INDEX Chapter
CHAPTERS NAME
PAGE NO.
N0.
GOODS & SERVICES TAX 1.
GST IN INDIA – AN INTRODUCTION
1.3 – 1.9
2.
SUPPLY UNDER GST
2.1 – 2.21
3.
CHARGES OF GST
3.1 – 3.21
4.
EXEMPTIONS OF GST
4.1 – 4.46
5.
PLACE OF SUPPLY
5.1 – 5.15
6.
TIME OF SUPPLY
6.1 – 6.4
7.
VALUE OF SUPPLY
7.1 – 7.7
8.
INPUT TAX CREDIT
8.1 – 8.25
9.
REGISTRATION
9.1 – 9.15
10.
TAX INVOICE, CREDIT AND DEBIT NOTE
10.1 – 10.10
11A..
E-WAY BILL
11A.1 – 11A.11
11B.
ACCOUNTS AND RECORDS
11B.1 – 11B.4
12A.
PAYMENT OF TAX
12A.1 -12A.6
Unit 1: Payment of Tax, Interest and other Amounts 12B.
PAYMENT OF TAX
12B.1 – 12B.5
Unit 2: Tax deduction at Source and Collection of Tax at Source 13.
RETURNS
13.1 – 13.12
14.
REFUNDS
14.1 – 14.20
15.
ASSESSMENT AND AUDIT
15.1 – 15.6
16.
INSPECTION, SEARCH, SEIZURE AND ARREST
16.1 – 16.5
17.
DEMAND AND RECOVERY
17.1 – 17.9
18.
LIABILITY TO PAY IN CERTAIN CASES
19.
OFFENCES AND PENALTIES
19.1 – 19.9
20.
APPEALS AND REVISION
20.1 – 20.10
21.
ADVANCE RULING
21.1 – 21.8
22.
MISCELLANEOUS PROVISIONS
18.1 –18.4
22.1 – 22.9
I-7
CUSTOMS & FTP 23.
BASIC CONCEPT OF CUSTOMS
23.3 – 23.8
24A.
TYPES OF DUTIES
24A.1 – 24A.7
24B.
CLASSIFICATION OF IMPORTED AND EXPORTED
24B.1 – 24B.4
GOODS 25.
IMPORT PROCEDURE
25.1 – 25.23
26.
VALUATION
26.1 – 26.16
27A.
DUTY DRAWBACK
27A.1 – 27A.4
27B.
WAREHOUSING UNDER CUSTOMS
27B.1 – 27B.12
28.
BAGGAGE, STORES AND IMPORT BY POST
28.1 – 28.6
29.
TRANSIT AND TRANSSHIPMENT
29.1 – 29.2
30.
REFUNDS UNDER CUSTOMS
30.1 – 30.4
31.
FOREIGN TRADE POLICY
31.1 – 31.22
䚉㻌 COLOUR USED
䚉Black - Heading, Sub-heading & important words 䚉Blue 䚉Red
- Matter or Content - Section, Rules & Schedule
䚉Green - Key code, Date, Month - Amendments for May 2022 - Amendments for Nov 2022
㻌
I-8
CHAPTER 3 CHARGES OF GST
GLIMPSES Intra-State Transfer & Inter-State Transfer: Liability To Pay Tax Under CGST/IGST Act: Reverse Charge Mechanism List of Specified Services Taxable Under Reverse Charge [i.e. The Services Where Tax is Payable By The Recipient] U/S 9(3) of CGST Act [In Case Of IGST U/S 5(3) Of IGST Act] List of Services Taxable Under Reverse Charge, i.e. The Services Where IGST Is Payable By The Recipient Tax Payable By E-Commerce Operator On Notified Services [U/S 9(5) of CGST Act, 2017] Composition Scheme Under CGST Act, 2017 [Section 10]
INTRA-STATE SUPPLY & INTER-STATE SUPPLY: Intra-State Supply U/S 8 of
[Nov 17, Jan 21]
Inter-State Supply U/S 7 of IGST Act.
IGST Act. 1. Where the location of the
1. Supply of goods/services when location of the
supplier and the place of
supplier and the place of supply are in two
supply are in –
different States/UTs.
Same State
Same Union territory
2. CGST and State Goods & Services Tax i.e. SGST/ Union Territory Goods & Services Tax i.e. UTGST shall be charged on an Intra-State Supply.
