Goods and Services Tax

Concept of Input Service Distributor in GST
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
11. Concept of Input Service Distributor in GST
Q 1. What is Input Service Distributor (ISD)?
Ans. ISD means an office of the supplier of goods or services or both which receives tax invoices towards receipt of input services and issues a prescribed document for the purposes of distributing the credit of central tax (CGST), State tax (SGST)/ Union territory tax (UTGST) or integrated tax (IGST) paid on the said services to a supplier of taxable goods or services or both having same PAN as that of the ISD.
Q 2. What are the requirements for registration as ISD?
Ans. An ISD is required to obtain a separate registration even though it may be separately registered. The threshold limit of registration is not applicable to ISD. The registration of ISD under the existing regime (i.e. under Service Tax) would not be migrated in GST regime. All the existing IS

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s in the course or furtherance of business.
Q 6. It is not possible many a times to establish a one-to-one link between quantum of input services used in the course or furtherance of business by a supplier. In such situations, how distribution of ITC by the ISD is to be done?
Ans. In such situations, distribution would be based on a formula. Firstly, distribution would be done only amongst those recipients of input tax credit to whom the input service being distributed are attributable. Secondly, distribution would be done amongst the operational units only. Thirdly, distribution would be done in the ratio of turnover in a State or Union territory of the recipient during the period to the aggregate of all recipients to whom input service being distributed is attributable. Lastly, the credit distributed should not exceed the credit available for distribution.
Q 7. What does the turnover used for ISD cover?
Ans. The turnover for the purpose of ISD does not include any duty or tax lev

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D for the recipients located in different States.
Q 12. Whether SGST / UTGST credit can be distributed as IGST credit by an ISD to recipients located in different States?
Ans. Yes, an ISD can distribute SGST /UTGST credit as IGST for the recipients located in different States.
Q 13. How are integrated tax, central tax and state tax to be distributed?
Ans. The distribution is to be made by an ISD as per following criteria:
(a) Integrated tax as integrated tax.
(b) Central tax as central tax (if the recipient and ISD are located in the same State) and as integrated tax (if the recipient and ISD are not located in the same State).
(c) State tax as state tax (if the recipient and ISD are located in the same State) and as integrated tax (if the recipient and ISD are not located in the same State). In case of distribution of central/ state tax as integrated tax, it should be ensured that the amount distributed equals the amount of credit of central and state tax put together
(Section

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es, 2017;
(b) The amount of credit distributed shall not exceed the amount of credit available for distribution;
(c) The credit of tax paid on input service attributable to a recipient of credit shall be distributed only to that recipient;
(d) If credit is attributable to more than one recipient, then it shall be distributed among such recipient(s) to whom the input service is attributable on pro rata basis of the turnover in a State of such recipient during the relevant period, to the aggregate of the turnover of all such recipients to whom such input service is attributable.
(e) If credit is attributable to all recipients, the above method of allocation on pro rata may be applied with reference to all recipients, which are operational in current year (Section 20(2) of the CGST Act, 2017)
Q 17. Whether ineligible credit should be distributed by an ISD?
Ans. The Input Service Distributor has to separately distribute the amount of ineligible input tax credit, under the provisions

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ipient in the same ratio in which the credit of the original invoice was distributed. The amount mentioned in the credit note should be reduced from the amount to be distributed in the month in which credit note is issued. If the amount of credit being distributed is less, the amount to be apportioned needs to be added to the output tax liability.
(Rule 39(1) (j) of the CGST Rules, 2017)
Q 21. Whether the excess credit distributed could be recovered from ISD by the department?
Ans. No. Excess credit distributed can be recovered along with interest only from the recipient and not ISD. The provisions of under section 73 or 74 would be applicable for the recovery of credit.
Q 22. What are the consequences of credit distributed in contravention of the provisions of the Act?
Ans. The credit distributed in contravention of provisions of Act could be recovered from the recipient to which it is distributed along with interest.
Manuals, Ready reckoner, Law and practice, Reference Guide,

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Input Tax Credit
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
10. Input Tax Credit
Q 1. What is input tax?
Ans. Input tax means the central tax (CGST), State tax (SGST), integrated tax (IGST) or Union territory tax (UTGST) charged on supply of goods or services or both made to a registered person. It also includes tax paid on reverse charge basis and integrated tax charged on import of goods. It does not include tax paid under composition levy.
Q 2. What is Input Tax Credit?
Ans. Input Tax Credit means the credit of input tax on the supplies of goods or services or both received by a registered person.
Q 3. Can GST paid on reverse charge basis be considered as input tax?
Ans. Yes. The definition of input tax includes the tax payable under the reverse charge.
Q 4. Does input tax includes tax (CGST/IGST/SGST) paid on input goods, input services and capital goods?
Ans. Yes, it includes taxes paid on input goods, input services and capit

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turn under section 39.
Q 7. Whether all particulars necessary in the documents- tax invoice or debit note or such other tax paying documents for claiming ITC?
Ans. If the said document does not contain all the specified particulars but contains the details of the amount of tax charged, description of goods or services, total value of supply of goods or services or both, GSTIN of the supplier and recipient and place of supply in case of inter-State supply, input tax credit may be availed by such registered person. (Proviso to Rule 36(2) of CGST Rules, 2018 inserted vide Notfn no.39/2018-Central Tax issued dated 04.09.18)
Q 8. Where the goods against an invoice are received in lots or instalments, how will a registered person be entitled to ITC?
Ans. The registered person shall be entitled to the credit only upon receipt of the last lot or installment.
Q 9. Can a person take input tax credit without payment of consideration for the supply along with tax to the supplier?
Ans. Yes, t

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invoice?
Ans. No. The time limit specified in section 16(4) shall not apply to a claim for re-availing of any credit, in accordance with the provisions of the Act or these rules, that had been reversed earlier.
Q 13. Certain supplies mentioned in Schedule I of the Act are deemed to be supplies even if made without consideration. Will the payment within 180 days' rule for credit apply even to such cases?
Ans. No. The value of supplies made without consideration as specified in Schedule I shall be deemed to have been paid for the purposes of the second proviso to section 16(2). (Proviso to Rule 37 of the CGST Rules, 2017)
Q 14. As per section 15(2)(b) of the CGST Act, 2017, any amount that the supplier is liable to pay in relation to such supply but which has been incurred by the recipient of the supply and not included in the price actually paid or payable for the goods or services or both are added in the value of a supply. In such cases, no consideration is to be paid to the suppl

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the direction of and on account of such registered person. [Explanation clause to Section 16(2)(b) inserted vide CGST(Amendment) Act, 2018]
Q 17. What is the time limit for taking ITC and reasons therefor?
Ans. A registered person cannot take ITC in respect of any invoice or debit note for supply of goods or services after the due date for furnishing the return under section 39 for the month of September following the end of financial year to which such invoice/invoice relating to debit note pertains or furnishing of the relevant annual return, whichever is earlier. So, the upper time limit for taking ITC is 20th October of the next FY or the date of filing of annual return whichever is earlier.
The underlying reasoning for this restriction is that no change in return is permitted after September of next FY. If annual return is filed before the month of September, then no change can be made after filing of annual return.
However, in cases of new registration or where a person shif

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e factory premises, etc. and taxes paid as a result of detection of evasion of taxes.
Q 20. A taxable person is in the business of information technology. He buys a motor vehicle for use of his Executive Directors. Can he avail the ITC in respect of GST paid on purchase of such motor vehicle?
Ans. No. ITC on motor vehicles can be availed only if the taxable person is in the business of transport of passengers or goods or is providing the services of imparting training on motor vehicle or further supply of such vehicles.
Q 21. Sometimes goods are destroyed or lost due to various reasons? Can a person take ITC to the extent of such goods?
Ans. No, a person cannot take ITC with respect to goods lost, stolen, destroyed or written off. In addition, ITC with respect of goods given as gifts or free samples are also not allowed. [Section 17(5)(h) of CGST Act]
Q 22. Can a registered person get ITC with respect of goods or services used for construction of a building for business purposes?

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ion that the invoices pertaining to such inward supplies should not be more than a year old.
Q 24. What is the eligibility of input tax credit on inputs in stock, input services and capital goods, lying in stock for a person who obtains voluntary registration?
Ans. The person who obtains voluntary registration is entitled to take the input tax credit of input tax on inputs in stock, inputs in semi- finished goods and finished goods in stock, held on the day immediately preceding the date of registration. This is subject to further condition that the invoices pertaining to such inward supplies should not be more than a year old.
Input service and capital goods lying in stock shall not be eligible for ITC. (Section 18(1)(b) of CGST Act, 2017)
Q 25. Where goods or services or both received by a taxable person are used for effecting both taxable and non-taxable supplies, whether the input tax credit is available to the registered taxable person?
Ans. The input tax credit of goods or s

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y preceding the date from which he ceases to be eligible for composition scheme. The manner of calculation of eligible credit is provided in CGST Rules. This is subject to further condition that the invoices pertaining to such inward supplies should not be more than a year old.
Q 28. Mr. A, a registered person was paying tax under composition scheme upto 30th July, 2017. However, w.e.f 31st July, 2017, Mr. A becomes liable to pay tax under regular scheme. Is he eligible for ITC?
Ans. Mr. A is eligible for input tax credit on inputs held in stock and inputs contained in semi-finished or finished goods held in stock and capital goods (reduced by such percentage points as has been prescribed by the ITC Rules) as on 30th July, 2017. The Input Tax Credit on capital goods shall be claimed after reducing the tax paid on such capital goods by five percentage points per quarter of a year or part thereof from the date of invoice or such other documents on which the capital goods were received

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in semi-finished or finished goods held in stock on the day immediately preceding the date of exercise of option or date of exemption. The ITC on inputs shall be calculated proportionately on the basis of corresponding invoices on which credit had been availed by the registered person on such input. In respect of capital goods held in stock the input tax credit involved in the remaining useful life in months shall be computed on pro-rata basis, taking the useful life as 5 years. Assume capital goods have been in use for 4 years, 6 months and 15 days. The useful remaining life in months will be 5 months ignoring the part of the month. If ITC on such capital goods is taken as C, ITC attributable to the remaining useful life will be C multiplied by 5/60. This would be the amount payable on capital goods. The ITC amount shall be determined separately for integrated tax, central tax and state tax. The payment can be made by debiting electronic credit ledger, if there is sufficient balance

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In case of supply of capital goods or plant and machinery on which input tax credit has been taken, the registered person shall pay an amount equal to the input tax credit taken on the said capital goods or plant and machinery, as reduced in the manner prescribed under sub-rule 6 of rule 44 of the CGST Rules, 2017, or the tax on the transaction value of such capital goods or plant and machinery, whichever is higher. But in case of refractory bricks, molds and dies, jigs and fixtures when these are supplied as scrap, the person can pay tax on the transaction value.
Q 34. Whether input tax credit can be taken on payment of tax after adjudication?
Ans. Input tax credit cannot be availed by a registered person in respect of any tax that has been paid in pursuance of any order where any demand has been confirmed in cases of evasion by reason of any fraud, willful misstatement or suppression of facts. (Rule 36(3) of the CGST Rules, 2017)
Q 35. How can Input Tax Credit be utilized?
Ans. T

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(b) the central/ State/ UT tax shall first be utilised towards payment of central/ State/ UT tax and the amount remaining, if any, may be utilised towards the payment of integrated tax;
The input tax credit on account of State/UT tax shall be utilised towards payment of integrated tax only where the balance of the input tax credit on account of central tax is not available for payment of integrated tax; (The CGST (Amendment) Act, 2018)
The input tax credit on account of central tax, State tax or Union territory tax shall be utilised towards payment of integrated tax, central tax, State tax or Union territory tax, as the case may be, only after the input tax credit available on account of integrated tax has first been utilised fully towards such payment. (Section 49A of CGST Act, 2017 inserted vide the CGST(Amendment) Act, 2018)
(c) the central/ State tax shall not be utilised towards payment of State/ Central tax.
Q 36. What are the supplies included in exempt supplies?
Ans. 'Ex

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isions in respect of banking companies?
Ans. A banking company or a financial institution including a non-banking financial company engaged in supply of specified services would either avail proportionate credit or avail 50% of the eligible input tax credit.
The option once exercised cannot be withdrawn in the same year. The restriction of 50% will not apply to the tax paid on supplies made by one registered person to another registered person having the same PAN.
Q 39. A banking company or a financial institution including a non-banking financial company engaged in in supply of specified services supplies non-business supplies and exempted supplies. How should it avail credit in case it choses the 50% option?
Ans. 50% of the eligible credit only can be taken. Thus, the credit of tax paid on inputs and input services used for non-business purposes should not be availed. Besides, ITC that are not eligible in terms of Section 17(5) should also not be availed. 50% of the remaining cre

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and insurance of motor vehicles for transportation of goods is admissible with no restrictions.
Motor Vehicles for transportation of persons: Thus, ITC on repairing, maintenance and insurance of motor vehicles for transportation of persons carrying more than 13 persons will be admissible. However, for motor vehicles for transportation of persons carrying up to 13 persons will be admissible only if it is used for transportation of passengers, further supply of such motor vehicles and imparting training on driving. [Section 17(5) (ab) as substituted vide the CGST (Amendment) Act, 2018]
Q 42. What would be input tax eligibility in cases where there is a change in the constitution of a registered person?
Ans. The registered person shall be allowed to transfer the input tax credit that remains unutilized in its electronic credit ledger to the new entity, provided that there is a specific provision for transfer of liabilities. (Section 18(3) of the CGST Act, 2017)
Q 43. What are the con

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cified in the demerger scheme.
Q 44. How to determine the credit attributable to exempt supplies in cases where the inputs/ input services are used for effecting exempt as well as taxable supplies?
Ans. The credit attributable to exempt supplies is to be determined as under:
D1 = (E/F) x C2
Where D1 = Credit attributable to exempt supplies
E = aggregate value of exempt supplies (all supplies other than taxable and zero-rated supplies)
F = total turnover of the person during the tax period
C2 = Common Credit i.e. Total input tax in a period reduced by:
T1 – Tax attributable exclusively for non-business purpose
T2- Tax attributable exclusively for exempt supplies
T3- Ineligible credits as per Section 17(5)
T4- Tax attributable exclusively for other than exempted supplies but including zero rated supplies
(Section 17(2) & (3) read with Rule 42 of the CGST Rules, 2017)
Q 45. Whether Schedule III activities (Activities considered as neither supply of goods nor supply of service

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such construction of immovable property is not capitalised. [Explanation to section 17(5)(d) of CGST Act]
Q 48. Whether a non-resident taxable person can take input tax credit of tax paid on goods and services, procured by him locally?
Ans. No. He can take input tax credit of tax paid only on goods and services imported by him.
Q 49. Whether the principal can take input tax credit of tax paid on input goods or capital goods, which are not received by him but sent directly to his Job-worker?
Ans. Yes, subject to some conditions and restrictions. In such cases the condition of receipt of goods, prescribed under Section 16(2)(b) of CGST ACT, shall not apply.
Q 50. What are the conditions/restrictions in cases where the inputs or capital goods are sent directly to Job-worker?
Ans. When the Principal sent the inputs or capital goods directly to Job-worker and take input tax credit in respect of the same, then the inputs (after completion of Job-work or otherwise) are required to be b

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Job Work
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
9. Job Work
Q 1.  What is job work?
Ans. Job work means undertaking any treatment or process by a person on goods belonging to another registered taxable person. The person who is treating or processing the goods belonging to other person is called 'job worker' and the person to whom the goods belongs is called 'principal'.
This definition is much wider than the one given in Notification No. 214/86 – CE dated 23rd March, 1986. In the said notification, job work has been defined in such a manner so as to ensure that the activity of job work must amount to manufacture. Thus the definition of job work itself reflects the change in basic scheme of taxation relating to job work in the proposed GST regime.
Q 2. Whether goods sent by a taxable person to a job worker will be treated as supply and liable to GST? Why?
Ans. It will be treated as a supply as supply includes all forms of sup

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uded in the aggregate turnover of the job worker?
Ans. No. It will be included in the aggregate turnover of the principal. However, the value of goods or services used by the job worker for carrying out the job work will be included in the value of services supplied by the job worker.
Q 5. Can a principal send inputs and capital goods directly to the premises of job worker without bringing it to his premises?
Ans. Yes, the principal is allowed to do so. The input tax credit of tax paid on inputs or capital goods can also be availed by the principal in such a scenario. The inputs or capital goods must be received back within one year or three years respectively failing which the original transaction would be treated as supply and the principal would be liable to pay tax accordingly.
Q 6. Can the principal supply the goods directly from the premises of the job worker without bringing it back to his own premises?
Ans. Yes. But the principal should have declared the premises of an unr

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ital goods sent to a job worker whether sent after receiving them at his place of business or even when such the inputs or capital goods are directly sent to a job worker without their being first brought to his place of business. However, the inputs or capital goods, after completion of job work, are required to be received back or supplied from job worker's premises, as the case may be, within a period of one year or three years of their being sent out.
Q 9. What happens when the inputs or capital goods are not received back or supplied from the place of business of job worker within prescribed time period?
Ans. If the inputs or capital goods are not received back by the principal or are not supplied from the place of business of job worker within the prescribed time limit, it would be deemed that such inputs or capital goods had been supplied by the principal to the job worker on the day when the said inputs or capital goods were sent out by the principal (or on the date of receip

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s carried out on the inputs by the principal or job worker.
Q 13. Who is responsible for the maintenance of proper accounts related to job work?
Ans. It is completely the responsibility of the principal to maintain proper accounts of job work related inputs and capital goods.
Q 14. Are the provisions of job work applicable to all categories of goods?
Ans. No. The provisions relating to job work are applicable only when registered taxable person intends to send taxable goods. In other words, these provisions are not applicable to exempted or non-taxable goods or when the sender is a person other than registered taxable person.
Q 15. Is it compulsory that job work provisions should be followed by the principal?
Ans. No. The principal can send the inputs or capital goods after payment of GST without following the special procedure. In such a case, the job-worker would take the input tax credit and supply back the processed goods (after completion of job-work) on payment of GST.
Q 1

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ddition to the goods received from the principal, can use his own goods for providing the services of job work.
Q 18. Can a person other than registered person follow the job work procedure under the Act?
Ans. No. It is important to note that the provisions of section 143 of the CGST Act are applicable to a registered person. Thus, it is only a registered person who can send the goods for job work under the said provisions.
Q 19. In case the principal and job worker are located in different states, is it necessary for the job worker to obtain compulsory registration?
Ans. No. Where the principal and the job worker are located in different States, the requirement for registration flows from section 24(i) of the CGST Act which provides for compulsory registration of suppliers making any inter-State supply of services. However, exemption from registration has been granted in case the aggregate turnover of the inter-state supply of taxable services does not exceed ₹ 20 lakhs or &

