOODS & SERVICE

• Export of G/S or both

OR Treated as
Means: inter-State
• Supply of G/S or both for authorized
operations to SEZ developer/ SEZ unit. supply and
zero rated.

Refund of unutilized ITC can be claimed. * Supply of G/S or both under bond/
LUT without payment of IGST.

Options under ZRS

Taxability of
Refund of such IGST paid can be * Notified class of persons may make Export
claimed. ZRS or notified class of G/S may be
exported on payment of IGST utilizing ITC is still
IGST. Tax
available to the
associated
exporter even
with exports
if there is full
Along with interest within 30 days after is always
In case of non-realization of sale exemption for
the expiry of the time limit prescribed IGST.
proceeds, supplier of ZRS be liable to the supply.
under FEMA for receipt of FOREX
deposit the refund so received.
remittance.
EXPORT OF GOODS
Difference between Exempted Supplies and Zero Rated Supply
Exempted Supplies Zero rated supplies
Exempt supply means supply of any goods and/or Zero-rated supply means (i) export of goods and/or
services which attracts nil rate of tax or which may services or (ii) supply of goods and/or services for
be wholly exempt from tax and includes non- taxable authorised operations to SEZ unit/SEZ developer.
supply. Taking the goods
No tax on the outward exempted supplies, however, No tax on the outward supplies; IS also to be tax Physical Exports from India to a
the input supplies used for making exempt supplies to free (by way of refund of ITC) place outside India.
be taxed
Credit of input tax need to be reversed, if taken. Credit of input tax may be availed for making ZRS,
No ITC on the exempted supplies. even if such supply is an exempt supply.
ITC allowed on ZRS.
Value of exempt supplies, for apportionment of ITC, Value of ZRS shall be added along with the taxable
shall include supplies on which the recipient is liable supplies for apportionment of ITC.
to pay tax on reverse charge basis, transactions in
securities, sale of land and, subject to clause (b) of
paragraph 5 of Schedule II, sale of building.
Any person engaged exclusively in the business of A person exclusively making ZRS needs to register
Payment for
supplying goods or services or both that are not as refund of unutilized ITC or IGST paid shall have Goods (not
Such supplies supplier is
liable to tax or wholly exempt from tax under the to be claimed. services) Supplies do
Deemed are notified received
CGST or IGST Act shall not be liable to supplied are not leave
Exports as deemed either in
manufactu red India.
registration. exports. INR/convertib
in India
A registered person supplying exempted goods Normal tax invoice shall be issued. le FOREX.
and/or services shall issue, instead of a tax invoice,
a bill of supply.

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 58
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CHAPTER - 15 REFUNDS

Categories of supply of goods notified as deemed exports

Supply of goods by a registered person against Advance Authorisation (AA)
Conditions applicable on supplying goods by registered Manufacturer Exporter (supplier) to a
Supply of Capital Goods (CG) by a registered person against Export Promotion Capital Goods (EPCG) authorisation. registered merchant exporter (Recipient) at concessional rate of GST:
Supply of goods by a registered person to EOU.
Supply of gold by specified bank or PSU against AA.

Taxability Of Deemed Export Supply must be made under a Tax Invoice.

Such supplies are subject to levy of taxes.

Recepient export said goods within 90 days from date of invoice by supplier.

Such supplies can be made on payment of tax and cannot be supplied

under a bond/LUT. Recipient shall indicate GSTIN of supplier and invoice number issued by
supplier in the shipping bill/ bill of export.

Refund of tax paid on supply, regarded as deemed export

admissible to either the supplier or recipient. Recipient shall registered with an Export Promotion Council.

Recipient shall place order on supplier for procuring goods at concessional rate
Mechant Exporter
and a shall provide a copy of it to jurisdictional tax officer of supplier

• Where a person who manufactures the goods (Manufacturer

Exporter) export these goods through Merchant Exporter who
Merchant Exports buys goods from manufacturer and exports them outside India at
concessional rate (CGST 0.05% CGST and SGST 0.05%) subject
to the specified conditions.

Recipient shall move the said

directly to the Port, ICD, Airport or Land Custom

goods from place

Station (LCS) from where the said

directly to a registered warehouse** from where

Supplies Export goods Exporter the said goods shall be moved to the Port, ICD,
Manufacturer Merchant
goods @ under LUT/ Outside Airport or LCS
Exporter Exporter
0.01% to Bond India

Gets refund of ITC Get credit of ** Registered principal place of business or registered additional place of business are deemed to be a
on account of concessional tax registered warehouse.
Inverted Duty paid.
structure.

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 59
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CHAPTER - 15 REFUNDS

Export of services [Section 2 (6)]

(iii) Procedure for direct exports [Rule 96A of the CGST Rules]

Supplier- in India Transaction is between separate entities not

RecipientOutside India between establishments of entities. Exporter has to execute bond or LUT before export, and pay tax with 18%
Interest within:
(i) Export of Goods: 15 days after end of 3 months (or further period as
Conditions to be satisfied to
allowed by commissoner) from date of invoice issued, if goods ot exported
qualify as Export of Services.
outside India; or
(ii) Export of Services: 15 days after end of 1 year (or further period as
POS = Consideration in allowed by commissoner) from date of invoice issued if the payment not
received by exporter in convertible FOREX or INR.
Outside India convertible FOREX / INR.
Note: If registered person is making ZRS without payment of tax, then in
case of non-realisation of sale proceeds, he would be be liable to deposit the
refund so received under section 16(3) along with interest within 30 days
Common provisions/aspects for export of goods and services
after the expiry of time limit prescribed under FEMA for receipt of FOREX
remittances.
(i) Supplies to SEZ unit/ developer.

Failure to export and paying tax with interest leads to withdrawal of facility
Supply to a SEZ unit/ developer is zero rated. of export without payment of IGST and recovery of the said amount under
section 79 of the CGST Act.
This facility can be restored after the payment of said amount.
Refund of Unutilized ITC or refund of IGST paid is available.

Registered persons are eligible to furnish a LUT in place of a bond. (Except

those who have been prosecuted for cases involving an amount> Rs. 250 Lakhs)
Condition - Such supplies are received for authorized operations by SEZ unit/
developer.
The details of the export invoices should be submitted in GSTR-1.

An endorsement from specified officer of zone is required to be issued.

(iv) Export to Nepal and Bhutan
Export of goods: Export of services:
Such Exports falls within the definition of RBI allows receipt of payment in INR in case of
(ii) Transactions with EOUs
‘export of goods’ under the IGST Act. exports of services to Nepal and Bhutan in case
RBI allow receipt of payment in INR in case of of supply of services and such supply in Nepal or
such exports. Bhutan, against payment in INR is considered as
India has rupee trade with Nepal and Bhutan. export of services subject to fulfillment of other
Supplies to EOUs Exports of EOUs conditions.
Treated as zero rated and qualify for all the
benefits available to ZRS.
Non-realization of export proceeds within the
time prescribed under FEMA may result in
recovery of any refund.
Zero rating not treated as deemed eligible for zero
Taxable like any exports and refund of tax rating.
applicable.
other taxable paid on deemed exports
supplies.
is admissible either to the
supplier or the recipient.

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 60
 CHAPTER - 16 JOB WORK

Job work Procedure

Sends goods for Job work – No Tax

Principal Job Worker

1
2
Sends it back to principal after job work in prescribed time – No Tax

2
2

Principal
Export supplies
– No tax Goods are not
goods after 2 returned/ supplied
receipt from job worker’s from job
Principal supplies goods directly from premises within
worker
job worker’s premises within prescribed time
prescribed time

Export – No tax
Supply within India - Principal to pay tax

Deemed as supply by principal. Date of supply is date

on which goods were sent for job work. Principal to
Export – No tax
pay tax alongwith interest.
Supply within India - Principal to pay tax

Time limits for the return of inputs/capital goods sent for job-work or supply from job worker’s place of business after required processing or treatment
Principal can take credit on goods (inputs and capital goods) sent for job work.
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 goods sent for job work/supply from job worker’s place of On failing to comply with the timelines, the goods will be deemed To have Timelines do not apply to moulds and dies, jigs and
business been supplied to the job worker on the day they were sent out. fixtures or tools sent
Inputs - 1 year (extendable by another 1 year) Principal is liable to pay tax along with applicable interest on such supply. out for job work.
Capital goods - 3 years (extendable by another 2 years) Subsequent return of the goods by the job worker will be treated as a
from the date of sending the same for job work or from the date of receipt of separate supply.
the same by the job worker.