2. Supply of goods/services imported into the territory of India. 3. Supplier located in India and the place of supply is outside India. 4. Supply to/by SEZ developer or SEZ unit; or 5. Supply to Foreign Tourist 6. Supply in the taxable territory, not being an Intra-State supply & not specified anywhere. 7. IGST shall be charged on an Inter-State Supply.
Example 1: Place of Supply = Maharashtra
Place of Supplier = Gujarat
IGST܃
Example 2: Place of Supply = Punjab
Place of Supplier = Chandigarh
IDT सार
IGST܃
3.1
Note: Although Chandigarh is located within the State of Punjab, such supply will not be considered as Intra-State supply because Punjab is a state and Chandigarh is a Union Territory. Therefore, such transfer is an Inter-State supply as per section 7 of IGST Act, 2017. Example 3: Place of Supply = Maharashtra
CGST܃
Place of Supplier = Maharashtra
+
SGST Maharashtra State ܃ Example 4: Place of Supply = Chandigarh
CGST܃ +
Place of Supplier = Chandigarh
UTGST ܃
Example 5: Place of Supply = Delhi
CGST܃ +
Place of Supplier = Delhi
SGST of Delhi ܃
Note: State includes a Union Territory with Individual Legislature. Delhi, Puducherry & Jammu & Kashmir have their own individual legislature and hence covered under State GST Law.
UNION TERRITORY OF INDIA Before Amendments “Union Territory” means the territory of-
After Amendments “Union Territory” means the territory of-
a) The Andaman and Nicobar Island
a) The Andaman and Nicobar Island
b) Lakshadweep
b) Lakshadweep
c) Dadra and Nagar Haveli
c) Dadra & Nagar Haveli and Daman & Diu
d) Daman and Diu
d) Ladakh
e) Chandigarh
e) Chandigarh
f) Other territory
f) Other territory
STUDENTS NOTE:-
IDT सार
3.2
Note:- State of Jammu & Kashmir has been reconstituted into 2 Union Territories
Jammu & Kashmir
Ladakh
(With separate legislature)
For GST purpose Treated as State Impact of Amendment:State includes a Union Territory with Individual legislature, It means Delhi, Puducherry & Jammu & Kashmir (have their own individual legislature), Covered under state GST law. a) Place of Supply = Jammu & Kashmir
Location of Supplier = Jammu & Kashmir
Intra-State Transfer
CGST SGST of Jammu & Kashmir
b) Place of Supply = Jammu & Kashmir Location of Supplier = Ladakh
Inter-State
IGST
Transfer
STUDENTS NOTE:-
IDT सार
3.3
LIABILITY TO PAY TAX UNDER CGST/ IGST ACT:
Liability to pay tax
Forward charge
Reverse charge
E-Commerce operator
Taxable person making
Recipient of Supply
Electronic Commerce
Supply will be liable
will be liable
Operator will be liable
REVERSE CHARGE MECHANISM
Reverse charge mechanism Section 5(3) of IGST Act, 9(3) of CGST Act
Specified categories of goods or services or both received from unregistered person
NN 13/2017
NN 4/2017
U/S 5(4) of IGST Act, U/S 9(4)
Specified Services (discussed
[Specified Goods]
of CGST Act
under next heading)
Under this provision, tax
1.
under reverse charge is
2. Bidi Wrapper
payable by the NOTIFIED
Not applicable
3. Tobacco Leaves
in Exam
class of registered persons
4. Silk yarn
on NOTIFIED categories
4A. Raw Cotton supplied by agriculturist to any registered
of supplies of goods and/or services received by such registered persons from any unregistered supplier Example: A developer purchased cement from unregistered person [If developer charged GST on sale of flats @1% / 5%]
IDT सार
Cashew Nuts
person. 5. Supply of Lottery by SG/UT/LA to Lottery Distributor or Selling Agent 6. *Used Vehicles, Seized and Confiscated Goods, old and used goods, waste and scrap *Conditions for Reverse Charge are as follows: a) If the supplier is Government/Local Authority. b) Supply is of used vehicles, seized & confiscated goods, old and used goods, waste & scrap. c) Goods Recipient Any Person.
