GST – States – CIRCULAR No. 73/2018-GST – Dated:- 5-11-2018 – CIRCULAR Commissioner of State Tax, Gujarat State, Ahmedabad Dated 5th November, 2018 CIRCULAR No.73/2018-GST No. GSL/GST/B.15 Subject: Scope of principal and agent relationship under Schedule I of GGST Act, 2017 in the context of del-credrc agent. Post issuance of circular No. 57/201 S-GST dated the 5th November, 2018 (effective from 4th September, 2018). various representations have been received from the trade and industry. as well as from the field formations regarding the scope and ambit of principal agent relationship under GST in the context of del-credre agent (hereinafter referred to as DCA ). In order to clarify these issues and to ensure uniformity of implementation across field formations, the Commissioner of State Tax, in exercise of its powers conferred under section 168 (1) of the Gujarat Goods and Services Tax Act, 2017 (hereinafter referred to as GGST Act ) hereby clarifies the issues in succeeding paras. 2
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n DCA and buyer. Concerns lune been expressed regarding the valuation of supplies from Principal to recipient where the payment for such supply is being discharged by the recipient through the loan provided by DCA or by the DCA himself. Issues arising out of such loan arrangement have been examined and the clarification on the same are as below: Sl. No. Issue Clarification 1 Whether a DCA falls under the ambit of agent under Para 3 of Schedule I of the GGST Act? As already clarified vide circular No. 57/31/2018-GST dated 4th September, 2018, whether or not the DCA will fall under the ambit of agent under Para 3 of Schedule I of the GGST Act depends on the following possible scenarios: In case where the invoice for supply of goods is issued by the supplier to the customer, either himself or through DCA, the DCA does not fall under the ambit of agent. In case where the invoice for supply of goods is issued by the DCA in his own name, the DCA would fall under the ambit of agent. 2 Whether
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may be noted that vide notification No. 12/2017-State Tax (Rate) dated 30th June, 2017 (S. No. 27), services by way of extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount (other than interest involved in credit card services) has been exempted. 3. Where DCA is an agent under Para 3 of Schedule I of the GGST Act and makes payment to the principal on behalf of the buyer and charges interest to the buyer for delayed payment along with the value of goods being supplied, whether the interest will form a part of the value of supply of goods also or not? In such a scenario following activities are taking place: 1. Supply of goods by the supplier (principal) to the DCA; 2. Further supply of goods by the DCA to the recipient; 3. Supply of agency services by the DCA to the supplier or the recipient or both; 4. Extension of credit by the DCA to the recipient. It is clarified that in cases where the DCA is an agent under Para 3 of Sch
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