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 61
XYZ
CHAPTER - 17 ASSESSMENT & AUDIT
The discussion under this chapter are summarised by way of diagrams to help students remember and retain the key provisions in a better and effective manner:
Different ways to assess the tax liability by a registered person

A registered person may assess his tax liability in two different ways depending upon the circumstances warranting such an
assessment.

Provisional Assessment Self-Assessment

Where the taxable person is unable to determine value; or rate of

tax applicable to the goods or services or both to be supplied by him In all cases other

For this –
• Taxable person shall furnish an application along with the documents in support of his request.
• The proper officer after calling for additional information and documents, if required, issue an order indicating thereino
* value or the rate or both on the basis of which the assessment is to be allowed on a provisional basis;
* amount for which the bond is to be executed and security to be furnished

Assessment under GST*

Self Assessment of Non-filers Assessment of unregistered Summary Assessment in certain Special

Provisional Assessment Scrutiny of Returns
Assessment of Return persons Cases

Person unable to determine value of Proper officer may issue an assessment

Every In order to verify of accuracy If return is not order imposing tax liability on a person
supply or rate of tax. Proper officer to the best
registered return, the Proper Officer may furnished even after based on any evidence showing a tax
examine return and seek of his jugment,may issue an
person shall service of notice u/s liability.
explanations. assessment order, within a
himself Payment of tax on 46,
period of 5 years from the
assess tax provisional basis on date specified under section
liability and execution of bond on a If person to whom liability pertains
Proper officer shall 44 for furnishing of
furnish a request made. is not ascertainable, the person in
If explanation offred is assess the liability the annual return.
return. charge of goods shall be assessed.
adequate, no further action. of tax within a
Final Assessment Time: 6 months from date of period of 5 years
communication of order from the date
specified u/s 44 for If order is erroneous, propern
If no adequate explanatio n offered furnishing of annual officer may withdraw such
If short paid, pay with interest If excess paid, refund with
or no corrective measures return. order and follow the procedure
u/s 50 interest u/s 56
laid down in section 73 or
section 74.
Proper Action u/s
65,66,67,73 or 74.

*This is not an exhaustive list of assessments under the GST law. In addition to the types of assessments listed herein above, determination of the liability of a taxpayer can be made under Sections 73 or 74 of
the CGST Act (discussed in detail separately).

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 62
XYZ
CHAPTER - 17 ASSESSMENT & AUDIT

Audit
Audit by Tax Authorities Special Audit
Commissioner or any officer authorized by him may undertake audit of any registered person At any stage of scrutiny, inquiry or investigation
Audit may be conducted at the place of business or in their office Assistant Commissioner is of the opinion that the value has not been correctly declared or the credit
availed is not within the normal limits
At least 15 days prior notice should be given May nominate a Chartered Accountant or Cost Accountant
Time Period : 3 months from the date of conduct of audit Time period : 90 days
Extension : not exceeding six months Extension : further 90 days
On conclusion, registered person shall be informed about findings, rights and obligations Audit will be conducted even if accounts have already been audited
If results in demand of tax, proceedings may be initiated under section 73 or 74. If results in demand of tax, proceedings may be initiated under section 73 or 74.

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 63
XYZ
CHAPTER - 18 INSPECTION, SEARCH, SEIZURE AND ARREST
Summary of provisions relating to inspection, search and seizure

power to summon any person whose attendance is

proper officer not below the rank of joint commissioner
necessary to give evidence or to produce
documents in any enquiry (sec.70)
will record in writing the reasons to believe
that

taxable person has

taxable person has any person has kept
suppressed any elvison of tax by the person goods,documents of
claimed ITC in excess of taxatable person has contravened goods or books of
transactions relating to engaged in the business of things, etc are secreted
entitlement any provision of the act of rules accounts to cause
goods, services or both transporting goods,warehouse & useful to any
evasion of payment of
or godown operatorfowner proceedings
tax

Inpection of place of taxable as well as any person (Sec.7)

Searc,seize & confiscate

Goods in movement goods,documents,books or things (Sec 37(2))
business of registered person
(Sec.68)
(Sec.7)

Practicable
Carring out any Person in charge must carry
Not practicable
audit,scrutiny,verification & checks documents of conveyance with him
to safe guard interest of revenue relied up n for issue
of notice
not relied upon
on making demand authorized by on intercepted bye the (Sec.67(3)) Service an order on the owner or the
paper officer propere officer custodian of the goods by proper
Retained by such
officer for any inquiry officer
Within 15 working days of Demand or or proceedings under
any further period allowed this Act Returned withing
30days of the
issue of notice Not remove of deal with the goods
liability to produce the document except with the previous permission of
Manner to release confiscated
by person in charge officer
goods,documents,etc,

penshable or hazardus goods constraint of

provisional basis (Sec.67(6)) storage space etc (Sec.67(8))
Actual discharge when no notice
issued (Sec.67(7))

Dispsed by proper officer

Execution of bond & furnishing Payment of applicable tax within 6 month of seizure
security interest & Panalty of goods Prepare inventory of such goods
(Sec.67(9))

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 64
XYZ
CHAPTER - 19 DEMANDS AND RECOVERY

Proceeding in case where

Non-payment of Tax Short Payment of Tax Errorneous Refund Wrong – availment or utilization of
ITC

Above cases by reason of fraud wilful misstatement or

Sec 73 Above cases other than fraud, wilful misstatement or
suppression of facts (Bonafide intention)
Sec 74 suppression of facts (malafide intention)

73 (1) 73 (1) Issue of SCN 74 (1) 74 (5)

Voluntary Payment before SCN Issue of SCN Voluntary Payment

Issue of SCN
before SCN
Pay = tax + Interest (Ascertained by
Full Payment Short payment Time of issue of SCN is SCN should specify
Time of issue of SCN is SCN should specify tax payer or PO)
6 months before last -amt. of tax payble
6 months before last -amt. of tax payble then penalty payable = 15% of Tax
date of D.O.(i.e, - interest
date of D.O.(i.e, - interest
Pay = tax + Interest (Ascertained by 4yrs,& 9 months from -100 Penalty if why
4yrs,& 9 months from -Penalty if any
tax payer or PO) D/D of A.R should not charged)
D/D of A.R

Short payment Full Payment

Full Payment Short payment

SCN Inform to P.O
If SCN issued for earlier period & same default for other period = issue
Inform to P.O statement for other period (group are same) SCN Shall be issued for
SCN Shall not be issued
short payment
SCN Shall not be issued

Payment of Tax + interest as mentioned in SCN Payment of Tax + interest as mentioned in SCN

If payment is not made within 30days of SCN If payment is not made within 30days & taxpayer If payment is made
If payment is made within
& representation is given in his defence has given representation in his defence within 30days of SCN
30days of SCN
DEMAND ORDER
Amt.Tax + interest & Payable = Penalty = 25% of tax
All proceeding shall be concluded
i.e.NO D.O & NO Penalty
Period-within 5 yrs from due Period-within 3 yrs from due
*Due date of A.R. OR *Due date of A.R. OR All proceeding shall be concluded
Liability to pay = tax + interest + penalty *Date of erroneous refund *Date of erroneous refund
Tax as D.O. 10% of tax = 10,000 with
Liability to pay = tax + interest + Tax as
D.O. + 100% Penalty

Imp note :-u/s 73 like sec 74 benefit is not available after D.O.i.e penalty (10% If payment of tax + interest Penalty is made within 30
or 10,000) is mandatorily payable irrespective of the fact whether payment is days of D.O If payment is not made within 30days of D.O
made within 30days or not from D.O. Penalty = 100% of tax
Penalty = 100% of tax

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 65
XYZ
CHAPTER - 19 DEMANDS AND RECOVERY

Excess collection of Tax

Sec 76 Tax collected but not paid to Government

1. Tax collected from any person to be 2. Issue of SCN:- If above amt. 76(1) has 3. Demand Order: After considering 4. Interest Payment:- Person shall pay 5. Opportunity of being heard: Opportunity
paid to the CG:-Every person collected not been paid, PO may serve a SCN = on representation, PO shall determine the interest @ 18% PA (u/s 50), from the of hearing shall granted if request in
tax and has not paid it to Govt. = shall the person liable to pay such amount Tax amt. due from such person & thereupon, date of collection to the date of written, received from such person)
immediately pay the said amount to & Penalty, such person shall pay the amount so payment to Govt.
Govt.. (Irrespective of whether Note- There is no time limit for Serving determined.
relevant supplies are taxable or not). SCN under this section

