Can composition scheme be availed of by a manufacturer and a service supplier?

Question 17 – Draft-Bills-Reports – Levy of and Exemption from Tax – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 17 – Q 17. Can composition scheme be availed of by a manufacturer and a service supplier? Ans. Yes, a manufacturer can opt for composition scheme generally. However, a manufacturer of goods, which would be notified on the recommendations of the GST Council, cannot opt for this scheme. This scheme is not available for services sector, except restaurants. – Statutory Provisions

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Will a taxable person, having multiple registrations, be eligible to opt for composition scheme only for a few of registrations?

Question 16 – Draft-Bills-Reports – Levy of and Exemption from Tax – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 16 – Q 16. Will a taxable person, having multiple registrations, be eligible to opt for composition scheme only for a few of registrations? Ans. All registered persons having the same Permanent Account Number (PAN) have to opt for composition scheme. If one registered person opts for normal scheme, others become ineligible for composition scheme. – Statutory Provisions, Acts,

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A person availing composition scheme during a financial year crosses the turnover of ₹ 50 Lakhs during the course of the year i.e. say he crosses the turnover of ₹ 50 Lakhs in December? Will he be allowed to pay tax under composition

A person availing composition scheme during a financial year crosses the turnover of ₹ 50 Lakhs during the course of the year i.e. say he crosses the turnover of ₹ 50 Lakhs in December? Will he be allowed to pay tax under composition scheme for the remainder of the year i.e. till 31st March? – Question 15 – Draft-Bills-Reports – Levy of and Exemption from Tax – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 15 – Q 15. A person availing composition scheme during a financial year

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What are the rates of tax for composition scheme?

Question 14 – Draft-Bills-Reports – Levy of and Exemption from Tax – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 14 – Q 14. What are the rates of tax for composition scheme? Ans. There are different rates for different sectors. In normal cases of supplier of goods (i.e. traders), the composition rate is 0.5 % of the turnover in a State or Union territory. If the person opting for composition scheme is manufacturer, then the rate is 1% of the turnover in a State or Union territory. In ca

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Can any person other than the supplier or recipient be liable to pay tax under GST?

Question 12 – Draft-Bills-Reports – Levy of and Exemption from Tax – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 12 – Q 12. Can any person other than the supplier or recipient be liable to pay tax under GST? Ans. Yes, the Central/State government can specify categories of services the tax on which shall be paid by the electronic commerce operator, if such services are supplied through it and all the provisions of the Act shall apply to such electronic commerce operator as if he is the p

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What is meant by Reverse Charge?

What is meant by Reverse Charge? – Question 9 – Draft-Bills-Reports – Levy of and Exemption from Tax – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 9 – Q 9. What is meant by Reverse Charge? Ans

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Are all goods and services taxable under GST?

Question 8 – Draft-Bills-Reports – Levy of and Exemption from Tax – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 8 – Q 8. Are all goods and services taxable under GST? Ans. Supplies of all goods and services are taxable except alcoholic liquor for human consumption. Supply of petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas and aviation turbine fuel shall be taxable with effect from a future date. This date would be notified by the Government on th

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What are composite supply and mixed supply? How are these two different from each other?

Question 6 – Draft-Bills-Reports – Levy of and Exemption from Tax – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 6 – Q 6. What are composite supply and mixed supply? How are these two different from each other? Ans. Composite supply is a supply consisting of two or more taxable supplies of goods or services or both or any combination thereof, which are bundled in natural course and are supplied in conjunction with each other in the ordinary course of business and where one of which is a

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Who can notify a transaction to be supply of goods or services?

Question 5 – Draft-Bills-Reports – Levy of and Exemption from Tax – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 5 – Q 5. Who can notify a transaction to be supply of goods or services? Ans. Central Government or State Government, on the recommendations of the GST Council, can notify an activity to be the supply of goods and not supply of services or supply of services and not supply of goods or neither a supply of goods nor a supply of services. – Statutory Provisions, Acts, Rules, Regu

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Will giving away essential commodities by a charitable institution be taxable activity?