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job worker. Two copies of the challan may be sent to the job worker along with the goods. The job worker should send one copy of the said challan along with the goods, while returning them to the principal. The FORM GST ITC-04 will serve as the intimation as envisaged under section 143 of the CGST Act,2017.
Q 22. What are the legal/documentary requirements where goods are sent by one job worker to another job worker?
Ans. In such cases, the goods may move under the cover of a challan issued either by the principal or the job worker. In the alternative, the challan issued by the principal may be endorsed by the job worker sending the goods to another job worker, indicating therein the quantity and description of goods being sent. The same process may be repeated for subsequent movement of the goods to other job workers.
Q 23. What are the legal/documentary requirements where goods are returned to the principal by the job worker?
Ans. The job worker should send one copy of the challa

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nd the principal shall issue the challan under rule 45 of the CGST Rules and send the same to the job worker directly.
Q 25. What are the legal/documentary requirements where goods are returned in piecemeal by the job worker?
Ans. In case the goods after carrying out the job work, are sent in piecemeal quantities by a job worker to another job worker or to the principal, the challan issued originally by the principal cannot be endorsed and a fresh challan is required to be issued by the job worker.
Q 26. What is the mode and manner in which the principal is required to intimate the details of goods sent for job work?
Ans. Rule 45(3) of the CGST Rules provides that the principal is required to furnish the details of challans in respect of goods sent to a job worker or received from a job worker or sent from one job worker to another job worker during a quarter in FORM GST ITC-04 by the 25th day of the month succeeding the quarter or within such period as may be extended by the Commi

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e tax.
Q 28. What would be the GST implications in case the goods are returned by the job worker after the stipulated period?
Ans. If such goods are returned by the job worker after the stipulated time period, the same would be treated as a supply by the job worker to the principal and the job worker would be liable to pay GST if he is liable for registration in accordance with the provisions contained in the CGST.
Q 29. Whether the value of moulds and dies, jigs and fixtures or tools which have been provided by the principal to the job worker and have been used by the latter for providing job work services would be included in the value of job work services?
Ans. Section 15 of the CGST Act lays down the principles for determining the value of any supply under GST. Importantly, clause (b) of sub-section (2) of section 15 of the CGST Act provides that any amount that the supplier is liable to pay in relation to the supply but which has been incurred by the recipient will form part o

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Electronic Commerce and Tax Collected at Source
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
8. Electronic Commerce and Tax Collected at Source
(The Questions adopted from the Frequently Asked Questions on TCS under GST released by Law Committee, GST Council on 28th September, 2018)
Q 1.  What is Electronic Commerce?
Ans. As per Section 2(44) of the CGST Act, 2017, electronic Commerce means the supply of goods or services or both, including digital products over digital or electronic network.
Q 2. Who is an e-commerce operator?
Ans. As per Section 2(45) of the CGST Act, 2017, electronic Commerce operator means any person who owns, operates or manages digital or electronic facility or platform for electronic commerce.
Q 3. What is Tax Collection at Source (TCS)?
Ans. As per Section 52 of the CGST Act, 2017 the e-commerce operator, not being an agent, is required to collect an amount calculated at the rate not exceeding one per cen

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is not available to e-commerce operators.
Q 6. Whether a supplier of goods or services supplying through e-commerce operator would be entitled to threshold exemption?
Ans. As per Section 24(ix) of the CGST Act, 2017, every person supplying goods through an e-commerce operator shall be mandatorily required to register irrespective of the value of supply made by him. However, a person supplying services, other than supplier of services under section 9 (5) of the CGST Act, 2017, through an e-commerce platform are exempted from obtaining compulsory registration provided their aggregate turnover does not exceed INR 20 lakhs (or INR 10 lakhs in case of specified special category States) in a financial year. Government has issued the notification No. 65/2017- Central Tax dated 15th November, 2017 in this regard.
Q 7. Whether TCS is required to be collected by e-commerce operators on supply of services by unregistered suppliers through their portal?
Ans. As per Section 24(ix) of the CGST

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in each State / UT as the obligation for collecting TCS would be there for every intra-State or inter-State supply. In order to facilitate the obtaining of registration in each State / UT, the e-commerce operator may declare the Head Office as its place of business for obtaining registration in that State / UT where it does not have physical presence. It may be noted that each State/UT has indicated one administrative jurisdiction where all e-commerce operators having business (but not having physical presence) in that State/UT shall register. The proper officer for the purpose of registration of ECOs has also been notified by each State/UT.
Q 9. Foreign e-commerce operator do not have place of business in India since they operate from outside. But their supplier and customers are located in India. So, in this scenario will the TCS provision be applicable to such e-commerce operator and if yes, how will foreign e-commerce operator obtain registration?
Ans. Where registered supplier i

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has GSTIN.
Q 11. What is meant by “net value of taxable supplies”?
Ans. The “net value of taxable supplies” means the aggregate value of taxable supplies of goods or services or both, other than the services on which entire tax is payable by the e-commerce operator, made during any month by a registered supplier through such operator reduced by the aggregate value of taxable supplies returned to such supplier during the said month.
Q 12. Whether value of net taxable supplies to be calculated at gross level or at GSTIN level?
Ans. The value of net taxable supplies is calculated at GSTIN level.
Q 13. Is every e-commerce operator required to collect tax on behalf of actual supplier?
Ans. Yes, every e-commerce operator is required to collect tax where the supplier is supplying goods or services through e-commerce operator and consideration with respect to the supply is to be collected by the said e-commerce operator.
Q 14. At what time should the e-commerce operator collect TCS?
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ns. As per section 10(2)(d) of the CGST Act, 2017, a composition taxpayer cannot make supplies through e-commerce operator. Thus, question of collecting TCS in respect of supplies made by the composition taxpayer does not arise.
Q 18. Whether TCS is to be collected on import of goods or services or both?
Ans. TCS is not liable to be collected on any supplies on which the recipient is required to pay tax on reverse charge basis. As far as import of goods is concerned since same would fall within the domain of Customs Act, 1962, it would be outside the purview of TCS. Thus, TCS is not liable to be collected on import of goods or services.
Q 19. Is there any exemption on Gold, owing to the fact that rate of GST is only 3% and TCS on it would erode the margin for the seller?
Ans. No such exemption from TCS has been granted.
Q 20. Whether payment of TCS through Input Tax Credit of operator for depositing TCS as per Section 52 (3) of the CGST Act, 2017 is allowed?
Ans. No, payment of T

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?
Ans. Negative amount cannot be declared. There will be no impact in next tax period also. In other words, if returns are more than the supplies made during any tax period, the same would be ignored in current as well as future tax period(s).
Q 23. What is the time within which such TCS is to be remitted by the e-commerce operator to the Government account?
Ans. The amount collected by the operator is to be paid to appropriate government within 10 days after the end of the month in which the said amount was so collected.
Q 24. How can actual suppliers claim credit of TCS?
Ans. The amount of TCS deposited by the operator with the appropriate Government will be reflected in the electronic cash ledger of the actual registered supplier (on whose account such collection has been made) on the basis of the statement filed by the operator in FORM GSTR-8 in terms of Rule 67 of the CGST Rules, 2017. The said credit can be used at the time of discharge of tax liability by the actual supplie

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ed to furnish a statement, electronically, containing the details of outward supplies of goods or services effected through it, including the supplies of goods or services returned through it, and the amount collected by it as TCS during a month within 10 days after the end of such month in FORM GSTR-8. The operator is also required to file an annual statement by 31st day of December following the end of the financial year in which the tax was collected in FORM GSTR-9B..
Q 27. Whether interest would be applicable on noncollection of TCS?
Ans. As per section 52(6) of the CGST Act, 2017, interest is applicable on omission as well in case of incorrect particulars noticed. In such a case, interest is applicable since it is a case of omission. Further penalty under section 122(vi) of the CGST Act, 2017 would also be leviable.
Q 28. What will be the place of supply for e-commerce operator for recharge of talk time of the Telecom Operator / recharge of DTH / in relation to convenience fee

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s of goods or services or both as well as stock of goods held by the suppliers within 15 working days of the date of service of such notice.
Q 31. Certain e-commerce operators who have been unable to obtain registration in the month of October, 2018 but have already collected TCS for the said month have expressed challenges in relation to the filing of such details in GTSR-8. It has beenasked as to how these details are to be furnished on the common portal?
Ans. E-commerce operators, who have been unable to obtain registration in the month of October, 2018 but have already collected TCS for the said month, may furnish the details of TCS collected in the month of October, 2018 in the first return in FORM GTSR-8 to be filed after obtaining registration.
Q 32. We purchase goods from different vendors and are selling them on our website under our own billing. Is TCS required to be collected on such supplies?
Ans. No. According to Section 52 of the CGST Act, 2017, TCS is required to be

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site documents for use of the premises as his place of business (like ownership document, agreement with the owner etc.) and there is no restriction about use of a premises by multiple persons. The registered person shall have to comply with the requirements of maintaining records as per section 35 of the CGST Act, 2017 and Rules 56 to 58 of the CGST Rules, 2017.
Q 34. I am a supplier, supplying my own products through a website hosted by me. Do I fall under the definition of an electronic commerce operator. Am I required to collect TCS on such supplies?
Ans. As per the definitions in Section 2 (44) & 2 (45) of the CGST Act, you will come under the definition of an electronic commerce operator. However, according to Section 52 of the Act, ibid, TCS is required to be collected on the net value of taxable supplies made through it by other suppliers where consideration is to be collected by the ECO. In cases where someone is selling their own products through a website, there is no requ

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TDS Scheme
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
7.1 TDS Scheme
(The Questions adopted from the Standard Operating Procedure on TDS under GST released by Law Committee, GST Council on 28th September, 2018)
Q 47. When tax deduction is required to be made in GST?
Ans. Tax is required to be deducted from the payment made / credited to a supplier, if the total value of supply under a contract in respect of supply of taxable goods or services or both, exceeds Rs. 2,50,000/- (Rupees two lakh and fifty thousand). This value shall exclude the taxes leviable under GST (i.e. 'Central tax', 'State tax', 'UT tax', 'Integrated tax' & Cess).
Q 48. As a DDO I am deducting TDS from salary and also while making payment of other bills under Income Tax Act. Then why should I need to deduct TDS again?
Ans. TDS under Income Tax is different from TDS under GST. There was a provision of TDS under VAT Act also. TDS under the GST Law is different from th

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N of his office
B. To be aware of the contract value
C. To know when to deduct TDS under GST
D. To know the nature of TDS (IGST or CGST & SGST/UTGST) to be deducted & the rate of tax
E. To know the GSTIN of his/her vendors/suppliers
F. To deduct TDS while making/crediting payment
G. To generate CPIN while depositing the deducted tax
H. To pay the deducted amount of TDS to the appropriate Govt. A/c
I. To submit GSTR-7 (Return)
J. To generate GSTR-7A
(TDS certificate for suppliers)
Q 51. Does every Government office require to be registered under GST laws?
Ans. Yes, every Government office shall get itself mandatorily registered under GST. Here the role of DDO is very important as he is responsible for deducting tax while making/crediting payment under GST in applicable cases and, unless & until the process of registration is completed, the DDO will not be able to deduct any tax.
Q 52. I am a DDO of a small Government Office. My office has not entered into any contract wit

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be uploaded for address proof?
Ans. Scanned copy of either of the following will have to be uploaded: valid electricity bill or Municipality khata copy or property tax receipt or any legal ownership documents etc.
Q 57. To submit my registration application do I always need a DSC?
Ans. One can use Electronic Verification Code for submission of the registration form in the common portal apart from DSC.
Q 58. How do I know that I have submitted the application form correctly? What is an ARN?
Ans. A pop-up message will appear that the form has been successfully submitted & an Acknowledgement Reference Number (ARN) will be sent to the registered mobile no & registered email address of the applicant after successful submission of Registration Application (FORM GST REG-07) online..
Q 59. Is this ARN called the GST registration No?
Ans. No. This ARN is generated only for a temporary period. Once FORM GST REG-07 is processed by the proper officer, the 15-digit GSTIN of the Tax Deductor

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ew DDO does not amend the details of his predecessor in office whether the ex-DDO would be liable for any lapse done by this new DDO?
Ans. No, the ex-DDO will not be liable for any lapse by his successor in office. A DDO is required to perform any responsibility in respect of TDS in GST either through a valid DSC (which is person specific) or through an EVC which would be sent to the registered mobile no as well as registered email id of the DDO only.
Q 64. Is there any threshold exceeding which tax is required to be deducted?
Ans. Yes. Tax is required to be deducted from the payment made/credited to a supplier, if the value of supply under a contract in respect of supply of taxable goods or services or both, exceeds Rs. 2,50,000/- (Rupees two lakh and fifty thousand). This value shall exclude the taxes leviable under GST (i.e. 'Central tax', 'State tax', 'UT tax', 'Integrated tax' & 'Cess').
Q 65. Mr B, a DDO of ABC Office of the Government West Bengal needs to buy stationeries fo

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s required to be deducted since the payment is being made after the effective date.
Q 69. I have entered into a contract worth Rs. 10 Lakh with a supplier XYZ prior to 01.10.2018. I have made a payment of Rs. 3 Lakhs to him prior to 01.10.2018. Now, I am making payment of the balance amount of Rs. 7 Lakh after 01.10.2018. Should I deduct tax on Rs. 10 Lakh?
Ans. No. Tax cannot be deducted for any payment made prior to 01.10.2018. So deduction will be made only in respect of Rs. 7 Lakh.
Q 70. I enter into a contract with a supplier ABC where the value of taxable supply is Rs. 2 Lakh and payment of Rs. 1 Lakh has been made on 15.10.2018. Now, on 20.10.2018 the contract value is revised from Rs. 2 Lakh to Rs. 6 Lakh. Am I liable to deduct any tax and if so, on which amount?
Ans. Yes, TDS shall have to be deducted on entire amount i.e. Rs. 6 lakhs while making remaining payment of Rs. 5 Lakh. In other words, 12,000/- would be deducted when remaining payment of Rs. 5 Lakh is made.
Q 71

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. 11,800/- for supply of goods/services or both worth Rs. 10,000/- and GST of Rs. 1,800/- to Mr A of ABC office in West Bengal. What is the value of payment on which Mr A should deduct TDS during making payment to Mr Z? Calculate the amount payable to Mr Z?
Ans. For purpose of deducting of TDS, the value of supply is to be taken as the amount excluding the tax indicated on the invoice. This means TDS shall not be deducted on the CGST, SGST or IGST component of invoice. In this case, TDS is to be deducted on Rs. 10,000/- and not on the full amount of Rs. 11,800/-. Mr Z has issued a Tax Invoice of Rs. 11,800/- which comprises a GST component of Rs. 1,800/-. TDS in this case is to be deducted @ 2% (1% of CGST & 1% of SGST) on Rs. 10,000/-. Mr A will deduct Rs. 200/- which he will deposit in the proper Govt. A/c head. Mr A will pay Rs. 11600/- (11800/ – 200/-) = (i.e. Full Invoice Value – TDS amount) to Mr Z.
Q 74. What is the different nature of supply & what is the rate of deduction?

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of filing return in FORM GSTR 7.
Q 78. Payment is made in respect of a single contract whose value of taxable supply is Rs. 3.5 Lakh. Two bills amounting to Rs. 1.5 lakh &Rs. 2 lakh respectively are passed for such payment. Since in respect of both the bills the amount paid does not exceed Rs. 2.5 lakh, I think that no tax is required to be deducted. Am I right?
Ans. No. Here the payments are being made against a single contract value of taxable supply exceeding Rs. 2.5 Lakh. Here, the value of taxable supply in the contract is Rs. 3.5 lakh. So, the deductor should deduct TDS on each payment to the supplier in respect of the aforesaid contract.
Q 79. When will a DDO know that his liability for payment has been completed??
Ans. Electronic cash Ledger of the DDO will be credited when tax deducted at source is deposited in Government account. Payment of such liability (which is the tax deducted at source) shall have to be done by debiting of the electronic cash Ledger and such debit c

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e amended details will again be auto-populated in 'TDS/TCS credit receipt” table. Supplier will take action comprising Accept/Reject the transactions. As usual, amount of accepted invoices will be credited to electronic cash ledger of the supplier.
Q 82. Is there any provision of refund to the deductor or the deductee arising on a/c of excess or erroneous deduction made under GST?
Ans. The refund to the deductor or the deductee arising on account of excess or erroneous deduction shall be dealt with in accordance with the provisions of section 54. Further no refund to the deductor shall be granted, if the amount deducted has been credited to the electronic cash ledger of the deductee.
Q 83. Who are liable to file return (GSTR-7)?
Ans. Post 01.10.2018, DDOs deducting tax will be liable to file return in FORM GSTR-7 for the month in which such deductions are made.
Q 84. What is the need for filing a return when deposit of TDS has already been made?
Ans. Electronic cash Ledger of the

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h in which such deductions have been made in accordance with the provision of section 39(3) of the CGST/SGST Acts, 2017. Hence, submission of FORM GSTR-7 is not required for a month in which no deduction is made.
Q 87. How can a deductor file FORM GSTR-7?
Ans. FORM GSTR-7 can be filed on the GST Portal, by logging in the Returns Dashboard by the deductor. The path is Services > Returns > Returns Dashboard.
Q 88. Is there any Offline Tool for filing Form GSTR-7?
Ans. Yes. FORM GSTR-7 return can be filed through offline mode also.
Q 89. Can the date of filing of FORM GSTR-7 be extended?
Ans. Yes, date of filing of FORM GSTR-7 can be extended by the Commissioner of State/Central tax through notification.
Q 90. What are the pre-conditions for filing FORM GSTR-7?
Ans. Pre-conditions for filing of FORM GSTR-7 are:
* Tax Deductor should be registered and should have a valid/active GSTIN.
* Tax Deductor should have a valid User ID and password.
* Tax Deductor should have an activ

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d on the GST Portal, one may continue to proceed to file. Liabilities will then be computed and after making payment, return can be filed.
Q 95. What are the features of FORM GSTR-7 Offline Utility?
Ans. The key features of FORM GSTR-7 Offline Utility are:
* The FORM GSTR-7 details of Table 3 and 4 can be prepared offline, with no connection to Internet.
* Most of the data entry and business validations are in built in the offline utility, reducing errors upon upload to GST Portal.
Q 96. From where can I download and use the FORM GSTR-7 Offline Utility in my system?
Ans. Following steps are required to be performed to download and open the FORM GSTR-7 Offline Utility in your system from the GST Portal:
1. Access the GST Portal: www.gst.gov.in
2. 2. Go to Downloads > Offline Tools > GSTR-7 Offline Utility option and click on it
3. Unzip the downloaded Zip file which contain GSTR-7_Offline_Utility.xls excel sheet.
4. Open the GSTR7_Offline_Utility.xls excel sheet by double