6. Time limit for Issuance of Order: 7. Period of stay excluded:- Where issuance 8. Order must be a speaking order: PO = 9. Adjustment of amount payable u/s 76(1) 10. Surplus after adjument: Amount of
Within 1 year-from the date of issue of order-stayed by an order of the set out relevant facts & the basis of his & (3):-Amount paid to Govt. (Sub- surplus (after adj. above)= *Credited to
of SCN. (No time limit for issue of Court/Appellate Tribunal stay period- decision sec.1/3)=adjusted against tax payable the Welfare Fund, (or) *Refunded to
SCN) excluded from period of 1 Year. by person, i.r.t. supplies (sub-sec.1) the person, borne the incidence of such
amount.
11. Refund :- Person-borne incidence of the amount= may apply for refund

Sec 73(11): Where amount of self-assessed tax is declared in GSTR-1 not paid within 30 days from the due date of payment of tax then Sec 75: Determination of Tax (General prov.)
mandatory penalty 10% of tax or 10,000 WIH  Period of stay-If issuance of SCN/DO is stayed by Court/AT= excluded from
period of SCN/DO for fraud/other than fraud/Sec 74A.
 If AA/AT concludes that charges of fraud are not sustainable-SCN u/s 74(1)=
Short Payment or non-payment of tax within due date read with cir. no. 76/50/2018 SCN u/s 73(1).
 Order on direction of Court such order shall be issued within 2 yг from the date
If Tax is self assessed (declared in GSTR-1) but not paid within 30 days of due date of return of communication of direction.
 Opportunity of being heard to aggrieved person.
 Adjournment (for reasons in written)=Upto 3 times to a person
 Order=Speaking (set out relevant facts & basis for his decisions)
 Amount demanded in order shall not exceed amount in SCN
If GSTR-3B is filed (with payment of tax & Interest) If proceeding u/s 73 is invoked (l.e. SCN is issued) before
 If AA/AT/court modifies amount of tax-modify Interest/penalty accordingly.
after 30 days of due date of return but before issue of furnishing GSTR-3B & payment of tax interest (Delay more
 Interest mandatory (even if not specified in SCN)
SCN u/s 73(1) (i.e. Sec 73 is not invoked) 30 days from due date)
 If no DO is issued within the time limits u/s 73(10), 74(10), or 74A(7) then
proceeding deemed to be corcluded.
1) Tax Payable = Yes  If appeal filed by dept. against decision of AT/AA/court= Period b/w date of
Tax Payable Yes
2) Interest u/s 50(1) decision of higher authority & lower authority= excluded from period of SCN/DO
Interest Yes u/s 50(1) delay payment of tax
3) Late fee of return: Yes u/s 47  If any amount of self assessed tax(in return)/amount of interest remains unpaid
Late fee: Yes u/s 47 (200 per day, max = 10,000)
4) Mandatory penalty Yes power is invoked u/s 73 recovered u/s79
 If penalty u/s 73/74/74A Imposed = no other penalty applies.
Penalty u/s 73(11) No. (as power u/s 73(1) is not invoked) u/s 73(11) 10% of tox or ₹ 10,000

Sec 77: Tax wrongfully collected & paid to CG/SG Sec 78: Initiation of recovery proceedings Sec 79: Mode of Recovery of Tax
 If a RP pays CGST/SGST/UTGST thinking it's an  A taxable person must pay any amount due within  Tax authorities can deduct outstanding dues from amounts owed to a TP.
intra-State supply, but IT'S later confirmed as 3months of receiving the order. If not, recovery  The authority can detain and sell a taxable person's goods to recover dues.
inter-State, they can get a refund. proceedings will begin.  Money owed to a taxable person can be recovered from a third party
 If an RP pays IGST thinking it's inter-State but  The authority may require payment in 3months, with  The authority can seize movable or immovable property until dues are paid
it's actually intra-State, they won'towe interest on written reasons.  Recovery con start through the District Collector where the TP has property or business, treating it as land
CGST and SGST/UTGST revenue arrears
Note Similar rules are in Section 19 of the IGST Act.  An application can be mode to the Magistrate for recovery as a fine
 Recovery can be pursued through a civil court decree against the surety for the defaulter's dues
 For companies in liquidation, dues con be notified to the liquidator for recovery
 Dues con be recovered through bonds executed under GST low.

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 66
XYZ
CHAPTER - 19 DEMANDS AND RECOVERY
 CGST arrears can be recovered as SGST arrears and vice versa

Sec 80 : Payment of tax and other amount in Sec 81: Transfer of property to be void Sec 82: Tax to be first charge on Sec 83: Provisional attachment to protect revenue in certain cases
instalments in certain cases property

 The Act allows instalment payments (excluding Sec 81: Transfer of property to be void Any tax, interest, or penalty owed is  The Comm. can provisionally attach a TP's property (including bank accounts) after
self-assessed tax) upon request to the in certain cases a first charge on a taxable person's proceedings of Assessment, Inspection, search, seizure, arrest, Demand & recovery
Commissioner. Up to 24 monthly instalments may  If a person transfers property (Sale, property, overriding other laws, for 1 yr.
be approved, but missing one makes the full mortgage) to defraud the government except under the Insolvency and  Perishable/hazardous property will be released if the TP pays the market price or
balance due immediately. after an amount is due, the transfer Bankruptcy Code the owed amt,, whichever is lower upon proof of payment. If not paid, comm. may
 A taxable person can apply for extension. The is void against tax claims dispose such property.
Commissioner will review the person's financial  Exceptions include valid transfers  A person can object to the attachment, and the Commissioner may release it if
ability and may grant extensions up to 24 monthly made for adequate consideration, in justified.
instalments with interest. good faith, without knowledge of  If property is with Court/Public Officer, An attachment order will hold it until the
 Instalment payments are denied if there are pending claims, or with prior debt is recovered.
current defaults on CGST/IGST/UTGST/SGST or permission from the PO  To attach partner's interest, the authority can charge the partner's share, Appoint
if instalments were denied last year, or if the a receiver for profits & Order the sale of the interest. Other partners may
amount is under ₹25,000. redeem or buy it.

Sec 84: Continuation and validation of certain recovery proceedings

 If government dues are increased, the Commissioner will issue a new notice, and recovery con continue from where it left off before the appeal.
 If dues are reduced, no new notice is needed. The Commissioner will inform the taxable person and authority & recovery will continue based on the reduced amount
Rule 88C: Manner of dealing with difference in Rule 88D: Manner of dealing with difference in ITC available in autogenerated statement containing the details of ITC and that availed in return
liability in GSTR 1 & GSTR 3B:
 If tax payable in GSTR 1/GSTR-1A exceeds in (1) Intimation for difference in GSTR-3B & 2B: If ITC availed by RP in GSTR-3B exceeds ITC available in GSTR-2B for a tax period(s) by prescribed % or amount, difference
GSTR 3B, RP shall pay differential tax amount shall be intimated to him.
along with interest in prescribed form & also (2) Time limit to pay excess ITC availed: - RP has to pay excess ITC availed + interest u/s 50 or explain reasons (reply) for such difference within 7 days.
explain the difference within 7 days. (3) Consequences for failure: If intimated amount is not paid partly on wholly within time limit & reply is also not furnished or furnished reply is пот acceptable, it will be
 If he failed to do so, the amount shall be demanded u/s 73 or 74.
recoverable as per Sec 79.

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 67
XYZ
CHAPTER - 20 LIABILITY TO PAY IN CERTAIN CASES

1 LIABILITY TO PAY IN CASE OF TRANSFER OF BUSINESS (SECTION 85) LIABILITY IN CASE OF COMPANY IN LIQUIDATION (SECTION 88)
4
Where transfer of business (wholly or partly) is made by way of sale, gift,
lease, leave and license, hire or in any other manner,
Liquidator shall give the intimation of his appointment to the Commissioner within 30 days of his
appointment
UPTO THE TIME OF SUCH TRANSFER

Transferor and transferee are jointly and severally liable wholly or to

the extent of transfer, to pay tax, interest or any penalty.
The Commissioner may make such inquiry or call for such information as he may deem fit.
Where transferee carries on such business either in his own name or in
some other name.

Transferee shall be liable to pay tax on the supply of goods or services

or both effected by him with effect from the date of such transfer.
Commissioner shall notify the liquidator the amount sufficient to provide for any tax, interest or penalty
Note: In case of death of sole proprietor, transferee shall be liable to pay any tax, interest or any penalty payable or likely to be payable by the company, within 3 months of receipt of intimation of liquidator.
due from the transferor.

