Definitions
Section 2
Bill
PRELIMINARY
MODEL GST LAW – GOODS AND SERVICES TAX ACT, 2016 – Draft June 2016
2. Definitions
In this Act, unless the context otherwise requires,-
(1) “actionable claim” shall have the meaning assigned to it in section 3 of the Transfer of Property Act, 1882;
(2) “address of delivery” means the address of the recipient of goods and/or services indicated on the tax invoice issued by a taxable person for delivery of such goods and/or services;
(3) “address on record” means the address of the recipient as available in the records of the supplier;
(4) “adjudicating authority” means any authority competent to pass any order or decision under this Act, but does not include the Board, the First Appellate Authority and the Appellate Tribunal;
(5) “agent” means a person who carries on the business of supply or receipt of goods and/or services on behalf of another, whether disclosed or not and includes a factor, broker, commission agent, arhatia,
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earing of seedlings or plants;
Explanation.- For the purpose of this clause, the expression 'forest' means the forest to which the Indian Forest Act, 1927 applies.
(8) “agriculturist” means a person who cultivates land personally, for the purpose of agriculture;
(9) "Appellate Tribunal" means the National Goods and Services Tax Appellate Tribunal constituted under section 81;
(10) “appointed day'' means the date on which section 1 of this Act comes into effect;
(11) “appropriate Government” means the Central Government in case of the IGST and the CGST, and the State Government in case of the SGST;
(12) “assessment” means determination of tax liability under this Act and includes self-assessment, re-assessment, provisional assessment, summary assessment and best judgement assessment;
(13) "associated enterprise" shall have the meaning assigned to it in section 92A of the Income Tax Act, 1961;
(14) “audit” means detailed examination of records, returns and ot
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ontinuity or regularity of such transaction;
(d) supply or acquisition of goods including capital assets and services in connection with commencement or closure of business;
(e) provision by a club, association, society, or any such body (for a subscription or any other consideration) of the facilities or benefits to its members, as the case may be;
(f) admission, for a consideration, of persons to any premises; and
(g) services supplied by a person as the holder of an office which has been accepted by him in the course or furtherance of his trade, profession or vocation;
(18) “business vertical” shall have the meaning assigned to a 'business segment' in Accounting Standard 17 issued by the Institute of Chartered Accountants of India;
(19) “capital assets” shall have the meaning as assigned to it in the Income Tax Act, 1961 (43 of 1961) but the said expression shall not include jewellery held for personal use or property not connected with the business;
(20) “capital goods” mea
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(i) supplying the service of renting of such motor vehicle; or
(ii) transportation of inputs and capital goods used for supply of service; or
(iii) supply of courier agency service;
(C) motor vehicle designed to carry passengers including their chassis, registered in the name of the supplier of service, when used for supplying the service of-
(i) transportation of passengers; or
(ii) renting of such motor vehicle; or
(iii) imparting motor driving skills;
(D) Components, spares and accessories of motor vehicles which are capital goods for the taxable person.
(21) “casual taxable person” means a person who occasionally undertakes transactions involving supply of goods and/or services in the course or furtherance of business whether as principal, agent or in any other capacity, in a taxable territory where he has no fixed place of business;
(22) “CGST” means the tax levied under the Central Goods and Services Tax Act, 2016;
(23) “chartered accountant” means a chartered accountan
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o be made, whether in money or otherwise, in respect of, in response to, or for the inducement of, the supply of goods and/or services, whether by the said person or by any other person;
(b) the monetary value of any act or forbearance, whether or not voluntary, in respect of, in response to, or for the inducement of, the supply of goods and/or services, whether by the said person or by any other person:
Provided that a deposit, whether refundable or not, given in respect of the supply of goods and/or services shall not be considered as payment made for the supply unless the supplier applies the deposit as consideration for the supply;
(29) “continuous journey” means a journey for which a single or more than one ticket or invoice is issued at the same time, either by a single supplier of service or through an agent acting on behalf of more than one supplier of service, and which involves no stop over between any of the legs of the journey for which one or more separate tickets or in
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cle;
(33) “cost accountant” means a cost accountant within the meaning of the Cost and Works Accountants Act, 1959 (23 of 1959);
(34) “Council” means the Goods and Services Tax Council established under Article 279A of the Constitution;
(35) “credit note” means a document issued by a taxable person as referred to in sub-section (1) of section 24;
(36) “debit note” means a document issued by a taxable person as referred to in sub-section (2) of section 24;
(37) “deemed exports”, as notified by the Central Government/State Government on the recommendation of the Council, refer to those transactions in which the goods supplied do not leave India, and payment for such supplies is received either in Indian Rupees or in convertible foreign exchange;
(38) “document” includes written or printed record of any sort and electronic record as defined in the Information Technology Act, 2000 [21 of 2000];
(39) “earlier law” means any of the following laws, that is to say,
(a) . . .