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10,000 rows of TDS details of the suppliers in the offline utility.
Q 102. I am a tax deductor. I've made payment for four different products to one of my suppliers. Shall I report each payment in four different rows of the offline utility?
Ans. No. Row with a duplicate GSTIN is not allowed in the utility. One should report the whole amount in one row only. All the payments are required to be added and one single consolidated amount has to be entered in the “Amount paid to deductee on which tax is deducted” column
Q 103. I have mistakenly entered rows with the same GSTIN. Should I use the “Delete” option from the dropdown of “Action” column to delete these rows?
Ans. No, the incorrect data has to be deleted in the utility manually using the “Delete” button of the keyboard. Add and Delete options of the “Action” column are meant for adding or deleting data in the GST portal. Delete option is required to be ignored while preparing FORM GSTR-7 for first- time upload, and for the subse

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10th December, 2018.
Q 107. As a DDO I have deducted tax while making payment to various Vendors. I have deposited the amount in the appropriate Government A/c & also filed return within stipulated time. Have I discharged all my liabilities relating to TDS?
Ans. No. A system generated TDS certificate in FORM GSTR-7A mentioning therein the value on which tax is deducted, and amount of tax deducted and other related particulars shall be available for download from the portal by deductee.
Q 108. How can a supplier download the TDS certificate in FORM GSTR 7A?
Ans. TDS certificate can be downloaded by access the www.gst.gov.in URL and using the following path: Login to the GST Portal with valid credentials. Navigate to Services > User Services > View/Download Certificates option.
Q 109. How many TDS Certificates are issued per GSTIN?
Ans. A single TDS certificate is issued per GSTIN per FORM GSTR-7 return filed by deductor.
Q 110. Is the signature of Tax Deductor required in TDS Cer

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GST Payment of Tax
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
7. GST Payment of Tax
Q 1.  What are the Payments to be made in GST regime?
Ans. In the GST regime, for any intra-state supply, taxes to be paid are the Central GST (CGST), going into the account of the Central Government) and the State/UT GST (SGST, going into the account of the concerned State Government). For any inter-state supply, tax to be paid is Integrated GST (IGST) which will have components of both CGST and SGST. In addition, certain categories of registered persons will be required to pay to the government account Tax Deducted at Source (TDS) and Tax Collected at Source (TCS). In addition, wherever applicable, Interest, Penalty, Fees and any other payment will also be required to be made.
Q 2.  Who is liable to pay GST?
Ans. In general, the supplier of goods or services is liable to pay GST. However, in specified cases like imports and other notified su

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of the three events, namely receiving payment, issuance of invoice or completion of supply. Different situations envisaged and different tax points have been explained in the aforesaid sections.
Q 4.  What are the main features of GST payment process?
Ans. The payment processes under GST Act(s) have the following features:
* Electronically generated challan from GSTN Common Portal in all modes of payment and no use of manually prepared challan;
* Facilitation for the tax payer by providing hassle free, anytime, anywhere mode of payment of tax;
* Convenience of making payment online;
* Logical tax collection data in electronic format;
* Faster remittance of tax revenue to the Government Account;
* Paperless transactions;
* Speedy Accounting and reporting;
* Electronic reconciliation of all receipts;
* Simplified procedure for banks
* Warehousing of Digital Challan.
Q 5.  How can payment be done?
Ans. Payment can be done by the following methods:
(i) Th

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payer is to be done on monthly basis by the 20th of the succeeding month. Cash payments will be first deposited in the Cash Ledger and the tax payer shall debit the ledger while making payment in the monthly returns and shall reflect the relevant debit entry number in his return. As mentioned earlier, payment can also be debited from the Credit Ledger. Payment of taxes for the month of March shall be paid by the 20th of April. Composition tax payers will need to pay tax on quarterly basis.
Q 7. Whether time limit for payment of tax can be extended or paid in monthly installments?
Ans. No, this is not permitted in case of self-assessed liability. In other cases, competent authority has been empowered to extend the time period or allow payment in instalments. (Section 80 of the CGST/SGST Act).
Q 8. What happens if the taxable person files the return but does not make payment of tax?
Ans. In such cases, the return is not considered as a valid return. Section 2(117) defines a valid re

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register will be automatically opened and displayed on his dash board at all times.
Q 11. What is a tax liability register?
Ans. Tax Liability Register will reflect the total tax liability of a taxpayer (after netting) for the particular month.
Q 12. What is a Cash Ledger?
Ans. The cash ledger will reflect all deposits made in cash, and TDS/TCS made on account of the taxpayer. The information will be reflected on real time basis. This ledger can be used for making any payment on account of GST.
Q 13. What is an ITC Ledger?
Ans. Input Tax Credit as self-assessed in monthly returns will be reflected in the ITC Ledger. The credit in this ledger can be used to make payment of TAX ONLY and no other amounts such as interest, penalty, fees etc.
Q 14. What is the linkage between GSTN and the authorized Banks?
Ans. There will be real time two-way linkage between the GSTN and the Core Banking Solution (CBS) of the Bank. CPIN is automatically routed to the Bank via electronic string for v

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ated, no further changes can be made to it by the taxpayer.
Q 17. Is there a validity period of challan?
Ans. Yes, a challan will be valid for fifteen days after its generation and thereafter it will be purged from the System. However, the tax payer can generate another challan at his convenience.
Q 18. What is a CPIN?
Ans. CPIN stands for Common Portal Identification Number (CPIN) given at the time of generation of challan. It is a 14-digit unique number to identify the challan. As stated above, the CPIN remains valid for a period of 15 days.
Q 19. What is a CIN and what is its relevance?
Ans. CIN stands for Challan Identification Number. It is a 17-digit number that is 14-digit CPIN plus 3-digit Bank Code. CIN is generated by the authorized banks/ Reserve Bank of India (RBI) when payment is actually received by such authorized banks or RBI and credited in the relevant government account held with them. It is an indication that the payment has been realized and credited to the a

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are authorized to collect payment of GST. Each authorized bank will nominate only one branch as its E-FPB for pan India Transactions. The E-FPB will have to open accounts under each major head for all governments. Total 38 accounts (one each for CGST, IGST and one each for SGST for each State/UT Govt.) will have to be opened. Any amount received by such E-FPB towards GST will be credited to the appropriate account held by such EFPB.
For NEFT/RTGS Transactions, RBI will act as E-FPB.
Q 23. What is TDS?
Ans. TDS stands for Tax Deducted at Source (TDS). As per section 51, this provision is meant for Government and Government undertakings and other notified entities making contractual payments where total value of such supply under a contract exceeds ₹ 2.5 Lakhs to suppliers. While making any payments under such contracts, the concerned Government/authority shall deduct 2% of the total payment made (1% under each Act and 2% in case of IGST) and remit it into the appropriate GST ac

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ax Collected at Source (TCS)?
Ans. This provision is applicable only for E-Commerce Operator under section 52 of CGST/SGST Act. Every ECommerce Operator, not being an agent, needs to withhold an amount calculated at the rate of one percent of the “net value of taxable supplies” made through it where the consideration with respect to such supplies is to be collected by the operator. Such withheld amount is to be deposited by such E-Commerce Operator to the appropriate GST account by the 10th of the next month. The amount deposited as TCS will be reflected in the electronic cash ledger of the supplier.
Q 27. What does the expression “Net value of taxable supplies” mean?
Ans. The expression “net value of taxable supplies” means the aggregate value of taxable supplies of goods or services, other than services notified under Section 9(5), made during any month by all registered taxable persons through the operator reduced by the aggregate value of taxable supplies returned to the supplie

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The electronic liability register of the person is debited by:-
(a) the amount payable towards tax, interest, late fee or any other amount payable as per the return furnished by the said person;
(b) the amount of tax, interest, penalty or any other amount payable as determined by a proper officer in pursuance of any proceedings under the Act or as ascertained by the said person;
(c) the amount of tax and interest payable as a result of mismatch under section 42 or section 43 or section 50; or
(d) any amount of interest that may accrue from time to time.
Q 31. What are the Credits made to the Electronic Liability Register?
Ans. The Electronic Liability Register is credited with the following amounts:
(a) Payment of every liability made by the registered person by way of debit from electronic credit ledger or electronic cash ledger;
(b) the amount of TDS deducted by the Deductor in terms of Section 51 and paid by way of debit from electronic cash ledger;
(c) the amount of TCS c

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e Common Portal and enter the details of the amount to be deposited by him towards tax, interest, penalty, fees or any other amount.
The deposit shall be made through any of the following modes:
(i) Internet Banking through authorized banks;
(ii) Credit card or Debit card through the authorised bank;
(iii) National Electronic Fund Transfer (NeFT) or Real Time Gross Settlement(RTGS) from any bank;
(iv) Over the Counter payment (OTC) through authorized banks for deposits up to ten thousand rupees per challan per tax period, by cash, cheque or demand draft.
On successful credit of the amount to the concerned government account maintained in the authorised bank, a Challan Identification Number (CIN) will be generated by the collecting Bank and the same shall be indicated in the challan.
On receipt of CIN from the collecting Bank, the said amount shall be credited to the electronic cash ledger of the person on whose behalf the deposit has been made and the Common Portal shall make av

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n for deposit up to ten thousand rupees per challan in case of an Over the Counter (OTC) payment does not apply to deposit to be made by –
(a) Government Departments or any other deposit to be made by persons as may be notified by the Commissioner in this behalf;
(b) Proper officer or any other officer authorised to recover outstanding dues from any person, whether registered or not, including recovery made through attachment or sale of movable or immovable properties;
(c) Proper officer or any other officer authorized for the amounts collected by way of cash, cheque or demand draft during any investigation or enforcement activity or any ad hoc deposit.
It may be noted that other registered persons may also deposit the amount of more than ten thousand rupees through challan via OTC mode but they would be liable for penalty for violation of Rule 87(3) of the CGST Rules, 2017.
Q 36. What is the validity period of the challan generated for the purpose of making deposit in the Electro

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t from the electronic cash ledger, the said amount shall be debited to the electronic cash ledger. If the refund so claimed is rejected, either fully or partly, the amount debited, to the extent of rejection, shall be credited to the electronic cash ledger by the proper officer by an order made in FORM GST PMT-03.
Q 40. What is an Electronic Credit Ledger?
Ans. Electronic Credit ledger is for maintaining an account of input tax credit of the registered person. The input tax credit as self-assessed in the return of a registered person shall be credited to his electronic credit ledger, in accordance with section 41, to be maintained in the prescribed manner.
Q 41. In what manner will the Electronic Credit Ledger be maintained?
Ans. The electronic credit ledger shall be maintained in FORM GST PMT-02 for each registered person eligible for input tax credit under the Act on the Common Portal and every claim of input tax credit under the Act shall be credited to the said Ledger.
Q 42. W

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g, if any, may be utilised towards the payment of central tax and State tax, or as the case may be, Union territory tax, in that order;
(b) the central tax shall first be utilised towards payment of central tax and the amount remaining, if any, may be utilised towards the payment of integrated tax;
(c) the State tax shall first be utilised towards payment of State tax and the amount remaining, if any, may be utilised towards payment of integrated tax.
But, the input tax credit on account of State tax shall be utilised towards payment of integrated tax only where the balance of the input tax credit on account of central tax is not available for payment of integrated tax;
(d) the Union territory tax shall first be utilised towards payment of Union territory tax and the amount remaining, if any, may be utilised towards payment of integrated tax
But, the input tax credit on account of Union territory tax shall be utilised towards payment of integrated tax only where the balance of the

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Valuation in GST
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
6. Valuation in GST
Q 1. What is the value of taxable supply to be adopted for the levy of GST?
Ans. The value of taxable supply of goods and services shall ordinarily be 'the transaction value' which is the price paid or payable, when the parties are not related and price is the sole consideration. Section 15 of the CGST/SGST Act further elaborates various inclusions and exclusions from the ambit of transaction value. For example, the transaction value shall not include refundable deposit, discount allowed subject to certain conditions before or at the time of supply.
Q 2. What is transaction value?
Ans. Transaction value refers to the price actually paid or payable for the supply of goods and or services where the supplier and the recipient are not related and price is the sole consideration for the supply. It includes any amount which the supplier is liable to pay but which

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been fulfilled.
Q 7. Whether post-supply discounts or incentives are to be included in the transaction value?
Ans. Yes. However, where the post-supply discount is established as per the agreement which is known at or before the time of supply and where such discount specifically linked to the relevant invoice and the recipient has reversed input tax credit attributable to such discount, the discount is allowed as admissible deduction under Section 15 of the CGST Act.
Q 8.  Whether pre-supply discounts allowed before or at the time of supply are includible in the transaction value?
Ans. No, provided it is allowed in the course of normal trade practice and has been duly recorded in the invoice.
Q 9.  When are the provisions of the Valuation Rules applicable?
Ans. Valuation Rules are applicable when
(i) consideration either wholly or in part not in money terms;
(ii) parties are related or supply by any specified category of supplier; and
(iii) transaction value declare

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f the services;
d) Interest or late fee or penalty for delayed payment of any consideration for any supply; and
e) Subsidies directly linked to the price excluding subsidies provided by the Central and State Government.
Q 11. How will value be determined where supply is made by a dealer dealing in second hand goods?
Ans. As per Rule 32(5) of the CGST Rules, 2017, where a taxable supply is provided by a person dealing in buying and selling of second hand goods i.e., used goods as such or after such minor processing which does not change the nature of the goods and where no input tax credit has been availed on the purchase of such goods, the value of supply shall be the difference between the selling price and the purchase price and where the value of such supply is negative, it shall be ignored
Q 12. How will goods re-possessed from defaulting borrowers be valued?
Ans. The proviso to Rule 32(5) of the CGST Rules provides that in case of the purchase value of goods repossessed from

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, –
(a) consideration charged for aforesaid service; and
(b) amount charged for transfer of land or undivided share of land, as the case may be
Q 14. How will supply of lottery tickets be valued under GST?
Ans. Lotteries are sold as goods and can be of following two types:
(a) “lottery run by State Governments” means a lottery not allowed to be sold in any State other than the organizing State. The rate of GST on these is 12% and the face value of the lottery is inclusive of taxes. Therefore, value of supply of lottery shall be 100/112 of the face value or the price notified in the Official Gazette by the organising State, whichever is higher.
(b) “lottery authorised by State Governments” means a lottery which is authorised to be sold in State(s) other than the organising State also. The rate of these is 28% and the face value of the lottery is inclusive of taxes. Therefore, value of supply of lottery shall be 100/128 of the face value or the price notified in the Official Gazet

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a person in a transaction, where the supplier and the recipient of the supply are not related and price is the sole consideration, to obtain such supply at the same time when the supply being valued is made.
Q 18. When will open market value become relevant under GST?
Ans. Open market value will be relevant in cases where consideration for the supply is not wholly in money. The open market value will be particularly relevant in cases where supply is between related persons, or between distinct persons (entities having same PAN but different GSTIN) and between principal and agent.
Q 19. How will value be determined in cases where the consideration for supply is not wholly in money?
Ans. Value of supply where the consideration is not wholly in money will be: –
a) Open market value of such supply
b) if open market value is not available, value shall be the sum total of consideration in money and any such further amount in money as is equivalent to the consideration not in money if s

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on cost mean?
Ans. Where the value of a supply of goods or services or both is not determinable by any of the provisions prescribed in Rule 27, 28 and 29 of the CGST Rules, 2017, then, cost based valuation is applied to determine value of supply. In other words, when a supply does not have money as sole consideration and neither open market value nor consideration involved can be ascertained, then, cost based rule as prescribed in Rule 30 of CGST Rules, 2017 is applied. In such cases, the value shall be one hundred and ten percent of the cost of production or manufacture or cost of acquisition of such goods or cost of provision of such services.
Q 22. What does residual method mean in valuation of supply?
Ans. Rule 31 of CGST Rules, 2017 is also known as the residual method of Valuation. Where the value of supply of goods or services or both cannot be determined under Rule 27 to 30, then, the value of supply shall be determined using reasonable means consistent with the principles a

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rol a third person; or
(viii) they are members of the same family;
(ix) Persons who are associated in the business of one another in that one is the sole agent or sole distributor or sole concessionaire, howsoever described, of the other, shall be deemed to be related.
It may be noted that the term “person” also includes legal persons.
Q 25. How will value be arrived at when supply is between related persons or distinct persons as specified in sub-section (4) and (5) of section 25 (other than an agent)?
Ans. The value of the supply of goods or services or both in such cases shall, –
(a) be the open market value of such supply;
(b) if open market value is not available, be the value of supply of goods or services of like kind and quality;
(c) if value is not determinable under clause (a) or (b), be the value as determined by application of rule 30 or rule 31, in that order:
In case the goods are intended for further supply as such by the recipient, the value shall, at the opti

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, –
(a) be the open market value of the goods being supplied, or at the option of the supplier, be ninety percent of the price charged for the supply of goods of like kind and quality by the recipient to his customer not being a related person, where the goods are intended for further supply by the said recipient;
Illustration: Where a principal supplies groundnut to his agent and the agent is supplying groundnuts of like kind and quality in subsequent supplies at a price of ₹ 5000 per quintal on the day of supply. Another independent supplier is supplying groundnuts of like kind and quality to the said agent at the price of ₹ 4550 per quintal. The value of the supply made by the principal shall be ₹ 4550 per quintal or where he exercises the option the value shall be 90% of the ₹ 5000 i.e. is ₹ 4500 per quintal.
(b) where the value of a supply is not determinable under clause (a), the same shall be determined by application of cost based method as pres

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29. Whether the temporary short-term transaction based loan extended by the DCA to the recipient (buyer), for which interest is charged by the DCA, is to be included in the value of goods being supplied by the supplier (principal) where DCA is not an agent under Para 3 of Schedule I of the CGST Act?
Ans. If the DCA being not an agent under Para 3 of Schedule I of the CGST Act, the temporary short-term transaction based loan being provided by DCA to the buyer is a supply of service by the DCA to the recipient on Principal to Principal basis and is an independent supply. Therefore, the interest being charged by the DCA would not form part of the value of supply of goods supplied (to the buyer) by the supplier. (CBIC Circular No. 73/47/2018-GST dated 5th November, 2018)
Q 30. Where DCA is an agent under Para 3 of Schedule I of the CGST 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 s