LIABILITY OF AGENT AND PRINCIPAL (SECTION 86)

2
If such tax, interest or penalty cannot be recovered from the company, every director during the period
is jointly and severely liable to pay it unless he proves that the non-recovery cannot be attributed to any
Agent supplies/ receives Agent and Principal are
to pay tax payable on gross neglect, misfeasance or breach of duty on his part
taxable goods on behalf jointly and severally
such goods
of principal. liable
LIABILITY OF DIRECTORS OF PRIVATE COMPANY (SECTION 89)
5

3 LIABILITY TO PAY IN CASE OF AN AMALGAMATION/MERGER OF COMPANIES (SECTION 87)

Where any tax, interest or penalty (TIP) due from a private company in respect of any supply for
any period cannot be recovered
Where two or more companies amalgamated or merged

due to order of Court/Tribunal or otherwise, AND Director(s) of such private company during such period to be jointly and severally

order is to take effect from the date earlier than date of that
order.
liable to pay such TIP not liable to pay such TIP

Supply/receipt of goods and/goods between any two or more of such companies to or from each other

if such private company gets

unless he proves that, nonrecovery
converted into a public company and
cannot be attributed to his gross
non- recovery pertains to the period
neglect, misfeasance or breach of duty.
er of companies
amalgamation/merg
court/Tribunal for
Date of order of

Such transactions shall be included in the turnover of before conversion.

Date from which
amalgamation/mer
ger is effective

supply or receipt of the respective companies.

6 LIABILITY OF PARTNERS OF FIRM TO PAY TAX (SECTION 90)
They shall be liable to pay tax accordingly.
General Scenario Firm Where any partner retires
and each of the He/firm, shall intimate date of retirement of said partner to Commissioner by a
partners of the firm written notice.
shall, jointly and Such partner shall be liable to pay TIP dues only upto:
These companies shall be treated as distinct companies for the period till date of such order. severally, be liable to  date of his retirement, if above intimation given within 1 month of
Registration certificates of said companies shall be cancelled with effect from the date of the said pay TIP in case of retirement
order firm.  or date of intimation, if above intimation given after 1 month of retirement

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 68
XYZ
CHAPTER - 20 LIABILITY TO PAY IN CERTAIN CASES

LIABILITY OF GUARDIANS, TRUSTEES ETC. (SECTION 91) (ii) ON PARTITION OF PROPERTY OF HUF OR AOP [SECTION 93(2)]
6 9

Where business is carried on by any guardian, trustee or agent on behalf of and for benefit of a
minor or other incapacitated person. Where property of the HUF or
AOP is partitioned amongst the
various members or groups of
members

TIP shall be levied and recoverable from such guardian, trustee or agent.
Each member/group of members
shall, jointly and severally, be
liable to pay TIP due
Such TIP shall be determined, levied and recoverable in a like manner and to the same extent as
it would be recoverable from minor or incapacitated person as if he were a major/capacitated
person and as if he were conducting the business himself & all provisions of GST law shall apply
accordingly.
up to the time of the partition

LIABILITY OF COURT OF WARDS ETC. (SECTION 92)

7

Court of Wards (COW), Administrator TIP shall be levied and

Where the estate/portion
General (AG), Official Trustee (OT) or any recoverable from such
of estate is under the (iii) On dissolution of a firm [SECTION 93(3)]
receiver or manager or any such person COW, AG, OT, 10
control of:
appointed by/under a order of court receiver or manager.

every person partner shall,

up to the time of
Such T.I.P. shall be determined, levied and recoverable from above mentioned persons in same manner and to Where a firm is dissolved jointly and severally, be
dissolution
same extent if he were conducting the business himself and & all provisions of GST law shall apply accordingly. liable to pay TIP due

SPECIAL PROVISIONS REGARDING LIABILITY TO PAY TAX, INTEREST OR PENALTY IN CERTAIN

8 CASES

(i) ON DEATH OF A PERSON liable to pay TIP [SECTION 93(1)]

If business is continued after his death by legal Business is discontinued after his death: LR
representative (LR) or any other person : Such shall be liable to pay TIP out of the estate of
LR/other person, shall be liable to pay TIP due deceased person to the extent to which his
from deceased person. estate is capable of meeting TIP due.

The successor shall be liable to pay any TIP due from the transferor in cases of transfer of business due to
death of sole proprietor.

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 69
XYZ
CHAPTER – 21 OFFENCES AND PENALTIES AND ETHICAL ASPECTS UNDER GST

Administarion power investigative

Power of Department
Power

registration Person Sec 63 - Unregistered Audit Access

Person (Best Judgement
Assessment)
Sec 62 Assessment of Sec. 65 Sec 71 Access Sec 68 Insfection of
filling the Sec 67(1)- Insfection of sec 69
non filter of returns Department to Business goods in transit
Return Business Arrested
(BJA) Audit Premises

Sec 59 Self Sec 66

Sec 60 Provisional
Assessment Special
Assessment Sec 72 -
Audit Sec 67(2) -
officers who are
Sec 61 scrutiny Search & Section 129 required to
of return Sec 64 Summary Seizure of any
assist proper
Assessment place or permises
officers

Adjudication Proceeding by Proper officer

if Action is initiated u/s Action initiated by Dept. in other Section e.g.

Tax
determination Interest Penalties
Action civil Proceeding Action to goods
Sec 73 ✅ Sec 73 ✅ Sec 73 ✅

sec 74 ✅ sec 74 ✅ sec 74 ✅

Sec 76 ✅ Sec 76 ✅ Sec 76 ✅ Sec 122:Penalties for Sec 123 & 124
Sec 67(2) - Detention ,saize of Sec 129 - Detention ,saize & Penalties
specified officence on :Penalties on other
goods in the premises [Discussed on goods & Conveyance in transit
TP/RP/any person agencies
above]

Proceeding deemed to be Sec 122(1) - Taxable person any

Sec 123 - Failure to furnish info return
concluded [Except Sec 122(2) - Registered Person
sec129,130,132 ] Sec 125 -failure to furnish statistics u/s
Sec 122(3) - Any Person 151
Sec 130 - Confisation of goods & the
* No Penalties under other section release on redemption fine (i.e fine in liue
of confiscation)
* Other person involved with main Sec 125 - General Penalties any where
person their proceeding of penalties Sec 126 - General disciplines related to Penalities
also deemed to be concluded

cognizance of offences - Explantion to Compounding of offences - Sec 138 - Compounding -

crimal proceeding against person - sec 132 :-
sec 132 & sec 134 means granting of immuniry from prosecution on
prosecution & imprisonment
payment of prescribed amount

YOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 70
XYZ
CHAPTER – 21 OFFENCES AND PENALTIES AND ETHICAL ASPECTS UNDER GST

