INTERPRETATION OF CENTRAL GOODS AND SERVICES TAX (CGST) ACT (PART-1)
By: – Dr. Sanjiv Agarwal
Goods and Services Tax – GST
Dated:- 19-4-2017
The Central Goods and Services Tax Act, 2017 has been enacted to make a provision for levy and collection of tax on intra-state supply of goods or services or both by the Central Government and the matters connected therewith or incidental thereto. This series of Articles shall analyze the provisions of Central Goods and Services Tax Act, 2017, which has been enacted on 12 April, 2017.
Objects of CGST Law
Presently, the Central Government levies tax on, manufacture of certain goods in the form of Central Excise duty, provision of certain services in the form of service tax, inter-State sale of goods in the form of Central Sales tax. Similarly, the State Governments levy tax on and on retail sales in the form of value added tax, entry of goods in the State in the form of entry tax, luxury tax and purchase tax, etc. Accordingly, t
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a single tax called the goods and services tax which will be levied on supply of goods or services or both at each stage of supply chain starting from manufacture or import and till the last retail level. So, any tax that is presently being levied by the Central Government or the State Governments on the supply of goods or services is going to be converged in goods and services tax which is proposed to be a dual levy where the Central Government will levy and collect tax in the form of central goods and services tax and the State Government will levy and collect tax in the form of state goods and services tax on intra-State supply of goods or services or both.
Need for GST Law
In view of the above, it has become necessary to have a Central legislation, namely the Central Goods and Services Tax Act, 2017. The proposed legislation will confer power upon the Central Government for levying goods and services tax on the supply of goods or services or both which takes place within a State.
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and Services Tax Council (the Council);
* to broad base the input tax credit by making it available in respect of taxes paid on any supply of goods or services or both used or intended to be used in the course or furtherance of business;
* to impose obligation on electronic commerce operators to collect tax at source, at such rate not exceeding one per cent. of net value of taxable supplies, out of payments to suppliers supplying goods or services through their portals;
* to provide for self-assessment of the taxes payable by the registered person;
* to provide for conduct of audit of registered persons in order to verify compliance with the provisions of the Act;
* to provide for recovery of arrears of tax using various modes including detaining and sale of goods, movable and immovable property of defaulting taxable person;
* to provide for powers of inspection, search, seizure and arrest to the officers;
* to establish the Goods and Services Tax Appellate Tribunal by th
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ven if made without consideration
Schedule II.
Activities to be treated as supply of goods or supply of services
Schedule III.
Activities or transactions which shall be treated neither as a supply of goods nor a supply of services
Origin and Commencement (Section 1)
* CGST Act will extend to whole of India excluding the states of Jammu and Kashmir.
* Jammu and Kashmir will need to approve levy of GST in its State assembly, on account of its special powers on taxation under article 370 of the Constitution. Once this is done, GST shall be introduced in the State.
* The CGST Act shall come into force from a date which will be notified by the Central Government in Official Gazette, i.e. from the appointed date.
* Different provisions may be made applicable from different dates as may be notified.
(To be continued……)
Reply By Ganeshan Kalyani as =
Sir, nice article. Sir, it is mentioned that CGST provision is not applicable in Jammu & Kashmir. But it seems that SGST & I
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