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pply of services in relation to purchase or sale of foreign currency, including money changing, shall be determined by the supplier of service in the following manner:-
(a) For a currency, when exchanged from, or to, Indian Rupees (INR), the value shall be equal to the difference in the buying rate or the selling rate, as the case may be, and the Reserve Bank of India (RBI) reference rate for that currency at that time, multiplied by the total units of currency.
In case where the RBI reference rate for a currency is not available, the value shall be 1% of the gross amount of Indian Rupees provided or received by the person changing the money.
In cases where neither of the currencies exchanged is Indian Rupee, the value shall be equal to 1% of the lesser of the two amounts the person changing the money would have received by converting any of the two currencies into Indian Rupee on that day at the reference rate provided by RBI.
(b) The person supplying the services can also exercis

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tion to booking of tickets for travel by air provided by an air travel agent, shall be deemed to be an amount calculated at the rate of 5% of the basic fare in the case of domestic bookings, and at the rate of 10% of the basic fare in the case of international bookings of passage for travel by air.
The expression “basic fare” means that part of the air fare on which commission is normally paid to the air travel agent by the airline.
Q 33. How will services in relation to Life Insurance business be valued?
Ans. The value of supply of services in relation to life insurance business shall be:
(a) the gross premium charged from a policy holder reduced by the amount allocated for investment, or savings on behalf of the policy holder, if such amount is intimated to the policy holder at the time of supply of service;
(b) in case of single premium annuity policies other than (a), ten per cent of single premium charged from the policy holder; or
(c) in all other cases, twenty-five per cen

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where the value of such supply is negative it shall be ignored.
The purchase value of goods repossessed from a defaulting borrower, who is not registered, for the purpose of recovery of a loan or debt shall be deemed to be the purchase price of such goods by the defaulting borrower reduced by five percentage points for every quarter or part thereof, between the date of purchase and the date of disposal by the person making such repossession.
Q 35. How will supply of vouchers be valued under GST?
Ans. The value of a token, or a voucher, or a coupon, or a stamp (other than postage stamp) which is redeemable against a supply of goods or services or both shall be equal to the money value of the goods or services or both redeemable against such token, voucher, coupon, or stamp.
Q 36. Who is a pure agent for the purpose of GST Valuation?
Ans.  “Pure agent” means a person who –
(a) enters into a contractual agreement with the recipient of supply to act as his pure agent to incur e

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Time of Supply
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
5. Time of Supply
Q 1.  What is time of supply?
Ans. The time of supply fixes the point when the liability to charge GST arises. It also indicates when a supply is deemed to have been made. The CGST/SGST Act provides separate time of supply for goods and services.
Q 2. When does the liability to pay GST arise in respect of supply of goods?
Ans. Section 12 of the CGST/SGST Act provides for time of supply of goods. The time of supply of goods shall be the earlier of the following namely,
(i) the date of issue of invoice by the supplier or the last date on which he is required under Section 31, to issue the invoice with respect to the supply; or
(ii) the date on which the supplier receives the payment with respect to the supply.
However, vide notification 66/2017-Central Tax dated 15.11.2017, liability to pay tax at the time of receipt of advance has been relaxed in case of

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t; or
b) the date of redemption of voucher in all other cases.
Q 5. Where it is not possible to determine the time of supply in terms of sub-section 2, 3, 4 of Section 12 or that of Section 13 of CGST/SGST Act, how will time of supply be determined?
Ans. There is a residual entry in Section 12(5) as well as 13 (5) which says that if periodical return has to be filed, then the due date of filing of such periodical return shall be the time of supply. In other cases, it will be the date on which the CGST/SGST/IGST is actually paid.
Q 6.  What does “date of receipt of payment” mean?
Ans. It is the earliest of the date on which the payment is entered in the books of accounts of the supplier or the date on which the payment is credited to his bank account.
Q 7. Suppose, part advance payment is made or invoice issued is for part payment, whether the time of supply will cover the full supply?
Ans. No. The supply of services shall be deemed to have been made to the extent it is cove

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ier.
Q 10. What is the time of supply applicable with regard to addition in the value by way of interest, late fee or penalty or any delayed payment of consideration?
Ans. The time of supply with regard to an addition in value on account of interest, late fee or penalty or delayed consideration shall be the date on which the supplier received such additional consideration.
Q 11. Is there any change in time of supply, where supply is completed prior to or after change in rate of tax?
Ans. Yes. In such cases provisions of Section 14 will apply.
Q 12. What is the time of supply, where supply is completed prior to change in rate of tax?
Ans.  In such cases time of supply will be
(i) where the invoice for the same has been issued and the payment is also received after the change in rate of tax, the time of supply shall be the date of receipt of payment or the date of issue of invoice, whichever is earlier;
(However, for supply of goods payment of tax need to be made only at th

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r for supply of goods payment of tax need to be made only at the time of issue of invoice in terms of notification 66/2017-Central Tax dated 15.11.2017) or
(ii) where the invoice has been issued and the payment is received before the change in rate of tax, the time of supply shall be the date of receipt of payment or date of issue of invoice, whichever is earlier; or; (However for supply of goods payment of tax need to be made only at the time of issue of invoice in terms of notification 66/2017-Central Tax dated 15.11.2017)
(iii) where the invoice has been issued after the change in rate of tax but the payment is received before the change in rate of tax, the time of supply shall be the date of issue of invoice
Q 14. Let's say there was increase in tax rate from 18% to 20% w.e.f.1.9.2017. What is the tax rate applicable when services provided and invoice issued before change in rate in July, 2017, but payment received after change in rate in September, 2017?
Ans. The old rate of 1

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f Services?
Ans. As per Section 31 of CGST/SGST Act a registered person shall, before or after the provision of service, but within a period of 30 days from the date of supply of service, issue a tax invoice showing description, value of goods, tax payable thereon and other prescribed particulars. For Banking and Insurance companies, this period is 45 days. For inter-state self-supplies made by bank, insurance and telecom companies, invoices can be issued before or at the time such supplier records the same in his books of account or before the expiry of the quarter during which the supply was made. Further a registered person liable to pay tax on reverse charge basis is also required to issue invoice on the date of receipt of goods or services or both.
Q 18. What is the time period within which invoice has to be issued in a case involving continuous supply of goods?
Ans. In case of continuous supply of goods, where successive statements of accounts or successive payments are involv

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the time of supply or six months from the date of removal, whichever is earlier.
Q 21. What is the time of supply in respect of supply by an associate enterprise, located outside India?
Ans. An associated enterprise is defined in section 2(12) of the CGST Act, 2017 as having same meaning as assigned in section 92A of the Income-tax Act, 1961. An enterprise which participates, either directly or indirectly, through one or more intermediaries, in the management, or control or capital of the other enterprise is an associated enterprise.
In the context of GST, associated enterprise is particularly relevant in the case of supply of services, where the supplier is located outside India. In such cases, the time of supply will be the earlier of date of entry in the books of account of the recipient of supply or the date of payment – thus, the levy under GST is attracted once such book entries are made even if no actual payment takes place or no invoice is issued. (Second proviso to section

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Meaning and Scope of Supply
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
4. Meaning and Scope of Supply
Q 1.  What is the taxable event under GST?
Ans. The taxable event under GST shall be the supply of goods or services or both made for consideration in the course or furtherance of business. The taxable events under the existing indirect tax laws such as manufacture, sale, or provision of services shall stand subsumed in the taxable event known as 'supply'.
Q 2. What is the scope of 'supply' under the GST law?
Ans. The term 'supply' is wide in its import covers all forms of supply of goods or services or both that includes sale, transfer, barter, exchange, license, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business. It also includes import of service. The GST law also provides for including certain transactions made without consideration within the scope of s

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nder Schedule-I of CGST /SGST Act, where one or more ingredients specified in answer to question no.4 are not satisfied, it shall still be treated as supply for levy of GST.
Q 6. Import of Goods is conspicuous by its absence in Section 7. Why?
Ans. Import of goods is dealt separately under the Customs Act, 1962, wherein IGST and compensation cess (wherever applicable) shall be levied under the Customs Tariff Act, 1975 in addition to basic customs duty. Proviso to section 5(1) of IGST Act, 2017 may be referred to.
Q 7.  Are self-supplies taxable under GST?
Ans. Inter-state self-supplies such as stock transfers, branch transfers or consignment sales shall be taxable under IGST even though such transactions may not involve payment of consideration. Every supplier is liable to register under the GST law in the State or Union territory from where he makes a taxable supply of goods or services or both in terms of Section 22 of the CGST Act. However, intra-state self-supplies are not

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lary to the aforementioned listed activities. In addition, any activity undertaken by the Central Govt. or a State Govt. or any local authority in which they are engaged as public authority shall also be construed as business. From the above, it may be noted that any activity undertaken included in the definition for furtherance or promoting of a business could constitute a supply under GST law.
Q 10. An individual buys a car for personal use and after a year sells it to a car dealer. Will the transaction be a supply in terms of CGST/SGST Act? Give reasons for the answer.
Ans. No, because the sale of old and used car by an individual is not in the course or furtherance of business and hence does not constitute supply.
Q 11. A dealer of air-conditioners permanently transfers an air conditioner from his stock in trade, for personal use at his residence. Will the transaction constitute a supply?
Ans. Yes. As per Sl. No.1 of Schedule-I, permanent transfer or disposal of business assets

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state and where it is in different states it will be inter-state supplies.
Q 15. Whether transfer of right to use goods will be treated as supply of goods or supply of service? Why?
Ans. Transfer of right to use goods shall be treated as supply of service because there is no transfer of title in such supplies. Such transactions are specifically treated as supply of service in Schedule-II of CGST/SGST Act.
Q 16. Whether Works contracts and Catering services will be treated as supply of goods or supply of services? Why?
Ans. Works contracts and catering services shall be treated as supply of services as both are specified under Sl. No. 6 (a) and (b) in Schedule-II of the GST law.
Q 17. Whether supply of software would be treated as supply of goods or supply of services under GST law?
Ans. Development, design, programming, customization, adaptation, upgradation, enhancement, implementation of information technology software shall be treated as supply of services as listed in Sl. No.

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ny Court or Tribunal established under any law,
(iii) functions performed by members of Parliament, State Legislatures, members of the local authorities, Constitutional functionaries
(iv) services of funeral, burial, crematorium or mortuary and
(v) sale of land and
(vi), actionable claims other than lottery, betting and gambling shall be treated neither a supply of goods or supply of services.
Vide the CGST (Amendment), 2018, following transactions have also been inserted in the schedule-III:
(vii) Merchant Trading or Out and Out transactions: Supply of goods from a place in the non-taxable territory to another place in the non-taxable territory without such goods entering into India.
(viii). (a) Supply of goods while the same are still in Customs Bonded warehouse: Supply of warehoused goods to any person before clearance for home consumption;
(viii) (b) High Seas Sales: Supply of goods by the consignee to any other person, by endorsement of documents of title to the goods,

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thereof, which are naturally bundled and supplied in conjunction with each other in the ordinary course of business, one of which is a principal supply.
Principal supply has been defined in Section 2(90) of the CGST Act as supply of goods or services which constitutes the predominant element of a composite supply and to which any other supply forming part of that composite supply is ancillary.
For example, where goods are packed and transported with insurance, the supply of goods, packing materials, transport and insurance is a composite supply and supply of goods is the principal supply.
Q 23. How will tax liability on a composite supply be determined under GST?
Ans.  A composite supply comprising two or more taxable supplies, one of which is a principal supply, shall be treated as a supply of such principal supply. (Section 8(a) of CGST Act, 2017)
Q 24. What is a mixed supply?
Ans. Mixed Supply means two or more individual supplies of goods or services or any combination

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On the other hand, supply of retreaded tyres, where the old tyres belong to the supplier of retreaded tyres, is a supply of goods (retreaded tyres under heading 4012 of the Customs Tariff)
(CBIC Circular No. 34/8/2018-GST dated 1st March, 2018)
Q 27. Whether activity of bus body building, is a supply of goods or services?
Ans. The classification would depend on which supply is the principal supply. In case, a bus body building company builds on the chassis owned by it and sells the completely built buses, it would be supply of goods. On the other hand, if the company builds the body on the chassis belonging to some else, it would be supply of services.
Q 28. Whether foods supplied to the patients as part of the healthcare services in hospitals taxable?
Ans. Health care services provided by the clinical establishments will include food supplied to the patients. Therefore, food supplied to the in-patients as advised by the doctor/nutritionists is a part of composite supply of healt

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provision of reverse charge liability on supplies received from unregistered persons, as provided in sections 9 (4) and 5 (4) of the CGST Act and the IGST Act respectively, have been kept in abeyance till 30.09.2019. Further as the recent CGST (Amendment) Act, 2018, sections 9 (4) shall only be applicable for specified class of registered persons which shall be notified by the government. However, the notification to bring the Act into effect is yet to be issued.
Q 30. What are the supplies of goods under RCM?
Ans.  Supplies of goods under reverse charge mechanism:
S/No.
Description of supply of Goods
Supplier of goods
Recipient of Goods
1
Cashew nuts, not shelled or peeled
Agriculturist
Any registered person
2
Bidi wrapper leaves (tendu)
Agriculturist
Any registered person
3
Tobacco leaves
Agriculturist
Any registered person
4
Silk yarn
Any person who manufactures silk yarn from raw silk or silk worm cocoons for supply of silk yarn
Any registered person
4A

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Cancellation of Registration
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
3.2 Cancellation of Registration
Q 53. Whether Cancellation of Registration Certificate is permissible?
Ans. Yes. Section 29 of the CGST Act, read with rule 20 of the CGST Rules provides that a taxpayer can apply for cancellation of registration in FORM GST REG-16 in the following circumstances:
* Discontinuance of business or closure of business;
* Transfer of business on account of amalgamation, merger, de-merger, sale, lease or otherwise;
* Change in constitution of business leading to change in PAN;
* Taxable person (including those who have taken voluntary registration) is no longer liable to be registered under GST;
* Death of sole proprietor;
* Any other reason (to be specified in the application) Application in FORM GST REG-16 has to be submitted within a period of 30 days of the “occurrence of the event warranting the cancellation”.
Q 54. What i

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er section 29(3) of the CGST Act, the cancellation of registration shall not affect the liability of the person to pay tax and other dues or to discharge any obligation under this Act or the rules made thereunder for any period prior to the date of cancellation whether or not such tax and other dues are determined before or after the date of cancellation.
Q 57. What are the obligation of a registered person applying for cancellation?
Ans. As per Section 29(5) of the CGST Act, read with rule 20 of the CGST Rules, the taxpayer seeking cancellation of registration shall have to pay, by way of debiting either the electronic credit or cash ledger, the input tax contained in the stock of inputs, semi-finished goods, finished goods and capital goods or the output tax payable on such goods, whichever is higher. As per section 45 of the CGST Act, every registered person whose registration is cancelled needs to file a final return in GSTR-10 with in three months of cancellation.
The requireme

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n is obtained by means of willful mis-statement, fraud or suppression of facts?
Ans. In such cases, the registration may be cancelled with retrospective effect by the proper officer. (Section 29(2) (e))
Q 60. What is suspension of registration?
Ans. Section 29 of the CGST Act has been amended by the CGST (Amendment) Act, 2018 to provide for “Suspension” of registration. The intent of the said amendment is to ensure that a taxpayer is freed from the routine compliances, including filing returns, under GST Act during the pendency of the proceedings related to cancellation. (This would be brought into force from the date law amendment is notified)
Q 61. Can cancellation of registration order be revoked?
Ans. Yes, but only in cases where the initial cancellation has been done by the proper officer suo moto, and not on the request of the taxable person or his legal heirs. A person whose registration has been cancelled suo moto can apply to the proper officer for revocation of cancellat

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Amendment of Registration
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
3.1 Amendment of Registration
Q 47. Whether Amendments to the Registration Certificate is permissible?
Ans. Yes. In terms of Section 28, the proper officer may, on the basis of such information furnished either by the registrant or as ascertained by him, approve or reject amendments in the registration particulars within a period of 15 common working days from the date of receipt of application for amendment.
It is to be noted that permission of the proper officer for making amendments will be required for only certain core fields of information, whereas for the other fields, the certificate of registration shall stand amen

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er officer mandatory for making amendments in registration?
Ans. Once an application in FORM GST REG-14 is submitted on the Common Portal, all amendments, except the following, shall stand amended. Permission of proper officer is required only if the amendment relates to
(i) legal name of business;
(ii) address of the principal place of business or any additional place of business; or
(iii) addition, deletion or retirement of partners or directors, Karta, Managing Committee, Board of Trustees, Chief Executive Officer or equivalent, responsible for the day to day affairs of the business,-
Q 50. Is there any time limit for approving amendment by the proper officer?
Ans. Yes. 15 days. The proper officer shall approve the amendment within

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ven working days of the service of the said notice, as to why the application submitted under sub-rule (1) shall not be rejected.
The taxable person shall furnish a reply to the notice to show cause in FORM GST REG-04 within seven working days from the date of the service of the said notice.
Where the reply furnished is found to be not satisfactory or where no reply is furnished in response to the notice issued within seven days, the proper officer shall reject the application and pass an order in FORM GST REG -05.
Q 52. What happens if the proper officer fails to take any action on the application for amendment?
Ans.  If the proper officer fails to take any action-
(a) within fifteen working days from the date of submission of ap

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Registration
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
3. Registration
Q 1. What is advantage of taking registration in GST?
Ans. Registration under Goods and Service Tax (GST) regime will confer following advantages to the business:
* Legally recognized as supplier of goods or services.
* Proper accounting of taxes paid on the input goods or services which can be utilized for payment of GST due on supply of goods or services or both by the business.
* Legally authorized to collect tax from his purchasers and pass on the credit of the taxes paid on the goods or services supplied to purchasers or recipients.
* Getting eligible to avail various other benefits and privileges rendered under the GST laws.
Q 2. Can a person without GST registration claim ITC and collect tax?
Ans. No, a person without GST registration can neither collect GST from his customers nor can claim any input tax credit of GST paid by him.
Q 3.  What wi

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urn over in a financial year exceeds the threshold limit of twenty lakh rupees shall be liable to register himself in the State or the Union territory of Delhi or Puducherry from where he makes the taxable supply.
In case of eleven special category states (as mentioned in Art.279A(4)(g) of the Constitution of India), this threshold limit for registration liability is ten lakh rupees.
Besides, Section 24 of the Act mentions certain categories of suppliers, who shall be liable to take registration even if their aggregate turnover is below the said threshold limit of 20 lakh rupees.
On the other hand, as per Section 23 of the Act, an agriculturist in respect of supply of his agricultural produce; as also any person exclusively making supply of non-taxable or wholly exempted goods and/or services under GST law will not be liable for registration.
Q 5.  What is aggregate turnover?
Ans. As per section 2(6) of the CGST/SGST Act “aggregate turnover” includes the aggregate value of:

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aking any inter-State taxable supply;
ii) casual taxable persons making taxable supply;
iii) persons who are required to pay tax under reverse charge;
iv) persons who are required to pay tax under sub-section (5) of section 9;
v) non-resident taxable persons making taxable supply;
vi) persons who are required to deduct tax under section 51;
vii) persons who make taxable supply of goods or services on behalf of other registered taxable persons whether as an agent or otherwise;
viii) Input service distributor (whether or not separately registered under the Act);
ix)  persons who supply goods, other than supplies specified under Section 9(5), through such ecommerce operator who is required to collect tax at source under section 52;
x) every electronic commerce operator who is required to collect tax at source under section 52
xi) every person supplying online information and data base retrieval services from a place outside India to a person in India, other than a regist

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ed 19th June, 2017
Q 8. What is the time limit for taking a Registration under GST?
Ans. A person should take a Registration, within thirty days from the date on which he becomes liable to registration, in such manner and subject to such conditions as is prescribed under the Registration Rules. A Casual Taxable person and a non-resident taxable person should however apply for registration at least 5 days prior to commencement of business.
Q 9. If a person is operating in different states, with the same PAN number, whether he can operate with a single Registration?
Ans. No. Every person who is liable to take a Registration will have to get registered separately for each of the States where he has a business operation and is liable to pay GST in terms of Section 22(1) of the CGST/SGST Act.
Q 10. Can a person obtain multiple registrations in a State?
Ans. Yes. In terms of the proviso to Sub-Section (2) of Section 25, a person having multiple place of businesses in a State or UT may

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liable to pay GST?
Ans. Yes. In terms of Section 25(3), a person, though not liable to be registered under Section 22 or section 24 may get himself registered voluntarily, and all provisions of this Act, as are applicable to a registered taxable person, shall apply to such person.
The person, once registered, will have to pay GST irrespective of his aggregate turnover.
Q 13. Is possession of a Permanent Account Number (PAN) mandatory for obtaining a Registration?
Ans. Yes. As per Section 25(6) of the CGST/SGST Act every person shall have a Permanent Account Number issued under the Income Tax Act,1961(43 of 1961) in order to be eligible for grant of registration.
However as per the proviso to the aforesaid section 25(6), a person required to deduct tax under Section 51, may have, in lieu of a PAN, a Tax Deduction and Collection Account Number issued under the said Income Tax Act, in order to be eligible for grant of registration.
Also, as per Section 25(7) PAN is not mandatory fo

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is the effective date of such suo moto registrations?
Ans.  It shall be effective from the date of order granting registration.
Q 17. Will such suo moto registrations be final registrations?
Ans. No. Every person to whom a suo-moto (temporary) registration has been granted under rule 16(1) of the CGST Rules, 2017, shall, within ninety days from the date of the grant of such registration, submit an application for registration in the form and manner provided in rule 8 (normal taxable persons) or rule 12 (TDS/TCS deductors) unless the said person has filed an appeal against the grant of temporary registration, in that case the application for registration shall be submitted within thirty days from the date of issuance of order upholding the liability to registration by the Appellate Authority.
Q 18. Whether the proper officer can reject an Application for Registration?
Ans. Yes. In terms of section 25(10) of the CGST Act, the proper officer can reject an application for registr

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the application for registration be verified physically by the department?
Ans. Only in cases where the proper officer feels the need for such verification but after the grant of registration. Wherever the proper officer feels so, he may get such verification done and the verification report along with other documents, including photographs, shall be uploaded in FORM GST REG-30 on the Common Portal within fifteen working days following the date of such verification.
Q 21. Is it necessary for the UN bodies to get registration under GST?
Ans. Yes. In terms of Section 25(9) of the CGST/SGST Act, all notified UN bodies, Consulate or Embassy of foreign countries and any other class of persons so notified would be required to obtain a unique identification number (UIN) from the GST portal. The structure of the said ID would be uniform across the States in conformity with GSTIN structure and the same will be common for the Centre and the States. This UIN will be needed for claiming refund

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voices and treat such supplies as supplies to another registered person (B2B) and the invoices of the same will be uploaded by the supplier.
Q 24. Who is a Casual Taxable Person?
Ans. Casual Taxable Person has been defined in Section 2 (20) of the CGST/SGST Act meaning a person who occasionally undertakes transactions involving supply of goods and/or services in the course or furtherance of business, whether as principal, or agent or in any other capacity, in a State or a Union territory where he has no fixed place of business.
Q 25. Who is a Non-resident Taxable Person?
Ans. In terms of Section 2(77) of the CGST/SGST Act, a nonresident taxable person means any 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 or residence in India.
Q 26. What is the validity period of the Registration certificate issued to a Casual Taxable Person and non- Resident

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ce deposit of tax in an amount equivalent to the estimated tax liability of such person for the period for which the registration is sought. If registration is to be extended beyond the initial period of ninety days, an advance additional amount of tax equivalent to the estimated tax liability is to be deposited for the period for which the extension beyond ninety days is being sought.
Q 28. A casual taxable person/non-resident taxable person has to make advance deposit of tax. Will such persons have to wait till grant of registration to deposit Advance Tax?
Ans. No. A person applying for registration as a casual taxable person/non-resident taxable person shall be given a temporary reference number by the Common Portal for making advance deposit of tax in accordance with the provisions of section 27 and the acknowledgement under rule 8 (5), for submission of registration application, shall be issued electronically only after the said deposit in the electronic cash ledger.
Q 29. What

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he definition
Has to file normal GSTR-1, GSTR-2 and GSTR-3 returns 
Has to file a separate simplified return in the format GSTR-5
Can claim ITC of all inward supplies 
Can get ITC only in respect of import of goods and /or services.
Q 30. Who is an ISD?
Ans. ISD stands for Input Service Distributor and has been defined under Section 2(61) of the CGST/SGST Act. It is basically an office meant to receive tax invoices towards receipt of input services and further distribute the credit to supplier units (having the same PAN) proportionately.
Q 31. Will ISD be required to be separately registered other than the existing tax payer registration?
Ans. Yes, the ISD registration is for one office of the taxpayer which will be different from the normal registration.
Q 32. Can a tax payer have multiple ISDs?
Ans. Yes. Different offices of a tax payer can apply for ISD registration.
Q 33. What could be the liabilities (in so far as registration is concerned) on transfer of a

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ice tax assesses having centralized registration will have to apply afresh in the respective states wherever they have their businesses.
Q 35. Whether the job worker will have to be compulsorily registered?
Ans. No, a Job worker is a supplier of services and will be obliged to take registration only when his turnover crosses the prescribed threshold of 20/10 Lakhs.
Q 36. Whether the goods will be permitted to be supplied from the place of business of a job worker?
Ans. Yes. But only in cases where the job worker is registered, or if not, the principal declares the place of business of the job worker as his additional place of business.
Q 37. At the time of registration will the assessee have to declare all his places of business?
Ans. Yes. The principal place of business and place of business have been separately defined under section 2(89) & 2(85) of the CGST/SGST Act respectively. The taxpayer will have to declare the principal place of business as well as the details of additi

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d given to it by the taxable person. After uploading the data on common portal using the ID and Password of FC, a print-out of acknowledgement will be taken and signed by the FC and handed over to the taxable person for his records. The FC will scan and upload the summary sheet duly signed by the Authorized Signatory.
Q 39. Is there any facility for digital signature in the GSTN registration?
Ans. Tax payers would have the option to sign the submitted application using valid digital signatures. There will be two options for electronically signing the application or other submissions- by e-signing through Aadhar number, or through DSC i.e. by registering the tax payer's digital signature certificate with GST portal. However, companies or limited liability partnership entities will have to sign mandatorily through DSC only. Only level 2 and level 3 DSC certificates will be acceptable for signature purpose.
Q 40. How will a person desirous of becoming a GST Practitioner apply?
Ans. A

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l have 7 days from the date when the taxable person communicates removal of deficiencies. In case no response is given by the departmental authorities within the said time line, the portal shall automatically generate the registration.
Q 43. What will be the time of response by the applicant if any query is raised in the online application?
Ans. If during the process of verification, one of the tax authorities raises some query or notices some error, the same shall be communicated to the applicant and to the other tax authority through the GST Common Portal within 3 common working days. The applicant will reply to the query/rectify the error/ answer the query within a period of seven days from the date of receipt of deficiency intimation.
On receipt of additional document or clarification, the relevant tax authority will respond within seven common working days from the date of receipt of clarification.
Q 44. What is the process of refusal of registration?
Ans. In case registratio

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Composition Levy
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
2.1 Composition Levy
Q 17. What is the composition levy under GST?
Ans. The composition levy is an alternative method of levy of tax designed for small taxpayers whose turnover is up to prescribed limit. The objective of composition scheme is to bring simplicity, ease compliance burden and reduce cost of compliance for the small taxpayers. The scheme is optional. It essentially provides for a turnover tax regime for such tax payers, with facility for filing of return on quarterly basis (instead of monthly return by the normal tax payers).
An eligible person opting to pay tax under the composition scheme shall, instead of paying tax on every invoice at the specified rate, pay tax at a prescribed percentage of his turnover every quarter.
Q 18. What is the rate of composition levy?
S/No.
Category of Registered person
Rate of Tax
1
Manufacturers, other than manufacturers of s

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Category States in which the turnover limit for Composition Levy for CGST and SGST purpose shall be ₹ 75 lakh?
Ans. Composition scheme is a scheme for payment of GST available to small taxpayers whose turnover in the preceding financial year did not cross Rs. One crore. In the case of following 9 states, the limit of turnover is ₹ 75 Lakhs in the preceding financial year.
a) Arunachal Pradesh
b) Assam
c) Manipur
d) Meghalaya
e) Mizoram
f) Nagaland
g) Sikkim
h) Tripura and
i) Himachal Pradesh.
Q 20. Who are the persons not eligible for composition scheme?
Ans. Following persons will not be allowed to opt for composition scheme:
a) supplier of services, other than restaurant service (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 valuab

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making any supply of goods through an electronic commerce operator who is required to collect tax at source under section 52; and
e) a manufacturer of such goods as may be notified by the Government on the recommendations of the Council. The manufacturers of the following goods shall not be eligible for the Composition Levy:
S.No.
Classification (Tariff item/ Chapter)
Description
1
2105 00 00
Ice cream and other edible ice, whether or not containing cocoa
2
2106 90 20
Pan masala
3
24
All goods i.e. Tobacco and manufactured tobacco substitutes
Q 21. Whether service providers can apply for composition scheme?
Ans. No, the Service Providers, except provider of restaurant services, cannot apply for the scheme. At present, there is no composition scheme for service providers, except for provider of restaurant services.
However, a new proviso has been added as per the recent CGST (Amendment) Act, 2018 in order to allow them to be eligible for the scheme even if they supply se

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ver of ₹ 100 Lakhs/75 Lakhs in December? Will he be allowed to pay tax under composition scheme for the remainder of the year i.e. till 31st March?
Ans. No. The option availed shall lapse from the day on which his aggregate turnover during the financial year exceeds ₹ 100 Lakhs/75 Lakhs. Once he crosses the threshold, he shall file an intimation for withdrawal from the scheme in FORM GST CMP-04 within seven days of the occurrence of such event.
Every person who has furnished such an intimation, may electronically furnish at the common portal, a statement in FORM GST ITC-01 containing details of the stock of inputs and inputs contained in semi-finished or finished goods held in stock by him on the date on which the option is withdrawn, within a period of thirty days from the date from which the option is withdrawn.
Q 24. How will aggregate turnover be computed for the purpose of composition scheme?
Ans. It will be computed on the basis of turnover on all India basis. “ag

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inward supplies?
Ans. No. A taxable person opting to pay tax under the composition scheme is out of the credit chain. He cannot take credit on his input supplies.
Q 26. Can a registered person, who purchases goods from a taxable person paying tax under the composition scheme, take credit on purchases made from the composition dealer?
Ans.  No.
Q 27. Can a person paying tax under the composition scheme issue a tax invoice under GST?
Ans.  No.
Q 28. Is monthly return required to be filed by the person opting to pay tax under the composition scheme?
Ans. No. Such persons need to file quarterly returns in Form GSTR-4. The GSTR-4 needs to be filed electronically on the common portal by the 18th day of the month succeeding the quarter relating to the supplies.
Q 29. What are the basic information that need to be furnished in GSTR 4?
Ans. It should contain details of turnover in the State or Union territory, inward supplies of goods or services or both and tax payable. The

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rd supply made) & 8 (II) (of advance of reverse charge or advances for which invoice is received in current period).
Q 31. How should a person who opts in or opts out of composition scheme file returns?
Ans. Composition tax payers have to file quarterly return and Normal tax payers have to file monthly returns in GST Regime. For the taxpayers who have opted in to composition scheme and taxpayers who have opted out from the composition scheme as normal tax payer, provision to file both monthly/quarterly returns (in the interim period), has been enabled on the GST Portal.
Q 32. A person opting to pay tax under the composition scheme receives inputs/input services from an unregistered person. Will the composition dealer have to pay GST under reverse charge? If yes, in what manner?
Ans. No. The requirement to pay GST on reverse charge basis under section 9(4) of the CGST Act has been removed wef 13.10.2017 till 30.09.2019.
Q 33. What is the form in which an intimation for payment of t

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t collect any tax from the appointed day but shall issue bill of supply for supplies made after the said day.
Q 36. What are the other compliances which a provisionally registered person opting to pay tax under the composition levy need to make?
Ans. Such persons have to furnish the details of stock, including the inward supply of goods received from unregistered persons, held by him on the day preceding the date from which he opts to pay tax under the said section, electronically, in FORM GST CMP-03, on the common portal, either directly or through a Facilitation Centre notified by the Commissioner, within a period of ninety days from the date on which the option for composition levy is exercised or within such further period as may be extended by the Commissioner in this behalf.
Q 37. Can a person making application for fresh registration under GST opt for composition levy at the time of making application for registration?
Ans. Yes. Such persons may give an option to pay tax und

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ated proportionately on the basis of corresponding invoices on which credit had been availed by the registered taxable person on such inputs. In respect of capital goods held in stock the input tax credit involved in the remaining useful life in months shall be computed on pro-rata basis, taking the useful life as 5 years. Assume capital goods have been in use for 4 years, 6 months and 15 days. The useful remaining life in months will be 5 months ignoring the part of the month. If ITC on such capital goods is taken as Credit, ITC attributable to the remaining useful life will be C multiplied by 5/60. This would be the amount payable on capital goods, the payable amount would be calculated by reducing by a prescribed percentage point. The ITC amount shall be determined separately for integrated tax, central tax and state tax / Union territory tax. The payment can be made by debiting electronic credit ledger, if there is sufficient balance in the electronic credit ledger, or by debiting

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uation
Effective date of composition levy
Persons who have been granted provisional registration and who opt for composition levy (Intimation is filed under Rule 3(1)) 
The appointed date i.e 1st July, 2017
Persons opting for composition levy at the time of making application for new registration in the same registration application itself (The intimation under Rule 3(2)) 
Effective date of registration; Intimation shall be considered only after the grant of registration and his option to pay tax under section 10 shall be effective from the effective date registration. of
Persons opting for composition after obtaining registration (The intimation is filed under Rule 3(3)) 
The beginning of financial year the
Q 43. What are the conditions and restrictions subject to which a person is allowed to avail of composition levy?
Ans. The person exercising the option to pay tax under section 10 shall comply with the following conditions, namely:-
(a) he is neither a casu

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receding financial year;
(f) he shall mention the words “composition taxable person, not eligible to collect tax on supplies” at the top of the bill of supply issued by him; and
(g) he shall mention the words “composition taxable person” on every notice or signboard displayed at a prominent place at his principal place of business and at every additional place or places of business.
Q 44. What is the validity of composition levy?
Ans. The option exercised by a registered person to pay tax under section 10 shall remain valid so long as he satisfies all the conditions mentioned in the said section and under the Composition Rules.
Q 45. Can a person paying tax under composition levy, withdraw voluntarily from the scheme? If so, how?
Ans. Yes. The registered person who intends to withdraw from the composition scheme shall, before the date of such withdrawal, file an application in FORM GST CMP-04, duly signed or verified through electronic verification code, electronically on the com

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all submit reply in FORM GST CMP-06. Upon receipt of the reply to the show cause notice issued, the proper officer shall issue an order in FORM GST CMP-07 within a period of thirty days of the receipt of such reply, either accepting the reply, or denying the option to pay tax under section 10 from the date of the option or from the date of the event concerning such contravention, as the case may be.
Q 47. In case the option to pay tax under composition levy is denied by the proper officer, can the person avail ITC on stock after denial?
Ans. Yes. Every person in respect of whom an order of withdrawal of option has been passed in FORM GST CMP-07, may electronically furnish at the common portal, a statement in FORM GST ITC-01 containing details of the stock of inputs and inputs contained in semi-finished or finished goods held in stock by him on the date on which the option is denied, within a period of thirty days from the date of the order passed in FORM GST CMP-07.
Q 48. Will withd

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Levy of and Exemption from Tax
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
Goods and Services Tax
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). However, clause 2 of Article 246A read with Article 269A provides exclusive power to the Parliament to legislate with respect to inter-State trade or commerce i.e. integrated tax (IGST).
Q 2. What is the taxable event under GST?
Ans. Taxable event under GST is supply of goods or services or both. CGST and SGST/ UTGST will be levied on intra-State supplies. IGST will be levied on inter-State supplies.
Q 3. Whether supplies made without consideration will also come within the purv

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t 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 principal supply. For example, when a consumer buys a television set and he also gets warranty and a maintenance contract with the TV, this supply is a composite supply. In this example, supply of TV is the principal supply, warranty and maintenance service are ancillary.
Mixed supply is combination of more than one individual supplies of goods or services or any combination thereof made in conjunction with each other for a single price, which can ordinarily be supplied separately. For example, a shopkeeper selling storage water bottles along with refrigerator. Bottles and the refrigerator can easily be priced and sold sepa

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solutely or subject to conditions. Further the Government can exempt, under circumstances of an exceptional nature, by special order any goods or services or both. It has also been provided in the SGST Act and UTGST Act that any exemption granted under CGST Act shall be deemed to be exemption under the said Act.
Q 10. When exemption from whole of tax on goods or services or both has been granted absolutely, can a person pay tax?
Ans. No. Furthermore, if the goods are partly exempted, the person supplying exempted goods or services or both shall not collect the tax in excess of the effective rate.
Q 11. What is meant by Reverse Charge?
Ans. It means the liability to pay tax is on the recipient of supply of goods and services instead of the supplier of such goods or services in respect of notified categories of supply.
Q 12. Is the reverse charge mechanism applicable only to services?
Ans. No, reverse charge applies to supplies of both goods and services, as notified by the Governm