SEC 122 PENALTIES FOR OFFENCES OF TAXABLE PERSON/REGISTERED PERSON/ANY PERSON SEC 122(1A)
SEC 122 (1) TAXABLE PERSON Any person who retains the benefit of a transaction Penalty tox evaded or input tox credit availed of or
(A) INVOICE/BILL OF SUPPLY (B) COLLECTION & PAYMENT covered under above clauses [A(i) & (ii)]. [C(1)&(ii)] of passed on
(i) Supply of Goods & Services (i) Collects any amt as tax but fails to pay to Govt, Sec 122 (1) and at whose instance such transaction is
(a) Without issue of invoice beyond a period of 3 months from the due date of conducted.
(b) Issue of incorrect of false invoice payment. SEC 122(1B) Penalty for ECO
(ii) Issue of invoice or bill without supply of goods & (ii) Collects any tax in contravention of the provision (i) ECO allows a supply through by URP other than a it Penalty is Higher of-
services in violation of provisions of this act of the Act but fails to pay to Govt. beyond a person exempted from registration, - ₹10,000 (IGST:20,000),or
period of 3 months from the due date of payment. (ii) ECO allows an inter-State supply through it by - Tax involved if such supply was made by RP
(iii) Issue of invoice using registration ne. of (iii) (a) Fails to deduct tax u/s 51 person who is not so eligible or other than composition dealer
another registered person. T (iii)ECO fails to furnish correct details in GSTR-8 u/s
D (b) Deducts on amt less than the amount 52(4) of outward supply of goods effected through it
required to be deducted by person exempted from obtaining registration.
S (c) Falls to pay to Govt amt deducted as tux, SEC 122A:-Penalty on manufacturer of goods for failure to register certain machines used in manufacture of
(iv) (a) Fails to collect tox u/s 52 goods as per special procedure u/s 148
₹1 lakh (CGST & SGST/UTGST each) or 2 lakh (IGST) per machine plus any other penalty under demand &
T (b) Collects an amt less than the amt require to
D be collected. recovery & GST law.Such machine is liable for seizure & confiscation unless penalties are paid & registration is
done within 3 days of receipt of communication of order of penalty.
S (c) Fails Foils to pay to Govt amt collected as
PENALTY ON OTHER AGENCIES
tax
Sec 123: failure to furnish info Return u/s 150 within Penalty = 100 (IGST: 200) for each day of failure
(C) ITC (D) REGISTRATION
90 days of service of SCN (Maximum₹ 5,000 (IGST: 10,000)])
(i) Takes or utilises ITC without actual receipt of (i) Liable to get registered but fails to obtain
Sec 124 failure to furnish Statistics u/s 151 Penalty=(a)Fine upto 10,000 (IGST:₹20,000) & (b) for
goods & services (fully/partially) in contravention registration.
continuing offence further fine upto 100 (IGST: 200) per day
of provisons of this act. but maximum 25,000 (IGST €50,000)
(ii) Takes or distributes ITC in contravention of (ii) Furnish folse info with regard to registration. SEC 125 GENERAL PENALTY
Sec 20 (ISD). Any persan who contravenes any of the provisions of Penalty which may extend to ₹25,000 (IGST :₹50,000)
(E) DOCUMENTS,RECORDS & INFORMATION (F) TURNOVER this Act for which no penalty is separately provided
(i) (a) Falsifies financial records (i) Suppresses turnover leading to evasion of tax. SEC 126 GENERAL DISCIPLINES PENALTIES
(b) Preduce fake accounts/documents 1. No penalty for(a) Miur breaches 15000) (b) Procedural requirements. (c) Any omission or mistake in document
(c) Furnishes any false info in return with an which is easily rectifiable (Apparent on record & Mode without fraudulent intent or gross negligence)
intention to evade payment of tax 2 Penalty imposed depends in facts & circumstances & shall be commensurate with the degree & severity of the
(ii) Fails to keep, maintain or retain books of breach.
accounts. 3. Opportunity of being heard after issuing SCN
(iii) Tampers with or destroys any material 4. Officer shall specify the nature of breach & applicable
evidence/ document. 5. Parsan velunturily discloses to an officer, PO. may consider this as a mitigating factor when (f) quantifying
(G) TRANSPORT/STORES (H) REFUND penalty.
(i) Transport taxable goods without documents. (i) Fraudulently obtains refund. 6.Persians not applicable - Penalty specified either a fixed sum or fixed percentage
(eg. eway bill, challan etc.) SEC 127 CIRCUMSTANCES UNDER WHICH OFFICER MAY ISSUE ORDER OF PENALTY
(ii) Supplies/transports/stores any goods which he Penalty is not one by following preceding
has reason to believe are liable to confiscation. (a) BJA of non filters of return (sec 62)
(I) PROPER OFFICER (J) SAIZED GOODS (b) BJA of unregistered person (sec 63)
Sec 122
(i) Obstructs / Prevents any officer of his duties. (i) Dispose off / Tampers with any goods – detained , (c) Summary Assessment .(sec 64)
(ii)Fails to furnish info. documetns called for by an seized or attached (d) Determination u/s 73.
officer (e) Determination u/s 74.
PENALTY:- (f) Determination u/s 74A
HIGHER OF THE FOLLOWING:- (g) Detention, seizure & release of goods & conveyances in transit.(sec 129)
1. ₹ 10,000 (1GST: 20.000) OR (h) confiscation of goods/conveyances & levy of penalty u/s 130.
2. An amt equivaled to any of the following (i.e 100%):- SEC 129 DETENTION SEIZURE & RELEASE OF GOODS & CONVEYANCE IN TRANSET
(a) Tax evaded or 1. Notwithstanding anything contained in this Act, where person:-
(b) Tax not deducted u/s 51 or short deducted or deducted but not paid To Govt or a.Transport any goods
(c) Tax not collected u/s 52 or shart collected or collected but not paid to Govt or b. Steres goods while in transit
(d) ITC availed or passed on ar distributed irregularly or in contravention of provision of this Act then
(e) Refund claimed fraudulently (i) all such goods (ii) conveyance (iii) documents related to gonde & conveyance "shall hel liable to be detention or Seizure”

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CHAPTER – 21 OFFENCES AND PENALTIES AND ETHICAL ASPECTS UNDER GST

RELEASE OF GOODS DETAINED OR SEIZED B. CONVEYANCE USED FOR CARRIAGE OF GOODS OR PASSENGERS:-
WHERE OWNER OF GOODS COME FORWARD FOR PAYMENT OF TAX & PENALTY a. Fine equal to tax payable on goods being transported.
3. No order without opportunity of being heard.
4."Confiscation= title to govt."
In case of exempted goods 5. P.O. shall take & hold possession of things confiscated with assistance of officer of police if needed.
In case of Taxable goods 6. If redemption fine not paid within 3 months, P.O. dispose of goods/ conveyance & deposits sale proceeds with
Govt.
• On payment of penalty equal to 200% of the • An amount equal to 2% (IGST :4% of the "As pe Sec 131, no confiscation made or penalty imposed above shall prevent the infliction of any other punishment
tox payable on such goods value of goods; or ₹ 25,000 (IGST:₹ 50,000 to which the person affected is liable under provisions of this act or under any other law."
whichever is less PUNISHMENT FOR ABOVE OFFENCES
Sec.132:Prosecution and imprisonment- Whoever commits ,or causes to commit and retain the benefits arising out
of ,any of the following offences
WHERE OWNER OF GOODS DOES NOT COME FORWARD FOR PAYMENT OF TAX & PENALTY
(A) INVOICE / BILL OF SUPPLY (C) ITC
(i) Supply of Goods & Services In violation of law if the (i) Avails ITC using invoice or bill referred in
without issue of invoice intention to evade the (ii) above fraudulently avails input tax credit
In case of exempted goods payment of Tax without any invoice or bill
In case of Taxable goods
(ii) Issue of invoice or bill In violation of law leading (D) FRAUDULENT ACTIVITIES
without supply of goods & to wrongful availment or (i) a) Evades Tax
• Penalty equal to higher of the following • An amount equal to 5% (2657 10%) of the
services (fake invoices) utilisation of ITC or b) Fraudulently obtains refund [not covered
50% of value of goods or value of goods or ₹ 25,000 (IGST : ₹ 50.000
refund. above]
200% of the tax payable an such goods whichever in less)
(B) COLLECTION & PAYMENT (E) DOCUMENTS, RECORDS &
INFORMAΤΙΟΝ
(i) Collects any amt as tax but fails to pay to Govt. beyond a (a) Falsifies/substitutes financial records
"No such goods & conveyance shall be detained or seized without serving an order of detention or seizure
period of 3 months from the due date of payment. (b) Produce fake accounts/documents
on the person transporting the goods."
(c) Furnishes any false info/ return with an
2. Omitted
intention to evade payment of tax.
3. Notice to transporter within 7 days specifying the penalty & order with 7 days of notice..
4. Opportunity of being heard. (F) ATTEMPT TO COMMIT OFFENCE (related To above(A)to (E))
5. On payment of amount, all proceedings shall be deemed to be concluded. (i) attempts to commit, or abets the commission of any of the offences mentioned above.
6. Transporter/ Owner fails to pay the amt within 15 days so detained/seized shall be liable to be sold or
disposed of to recover penalty payable as per order. PUNISHMENT FOR ABOVE OFFENCES (WITH PREVIOUS SANCTION PREVIOUS SANCTION OF
7. Transporter can get conveyance released on payment of which is lower of: Penalty in the order or COMMISSIONER)
1,00,000 (IGST: ₹2,00,000). Offence Involving Amount Involved (in ₹) Punishment
"Where detained/ seized goods are perishable/ hazardous/ likely may be reduced by P.O.." to depreciate Tax evaded or > 5 crores upto 5 Years and with fine
(Note: If Amt below
the period of 15 days ITC wrongly availed or utilised or Exceeds 2 crores but 5 crores 1 Cr No upto 3 Years and with fine
SEC 130 CONFISCATION OF GOODS OR CONVEYANCES & LEVY OF PENALTY Refund wrongly taken Exceeds 1 Cr but 2 Cr in imprisonment) upto 1 Years and with fine
1. Where Not withstanding to not withstand to anything contained in this Act, if any person:- offence specified in AOO(ii) above
a. Supplies or receives goods in contravention of provisions of this Act with intent to evade payment Commits or abets the commission No limit 6 months or fine or both
of tax; or of an offence specified E (above)
b. Doesn't account for goods on which he is liable to pay tax. For second and every subsequent No limit (even offence of 1) upto 5 Years and with fine
c. Supplies any taxable goods without applying for registration. offence under section 132
d. Contravenes any of provisions of this Act with intent to evade payment of tax; (Imprisonment minimum 6 months in the absence of special and adequate reasons to the contrary to be recorded in
e. uses any conveyance for transporting goods in contravention of provisions of this Act unless owner the judgment of the Court)
of conveyance proves that it was used without his knowledge/connivance. then, all such COGNIZABLE & BAILABLE OFFENCE
goods/conveyance are liable to confiscation and penalty u/s 122 be levied. COGNIZABLE &  means serious category of offences where arrest can be done without a warrant and
2. REDEMPTION FINE (OPTION TO PAY FINE IN LIEU OF CONFISCATION):-(in addition to tax, NON-BAILABLE investigation with or without the permission of a court.
penalty and charges payable) If goods are confiscated by Govt. If goods are confiscated by Dept.  accused person shall not be automatically entitled for bail. However, court may order him to
A. FOR GOODS be released on a suitable bail
a. Fine shall not exceed Market value of goods confiscated less tax chargeable; NON-  means relatively less serious offences where accused not be arrested without a warrant and
b. Fine Penalty shall not be less than Penalty equals to 100% of tax payable on such goods (Lower COGNIZABLE & an investigation cannot be initiated without a court order.
restriction) BAILABLE  accused shall be offered to be released on bail upon his arrest by the police officer or the
court informing about his right to be so released