(b) . . .
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sions, means taking out of India to a place outside India;
(44) the supply of any service shall be treated as “export of service” when
(a) the supplier of service is located in India,
(b) the recipient of service is located outside India,
(c) the place of supply of service is outside India,
(d) the payment for such service has been received by the supplier of service in convertible foreign exchange, and
(e) the supplier of service and recipient of service are not merely establishments of a distinct person;
Explanation.- For the purposes of clause (e), an establishment of a person in India and any of his other establishment outside India shall be treated as establishments of distinct persons.
(45) “First Appellate Authority” means an authority referred to in section 79;
(46) “fixed establishment” means a place (other than the place of business) which is characterised by a sufficient degree of permanence and suitable structure in terms of human and technical resources to supply
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matical variations and cognate expressions, means bringing into India from a place outside India;
(52) the supply of any service shall be treated as an “import of service” if,
(a) the supplier of service is located outside India,
(b) the recipient of service is located in India,
(c) the place of supply of service is in India, and
(d) the supplier of service and the recipient of service are not merely establishments of a distinct person;
Explanation 1.- An establishment of a person in India and any of his other establishment outside India shall be treated as establishments of distinct persons.
Explanation 2.- A person carrying on a business through a branch or agency or representational office in any territory shall be treated as having an establishment in that territory.
(53) “India” means,-
(a) the territory of the Union as referred to in clauses (2) and (3) of Article 1 of the Constitution;
(b) its territorial waters, continental shelf, exclusive economic zone or any other
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e of business;
(56) "Input Service Distributor" means an office of the supplier of goods and / or services which receives tax invoices issued under section 23 towards receipt of input services and issues tax invoice or such other document as prescribed for the purposes of distributing the credit of CGST (SGST in State Acts) and / or IGST paid on the said services to a supplier of taxable goods and / or services having same PAN as that of the office referred to above;
Explanation.- For the purposes of distributing the credit of CGST (SGST in State Acts) and / or IGST, Input Service Distributor shall be deemed to be a supplier of services.