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ernment. However, the notification to bring the Act into effect is yet to be issued.
Q 13. What are the supplies of goods under RCM?
Ans.  Supplies of goods under reverse charge mechanism:
S/No.
Description of supply of Goods
Supplier  of goods
Recipient of Goods
1
Cashew nuts, not shelled or peeled 
Agriculturist 
Any registered person
2
Bidi wrapper leaves (tendu) 
Agriculturist 
Any registered person
3
Tobacco leaves 
Agriculturist 
Any registered person
4
Silk yarn 
Any person who manufactures silk yarn from raw silk or silk worm cocoons for supply of silk yarn
Any registered person
4A
Raw cotton 
Agriculturist 
Any registered person.
5
Supply of lottery 
State Government, Union Territory or any local authority 
Lottery distributor or selling agent
6
Used vehicles, seized and confiscated goods, old and used goods, waste and scrap 
Central Government, State Government, Union territ

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ight be available to CTP?
Ans. The “estimated net tax liability” only and not the gross tax liability, after considering the due eligible ITC which might be available to such taxable person needs to be paid as advance tax by a casual taxable person(CTP) while taking registration.
Q 16. Can any person other than the supplier or recipient be liable to pay tax under GST?
Ans. Yes, the 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 person liable to pay tax in relation to supply of such services. Notification No. 17/2017-Central Tax (rate) dated 28/06/2017 as amended by notification no.23/2017-Central Tax (rate) dated 22/08/2017 and Notification No. 14/2017-Integrated Tax (Rate) dated 28/06/2017 as amended by notification no. 23/2017-Integrated Tax (rate) dated 22/08/2017 have been is

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Overview of Goods and Services Tax (GST)
GST FAQ 3rd Edition – December, 2018 – GST Frequently Asked Questions (FAQs)
GST
CENTRAL BOARD OF INDIRECT TAXES & CUSTOMS NEW DELHI
FREQUENTLY ASKED QUESTIONS (FAQs)
ON
GOODS AND SERVICES TAX (GST)
3rd Edition: 15th December, 2018
(Note: Changes announced in GST Council meeting held on 22nd December, 2018 are being incorporated and the updated edition will be uploaded shortly)
1. Overview of Goods and Services Tax (GST)
Q 1. What is Goods and Services Tax (GST)?
Ans. It is a destination based tax on consumption of goods and services. It is proposed to be levied at all stages right from manufacture up to final consumption with credit of taxes paid at previous stages available as set-off. In a nutshell, only value addition will be taxed and burden of tax is to be borne by the final consumer.
Q 2. What exactly is the concept of destination based tax on consumption?
Ans. The tax would accrue to the taxing authority which has juri

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te Surcharges and Cesses so far as they relate to supply of goods and services
The GST Council shall make recommendations to the Union and States on the taxes, cesses and surcharges levied by the Centre, the States and the local bodies which may be subsumed in the GST.
Q 4. What principles were adopted for subsuming the above taxes under GST?
Ans. The various Central, State and Local levies were examined to identify their possibility of being subsumed under GST. While identifying, the following principles were kept in mind:
(i) Taxes or levies to be subsumed should be primarily in the nature of indirect taxes, either on the supply of goods or on the supply of services.
(ii) Taxes or levies to be subsumed should be part of the transaction chain which commences with import/ manufacture/ production of goods or provision of services at one end and the consumption of goods and services at the other.
(iii) The subsumation should result in free flow of tax credit in intra and inter-Stat

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isting taxation system (VAT & Central Excise) will continue in respect of the above commodities.
Q 7. What is the status of Tobacco and Tobacco products under the GST regime?
Ans. Tobacco and tobacco products is leviable to GST. In addition, the Centre has the power to levy Central Excise duty on these products.
Q 8. What type of GST is proposed to be implemented?
Ans. It would be a dual GST with the Centre and States simultaneously levying it on a common tax base. The GST to be levied by the Centre on intra-State supply of goods and / or services would be called the Central GST (CGST) and that to be levied by the States/ Union territory would be called the State GST (SGST)/ UTGST. Similarly, Integrated GST (IGST) will be levied and administered by Centre on every inter-state supply of goods and services.
Q 9. Why is Dual GST required?
Ans. India is a federal country where both the Centre and the States have been assigned the powers to levy and collect taxes through appropriate l

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Tax) but, the tax is collected and retained entirely by the States. As for services, it is the Centre alone that is empowered to levy service tax.
Introduction of the GST required amendments in the Constitution so as to simultaneously empower the Centre and the States to levy and collect this tax. The Constitution of India has been amended by the Constitution (one hundred and first amendment) Act, 2016 for this purpose. Article 246A of the Constitution empowers the Centre and the States to levy and collect the GST.
Q 12. How a particular transaction of goods and services would be taxed simultaneously under Central GST (CGST) and State GST (SGST)?
Ans. The Central GST and the State GST would be levied simultaneously on every transaction of supply of goods and services made by registered persons except the exempted goods and services, goods and services which are outside the purview of GST. Further, both would be levied on the same price or value unlike State VAT which is levied on th

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e would be allowed to use only the credit of CGST paid on his purchases while for SGST he can utilize the credit of SGST alone. In other words, CGST credit cannot, in general, be used for payment of SGST. Nor can SGST credit be used for payment of CGST.
Illustration II: Suppose, again hypothetically, that the rate of CGST is 10% and that of SGST is 10%. When an advertising company located in Mumbai supplies advertising services to a company manufacturing soap also located within the State of Maharashtra for, let us say ₹ 100, the ad company would charge CGST of ₹ 10 as well as SGST of ₹ 10 to the basic value of the service. He would be required to deposit the CGST component into a Central Government account while the SGST portion into the account of the concerned State Government Of course, he need not again actually pay ₹ 20 (Rs. 10+Rs. 10) in cash as it would be entitled to set-off this liability against the CGST or SGST paid on his purchase (say, of inputs s

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would instantly spur economic growth. There may also be revenue gain for the Centre and the States due to widening of the tax base, increase in trade volumes and improved tax compliance. Last but not the least, this tax, because of its transparent character, would be easier to administer.
Q 14. What is IGST?
Ans. Under the GST regime, an Integrated GST (IGST) would be levied and collected by the Centre on inter-State supply of goods and services. Under Article 269A of the Constitution, the GST on supplies in the course of inter- State trade or commerce shall be levied and collected by the Government of India and such tax shall be apportioned between the Union and the States in the manner as may be provided by Parliament by law on the recommendations of the Goods and Services Tax Council.
Q 15. Who will decide rates for levy of GST?
Ans. The CGST and SGST would be levied at rates to be jointly decided by the Centre and States. The rates would be notified on the recommendations of t

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ied period to raise additional resources during any natural calamity or disaster;
(viii) special provision with respect to the North- East States, J&K, Himachal Pradesh and Uttarakhand; and
(ix) any other matter relating to the GST, as the Council may decide.
Q 17. What is the guiding principle of GST Council?
Ans. The mechanism of GST Council would ensure harmonization on different aspects of GST between the Centre and the States as well as among States. It has been provided in the Constitution (one hundred and first amendment) Act, 2016 that the GST Council, in its discharge of various functions, shall be guided by the need for a harmonized structure of GST and for the development of a harmonized national market for goods and services.
Q 18. How are decisions be taken by GST Council?
Ans. The Constitution (one hundred and first amendment) Act, 2016 provides that every decision of the GST Council shall be taken at a meeting by a majority of not less than 3/4th of the weighted vo

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payable at the rates specified in the Schedules to the respective Acts.
Q 20. What are the benefits available to small tax payers under the GST regime?
Ans. Tax payers with an aggregate turnover in a financial year up to [Rs.20 lakhs & ₹ 10 Lakhs for NE and special category states] would be exempt from taking registration under GST. Further, a person whose aggregate turnover in the preceding financial year is less than ₹ 1 Crore (75 lakhs for 9 special category states viz 1. Arunachal Pradesh, 2. Assam, 3. Manipur, 4. Meghalaya, 5. Mizoram, 6. Nagaland, 7. Sikkim, 8. Tripura, and 9. Himachal Pradesh) can opt for a simplified composition scheme where tax will payable at a concessional rate on the turnover in a state.
[Aggregate turnover shall include the aggregate value of all taxable supplies, exempt supplies and exports of goods and/or services and exclude taxes viz. GST.] Aggregate turnover shall be computed on all India basis. For NE States and special category states

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cheme of Classification of Services” on 12th June 2018.
Q 22. What is the scope of composition scheme under GST?
Ans. Small taxpayers with an aggregate turnover in a preceding financial year up to Rs. One Crore (75 lakhs for special category States – except Jammu & Kashmir and Uttarakhand) are eligible for composition levy. This scheme is basically for suppliers of goods and restaurant service providers only. Under the scheme, a taxpayer shall pay tax as a percentage of his turnover in a state during the year without the benefit of ITC. The rate of tax for CGST and SGST/UTGST shall not exceed [1% for manufacturer as well as traders; 5% for specific services as mentioned in para 6(b) of Schedule II viz serving of food or any other article for human consumption i.e. restaurant service providers]. A tax payer opting for composition levy shall not collect any tax from his customers.
Tax payers making inter- state supplies (except persons making inter-state supplies of certain specified

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nd Service Tax Network (GSTN). A Special Purpose Vehicle called the GSTN has been set up to cater to the needs of GST. The GSTN shall provide a shared IT infrastructure and services to Central and State Governments, tax payers and other stakeholders for implementation of GST. The functions of the GSTN would, inter alia, include:
(i) facilitating registration;
(ii) forwarding the returns to Central and State authorities;
(iii) computation and settlement of IGST;
(iv) matching of tax payment details with banking network;
(v) providing various MIS reports to the Central and the State Governments based on the tax payer return information;
(vi) providing analysis of tax payers' profile; and
(vii) running the matching engine for matching, reversal and reclaim of input tax credit.
The GSTN is developing a common GST portal and applications for registration, payment, return and MIS/ reports. The GSTN would also be integrating the common GST portal with the existing tax administrat

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ose 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 suppliers and take a decision as to whether to deal with a particular supplier or not. This will create healthy competition amongst taxable persons.
Q 26. 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, betting and gambling as one of such transactions. Thus only lottery, betting and gambling shall be treated as supplies under the GST regime. All t

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ated to furnish an information return of the same in respect of such periods, within such time, in such form and manner and to such authority or agency as may be prescribed. Failure to do so may result in penalty being imposed as per Section 123.
Q 29. 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 from an expert at any state of scrutiny, inquiry, investigation or any other proceedings.
Q 30. 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 pre

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pursuance of the powers conferred by this section, the government  has  constituted  the  National  Anti-Profiteering Authority (NAA). NAA is required to examine whether input tax credits availed by any registered person or the reduction in the tax rate have actually resulted in a commensurate reduction in the price of the goods or services or both supplied by him.
NAA has power to investigate cases against the registered person who has not passed on the benefits by way of commensurate reduction in prices and order reduction in prices, cancel registration, impose penalty and/or return to the recipient, an amount equivalent to the amount not passed on by way of commensurate reduction in prices along with interest.
Q 32. What tax will be levied on goods manufactured but not cleared from factory before 01.07.2017?
Ans. Goods manufactured, but not cleared from factory before 01.07.2017 have been exempted from Central Excise duty vide Tariff Notification No. 12/2

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Frequently Asked Questions on TCS under GST (Updated as on 30.11.2018)
General FAQ on GST – GST Frequently Asked Questions (FAQs)
GST
1. What is Electronic Commerce?
Ans.    As per Section 2(44) of the CGST Act, 2017, electronic Commerce means the supply of goods or services or both, including digital products over digital or electronic network.
2. Who is an e-commerce operator?
Ans.    As per Section 2(45) of the CGST Act, 2017, electronic Commerce operator means any person who owns, operates or manages digital or electronic facility or platform for electronic commerce.
3. What is Tax Collection at Source (TCS)?
Ans.    As per Section 52 of the CGST Act, 2017 the e-commerce operator, not being an agent, is required to collect an amount calculated at the rate not exceeding one per cent., as notified by the Government on the recommendations of the Council, of the net value of taxable supplies made through it, where the consideration

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upplying goods through an e-commerce operator shall be mandatorily required to register irrespective of the value of supply made by him. However, a person supplying services, other than supplier of services under section 9 (5) of the CGST Act, 2017, through an e-commerce platform are exempted from obtaining compulsory registration provided their aggregate turnover does not exceed INR 20 lakhs (or INR 10 lakhs in case of specified special category States) in a financial year. Government has issued the notification No. 65/2017 – Central Tax dated 15th November, 2017 in this regard.
7. Whether TCS is required to be collected by e-commerce operators on supply of services by unregistered suppliers through their portal?
Ans. As per Section 24(ix) of the CGST Act, 2017, every person supplying goods or services through an ecommerce operator is mandatorily required to register. However, vide Notification 65/2017-Central Tax dated 15th November, 2017 a person supplying services, other than sup

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its place of business for obtaining registration in that State / UT where it does not have physical presence. It may be noted that each State/UT has indicated one administrative jurisdiction where all e-commerce operators having business (but not having physical presence) in that State/UT shall register. The proper officer for the purpose of registration of ECOs has also been notified by each State/UT.
9. Foreign e-commerce operator do not have place of business in India since they operate from outside. But their supplier and customers are located in India. So, in this scenario will the TCS provision be applicable to such e-commerce operator and if yes, how will foreign e-commerce operator obtain registration?
Ans. Where registered supplier is supplying goods or services through a foreign e-commerce operator to a customer in India, such foreign e-commerce operator would be liable to collect TCS on such supply and would be required to obtain registration in each State / UT. It may be

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the e-commerce operator, made during any month by a registered supplier through such operator reduced by the aggregate value of taxable supplies returned to such supplier during the said month.
12. Whether value of net taxable supplies to be calculated at gross level or at GSTIN level?
Ans. The value of net taxable supplies is calculated at GSTIN level.
13. Is every e-commerce operator required to collect tax on behalf of actual supplier?
Ans. Yes, every e-commerce operator is required to collect tax where the supplier is supplying goods or services through e-commerce operator and consideration with respect to the supply is to be collected by the said e-commerce operator.
14. At what time should the e-commerce operator collect TCS?
Ans. TCS is to be collected once supply has been made through the e-commerce operator and where the business model is that the consideration is to be collected by the e-commerce operator irrespective of the actual collection of the consideration. For e

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ollected on import of goods or services or both?
Ans. TCS is not liable to be collected on any supplies on which the recipient is required to pay tax on reverse charge basis. As far as import of goods is concerned since same would fall within the domain of Customs Act, 1962, it would be outside the purview of TCS. Thus, TCS is not liable to be collected on import of goods or services.
19. Is there any exemption on Gold, owing to the fact that rate of GST is only 3% and TCS on it would erode the margin for the seller?
Ans. No such exemption from TCS has been granted.
20. Whether payment of TCS through Input Tax Credit of operator for depositing TCS as per Section 52 (3) of the CGST Act, 2017 is allowed?
Ans. No, payment of TCS is not allowed through Input Tax Credit of e-Commerce operator.
21. It is very common that customers of e-commerce companies return goods. How these sales returns are going to be adjusted?
Ans. An e-commerce company is required to collect tax only on the ne

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within which such TCS is to be remitted by the e-commerce operator to the Government account?
Ans. The amount collected by the operator is to be paid to appropriate government within 10 days after the end of the month in which the said amount was so collected.
24. How can actual suppliers claim credit of TCS?
Ans. The amount of TCS deposited by the operator with the appropriate Government will be reflected in the electronic cash ledger of the actual registered supplier (on whose account such collection has been made) on the basis of the statement filed by the operator in FORM GSTR-8 in terms of Rule 67 of the CGST Rules, 2017. The said credit can be used at the time of discharge of tax liability by the actual supplier.
25. How is TCS to be credited in cash ledger? Whether the refund of such TCS credit lying in the ledger would be allowed at par with the refund provisions contained in section 54(1) of the CGST Act, 2017?
Ans. TCS collected is to be deposited by the e-commerce oper

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e end of such month in FORM GSTR-8. The operator is also required to file an annual statement by 31st day of December following the end of the financial year in which the tax was collected in FORM GSTR-9B.
27. Whether interest would be applicable on non-collection of TCS?
Ans. As per section 52(6) of the CGST Act, 2017, interest is applicable on omission as well in case of incorrect particulars noticed. In such a case, interest is applicable since it is a case of omission. Further penalty under section 122(vi) of the CGST Act, 2017 would also be leviable.
28. What will be the place of supply for e-commerce operator for recharge of talk time of the Telecom Operator / recharge of DTH / in relation to convenience fee charged from the customers on booking of air tickets, rail supplied through its online platform?
Ans. As per section 12(11) of the IGST Act, 2017, the address on record of the customer with the supplier of services is the place of supply.
29. Under multiple e-commerce mo

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FAQ on HSN Code and GST rates dated 25-07-2017
General FAQ on GST – GST Frequently Asked Questions (FAQs)
GST
Q. 1. What is the HSN code for Mahua Flower and its GST rate?
Ans. Mohua flowers fall under heading 1212 and attract 5% GST.
Q. 2.  What is the HSN code for Sal Leaves which is used for making plates and its GST rate?
Ans.  Sal leaves are classifiable under heading 0604 and attract Nil GST.
Q. 3.  What is the HSN code for Sabai Grass (a kind of grass used for making of rope, baskets, etc.) and its GST rate?
Ans.  Sabai grass is used as plaiting material and is classifiable under heading 1401 and attracts 5% GST.
Q. 4.  What is the GST rate on Hand Made Branded Biri?
Ans.
* All biris attract 28% GST.
* In addition, handmade biris attract NCCD of Re. 1 per thousand. Machine made biris attract NCCD of ₹ 2 per thousand.
Q. 5.  What is the GST rate on sugarcane procured by the sugar mills which is generally fresh and procured

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yarn and jute twine?
What is GST rate on jute bags and jute cloth?
Ans.
* As per the HSN Explanatory Notes, goods of jute fibres measuring 20,000 decitex or less are classifiable under heading 5307 as yam and attract 5% GST.
* Goods of jute fibres measuring more than 20,000 decitex are classifiable under heading 5607 as twine and attract 12% GST.
* Sacks and bags, of a kind used for the packing of goods are classifiable under heading 6305 and attract 5%/12% GST, depending on their sale value not exceeding or exceeding ₹ 1000 per piece.
* Woven fabrics of jute are classifiable under heading 5310 and attract 5% GST, with no refund of unutilised ITC.
 Q. 10.  What is the GST rate on used Rail Wagons?
Ans.
* Railway wagons are classifiable under heading 8606 and attract 5% GST, with no refund of unutilised ITC.
* Therefore, used railway wagons also attract 5% GST.
Q. 11.  What is the GST rate and HSN code of Raw and processed wood of Malaysia saal an