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CHAPTER – 21 OFFENCES AND PENALTIES AND ETHICAL ASPECTS UNDER GST

COGNIZANCE OF OFFENCES Compounding Amt by 38/2023.(Commissioner shall determine the compounding amount below:-
COGNIZABLE & NON BAILABLE NON COGNIZABLE & BAILABLE Offence if offence is punishable u/s if offence is punishable u/s
Offences related to above (A) to (C) (of sec 132) Other Offences 132(1)(i) (1st time) 132(1)(i) (Repeat)
where:- SOG or SOS without invoice to evade tax, Up to 75% of tax/ITC/refund Up to 60% of
(i) amount of tax evaded or 1) Offences related to above (A) to (C) of Sec 132 ITC on fake invoice or without invoice wrongly taken, Minimum = 50% tax/ITC/refund wrongly
(ii) amt of ITC wrongly availed or Exceeds 5 Cr above, where tax or ITC or refund evaded is 5 crores fails to pay to Govt. after collection within 3 taken, Minimum = 40%
(iii) amt of refund wrongly taken or less months (Note: If compounding not
2) Offences related to above (D) to (H) of Sec 132 Evades tax or fraudulently obtains refund not allowed: its not relevant)
above [irrespective of amount involved] covered above & also where invoice without
"BAIL CAN BE CONSIDERED BY A JUDICIAL "ARRESTED PERSONS SHALL BE RELEASED ON BAIL SOS/SOG leading to wrong ITC or refund.
MAGISTRATE ONLY" BY PO" Falsifies financial records or produces fake Amount equivalent to 25% of Amount equivalent to 25% of
Sec 133: Liability of Officers & Others accounts/documents tax evaded. tax evaded.
Persons liable Punishment Prosecution Requirement Deals with goods liable to confiscation
1. Person handling statistics u/s 151 Up to 6m imprisonment Govt. servant: Receives or deals with supply of services in 25% of tax evaded/ITC 25% of tax evaded / ITC
2. CGST officer with access to information u/s or 25,000 fine, or Sanction of Govt. contravention of GST law wrongly availed/ utilised / wrongly availed/ utilised
3. Person providing services on common portal both Non-govt. servant: Attempt to commit or abetsany of the above refund wrongly taken. /refund wrongly taken.
4. Agent of common portal Sanction of Commissioner offences
Proviso:- If 2 or more offence are committed, compounding amount shall be higher of those prescribed.
Sec 134: Cognizance of offences
Circular No 171/03/2022: Clarification on Demand & Penalty for Fake Invoices under CGST
➔ can only take action on GST offences with prior approval from the Commissioner.
1. If A issues a tax invoice to B without actual supply.
➔ Such offences must be tried by a Magistrate of First Class or higher.
Cases Clarification
Sec 135: Presumption of Culpable mental state
Is it a supply u/s 7 of the CGST Act? No, because no goods or services were actually
➔ The court will assume the accused had a guilty mind, but the accused can prove otherwise.
supplied.
➔ "Culpable mental state" includes intention, motive, knowledge, or belief in a fact.
➔ A fact is considered proved only if the court is convinced beyond reasonable doubt, not just by probability. Can demand/recovery be made from A u/s 73 or 74 of No tax liability arises, so no demand or recovery can
CGST Act? be made u/s 73 or 74.
Sec 136:Relevance of Statements in Certain Cases
Can penal action be taken against A? No penalty u/s 73 or 74. However, penalty u/s
A statement made and signed by a person in response to a summons can be used as evidence in a prosecution if:
122(1)(ii) may apply for issuing invoices witht actual
a) The person is dead, missing, unable to testify, kept away by the opposing party, or their presence is
supply.
difficult or costly to obtain, or
b) The person has testified in court, and the court decides the statement is necessary for justice. 2. A issues a tax invoice to B without supply. B claims ITC on it and uses it to pay tax on his own supplies to
buyers.
Sec 137: Offences by Companies and Other Entities
Cases Clarification
Who is Guilty & Punished  Company & the person in charge responsible for business at the time of offence
Liability for ITC Demand & Penalty  B wrongly availed & utilized ITC on fake invoices.
 Partner, karta, managing trustee of firm/LLP/HUF/trust
 Liable for demand, recovery, penalty u/s 74 &
Other Persons Liable to Be Director, manager, officer of the company or partner/member/trustee/ manager of
interest u/s 50.
Punished other entities
Penal Action u/s 122 No additional penalty u/s 122 if penalty is imposed u/s
Persons Not Liable to If the offence was committed without their knowledge or they exercised due
74.
Punishment diligence to prevent it.
3. A issues a tax invoice to B without supply. B claims ITC and passes it to C through similar invoices.
COMPOUNDING OF OFFENCES (SEC 138)
Cases Clarification
compounding means granting of immunity from prosecution on payment of prescribed amount
Is it a supply u/s 7?  No actual supply of goods or services.
1. Any Offence may be compounded by Commissioner  B availed ineligible ITC on fake invoices from A.
2. Either before or after the institution of prosecution  No tax payable on B's supply to C due to lack of
3.Upon payment of compounding amount. actual supply.
NON COMPOUNDING Penal Action u/s 122  B is liable for penalty u/s 122(1)(ii) for issuing fake
a) Person who has been allowed to compound once earlier for offence under A to E invoices without supply.
b) Person who has been accused of Issuing invoice/bill without supply leading to wrongful availment/utilisation of  B is also liable u/s 122(1)(vii) for utilizing ITC
ITC or tax refund without actual receipt of goods or services.
c) Person convicted for an offence by a court.
d) Any other class of persons or offences as may be prescribed
COMPOUNDING
Other Offences
MONETARY LIMIT FOR COMPOUNDING AMOUNT:- (Allowed Only After Payment of Tax, Interest & penalty)
i) MINIMUM LIMIT = 25% of tax sinvolved ii) MAXIMUM LIMIT 100% of tax involved

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CHAPTER - 22 APPEALS AND REVISION

Administrative Preceding
Power of Department BJP Adjudication Order
Investigation Sec 73/74/74A/76
Others

Order by PO Order by office below rank of Revisional Authority (P.O)

* erroneous (Prejudicial to revenue) * Illegal or improper * Illegal or importer * Not Considering material facts