3.4
LIST OF SPECIFIED SERVICES TAXABLE UNDER REVERSE CHARGE [i.e. THE SERVICES WHERE TAX IS PAYABLE BY THE RECIPIENT] U/S 9(3) OF CGST ACT [In case of IGST U/S 5(3) OF IGST ACT]
S. Nos. 1: Services provided by GTA who has not paid GST @12% in respect of Transportation of
Goods BY ROAD to specified person {MCQ-Nov 20} Supplier GTA
Recipient is:
Recipient is any other person Exempt
a) Department/ establishment of
Recipient is:
Refer Entry 21A
CG/SG/UT Or b) Local Authority Or c) Government agencies
Specified person: 1)
Any factory registered under Factories Act, 1948.
2) Any society registered under the Societies Registration Act, 1860. 3) Any co-operative society established by or under taken by or under any law.
(which has taken
4) Any person registered under GST Act, 2017
registration only for
5) Any casual taxable person located in the
the purpose of deducting tax u/s 51 and not for making a taxable supply).
taxable Territory. 6) Any partnership firm whether registered or not under any law including AOP. 7) Body corporate established under any law.
Exempt (Refer entry 21B)
★ CG Central Government
Tax Rate @5% RCM
Tax Rate @12% FCM
SG State Government
Note: - If question says, GTA is
UT Union Territory
unregistered person then RCM will be applicable.
STUDENTS NOTE:-
IDT सार
3.5
S. Nos. 2 & 3: Legal Services
Legal services provided by Arbitral tribunal/ Advocate S.N. 2: Supplier is senior Advocate
S.N. 2: Supplier is
S.N. 3: Supplier is Arbitral tribunal
Partnership firm of Advocates {NOV 20} Individual Advocate [Expect senior Advocate] Recipient is
Recipient is an Advocate
Recipient is any person
Recipient is
Govt./ LA/
Or
other than Business entity
Business entity
GE/ GA
Firm of Advocate Aggregate Turnover of preceding financial
Exempt
Exempt
year of recipient is as make it eligible for
Refer Entry 45
Refer Entry 45
exemption from GST registration.
Yes
Exempt (Refer Entry 45)
Recipient is Govt./ LA/
Recipient is an advocate or firm of Advocate
GE/ GA
No
Taxable under RCM
Recipient is any person other than Business Entity
Aggregate Turnover of preceding Exempt
financial year of recipient is as make
Exempt
Refer Entry 45
it eligible for exemption from GST
Refer Entry 45
registration.
Yes
★
No
Exempt
Taxable under
Refer Entry 45
RCM
GE Government Entity GA Government Authority LA Local Authority
STUDENTS NOTE:-
IDT सार
3.6
→ S. Nos. 4: Services provided by way of Sponsorship to any body Sponsorship services
RCM Supplier [Any person] Recipient [Body corporate or partnership firm] located in TT S. Nos. 5: Services provided by Govt./Local authority to Business Entity
Services provided by Govt./Local authority to Business Entity S. N. 5 Services provided by
Business entity
Postal department by way of: [SEAL] S
Speed post
E
Express parcel post
A
Agency service
L
Life insurance service
S. N. 5A Services by way of
S. N. 5 Any other Services
Renting of immovable property [Subject to Exemptions]
Taxable under
Govt. In relation to an Aircrafts/ Vessels.
Services provided by Govt. To
Govt. In relation to Transportation
Recipient is registered
Recipient is not registered
RCM [but subject
under GST Act
under GST Act
to exemption]
of Goods or passenger [Subject to Exemption]
Tax under RCM
Tax under FCM
Tax under FCM
S. Nos. 5B: Transfer of development rights or floor space index (including additional FSI)
Supplier [Any person]
IDT सार
RCM
Recipient [Promoter]
3.7
S. Nos. 5C: Long term lease of land (30 years or more) Long term lease of land (30 years or more) for construction of a project by a promoter Consideration in the form of upfront amount
Supplier
like Premium, Salami, etc. & periodic rent.
Promoter
[Any person] RCM
Analysis of S. Nos. 5B & 5C E.g. Consideration 10 Cr.
Transfer of development rights or Any Person
Floor space Index or
Promotor
or
Long term lease of land (30 year or
Developer
or
more) against consideration in the
Builder
form of upfront amount (called as premium/salami etc.) Constructed Flats are Sold
Before issuance of completion
After issuance of CC & covered
certificate & tax is paid on them
under Schedule III
Consideration ₹ 10 Cr. will be exempt
Consideration ₹ 10 Cr. will be Taxable under RCM
Refer Entry Nos. 41A & 41B of Exemption Notification of CGST Act, 2017
S. Nos. 6, 7 & 8: Services supplied by directors, Insurance agent & Recovery agent S. N. 6
IDT सार
Category of supply of GST
Supplier of
Recipient of service
Services
(liable for payment of Tax)
Services supplied by a Director of
A director of a
The company or a body corporate
a company/body corporate to the
company or a
located in the taxable territory as
said company/body corporate.
body corporate
per Sec 2(11) of Companies Act, 2013.