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.
Q. 15.  What is the HSN code and GST rate for Chilli soaked in butter milk with salt (mor milagai in Tamil)?
Ans.
* Vegetables provisionally preserved (for example, by sulphur dioxide gas, in brine, in sulphur water or in other preservative solutions), but unsuitable in that state for immediate consumption are classifiable under heading 0711 and attract 5% GST.
* Thus, chilli soaked in butter milk with salt (mor milagai in Tamil) falls under 0711 and attracts 5% GST.
Q. 16.  What is GST rate for bangles?
Ans.
* Plastic bangles falling under heading 3926 are exempt from GST.
* Glass bangles (except those made from precious metals) falling under heading 7018 are exempt from GST.
* Bangles of base metal, whether or not plated with precious metals, falls under tariff item 7117 19 10 and attract 3% GST.
Q. 17.  What is the classification and GST rate for man-made fishnet twine?
Ans.
* As per the HSN Explanatory Notes, goods of man-made fibres (including th

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GST — FAQ on HSN Code and GST rates dated 03-08-2017
General FAQ on GST – GST Frequently Asked Questions (FAQs)
GST
Q. 1.  What is the HSN code and GST rate for lac or shellac bangles?
Ans. Lac or shellac bangles are classifiable under heading 7117 and attract 3% GST.
Q. 2.  What is the HSN code and GST rate for kulfi?
Ans. Kulfi is classifiable under heading 2105 and attracts 18% GST.
Q. 3.  What is the HSN code for Solar Panel Mounting Structure and its GST rate?
Ans.
* Structures of iron or steel fall under heading 7308 and structures of aluminium fall under heading 7610 and attract 18% GST.
* Solar Panel Mounting Structure, depending on the metal they are made of, will fall under heading 7308 or 7610 and attract 18% GST.
Q. 4.  What is the HSN code for Idli Dosa Batter (Wet Flour) and its GST rate?
Ans.  Idli Dosa Batter (Wet Flour) [as food mixes] falls under heading 2106 and attracts 18% GST.
Q. 5.  What is the HSN code for Mai

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s, in form of bars, cakes, moulded pieces or shapes falling under heading 3401 [except 3401 30] attract 18% GST.
* Other organic surface active products and preparations falling under sub-heading 3401 30 and organic surface active agents and preparations falling under heading 3402 attract 28% GST.
Q. 9.  What is the GST rate on Rakhi?
Ans.
* Puja samagri, including kalava (raksha sutra) attracts Nil GST.
* Rakhi, which is in form of kalava [raksha sutra] will thus attract Nil GST.
* Any other rakhi would be classified as per its constituent materials and attract GST accordingly.
 Q. 10.  What is the GST rate on Nail Polish?
Ans.  Nail Polish [whether in large quantities say 50 to 100 litres or in retail packs] falls under heading 3304 and attracts 28% GST.
Q. 11.  What is the GST rate and HSN code of Wet Dates?
Ans.  Wet dates fall under heading 0804 and attract 12% GST.
Q. 12.  What is the HSN code and GST rate for Pet Food?
Ans. &nbs

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. 17.  What is the HSN code and GST rates for Cotton Seed oil cake?
Ans.
* Cotton seed oil cakes for use as aquatic feed including Shrimp feed and prawn feed, poultry feed & cattle feed attract Nil GST.
* Cotton seed oil cakes for other uses attract 5% GST.
Q. 18.  What is the GST rate for Portable and Mobile Toilets?
 Ans. Prefabricated buildings, including portable and mobile toilets, fall under heading 9406 and attract 18% GST.
Q. 19.  What is the GST Compensation Cess rate on imported Coal?
Ans.  Imported coal will attract GST compensation cess @ ₹ 400 per tonne.
Q. 20.  What is the HSN code and GST rates for Battery for mobile handsets?
Ans.  Battery for mobile handsets falls under heading 8506 and attracts 28% GST.
Q. 21.  What is the HSN code and GST rate for tamarind?
Ans.
* Tamarind [fresh] falls under 0810 and attract Nil GST.
* Tamarind [dry] falls under 0813 and attract 12% GST.
Q. 22.  What is the HSN cod

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12% GST.
* Folding cartons, boxes and cases, of non-corrugated paper and paperboard, falling under heading 4819 attract 18% GST under the residual entry S. No. 453.
Q. 28.  Tobacco leaves falling under heading 2401 attracts 5% GST on reverse charge basis in respect of supply by an agriculturist. What is the meaning of tobacco leaves?
Ans.  For GST rate of 5%, tobacco leaves means leaves of tobacco as such or broken tobacco leaves or tobacco leaves stems.
Q. 29.  What is the HSN code and the GST rate for Isabgol seeds?
Ans.
* Isabgol seeds fall under heading 1211.
* Fresh isabgol seeds attract Nil GST.
* Dried or frozen Isabgol seeds attract 5% GST.
Q. 30.  What is the HSN code and the GST rate for Isabgol husk?
 Ans. Isabgol husk falls under 1211 and attracts 5% GST.
Q. 31.  What is HSN code and GST rate of copra and dried coconut?
Ans.  
* Coconuts, fresh or dried, whether or not shelled or peeled fall under heading 0801 and attract

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GST — FAQ relating to DMRC, CPWD and DDA dated 07-08-2017
General FAQ on GST – GST Frequently Asked Questions (FAQs)
GST
The undersigned is directed to refer to OM dated 14-7-2017 addressed to the Shri Upender Gupta, Commissioner (GST) on the above mentioned subject. The replies/comments with respect to the queries raised in the said OM are as under :
A. DMRC
(1) DMRC receiving Bills for the period up to 30-6-2017 on or after 1-7-2017. In many of the cases Liability of RCM is upon DMRC as recipient of services. As per previous law of Service Tax RCM liability of service tax arises at the time of payment of Consideration. In view of the above you are requested to please clarify following :
(a)        Up to what date we can Deposit RCM under the old regime for the services provided before 30-6-2017?
(b)       Where to report the RCM deposited in point (a) above? Presently RCM deposited in respective

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;      Manual records were maintained for whole financial year for Common Credit amount.
(c)        At the year-end amount of Eligible CENVAT calculated multiplying with Ratio, as calculated in point a) above.
Note : – All above calculations are done at year end only currently, hence the said amount of CENVAT were shown through revised return of half year ended Mar.' 17.
In view of the above you are requested to please provide the opinion how the credit will be taken in the current GST regime.
Reply : Provisions for taking input tax credit have been provided in section 17 of the CGST Act, 2017 and in rules 42 and 43 of the CGST Rules, 2017 which may be referred to by DMRC.
(3) Presently we were deducting 4% TDS under DVAT/UPVAT and 5% under HVAT from the bills of works contract. Bills up to 30-6-2017 are under process and will be paid after June, 17. Few bills will also be received after 30-6-2017. In view of th

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Reply : Section 25 of CGST Act, 2017 provides that a person supplying goods or services to get registered in every State from where it is supplying, given that it crosses the threshold exemption limit. If taxable services are being provided, DMRC should get registered. They should refer to the definition of 'location of supplier of services' as contained in section 2(71) of CGST Act, 2017 to ascertain liability of registration in a particular State.
(6) In PB, we provide LOA (Letter of acceptance) to party and charge advance Service tax from licensee. It is a manual exercise. Please suggest as to can we treat LOA as billing in GST? If yes than, what will be the format of invoicing in case of GST for LOA payment?
Reply : In GST also, liability arises on advance receipts. Please see Rule 46 and 50 of CGST Rules, 2017 for information to be contained in Tax Invoice and Receipt voucher respectively.
(7) What will be the treatment of Cenvat credit which remains unutil

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under GST considering these services are not covered under RCM in GST regime, then is there any tax implication on DMRC as Govt. has not received tax on these services Not by DMRC nor by Contractor?
Scenario (2) – IF DMRC is required to paid RCM on these services as mentioned above then the process may please be explained such as follows :
(a)        Rate at which RCM is to be paid,
(b)       Whether it is to be paid under old regime of Service Tax or under New Regime of GST,
(c)        IF paid where it is to be shown, in which month Return,
(d)       Any other Tax Compliance and its Implication on DMRC, if any.
Note – Many Services which were earlier covered under RCM has not covered under RCM under GST e.g. hiring of Manpower Services, works contract services etc.
Reply : It may so happen that a particular service was under reverse charge unde

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lment.
Para 9 and 2.3 : The funds for execution of project will be released separately in advance for the immediate next 3 months on the basis of the requirement furnished by PD/N-GN/DMRC for the ensuing year in advance. However, if there is any saving in the project, for what so reason, such saving would be fully advantage of NMRC.
Since the agreement was signed before 1st March, 2016, the fee was not subject to Service Tax.
Queries :
The fee is being paid to DMRC @ 6% of Rs. 5135 crores, i.e., Rs. 308 crores and till 30th June, 2017, DMRC has already received Rs. 225 crores. The quarterly advance fee for April-June, 2017, amounting to Rs. 20.91 crores was invoiced to NMRC on 30th June, but the payment is received by this office on 6-7-2017.
Clarification is sought on whether the Apr.-June, 2017 quarter fees received after the appointed date is subject to GST? If yes, kindly suggest the action to be taken by this office in this regard.
Reply : If the bills were issued

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tion of the project and (iii) invoicing of the balance fees of Rs. 63 crores. Presently, only Proforma Invoice is being raised for fees and cash flow statement is submitted to show the utilization of funds on quarterly basis to the Client. This office has obtained exemption orders from the Commercial Taxes, UP of UPVAT on the turnover of DMRC, which purely comprises of only engineering consultancy.
Reply : Invoicing is an internal matter. However, it has to be ensured that tax invoices are issued in terms of the provisions of service tax and GST. GST is payable in terms of Section 13 of CGST Act, 2017.
(12) The scope of system contract awarded by DMRC includes, 'Design, Manufacturing, Supply, Installation, Testing & Commissioning of Escalators for Noida – Greater Noida MRTS Project”. The contract was awarded to a Consortium of Schindler (China) Elevator Company Limited and Schindler India Private Limited, with the Indian member as the lead partner. The contract price is inc

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IEC. The Indian partner is clearing the materials from the port by discharging the duties, taxes and other charges and then transporting the same to the site and performing installation, commissioning and maintenance job.
Query : Kindly clarify the rate of GST applicable for the above type Contracts. Also, please clarify since the materials are imported separately in the name of DMRC, whether it will be construed as a supply contract and custom duty plus IGST is leviable at 28% slab rate? Further, since the duties and taxes are paid by the Consortium member on the import consignment in the name of DMRC, will the credit of IGST be reflected in DMRC's GSTN account? If yes, how the billing will be done by the Consortium to DMRC.
Reply : From this description, tax rate cannot be suggested. Depending upon the nature of contract, it can be decided if it is taxable as a composite supply or separate supplies. If DMRC is the importer, credit of IGST on imports can be taken given oth

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and DVAT is applicable: Bills (such as advocates and works contract service, for which the vender has raised bills up to 30 June, 2017). Under reverse charge, liability arises at the time of payment only. In such case, what treatment needed in respect of : 1. For Service tax-RCM : whether it will be applicable. 2. For RCM-GST : Whether RCM under GST will be applicable if other conditions satisfy such as advocate services, services/goods from unregistered dealers.
Reply : As payment are made after 30th June, 2017, it would be covered under GST provisions.
(15) DMRC is availing services of doctors in metro Bhawan and other staff quarters. For, which DMRC is paying fixed monthly amount as honorarium. Whether : 1. it will be covered under list of exempted services (point no. 82(i), Health care services by an authorized medical practitioner. 2. If No, GST is applicable for these payment under reverse charge?
Reply : It is exempt. Please see S. No. 74 of Table to Notificati

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hould be paid by 10th of the month succeeding in which deduction was made. DDO should also issue the certificate within five days from the date of deposit into government exchequer. However, the provision of tax deducted at source (section 51 of CGST Act, 2017) has not been made effective as of now.
(2) CPWD DDOs are not registered as it is to open from 25th July and DDOs are thinking that after any deduction of GST how to deposit the same and issue the deduction certificate to contractor.
Reply : The deducted amount should be deposited in the challan prescribed for the purpose (FORM GST PMT-06). A certificate, called FORM GSTR-7A, has also been prescribed for the purpose. However, the provision of tax deducted at source (section 51 of CGST Act, 2017) has not been made effective as of now.
(3) There are confusion that if a division (i.e. DDO is operating from one place and working in more than one state then how many registration DDO need.
Reply : DDO should get

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r than TDS for income tax is not clear.
Reply : As the section relating to tax deduction at source (section 51 of CGST Act, 2017) has not been notified, no deduction should be made as of now under GST regime. Once the section is notified, DDOs should start deducting tax at source.
C. DDA
(1) DDA shall be responsible for deduction of TDS under GST on payments to be made to contractors and shall also collection of GST on certain activities. All the DDOs of DDA have separate TAN number and were individually reeistered under VAT and Service Tax regime. Point for clarification is that since DDA has one vertical business and is only in Delhi, has taken single registration number under PAN. This single GST registration shall suffice or all DDOs will have to get registered separately? Once separate registration is taken by DDOs, will they not be separate identity and cannot trade freely among themselves.
Reply : Registration under GST is state-wise. So, all the DDOs loc

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GST — FAQ on Drugs & Pharmaceuticals dated 31-07-2017
General FAQ on GST – GST Frequently Asked Questions (FAQs)
GST
Question 1 : Whether formulations cleared have to be assessed to GST under transfer price mechanism or on the basis of MRP printed on them?
Answer : The assessment of drugs and formulations under GST would be on the basis of transaction value at each level of supply with end to end ITC chain for neutralizing the GST paid at the procurement level.
Question 2 : What are the requirements for clearance of physician samples distributed free of cost?
Answer : In case of clearance of physician samples distributed free of cost, the ITC availed on the said samples has to be reversed in view of the provisions under Section 17(5)(h) of the CGST Act, 2017. No tax is payable on clearance of physician samples distributed free of cost as the value of supply is zero and no credit has been availed.
Question 3 : What is the procedure for movement of

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n section 143 of the CGST Act, 2017 i.e. the principal can send any inputs etc. to such units without payment of tax and the principal can clear the goods from the premises of such units if the principal declares these units as his additional place of business or where such units are themselves registered under section 25 of CGST Act, 2017.
Question 5 : What is the treatment of clearances effected to Special Economic Zones?
Answer : The clearances effected to the SEZ are zero rated supplies in terms of Section 16 of the IGST Act, 2017. Accordingly, the supplier can claim refund of IGST paid on such supplies or clear the same under bond/letter of undertaking and claim refund of the unutilised ITC.
Question 6 : Whether SEZ unit located in a State requires a separate registration under GST?
Answer : The SEZ unit located in a State is treated as a business vertical distinct from other units located in the State outside the SEZ [first proviso to Rule 8 of the CGST Ru

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te of sixty per cent on such goods which attract central tax at the rate of nine per cent or more and forty per cent for the other goods of the central tax applicable on supply of such goods after 1st July, 2017 and the said amount shall be credited in the electronic credit ledger after the central tax payable on such supply has been paid. In case where integrated tax is paid, the amount of ITC would be at the rate of thirty per cent and twenty per cent respectively of integrated tax. This facility is available for a maximum period of 6 months from the appointed day (i.e. upto 31st December, 2017) or till the goods are sold out, whichever is earlier.
Question 9 : Whether a manufacturer can avail deemed credit in respect of transitional stocks on the appointed day in respect of the stocks for which duty paying document is not available?
Answer : In terms of the proviso to Section 140(3) of the CGST Act, 2017, the manufacturer is not eligible to avail deemed credit in respect

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n 11 : What is the obligation cast on the Registered Person in case of purchases from Unregistered Person?
Answer : In terms of Section 9(4) of the CGST Act, 2017 read with Section 31(3) ibid, the Registered Person procuring the taxable supplies from an Unregistered Supplier has to raise invoice and pay GST on reverse charge basis in respect of such supplies.
Question 12 : What is the treatment of supplies made from erstwhile tax free zones?
Answer : Since GST is a destination-based consumption tax with seamless transfer of ITC credit, no exemptions are accorded to supplies made by erstwhile tax free zones. Accordingly, the goods cleared from erstwhile tax free zones would be subjected to GST from the appointed day (1st July, 2017).
Question 13 : What is the effect of non-payment of consideration in respect of taxable supplies received by the recipient?
Answer : If the recipient fails to pay to the supplier the amount towards the value of supply along

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be issued by the Registered Person for supply of goods from one premises to another premises under the same registration number?
Answer : In terms of Rule 55(1)(c) of the CGST Rules, 2017 such movements have to be effected under the cover of a delivery challan along with any other document that may be prescribed in lieu of the e-way bill.
Question 16 : Whether discounts can be claimed as an abatement from the price for assessing GST?
Answer : In terms of Section 15(3) of the CGST Act, 2017, the value of supply for charging GST shall not include any discount which is given before or at the time of the supply if such discount has been duly recorded in the invoice issued in respect of such supply. The value of supply shall also not include any discount which is given after the supply has been effected, if such discount is established in terms of an agreement entered into at or before the time of such supply and specifically linked to relevant invoices and ITC attributab

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GST — FAQ on E-Commerce dated 31-07-2017 dated 31-07-2017
General FAQ on GST – GST Frequently Asked Questions (FAQs)
GST
Question 1 : What is Electronic Commerce?
Answer : Electronic Commerce has been defined in Sec. 2(44) of the CGST Act, 2017 to mean the supply of goods or services or both, including digital products over digital or electronic network.
Question 2 : Who is an e-commerce operator?
Answer : Electronic Commerce Operator has been defined in Sec. 2(45) of the CGST Act, 2017 to mean any person who owns, operates or manages digital or electronic facility or platform for electronic commerce.
Question 3 : Is it mandatory for e-commerce operator to obtain registration?
Answer : Yes. As per Section 24(x) of the CGST Act, 2017 the benefit of threshold exemption is not available to e-commerce operators and they are liable to be registered irrespective of the value of supply made by them.
Question 4 : Whether a person supplying go

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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 supplier liable to pay tax in relation to the supply of such services. A similar provision for inter-State supply is provided for in Sec. 5(5) of the IGST Act, 2017. [Refer to Notification No. 17/2017-Central Tax (Rate) and 14/2017-Integrated Tax (Rate) dated 28-6-2017].
Question 6 : Will threshold exemption be available to electronic commerce operators liable to pay tax on notified services?
Answer : No. Threshold exemption is not available to e-commerce operators who are required to pay tax on notified services supplied through them.
Question 7 : What is Tax Collection at Source (TCS)?
Answer : The e-commerce operator is required to collect an amount at the rate of one per cent (0.5% CGST + 0.5% SGST) of the net value of taxable supplies made through it, where the consideration