Appeal Review (Appeal by Commissioner) Revision

Appeal by aggrieved person (Generally taxpayer) against Commissioner : - To satisfy himself about legality/propriety Revisional Authority
order of P.O On his own motion or on the request of commissioner Time limit-Within 6 On his own motion
Form-GST APL-01 from SGST/UTGST Act Months from On information received by him
Manner- Electronically (manually if notified by Form-GST APL-03 Communication of On the requet of SGST/UTGST Comm., may call for &
Commissioner or if order to be appealed against is not Manner- Electronically (manually if notified by order examine records.
available on portal) Commissioner or if order to be appealed against is not Condonation-1 Month (Records=includes all records available at the time of
Time limit -Within 3 Months from Communication of available on portal) No pre- deposit examination by RA)
order required
Condonation for delay- 1 month for reasonable cause

Appellate Authority Revision Authority (Appeal by Commissiner Order cannot be revised by RA

➔ RA cannot revise following orders
Orded Passed By AA Shall be:- Orded Passed By RA Shall be:-  Order subject to appeal before
i) Addt. Comm. /joint comm. Comm.(Appeal) i) Addt. comm/joint comm. Principle Comm.comm AA/AT/HC/SC
ii)Asst. comm. / D. comm.or Any Officer not below the ii)Asst. comm. / D. comm.or J.comm./Addt. Comm.  Order having period before 6
Pre-Deposits
Superintendent rank of joint Comm.(Appeal) Superintendent months & after 3yrs from
Mandatory Pre-deposits= (AA) 1) AA shall not refer the case back for fresh adjudication After enquiry pass such order as he think just and proper which communication of order
a. Full amount of tax /interest / 2) Order to be passed by AA within 1 yr from the date of filling includes enhancing or modifying or annulling the original order  Order already taken for
penalty / fine (Agreed) appeal. revision
b. 10% of dispute amount of tax  Revisional order
Note:- No pre-deposit for Exception: -
dispute amt. of penalty, interest RA may pass an order on any point not
against order of AA/RA
& late fee etc. raised in any appeal before
Subject to maximum 25 Cr (i.e AA/AT/HC/SC
CGST/SGST: 25 Cr & IGST: 50 Cr) before expiry of :-
Appeal by Aggrieved person from & Time limit Application by Dept. *1 yr. from date of order in appeal,
For Appeal against order under sec (or)
129(3) Pre-deposit = 25% of penalty *3 yr from date of initial order,
In APL -05 Within 3 month from In APL - 07 Within 6 month from whichever is later
Cmmunication or order (+further 3 month order date

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CHAPTER - 22 APPEALS AND REVISION

Pre-Deposits APPELLATE TRIBUNAL (AT) [GSTAT]

Mandatory Pre-deposits= (AA) Centre State No. of member required to hear appeal:-if
a. Full amount of tax /interest / Principal Bench (at New Delhi) State benches tax/ ITC/Fine/ free/penalty in any order
penalty / fine (Agreed) P JM TM(C) TM(S) 27M TM(C) TM(S) appealed against < = ₹50 lakhs & does not
Note:- it is addition to pre- Jurisdiction :- to hear appeals against orders passed by AA/RA Jurisdiction :- to hear appeals against orders passed involve any question of law then appeal may
depsite with AA in the cases where one of the issues involved relates to POS, by AA/RA other than those discussed for principal be heard by single Member with approval of
b. 20% of dispute amount of tax adjudicate matters referred in Sec 171 (2) (i.e Anti-profiteering) & hear bench beside. President.
Subject to maximum 50 IGST: 100 cases that may be notified by Govt. In all other cases.it shall be heard
Cr) together by 1 JM & 1 TM
P:President ,JM Judicial Member ,TM:Technical
Member

Manner of filing Is filed electronically except where Registrar allows manually by general/special order.
Appeal, Application &
Memorandum
AT can refuse an Where- Amount of tax/ ITC/ Difference in tax or ITC/fine/fees/penalty determined by such order = upto 50000/-
appeal
Memorandum of cross Can be filed (within 45days from receipt of notice) in FORM GST APL-06 (Condonation= + 45days).
objection
Fees 1,000/- for every 1,00,000/-of tax etc., ₹25,000/- & Min. 5,000, fee = ₹5,000 if appeal is for order not having demand of tax, int, fine, fee or penalty.
Distribution/Transfer Subject to jurisdiction discussed above, President shall distribute business of AT & transfer cases among benches.
Validity of Act Act or proceedings of AT shall be not be questioned or invalid merely due to vacancy or defect in its constitution.
Date for filing 1. If order is uploaded on portal, appeal is filed on date of provisional acknowledgment (ack).
appeal/application 2. If not uploaded, appellant must submit/upload a self-certified copy within 7 days of filing APL-05/07 & date of provisional acknowledgment becomes the filing date. If submitted after 7 days, the filing
date is the date of uploading of self-certified copy.
3. Final ack. In APL-02 is issued after defect removal in all above cases.
4. The appeal is treated as filed only when the final ack. is issued.

ORDER of AT

Difference in opinion on any pt. of appeal:- Order of AT pass such orders thereon as it thinks fit, confirming, modifying Rectification Order by AT Withdrawal of
or annulling the decision or order appealed against or appeal/application
Situations President shall refer case to Refer the cash to the AA or to the RA, or to the original adjudicating AT may amend any order passed by it so ➔ Apply in APL-05/07W
(a) appeal was originally heard by to another Member of a State back authority, for a fresh adjudication. as to rectify any error apparent on the before issue of order by
Members of a State Bench, Bench within State or, Time limit of The law provides an advisory time limit of 1 year from the date face of the record if such error is AT
no such other State Bench is to a Member of a State Bench order of filing of appeal for the Tribunal to decide the appeal. ➔ noticed in the order by its own ➔ file it fresh in original
available within State in another State Copy of order The Tribunal shall send a copy of its order to AA/RA/Original accord, or time limit- if final ack. in
(b) appeal was originally heard by to another Member from adjudicating authority/ Appellant/ Jurisdictional Commissioner or ➔ is brought to its notice by the APL-02 is issued
Members of Principal Bench, Principal Bench or commissioner of CGST/SGST/UTGST ➢ CGST/SGST/UTGST Commissioner ➔ withdrawal need approval
where no such other Member to a Member of any State Binding Effect Every order passed by the AT shall be final and binding on the or of AT in 15 days of filing
is available, Bench parties unless the dispute is taken to a higher appellate forum. ➢ the other party to the appeal application
within a period of 3 months from the date
& point(s) shall be decided as per majority including members who first Important Note:- 1) Any order made by the Appellate Tribunal may be enforced of the order.
heard it. by it in the same manner as if it were a decree made by a court in a suit pending ➔ If amendment has the effect of
therein enhancing an assessment or reducing
2) All proceedings before the AT shall be deemed to be judicial proceedings under a refund or ITC or otherwise
Indian Penal Code, and the AT shall be deemed to be civil court. increasing the liability then party has
been given an opportunity of being
heard.

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CHAPTER - 22 APPEALS AND REVISION

=> If order is of AT (Principal Bench) => If order is of AT(State Benches)

Appeal shall be lie to SC against an order Appeal shall be lie SC against an order passed by the HC where HC Appeal shall be lie High Court against an order
passed by the principal Bench of tribunal certifies to be a fit one for appeal to the Supreme court passed by the State Benches of tribunal

High Court (HC)

Supreme Court (SC)

Form GST APL-08

Sec 119: Suns due to be paid notwithstanding appeal, etc. Time Limit Within 180 days from date of order appealed against is
Suma due to Gort, an order passed by Principal Bench or State Benches of AT u/s 113(1) or High Court shall be payuble, received by aggrieved persan
irrespective of fact that appeal is preferred to higher authority. Question of Low The HC may admit such appeal if it is satisfied that
the case involves a substantial question of low

Rule 112- Freduction of Additional Evidence before AA/AT

Sec.116-Authority Representative for AA/AT Sec.121-Order-against which appeal cant be field
Appelsen shall not be allowed to predice before the AA or the AT additional evidence,
whether und in damentary Authorised Representative Disqualification for Orders- against which appeal cant be filed:-
Expectation :- in Following cases production of Additional Evidence shall be allowed Relative/regular employee, Authorised Representative- Order of Comm./other - for transfer of
Adjudicating Authority Appellate Authority refused to admit evidences, which ought Advocate /CA/CMA/CS, Person dismissed/ removed proceedings from one officer to another
to home Save admitted IDT gazetted officer (only from Govt service officer
Appellant was prevented by sufficient couse from producing evidences called by after 1 yr from retirement) Person convicted any Order of seizure / retention of books, docs
Adjudicating Authority/Appellate Authority GST practitioner offence under law etc
Appellant was prevented by sufficient couse from producing evidences relevant to Person found guilty of Order sanctioning prosecution
any ground of appeal to Adjudicating Authority / Appellate Authority misconduct Order u/s 80 related to payment of
Adjudicating Authority / Appellate Authority has made order appealed against Person, who is insolvent tax/interest etc in installments
,without giving sufficient opportunity to produce evidences