3.8
7
Services supplied by an Insurance
An insurance
Any person carrying on insurance
agent to any person carrying on
agent
business, located in the taxable
insurance business. 8
territory
Services supplied by a Recovery
A recovery
A banking company or a financial
agent to a banking company or
agent
institution or a non-banking
a financial institution or a non-
financial company, located in the
banking financial company.
taxable territory.
S. Nos. 9: Services by a Music composer, Photographer & Artist S. N. 9
Category of supply of GST
Supplier of
Recipient of service
Services
(liable for payment of Tax)
Supply of services by Music composer,
Music
Music company, producer
photographer, artist or the like by way of
composer,
or the like, located in the
transfer or permitting the use or enjoyment
photographer,
taxable territory.
of a copyright covered under section 13(1)(a)
artist, or the
of the Copyright Act, 1957 relating to
like
original dramatic, musical or artistic works
S. Nos. 9A: Supply of Services by Author Supplier Author
Permitting the use of enjoyment of a copyright Recipient – Publisher in Taxable Territory
Option I
Option II
Publisher is liable for
Author can be liable
payment of tax under RCM
for payment of tax If:
i. ii.
Author has taken Registration under GST Act Filed a declaration in the Form at Annexure I to the GST Commissioner
iii.
He shall not withdraw the option within a period of 1 Year
STUDENTS NOTE:-
IDT सार
3.9
S. Nos.: 10 & 11 {NOV 20}
S. N.
Category of supply of GST
Supplier of services
Recipient of service (Liable for payment of Tax)
10
Supply of services by the
Members of Overseeing
members of Overseeing
Committee constituted by
Committee to Reserve Bank of
the Reserve Bank of
India (RBI)
India (RBI)
Services supplied by individual Individual Direct Selling
11
Direct Selling Agents (DSAs)
Agents (DSAs) other than
other than a body corporate,
a body corporate,
partnership or Limited
partnership or LLP firm
Reserve Bank of India (RBI)
Bank or NBFCs
Liability Partnership (LLP) firm to bank or non-banking financial company (NBFCs). S. Nos. 12 & 13:
S. N.
Category of supply of GST
Supplier of services
Recipient of service (Liable for payment of Tax)
Services provided by Business
12
Business facilitator
A banking company, located
facilitator to a banking company
in the taxable territory
[Effective from 01/01/2019]
Business Facilitator
Banking Company
Supplier S. N. 13
Category of supply of GST
Recipient Supplier of Services
Recipient of Services
Services provided by an agent of
An agent of
A business correspondent,
business correspondent to business
business
located in the taxable
correspondent.
Correspondent
territory.
[Effective from 01/01/2019]
Agent of Business Correspondent Supplier
IDT सार
Business Correspondent (TT) Recipient
3.10
S.N os. 14: Security Services {NOV 20}
S. N.
Category of supply of GST
14
Supplier
Recipient
Security Services (services provided by way of supply of security
Any
A
personnel) provided to a registered person.
person
registered
However, nothing contained in this entry shall apply to:
other
person,
than a
located in
body
the
corporate
taxable
(i) a) Department or Establishment of the Central Government or State Government or Union Territory; or Local authority; or
territory.
b) Governmental agencies; which has taken registration under the CGST Act only for the purpose of deducting tax under section 51 of the said Act and not for making a taxable supply of goods or services; or (ii) A registered person paying tax under composition scheme. [Effective from 01/01/2019]
Example: Case
Supplier
Recipient
Impact
1.
Mr. A (URP)
Mr. B (RP)
RCM
2.
Mr. A (RP)
Mr. B (URP)
FCM
3.
Mr. A (URP)
Mr. B (URP)
No Tax
4.
Mr. A (RP)
Mr. B (RP under CS)
FCM
5.
Mr. A (RP)
Mr. B (RP)
FCM
6.
Mr. A (RP)
Mr. B (RP)
FCM
7.