(57) "input tax" in relation to a taxable person, means the {IGST and CGST}/{IGST and SGST} charged on any supply of goods and/or services to him which are used, or are intended to be used, in the course or furtherance of his business and includes the tax payable under sub-section (3) of section 7;
(58) “input tax credit” means
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) a Cantonment Board as defined in section 3 of the Cantonments Act, 2006;
(e) a Regional Council or a District Council constituted under the Sixth Schedule to the Constitution;
(f) a Development Board constituted under Article 371 of the Constitution; or
(g) a Regional Council constituted under Article 371A of the Constitution;
(64) “location of recipient of service” means:
(i) where a supply is received at a place of business for which registration has been obtained, the location of such place of business;
(ii) where a supply is received at a place other than the place of business for which registration has been obtained, that is to say, a fixed establishment elsewhere, the location of such fixed establishment;
(iii) where a supply is received at more than one establishment, whether the place of business or fixed establishment, the location of the establishment most directly concerned with the receipt of the supply; and
(iv) in absence of such places, the location of the usua
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d quality at or about the same time and at the same commercial level where the recipient and the supplier are not related;
(68) “money” means Indian legal tender or any foreign currency, cheque, promissory note, bill of exchange, letter of credit, draft, pay order, traveller cheque, money order, postal or electronic remittance or any such similar instrument when used as consideration to settle an obligation or exchange with Indian legal tender of another denomination but shall not include any currency that is held for its numismatic value;
(69) “non-resident taxable person” means a taxable person who occasionally undertakes transactions involving supply of goods and/or services whether as principal or agent or in any other capacity but who has no fixed place of business in India;
(70) “non-taxable territory” means the territory which is outside the taxable territory;
(71) “notification” means notification published in the Official Gazette and the expressions 'notify' and 'notified'
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s Act, 2013 (18 of 2013);
(h) any body corporate incorporated by or under the laws of a country outside India;
(i) a co-operative society registered under any law relating to cooperative societies;
(j) a local authority;
(k) government;
(l) society as defined under the Societies Registration Act, 1860 (21 of 1860);
(m) trust; and
(n) every artificial juridical person, not falling within any of the preceding sub-clauses;
(75) “place of business” includes
(a) a place from where the business is ordinarily carried on, and includes a warehouse, a godown or any other place where a taxable person stores his goods, provides or receives goods and/or services; or
(b) a place where a taxable person maintains his books of account; or
(c) a place where a taxable person is engaged in business through an agent, by whatever name called;
(76) “prescribed'' means prescribed by the rules, regulations or by any notification issued under this Act;
(77) “principal” means a person on whose beha
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he service is rendered,
and any reference to a person to whom a supply is made shall be construed as a reference to the recipient of the supply;
Explanation.- The expression “recipient” shall also include an agent acting as such on behalf of the recipient in relation to the goods and/or services supplied.
(81) “regulations” means the regulations made by the Board/Commissioner under any provision of the Act on the recommendation of the Council;
(82) persons shall be deemed to be “related persons'' if only –
(a) they are officers or directors of one another's businesses;
(b) they are legally recognized partners in business;
(c) they are employer and employee;
(d) any person directly or indirectly owns, controls or holds five per cent or more of the outstanding voting stock or shares of both of them;
(e) one of them directly or indirectly controls the other;
(f) both of them are directly or indirectly controlled by a third person;
(g) together they directly or indirectly co
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State Government may, on the recommendation of the Council, by notification, specify;
(86) “rules” means the rules made by the Central/State Government under any provision of the Act on the recommendation of the Council;
(87) “schedule” means a schedule appended to this Act;
(88) “services'' means anything other than goods;
Explanation: Services include intangible property and actionable claim but does not include money.
(89) “SGST” means the tax levied under the State Goods and Services Tax Act;
(90) “Special Economic Zone'' shall have the meaning assigned to it in clause (za) of section 2 of the Special Economic Zones Act, 2005 [28 of 2005];
(91) “supplier” in relation to any goods and/or services shall mean the person supplying the said goods and/or services and shall include an agent acting as such on behalf of such supplier in relation to the goods and/or services supplied;
(92) “supply'' shall have the meaning as assigned to it in section 3;
(93) “tangible property” mean
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eception of signs, signals, writing, images and sounds or intelligence of any nature, by wire, radio, visual or other electro-magnetic means;
(101) “time of supply of goods'' shall have the meaning as assigned to it in section 12;
(102) “time of supply of services'' shall have the meaning as assigned to it in section 13;
(103) “to cultivate personally” means to carry on any agricultural operation on one's own account-
(a) by one's own labour, or
(b) by the labour of one's family, or
(c) by servants on wages payable in cash or kind (but not in crop share) or by hired labour under one's personal supervision or the personal supervision of any member of one's family;
Explanation 1. – A widow or a minor or a person who is subject to any physical or mental disability or is a serving member of the armed forces of the Union, shall be deemed to cultivate land personally if it is cultivated by her or his servants or by hired labour.
Explanation 2. – In the case of a Hindu Undivided Fami
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