Additional Evidence :- Means evidence other than the evidence produced by him during Notes :- Representative befor HC/SC require degree of law
the course of the proceedings before the adjudication authority or as,the case may
be,the AA

Sec 120 read with Circular no. 207/1/2024: Appeal not to be filed in certain cases:

Monety Limits: The Board may set monetary limits for CGST officers when filing appeals or applications based on GST Council recommendations. Accordingly. CBIC fixes following monetary limits:

Appeallate Forum Monetary Limit (₹)

GSTAT 20,00,000
Restriction application to P.O.
High Court 1,00,00,000
Supreme Court 2,00,00,000

➔ Non-Filing Exception: A CGST officer can still file appeals in other cases involving similar issues, even if they didn't file due to monetary limits.
➔ No Acquiescence: A party in an appeal or application cannot argue that the CGST officer agreed with a decision just because they didn't file an appeal due to these limits.
➔ Consideration by Tribunal: The Appellate Tribunal or Court will consider the reasons for a CGST officer's non-filing of an appeal due to the set monetary limits.
➔ Note : Refer regular for detail discussion of circular no.207/1/2024
Student Notes :-

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XYZ
CHAPTER - 23 ADVANCE RULING

1 ADVANCE RULING
AAR would send a copy of
Make an application in The application, verification application to concerned
Decision provided by the on contained therein and all
prescribed form to the AAR with officer and, if necessary, call
Authority for advance undertaken or proposed to
specified related to supply of goods fees of Rs. 5000/- each for relevant documents to be signed for all relevant records from
ruling /Appellate Authority be undertaken by the
matters/ and/or services CGST and SGST. in prescribed manner. the concerned officer. Records
for advance ruling to applicant.
applicant questions to be returned asap.

2 Questions for which advance ruling can be sought [Section 97] AAR may examine
application & records and after Application not be admitted in If application is rejected, only
hearing applicant or his the cases where the question by way of a speaking order giving
Classification of any goods and/or services raised is already pending or the reasons for rejection,
authorized
decided in any proceedings in the application not to be rejected
representative, pass an case of an applicant under any of unless an opportunity of being
order either admitting or the provisions of GST law. heard given to applicant.
Applicability of a notification
rejecting the application.
Questions for seeking advance ruling

Determination of time & value of supply of goods

and/or services. Copy of Order Opportunity of being heard to be
If application admitted, ruling
admitting/rejecting the given to applicant/authorized
to be pronounced within 90 days
application to be sent to the representative and
Admissibility of ITC of tax paid or deemed to have of receipt of the application by
applicant and to the concerned officer/authorized
been paid. AAR.
officer. representative.

Determination of the liability to pay tax.

In case of difference of opinion between 2

members of AAR, points to be referred to
Whether applicant is required to be registered. AAAR. Copy of the advance ruling duly signed by
members and certified in prescribed manner to
• If AAAR also unable to come to a common be sent to the applicant, the concerned officer
Whether any particular thing with respect to goods conclusion in regard to the point(s), it shall and the jurisdictional officer.
and/or services amounts to supply within the meaning be deemed that no advance ruling can be
of that term. given in respect of that question.

3 RECTIFICATION OF MISTAKES [SECTION 102]

AAR & AAAR can amend their order within 6 months from date of order.

Such mistake may be noticed by authority on its own or brought to notice by applicant or the
concerned officer /jurisdictional officer.
If obtained by
copy of order to be
fraud It will be deemed Order to be passed
sent applicant If tax liability increases or ITC reduces due to such rectification, applicant must be heard.
/suppression of that such advance only after hearing
concerned officers
material facts/ ruling had never been the applicant/
and the jurisdictional
misrepresent ation of made. appellant.
officer. 4 APPLICABILITY OF ADVANCE RULING [SECTION 103]
facts
Binding only on applicant and concerned officer/jurisdictional officer. Not applicable to similarly placed
other taxable persons in the State.
Binding till the period when law facts/circumstances supporting the original advance ruling have not changed.

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CHAPTER - 24 MISCELLANEOUS PROVISIONS
Sec 171 :-Antiprofiteering

Profiteering

Reduction in rate of tax on

Interested parties
SOG/SOS Benifit of ITC

Examination of
Issue of national Issue of Application[within 2 month
nature Application Application local nature +1 month]
Commensurate benifit to be
given to customer

nature
On screening satisfied that benefit
not passed on then forword it to
Standing Committee on State Level Screening
standing committee
Antiprofiteering committee
Standing committee is satisfied that there is prima
facie evidence that supplier has not passed on the
benefit -Refer the matter to DGAP
Notice to Interested parties
DGAP Investigation Process Conduct Investigation & collect
evidence
Completion of Investigation within
6 month + 3 month (extension)
Appellate Tribunal (AT) Can seek opinion of other Agencies
to discharge duties

Where authority determines that a. R.P. has not passed on the benefits
Reduction of rate of tax
Benefit to ITC by way of Commensurate reduction in prices
POWER OF DGAP
Note:-CG notified 01/04/25 from which CCI will not accept request for examination (return
application to examine above) of matter discussed above, CG also empowered principle bench
Power to summon any person
of AT as the new authority to examine the same later.
Power same as that civil court

Order by CCI /AT

Reduction in prices Return to recipient = amt. equivalent to benefit not passed Imposition of penalty = 10% amt. Cancellation of Registration
with int. @ 18. Pa profiteering
Int: from date of collection- Date of return Note:No penalty 1f amt. deposited
If eligible person does not claim / not identifiable, deposite = withing 30 days or order
50% amount each in central + State CWF with in @ 18% p.a

Sec-151 Power to call for information: - The Commissioner or an officer authorised by him may, by an order, direct any person to furnish information relating to any matter dealt with in connection with this Act, within such time,
in such form, and in such manner, as may be specified therein
Sec-169 Service of Notice in certain circumstances:-
➢ Any notice, decision, order, summons, etc under the Act / rules, are served on assessee with sec. 169.
➢ Sec. 169(1)-Modes of Service- (any method can be followed)

sYOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 78
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CHAPTER - 24 MISCELLANEOUS PROVISIONS
a) Giving/ tendering directly: directly, or by messenger / courier, to addressee/ taxable person/ his manager/ authorised representative/advocate/tax practitioner/ to regular employee/ adult member of family.

b) By Registered post/Speed post/courier:- with acknowledgement due, to person for whom it is intended / authorised representative, at his last known place of business/residence
c) By E-mail:- to his e-mail address provided at registration, or amended id.
d) By making it available at Common portal
e) By Publication in news paper:- circulating in locality, in which taxable person is last known to have resided, carried on business or personally worked for gain.
f) By affixing at place of business etc.:- at some conspicuous place at his last known POB/residence, if above methods are not practicable. If such method is not practicable, affix a copy thereof on notice board of
office of concerned officer, who passed it.
➢ Sec. 169(2)- Deemed date of serving- On the date on which it is tendered /published, or copy there of is af fixed in above manner.
➢ Sec. 169(3)- Deemed date of receipt If sent by registered post/speed post- deemed to have been received at expiry of the period normally taken by such post in transit, unless contrary is proved.
Sec-158A Consent based sharing of information furnished by taxable person
read with (1) Sharing of information by portal: - Following details furnished by RP may be shared by common portal with Account Aggregator, if RP opts for the same-
rule 163 (a) particulars furnished in FORM GST REG-01 or GSTR-3B or Annual return;
(b) particulars uploaded for preparation of invoice, for generation of documents u/s 68 & in GSTR-1, as amended in GSTR-1A.
(c) other details prescribed.
(2) Consent required:- For this, consent shall be obtained of following & communicated to portal-
(a) Supplier (in all cases) &Note:- RP shall give consent only after obtaining consent of all recipients to whom he has issued invoice, credit notes & debit notes during said tax periods.
(b) recipient (for clause (b) & (c) above only) if it includes identity information of recipient.
(3) Effects: - No action shall lie against Govt. or common portal for any liability due to information shared. There shall be no impact on liability to pay tax on relevant supply or as per relevant return.

sYOUTUBE & TELEGRAM – ARHAM INSTITUTE, CONTACT NO. FOR CLASSES - 9039600091 CA VARDHAMAN DAGA pg. 79