Mr. A (RP)
Registered only for Deducting TDS
FCM
RP – Registered Person URP – Unregistered Person CS – Composition Scheme STUDENTS NOTE:-
IDT सार
3.11
S. Nos. 15: Renting of motor vehicles {Nov 20}
S. N.
Category of supply of GST
Supplier of services
Recipient of service (Liable for payment of Tax)
15
Services Provided
Any person other than a
Any Body Corporate
By way of renting of any
Body Corporate, Who
Located in the taxable
motor vehicle designed to
supplies the service to a
territory.
carry passengers where the
Body Corporate and does
cost of fuel is included in the
not issue an invoice
consideration charged from
charging GST @12% (CGST
the service recipient
@6% + SGST/UTGST @6%)
To a Body Corporate
to the service recipient
Person liable to pay tax under renting of motor vehicle services Where GST is payable @12%
Where GST is payable @5% Supplier is other than Body
Supplier is Body Corporate
Corporate Recipient is a Body Corporate
Forward Charge Recipient is other than Body Corporate Reverse Charge Analysis of S.N. 15
S. No.
Particulars
CGST
SGST
IGST
Impact
1.
Mr. ‘X’ (RP) provide services by way of,
2.5%
2.5%
5%
RCM
6%
6%
12%
FCM
No GST &
No GST &
No GST &
RCM
Renting of any motor vehicle designed to
No Tax
No Tax
No Tax
carry passengers to Body Corporate
Invoice
Invoice
Invoice
Renting of any other motor vehicle designed to carry passengers to Body Corporate [ITC Not allowed except ITC of Input Services in Same link of Business] 2.
Mr. ‘X’ (RP) provide services by way of, Renting of any motor vehicle designed to carry passengers [Full ITC allowed]
3.
IDT सार
Mr. ‘X’ (URP) provide services by way of,
3.12
S. Nos. 16: Lending of securities
S. N.
Category of supply
Supplier of services
Recipient of service
of GST 16
(Liable for payment of Tax)
Services of lending
Lender i.e. a person who deposits
Borrower i.e. a person who
of securities under
the securities registered in his
borrows the securities under
Securities Lending
name or in the name of any
the Scheme through an
Scheme, 1997
other person duly authorized on
approved intermediary of
(“Scheme”) of SEBI
his behalf with an approved
SEBI.
as amended.
intermediary for the purpose of lending under the scheme of SEBI.
LIST OF SERVICES TAXABLE UNDER REVERSE CHARGE, i.e. THE SERVICES WHERE IGST IS PAYABLE BY THE RECIPIENT S. N.
Category of supply of GST
Supplier of services
Recipient of service (Liable for payment of Tax)
1
Any service supplied by
Any person located in
Any person located in the
any person who is located
a non-taxable territory
taxable territory other than
in a non-taxable territory
(NTT)
non-taxable online recipient
to any person other than non-taxable online recipient. Recipient
Supplier (NTT)
S. N.
Recipient
Category of supply of GST
Non-Taxable Online Recipient
Other than Non-Taxable Online Recipient
Supplier of services
2
Services supplied by a
person
FCM
Recipient of service (Liable for payment of Tax)
A person
Importer, as defined in section
located in non-taxable territory
located in
2(26) of the Customs Act, 1962,
by way of transportation of goods
non-taxable
located in the taxable territory.
by a vessel from a place outside
Territory (NTT).
India up to the customs station of clearance in India STUDENTS NOTE:-
IDT सार
RCM
3.13
R
R
S
Freight =
₹
2,00,000 Exporter (NTT)
Importer (India) (TT) Liability to pay tax on Importer
TAX PAYABLE BY E-COMMERCE OPERATOR ON NOTIFIED SERVICES [U/S 9(5) OF CGST ACT, 2017] {Nov 18} Services supplied through ECO are notified for this purpose Services supplied through ECO are notified for this purpose (a) Transportation of passengers by a radiotaxi, motor car, maxi
[MTP Dec 21]
(b) Accommodation for lodging or residential purpose in hotels, inn, guest house etc; (c) Housekeeping such as Plumbing, Carpentering etc.
cab and motor cycle; If Supplier is liable for
ECO is liable for the
Registration U/S 22 of CGST Act
If Supplier is not liable for Registration U/S 22 of CGST Act
payment of Tax Supplier is liable for the
ECO is liable for the
payment of Tax
payment of Tax
(d) GST impacting On Restaurant Services Provided by E-Commerce Operators i.e . Zomato, Swiggy etc.