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eturned to the suppliers during the said month. [Refer to Explanation to Section 52(1) of the CGST Act, 2017].
Question 10 : Is every e-commerce operator required to collect tax on behalf of actual supplier?
Answer : Yes, every e-commerce operator [other than an operator required to pay tax under Section 9(5) of the CGST Act, 2017] is required to collect tax where consideration with respect to a taxable supply is collected by such e-commerce operator. [Refer to Section 52(1) of the CGST Act, 2017].
Question 11 : What time should the e-commerce operator make such collection?
Answer : The e-commerce operator should make the collection during the month in which the consideration amount is collected from the recipient.
Question 12 : What is the time within which such TCS is to be remitted by the e-commerce operator to Government?
Answer : The amount collected by the operator is to be paid to the government within 10 days after the end of the month in whi

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thin ten days after the end of such month. The statement will be filed in FORM GSTR-8. The operator is also required to file an annual statement by 31st day of December following the end of the financial year in which the tax was collected. [Refer to Section 52(4) and Section 52(5) of the CGST Act, 2017].
Question 15 : What is the concept of matching in e-commerce provisions and how it is going to work?
Answer : The details of supplies furnished by every operator in his statement for the month will be matched with the corresponding details of outward supplies furnished by the concerned supplier in his valid return for the same month or any preceding month. Where the details of outward supplies declared by the operator in his statement do not match with the corresponding details declared by the supplier, the discrepancy shall be communicated to both persons. [Refer to Section 52(8) and Section 52(9) of the CGST Act, 2017].
Question 16 : What will happen if the details

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nish such details within a period of 15 working days from the date of service of such notice. [Refer to Section 52(12), (13) and (14) of the CGST Act, 2017].
Question 18 : The sellers supplying goods through e-Commerce operators (ECO) may have common places of business, especially if their goods are stored in a shared facility operated by the ECO. This will result in the same additional place of business being registered by multiple suppliers. Is this allowed?
Answer : Yes, this is allowed. Any registered person can declare a premises as a place of business if he has requisite documents for use of the premises as his place of business (like ownership document, agreement with the owner etc.) and there is no restriction about use of a premises by multiple persons. The registered person shall have to comply with the requirements of maintaining records as per Section 35 of the CGST Act, 2017 and Rules 56 to 58 of the CGST Rules, 2017.
Question 19 : Do travel agents provid

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ted on the entire value of the transaction?
Answer : Section 52(1) of the CGST Act, 2017 mandates that TCS is to be collected on the net taxable value of such supplies in respect of which the ECO collects the consideration. The amount collected should be duly reported in GSTR-8 and remitted to the Government. Any such amount collected will be available to the concerned supplier as credit in his electronic cash ledger.
Question 22 : GST requires a dealer to maintain a consecutive serial number for invoices. If we are supplying from multiple locations, do we need to centrally maintain the invoice numbers serially?
Answer : Section 46 of the CGST Rules, 2017 provides that invoice may have “a consecutive serial number not exceeding sixteen characters, in one or multiple series, containing alphabets or numerals or special characters hyphen or dash and slash symbolised as “-” and “/” respectively, and any combination thereof, unique for a financial year”. Therefore, a suppl

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ver, according to Section 52 of the Act ibid, TCS is required to be collected on the net value of taxable supplies made through it by other suppliers where the consideration is to be collected by the ECO. In cases where someone is selling their own products through a website, there is no requirement to collect tax at source as per the provisions of this Section. These transactions will be liable to GST at the prevailing rates.
Question 25 : We purchase goods from different vendors and are selling them on our website under our own billing. Is TCS required to be collected on such supplies?
Answer : No. According to Section 52 of the CGST Act, 2017, TCS is required to be collected on the net value of taxable supplies made through it by other suppliers where the consideration is to be collected by the ECO. In this case, there are two transactions – where you purchase the goods from the vendors, and where you sell it through your website. For the first transaction, GST is leviab

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E-way Bill — FAQ-III dated 01-10-2018
General FAQ on GST – GST Frequently Asked Questions (FAQs)
GST
Q. What should I do if I don't have 'Transporter Id' but want to enter and generate 'Part-A slip'?
Ans.  This is not possible as per rule 138(3). If the taxpayer is not having the details of 'Transporter Id' but he still wants to enter and generate the 'Part-A Slip', then he has to compulsorily enter the 'Transporter Id' to generate the 'Part-A Slip' to enable the transporter to enter Part-B.
Q. What should I do if I want to generate 'PART-A Slip' and want to transport the goods myself later?
Ans.  If the user wants to generate the 'Part-A slip' and wants to transport the goods himself later, then he has to enter his GSTIN as the 'Transporter Id' and generate 'Part-A slip'. Once he gets the conveyance details he can update the Part-B by using 'Update Part-B/Vehicle' sub-option provided under E-Way Bill menu and start the movement of goods.
Q. When to extend the

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om the dropdown list and proceed further to next stage.
Q. What happens if the total invoice value does not match with the sum of assessable value, tax value and other values?
Ans.  Ideally, the total invoice value should match with the sum of assessable value, tax value and other values. The system matches it even if there is a variation of ₹ 2.00 as this variation is allowed to take care rounding of decimal values.
If the total invoice value is greater than sum of total of taxable value, applicable taxes and charges, the system will alert the user through pop-up message and user can still proceed further for generating the e-Way Bill. But if the total invoice value is less than the sum total of taxable value, applicable taxes and charges, system will not allow the user to proceed further without correcting the invoice value.
Q. Why message is sent if total invoice value is more than ₹ 10 Crores?
Ans.  It has been observed in the e-way bill system that some

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common portal and I want to login in the e-Way Bill portal?
Ans.  If the taxpayer's GSTIN is cancelled in the e-Way Bill system but is active in the GST common portal and the taxpayer wants to login and generate the e-Way Bill, he has to first go to the Taxpayer search option in the Home page of e-Way Bill portal. He has to then enter his GSTIN and system will show his corresponding GSTIN details existing in GST Common Portal. If the status of GSTIN is active, taxpayer can login and generate the e-Way Bill.
Q. I have amended by GST registration details in GST Common Portal, but it is not being shown on the e-way bill system. What should I do?
Ans.  In such case the taxpayer has to login and use the “My GSTIN from CP” sub-option provided under “Update” option in the main menu.
Q. When should I use Multi-Vehicle option?
Ans.  When the taxpayer or transporter wants to move the consignment of one e-Way Bill in multiple vehicles, after moving to transshipment place, he c

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FAQs on export and FTP related issues of GST dated 07-07-2017
General FAQ on GST – GST Frequently Asked Questions (FAQs)
GST
The e-mails and tweets received by DGFT were scrutinized and developed into a short FAQ. It should be noted that the tweets received or the replies quoted are only for educational and guidance purposes and do not hold any legal validity.
Q 1. Has DGFT/Department of revenue issued any clarification to explain implication of GST on FTP schemes/exports/imports?
Reply. I-DGFT has issued Trade Notice No. 11 on June 30, 2017.
Please see the following link :
http://dgft.gov.in/Exim/2000/TN/TN17/Trade%20Notice%20No.11%20dt.30.06.2017.pdf
II-DOR has issued a guidance note on imports-exports. Please see the following link :
http://www.cbec.gov.in/resources//htdocs-cbec/guidnce-note-imprtrs-exprtrs.pdf;jsessionid=64B4B7C8DC1C02885DFAB663533AAA5E
Q 2. What is the definition of exports under the GST?
Reply. Exports of goods means taking go

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b)  He may export on payment of IGST and claim refund of IGST paid on goods and services exported.
The SEZ developer or SEZ unit receiving zero rated supply can claim refund of IGST paid by the firm making supply to SEZ.
Q 6. What is the time line for obtaining refund on the GST paid?
Reply. Refund on account of export
I.  For 90% of the total amount claimed as refund excluding the amount of input tax credit, provisional refund will be granted within 10 days of making of application or within 7 days of issuance of acknowledgement of the application.
II.  Refund of the balance 10% will be granted after verification of documents furnished by the applicant.
Q 7. What type of duties can be paid using MEIS or SEIS scrips now? Can we use these scrips to pay GST?
Reply. For items covered under the GST, scrips can be used for payment of Basic Custom Duty, Safeguard Duty, Transitional Product Specific Safeguard Duty and Antidumping Duty.
For items not

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oods or services).
Q 10. Will the exemptions, available to 100% EOUs & SEZs in the pre GST regime would continue?
Reply. SEZs
No change in the operation of the SEZ scheme.
SEZs can continue to import raw materials without payment of any duty. Supplies to SEZs would also be treated as Zero rated supplies.
EOUs
(i)  Imports by EOUs
  The EOUs will continue to get exemption from payment of the basic Customs Duty, however they will have to pay IGST on imports.
*         On the IGST paid on import of inputs, ITC would be available which can be utilized for payment of GST payable on the goods cleared in the DTA. Refund of the unutilized ITC can also be claimed under Section 54(3) of CGST Act.
*         The facility of duty free import of capital goods under the Procurement Certificate procedure will not be available. To import capital goods at zero duty, EOUs will have to follow proce

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bsp;   Refund of any benefits taken on procurement of inputs from DTA under Chapter 7 of FTP and used in the manufacture of products under DTA sale.
(iv)  Inter Unit Transfers
  Supply of goods from one EOU to another EOU (inter-unit transfer) will require payment of applicable GST. The BCD exemption availed on inputs by the supplier EOU, utilized in such transferred goods would have to be reversed by the recipient EOU at the time clearance of such goods in DTA. Same provisions apply on sending of Goods for Job work.
(v)  Exempt products
  For GST exempt Goods like Petroleum products, the existing provisions provided under notification no. 52/2003-Cus., notification no. 22/2003-C.E. and Notification no. 23/2003-C.E. will continue to apply for import, domestic procurement and domestic clearance respectively.
Q 11. How to update GST number in IEC?
Reply. There is no need to update or incorporate the GSTIN in the IEC. However, it is informed t

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rts and take Input Tax Credit (ITC) on the duty paid. He cannot claim refund of any unutilized input tax credit after the exports.
Q 13. Will Invalidation and ARO be available under Advance Authorisation or EPCG scheme post GST implementation?
Reply. ARO
For items covered under the GST, No Advance Release Order (ARO) facility will be available in Advance Authorisation and EPCG scheme.
For items not covered under the GST (Listed in the Schedule 4 of Central Excise Act, 1944 read with The Taxation Laws (Amendment) Act, 2017 No. 18 of 2017, with effect from July 1, 2017) ARO would be available.
Invalidation
Invalidation facility will be available for both Advance Authorisation and EPCG schemes, but applicable GST would need to be paid while making local procurement, using an invalidation letter.
Input Tax Credit (ITC) of the GST paid on such local procurement can be availed as per CGST Rules, 2017. Please also refer to DGFT Trade Notice No. 11/2018, dated 30-6-2017.
Q 14

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se Act, 1944, the TED refund would be available, provided the items are eligible for supply under the said category of the deemed exports under chapter 7 of the FTP, and there is no exemption from payment of excise duty.
2.  The drawback as provided under Chapter 7 would be limited to the refund of basic custom duty only.
Q 18. Whether balance import quantities under Advance Authorisations issued before 1-7-2017 can be utilised after 1-7-2017? And, will there be any implications on export obligation?
Reply. The balance import quantities under Advance Authorisations can be utilised for duty free import but only Basic Customs Duty will be exempted on import after 1-7-2017. The applicable IGST will be required to be paid. There will be no implication on export obligation of Advance Authorisations.
Q 19. Whether balance import quantities under EPCG issued before 1-7-2017 can be utilised after 1-7-2017? And, will there be any implications on export obligation?
Reply

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GST — FAQ on Food Processing dated 31-07-2017
General FAQ on GST – GST Frequently Asked Questions (FAQs)
GST
Question 1 : If I have multiple manufacturing units in a State/UT, do I have to register all my companies separately or as a group?
Answer : You shall be granted a single registration in the State/UT. However, you have the option to take separate registration for each of your business verticals (as defined in section 2(18) of the CGST Act, 2017) in the State/UT.
Question 2 : A registered person is sending semi-cooked food from his manufacturing unit at Gurgaon to his branch in Delhi. Is he required to pay any tax?
Answer : In accordance with the provisions of section 25(4) of the CGST Act, 2017, branches in different States are considered as distinct persons. Further, as per Schedule I, this constitutes supply made in the course or furtherance of business between distinct persons even if made without consideration. As it is an inter-State supply

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rson is eligible to reduce the tax liability by issuing credit notes to his recipient for such returned goods subject to the condition that the recipient reduces the claim of ITC to that extent if ITC was availed by him. (Credit Note must bear reference of original invoice No.)
Question 6 : What will be the rate of tax on cold drinks (non-alcoholic beverages) and ice cream when served in non-AC Restaurant along with food?
Answer : The rate of tax shall be 12%. In the event of the supply being made in an AC restaurant, the rate of tax shall be 18%. If the restaurant was availing compoistion scheme (can do so only if ice cream is not manufactured by the restaurant), the rate of tax shall be 5% of the aggregate turnover.
Question 7 : The supplier has sold machinery for hotel industry on 28-6-2017. The purchaser has received the invoice and machinery on 5-7-2017. Whether ITC of Duty/VAT paid (under the existing law) on machinery can be allowed to be claimed?
Answer :&ems

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st financial year my turnover was ₹ 5.5 Crore. Today, I am not registered under VAT. My questions are :
(i)         Will I have to get myself registered now?
Answer : Rice put in a unit container and bearing a registered brand name is taxable @ 5%. In accordance with the provisions of section 22 of the CGST Act, 2017 (applicable in your case), a person becomes liable to be registered in the State/UT from where he makes taxable supply of goods or services or both if his aggregate turnover (which includes value of exempt supplies as well) in a financial year exceeds ₹ 20 Lakh. Hence, liability to get registration accrues in your case from the date the aggregate turnover in the current financial year exceeds ₹ 20 lakh.
(ii)        The suppliers of basmati rice (branded) are saying that they will charge 5% IGST and I must get myself registered to avail the ITC. What do I do?
Answer : 

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cluded in one invoice.
(iv)       As an un-registered taxable person now, am I required to furnish information like HSN, place of supply, taxable value, etc. in my invoice? (I know that it is mandatory for a tax invoice only).
Answer : HSN codes, taxable value, place of supply are required to be recorded in a tax invoice to be issued by a registered person under rule 46 of the CGST Rules, 2017. An unregistered person cannot issue a tax invoice.
(v)        Assuming, I apply for voluntary registration and obtain GST registration :
(a)
Will I get ITC on the IGST paid on branded rice lying in stock on the date prior to the date of my liability?
Yes, a person who takes voluntary registration is entitled to take credit of input tax in respect of inputs held in stock on the day immediately preceding the date of grant of registration. In this connection, section 18(1)(b) read with section 25(3) of the CGST Act, 2017 re

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, taxes paid on accounting software which were acquired before registration will not be available as credit since credit is not available in respect of services in such cases. Other than that, credit shall be available on CGST/SGST paid on packing materials, etc. subject to conditions and restrictions spelt out in sections 16 to 18 of CGST Act, 2017
(c)
When shall I start charging tax i.e. from the date I apply for registration or only after I have got my registration number?
*   Only from date the registration has been granted.
*   The tax invoice also can be issued from that date only.
*   Prior to it neither you can issue tax invoice nor charge any tax on the invoice.
(d)
Will I have to issue tax invoice for all sales that I make i.e. branded or un-branded after getting registered?
Rice put up in a unit container and bearing a registered brand name is taxable @ 5% and tax invoice has to be issued for supply of taxable goods [Section 31(1) of the

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floor area of the restaurant is air conditioned and supplies food as well as liquor, the ground floor serves only food and is non-air-conditioned. Caterpillar wants to know, :
(i)         Whether they will charge GST @ 12% on supplies made from ground floor or 18%?
Answer : Tax will have to be charged @ 18% irrespective of from where the supply is made, first floor or second floor. If any part of the establishment has a facility of air conditioning then the rate will be 18% for all supplies from the restaurant.
(ii)        Whether they can raise one tax invoice for both food and liquor or not?
Answer : Tax invoice has to be issued for supply of food, while for liquor a bill of supply has to be issued or any invoice as may be required under the provisions of local VAT or sales tax law of the concerned State.
(iii)       What will the rate of tax to be charged for suppl

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FAQ for GST on Gems & Jewellery dated 18-08-2017
General FAQ on GST – GST Frequently Asked Questions (FAQs)
GST
Question 1 : Whether advertising and communication material (banners/hoardings/posters) provided to distributors would be treated as supply in the course of business by the company thereby not requiring any reversal of ITC.
Answer :
(a)        Where the material is provided free of cost :
This would not amount to a supply and hence no tax is payable on such transaction and in such a case credit availed by the company would need to be reversed in accordance with section 17(5) of the CGST Act, 2017.
(b)        Where the material is provided for a consideration :
            This would amount to a normal supply.
Question 2 : Currently Banks do not pay any VAT on import of precious metals. Banks/nominated agencies pay only customs

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liable to pay IGST on such imports but not the overseas entities since they are not effecting the import.
Question 4 : Gold and silver imported by banks/nominated agencies on consignment basis are lying in stock as on 1st July. Clarification is required on how to charge the customers in transition phase from VAT to GST. Will customers be liable to pay GST rates?
Answer : GST is payable @ 3% with effect from 1-7-2017.
Question 5 : Banks lend gold in physical form for a period not exceeding 6 months. Banks receive interest on the gold ounces disbursed and the same is converted into Rupees after calculation of interest on the ounces and the USD/INR conversion. Will the same methodology continue in case of GST as well wherein Banks shall pay a provisional GST (i.e. IGST/SGST/CGST) on ongoing market prices and pay the final GST as and when the prices are fixed?
Answer : Yes, Banks may avail of the benefit of provisional assessment provided under section 60 of the CG

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we charge GST @ 3% on the total value or @ 3% on the gold value and @ 5% on making charges?
Answer : GST is payable at the rate of 3% of the total transaction value of jewellery, whether the making charge is shown separately or not.
Question 8 : When we issue gold as raw material to our Job Worker for Job Work and he returns that gold as finished goods, what GST treatment will be done and how to calculate the value?
Answer : The job worker, if registered, would be required to pay GST at the rate of 5% on job charges only. The jewellery manufacturer would in turn take credit of GST paid on such job work and may utilize the same for payment of GST on his outward supply of manufactured jewellery. However, if the job worker is exempted from registration, the jewellery manufacturer would be required to pay GST on his input supply from the job worker [of jewellery made out of precious metal given by him] on reverse charge basis. Nonetheless, he would be eligible to avail in

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