Question 4 – Draft-Bills-Reports – Levy of and Exemption from Tax – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 4 – Q 4. Will giving away essential commodities by a charitable institution be taxable activity? Ans. In order to be a supply which is taxable under GST, the transaction should be in the course or furtherance of business. As there is no quid pro quo involved in supply for charitable activities, it is not a supply under GST. – Statutory Provisions, Acts, Rules, Regulations, Tax

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What is the taxable event under GST?

What is the taxable event under GST? – Question 2 – Draft-Bills-Reports – Levy of and Exemption from Tax – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 2 – Q 2. What is the taxable event under

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Where is the power to levy GST derived from?

Question 1 – Draft-Bills-Reports – Levy of and Exemption from Tax – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 1 – 2. Levy of and Exemption from Tax Q 1. Where is the power to levy GST derived from? Ans. Article 246A of the Constitution, which was introduced by the Constitution (101st Amendment) Act, 2016 confers concurrent powers to both, Parliament and State Legislatures to make laws with respect to GST i.e. central tax (CGST) and state tax (SGST) or union territory tax (UTGST). Howe

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What is Anti-Profiteering measure?

Question 33 – Draft-Bills-Reports – Overview of Goods and Services Tax (GST) – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 33 – Q 33. What is Anti-Profiteering measure? Ans. As per section 171 of the CGST/SGST Act, any reduction in rate of tax on any supply of goods or services or the benefit of input tax credit shall be passed on to the recipient by way of commensurate reduction in prices. An authority may be constituted by the government to examine whether input tax credits availed by

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Is there any provision in GST for tax treatment of goods returned by the recipient?

Question 32 – Draft-Bills-Reports – Overview of Goods and Services Tax (GST) – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 32 – Q 32. Is there any provision in GST for tax treatment of goods returned by the recipient? Ans. Yes, Section 34 deals with such situations. Where the goods supplied are returned by the recipient, the registered person (supplier of goods) may issue to the recipient a credit note containing the prescribed particulars. The details of the credit note shall be declar

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Different companies have different types of accounting software packages and no specific format are mandated for keeping records. How will department be able to read into these complex software?

Question 31 – Draft-Bills-Reports – Overview of Goods and Services Tax (GST) – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 31 – Q 31. Different companies have different types of accounting software packages and no specific format are mandated for keeping records. How will department be able to read into these complex software? Ans. As per Section 153 of the CGST/SGST Act, having regard to the nature and complexity of a case and in the interest of revenue, department may take assistance

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What is the concept of Information Return?

Question 30 – Draft-Bills-Reports – Overview of Goods and Services Tax (GST) – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 30 – Q 30. What is the concept of Information Return? Ans. Information return is based on the idea of verifying the compliance levels of registered persons through information procured from independent third party sources. As per section 150 of the CGST/SGST Act, many authorities who are responsible for maintaining records of registration or statement of accounts or

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Whether actionable claims liable to GST?

Question 28 – Draft-Bills-Reports – Overview of Goods and Services Tax (GST) – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 28 – Q 28. Whether actionable claims liable to GST? Ans. As per section 2(52) of the CGST/SGST Act actionable claims are to be considered as goods. Schedule III read with Section 7 of the CGST/SGST Act lists the activities or transactions which shall be treated neither as supply of goods nor supply of services. The Schedule lists actionable claims other than lottery

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What is the purpose of Compliance rating mechanism?

Question 27 – Draft-Bills-Reports – Overview of Goods and Services Tax (GST) – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 27 – Q 27. What is the purpose of Compliance rating mechanism? Ans. As per Section 149 of the CGST/SGST Act, every registered person shall be assigned a compliance rating based on the record of compliance in respect of specified parameters. Such ratings shall also be placed in the public domain. A prospective client will be able to see the compliance ratings of supp

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How are the disputes going to be resolved under the GST regime?

Question 26 – Draft-Bills-Reports – Overview of Goods and Services Tax (GST) – FAQ on GST (2nd Edition) dated 31.3.2017 – Question 26 – Q 26. How are the disputes going to be resolved under the GST regime? Ans. The Constitution (one hundred and first amendment) Act, 2016 provides that the Goods and Services Tax Council shall establish a mechanism to adjudicate any dispute- (a) between the Government of India and one or more States; or (b) between the Government of India and any State or States

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