Applicable in exams, if it is in supplementary issued by ICAI
(1) Restaurant Services by E-Commerce On September 17, it was decided at the Goods and Services Tax Council meeting that e-commerce operators be made liable to pay tax on services provided through them namely transport of passengers, by any type of motor vehicles- restaurant services provided, with some exceptions. This will become effective January 1, 2022, said a statement issued by the Finance Ministry after the GST Council meeting.
NN 17/2021 wherein E-commerce platforms (“ECO”) Zomato, Swiggy are liable to pay tax on the restaurant services effective 1st January, 2022 The liability to pay taxes on the non- restaurant services as per this directive still lies with the restaurants themselves.
IDT सार
3.14
Further Circular No. 167/23/2021-GST dated 17.11.2021 issued for clarification regarding modalities of compliance to the GST laws in respect of supply of restaurant service through ECO.
ECO is now made liable to pay GST on “restaurant services” provided through the e-Commerce platform.
This change is not applicable for restaurant services provided from a premise with declared of Rs. 7,500/- or above per day.
Swiggy, Zomato qualifies etc is qualify as an “e-commerce operator” under Section 2(45) of tariff CGST Act, 2017.
(2) What is Restaurant and Non-Restaurant Services? As per NN.11/2017 – CTR, “Restaurant service means supply, by way of or as part of any service, of goods, being food or any other article for human consumption or any drink provided by a restaurant, eating joint including mess, canteen, whether for consumption on or away from the premises where such food or any other article for human consumption or drink is supplied”. A restaurant is a place which is in the business of preparing and serving food in the premises or as takeaway.
An illustration under this category is provided below: a) Restaurants located in a premise where declared tariff is not exceeding Rs. 7,500 per day and providing restaurant services.
b) Food and beverage sold as a part of restaurant services and which qualifies as restaurant services.
c) Cloud kitchens providing restaurant services etc. d) Stand-alone restaurants which are not ice cream parlors or bakeries. As per NN. 17/2021, Zomato, Swiggy shall be responsible for charging, collecting and paying GST @ 5% on supply of “restaurant services” made by such restaurant thru the ECO platform. For Restaurant with No GSTIN, ECO will be responsible for charging, collecting, paying GST @5% on total order value. Section 9(5) The Government may, on the recommendations of the Council, by notification, specify categories of services the tax on intra-State supplies of which shall be paid by the electronic commerce operator if such services are supplied through it, and all the provisions of this Act shall apply to such electronic commerce operator as if he is the supplier liable for paying the tax in relation to the supply of such services.
NN. 17/2021
IDT सार
3.15
supply of restaurant service other than the services supplied by restaurant, eating joints etc. located at specified premises. specified premises means premises providing hotel accommodation service having declared tariff of any unit of accommodation above seven thousand five hundred rupees per unit per day or equivalent. (3) Schedule II of CGST Act, 2017- Clause 6 – Composite Supply The following composite supplies shall be treated as a supply of services, namely: —
a) works contract as defined in clause (119 ) of section 2; and b) supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (other than alcoholic liquor for human consumption), where such supply or service is for cash, deferred payment or other valuable consideration. (4) Frequently ask question
1.
If you operate or manage E-Commerce Platform, Whether TCS would be applicable? YES
2. If Suppliers making taxable supplies through E-Commerce Operator, Whether TCS Would be applicable? YES
3. Suppliers supplies Transportation of Passengers, housekeeping, and hotel Accommodation services thru ECO, Whether TCS would be applicable? NO
4. Restaurant Service is provided from Specified Premises, Whether ECO would be liable for charging of tax? NO
5. Restaurant Service is provided from location other than Specified Premises, Whether ECO would be liable for charging of tax? YES
If ECO is located outside India If the ECO is located in taxable territory
Person liable to pay tax is the ECO
No If the ECO does not have physical presence
Person liable to pay tax is the person
in the taxable territory
representing the ECO
No If the ECO has neither the physical
Person liable to pay tax is the person
presence nor any representative in the
appointed by the ECO for the purpose of
taxable territory
paying the tax
IDT सार
3.16
COMPOSITION SCHEME UNDER CGST ACT, 2017 [SECTION 10(1)(2) & 10(2A)] [May 18, Nov 18, RTP Nov 19, Nov 19] {RTP, MCQ, CASE STUDY, Nov 20} [RTP Nov 20, MTP Dec 21] Composition scheme & concessional rate scheme Basis
Composition Scheme u/s 10(1) & 10(2)
Concessional Rate Scheme (Presumptive Scheme) (Sec 10(2A)
1. Optional scheme
It is an optional scheme
It is an optional scheme
2. Eligible Person
Manufacturer [other than notified Goods] Exclusively engaged in Notified Goods: (Key:- PITA) (i) Ice cream and other edible ice, whether or not containing cocoa. (ii) Pan Masala (iii) Tobacco and manufactured tobacco substitutes (iv) Aerated Water
Trader
supplying services other than restaurant services. Any person who is not eligible for composition scheme. (Except Manufacturer of
Service Provider [only supplier making
Notified Goods)
supplies under Schedule II para 6 Clause 6(b) [Restaurant service] 3. Aggregate
Applicable to registered person, whose
Aggregate Turnover in
Turnover (ATO)
aggregate turnover in preceding year is not
preceding year is not
for Eligibility
exceeding ₹ 1.5 crore or ₹ 75 Lacs [in special
exceeding ₹ 50 Lacs
category states] Special Category State [Key –STNAM3 UK] Sikkim
Tripura
Nagaland
Arunachal Pradesh
4. Tax Rate
Manipur
Meghalaya
Registered
CGST
Mizoram
Uttarakhand
SGST
SGCT 3% of ATO
person is a Manufact-
0.5% of
urer
ATO
Trader
0.5% of
0.5% of Taxable
Taxable supply
supply
2.5% of ATO
2.5% of ATO
Restaurant
5. Is composition
0.5% of ATO
Composition scheme taxpayers permitted to
scheme holder
render services other than restaurant services
eligible for
upto a specified limit:
making supply
This specified value is not exceeding:
IDT सार
CGST 3% of ATO
3.17
of service [other
(a) 10% of the turnover (Excluding interest
than restaurant
on loan advance & deposit) in a
service]
State/Union territory in the preceding financial year; or (b) ₹ 5 lakh, Whichever is higher.
6. Aggregate Turnover
Aggregate Turnover Inclusions Value of all outward supplies i.e. –
Exclusions CGST
Taxable supplies
SGST
Exempt supplies
UTGST
Exports
IGST
Inter-State supplies
Cess
of persons having same PAN to be computed on all India basis
Value of inward supplies on which tax is payable under reverse charge.
Note: 1)
Interest income on loan, advance and deposit to be excluded while computing aggregate turnover.
7. Who cannot opt
a) A service provider (except Restaurant Services and a Registered person
for Composition
whose Value of Service < 10% of the Turnover in a state/UT in
Scheme/
preceding F.Y. OR ₹ 5 Lakh, whichever is Higher) (This point is only
Concessional
applicable for composition Scheme)
Rate Scheme (CRS)
b) Person making non-taxable supplies (Alcohol, Petrol and Supplies under Schedule III) c) Person making Inter-State supply of goods. [In case of CRS InterState Supply of Goods/Services] d) An electronic commerce operator responsible for collecting tax at source And e) Manufacturer of notified goods. f) Non-resident Taxable Person or Casual Taxable Person
8. Something To Know
1) The option availed by a registered person u/s 10 shall lapse with effect from the day on which aggregate T/O during Financial year exceeds limits specified. [Same in CRS U/S 10(2A)] 2) Composition scheme to be adopted uniformly by all the registered
IDT सार
3.18
persons having the same PAN. (Same in CRS) 3) A taxable person who is covered u/s 10 Concessional Rate Scheme 10(2A) shall neither collect any tax from the recipient on supplies made by him nor shall he be entitled to any credit of input tax. 4) There is no restriction on Composition Supplier to procure goods from Inter-State Supplier. 5) A taxable person (u/s 10) shall mention the words “Composition Taxable Person”. On sign board displayed at prominent place at his Principal place of Business and Additional place of Business. 6) A taxable person shall pay Tax under RCM on inward supply of goods or services u/s 9(3)/ 9(4). (Same in CRS)
Example: A Photographer ‘Touch stone’ has commenced providing photography services in Mumbai from April this year. His turnover for various quarter till December is as follows: April – June
₹ 20 Lakh
July – Sept
₹ 30 Lakh
Oct- Dec
₹ 30 Lakh
Analysis: - Touch stone becomes eligible for the registration when his aggregate turnover exceeds ₹ 20 L - while registering under GST, he opts for composition scheme for services u/s 10(2A) - on Rs. 30 Lakh [turnover of July-Sept quarter], he shall pay tax @6% [3% CGST and 3% SGST], i.e. CGST ₹ 90,000 and SGST ₹ 90,000 - By the end of the July-Sept Quarter, his aggregate turnover reaches ₹ 50 L - Consequently, his option to avail composition scheme for services shall lapse by the end of July-Sept quarter and thereafter, he is required to pay tax at the normal rate of 18%. thus the tax payable for Oct-Dec quarter is ₹ 30 L X 18%, i.e. ₹ 5,40,000 RULES FOR COMPOSITION SCHEME Rule 3(2): At the time of registration, any person can option composition scheme in part B of Form GST Reg. – 01 Rule 3(3): Filing of intimation before the beginning of financial year: Any person who is registered under regular scheme but now opt composition Scheme shall electronically file and intimation in FORM GST CMP – 02. Prior to the commencement of the financial year for which the option to pay tax under composition Scheme is exercised. Rule 3(A): He shall furnish the ITC declaration in FORM GST CMP - 03 within a period of 60 days from the commencement of relevant financial year.
IDT सार
3.19
Rule 3(5) : One intimation applicable for all place in case of same pan Rule 4: EFFECTIVE DATE FOR COMPOSITION LEVY The beginning of the financial year, where intimation is filed u/r 3(3) Rule 6: Provision regarding validity of composition scheme Rule 6(1): The option exercise shall remain valid so long as he satisfied all the conditions. Rule 6(2): Mandatory Cessation of Composition Levy on Violation of Conditions: The person shall be liable to pay tax under regular scheme from the day he cease to satisfy any of the condition and shall issue tax invoice for every taxable supply and he shall also file intimation for withdrawal from the scheme in FORM GST CMP-04 within 7 days of occurrence of such event. Rule 6(3): Application for withdrawal from scheme: The register person who intends to withdraw from the composition scheme shall file an Application in FORM GST CMP - 04. Rule 6(4): Where the proper officer has reason to believe that the registered person was not eligible for composition scheme or has contravened the provision of the Act. Proper officer (PO) may issue a SCN (show case notice) as why option to pay tax u/s 10 shall not be denied. Rule 6(5): Registered person as per (u/s 10) shall reply to proper officer upon receipt of reply, The PO shall issue an order within 30 days of the receipt of the reply or denying the Option to pay tax u/s 10 as the case may be. Rule 6(6): Every person may furnish a statement in FORM GST ITC - 01 containing Detail of stock of inputs and inputs contained in semi-finished or finished goods held in stock by him on the date on which option is withdrawn or denied, within a period 30 days from the date from which the option is withdrawn or from the date of the order passed. STUDENTS NOTE:-
IDT सार
3.20
Indirect Tax Laws (IDT) | IDT SAAR | CLASS NOTES AUTHOR PUBLISHER DATE OF PUBLICATION EDITION ISBN NO NO. OF PAGES BINDING TYPE
: : : : : : :
Mahesh Gour, K.M. Bansal TAXMANN June 2022 5th Edition 9789356222076 430 PAPERBACK
Rs. : 950 | USD : 46
Description This book is prepared exclusively for the Final Level of Chartered Accountancy Examination requirement. It covers the entire revised syllabus as per ICAI. It is a one-stop solution to conquer the vast subject of Indirect Taxation easily. This book aims to explain the complicated provisions of the law in a simplified manner with the help of charts & diagrams. This book covers the following laws: · GST Act · Customs Act · Foreign Trade Policy The Present Publication is the 5th Edition & updated till 30th April 2022 for CA-Final | New Syllabus | Nov. 2022/May 2023 exams. It is authored by CA (Dr.) Mahesh Gour & CA (Dr.) K.M. Bansal, with the following noteworthy features: · Strictly as per the New Syllabus of ICAI · [Pictorial Presentation/Charts with Handwritten Fonts] are used in the book for easy understanding of complex concepts · [Multi-Colour Coded Book] which follows the below structure: o Black – Heading, Sub-Heading & Important Words o Blue – Matter/Content o Red – Section, Rules & Schedules o Green – Key Code, Date, Month Amendments for December 2021 Amendments for May 2021 · [Author's View] for conceptual clarity · [RTPs & MTPs of ICAI] This book covers references to RTPs & MTPs Questions of ICAI · [Amendments Applicable for Nov. 2022 Examination] are especially highlighted
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