Goods and Services Tax

Question 15 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 15 – Q 15. Mr. A applies for voluntary registration on 5th June, 2017 and obtained registration on 22nd June, 2017. Mr. A is eligible for input tax credit on inputs in stock as on ………….. 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 as on 21st June, 2017. – Sta

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Question 14 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 14 – Q 14. Mr. B, a registered taxable person was paying tax under composition rate up to 30th July, 2017. However, w.e.f 31st July, 2017. Mr. B becomes liable to pay tax under regular scheme. Is he eligible for ITC? Ans. Mr. B is eligible for input tax credit on inputs held in stock and inputs contained in semi-finished or finished goods held in stock as on 30th July,2017. – St

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A dealer paying tax on compounding basis crosses the compounding threshold and becomes a regular taxable person. Can he avail ITC and if so from what date? – Question 13 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 13 – Q 13. A dealer paying tax on compounding basis crosses the compounding threshold and becomes a regular taxable person. Can he avail ITC and if so from what date? Ans. As per section 16(3) of the MGL, he can avail ITC in

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Question 12 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 12 – Q 12. What would be input tax eligibility in cases where taxable person paying tax under section 7 opts to pay tax under Compounding Scheme under Section 8? Ans. As per section 16(12) of the MGL, the registered taxable person, who was paying tax under section 7 opts to pay tax under Compounding Scheme under Section 8, has to pay an amount equivalent to the input tax credit

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Question 11 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 11 – Q 11. What would be input tax eligibility in case where the goods and/or services supplied by a registered taxable person become absolutely exempt? Ans. As per section 16(12) of the MGL, the registered taxable person who supplies goods and / or services which become absolutely exempt, has to pay an amount equivalent to the input tax credit in respect of inputs held in stock

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Question 10 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 10 – Q 10. What would be input tax eligibility in cases where there is a change in the constitution of a registered taxable person? Ans. As per section 16(8) of the MGL, the transferor shall be allowed to transfer the input tax credit that remains unutilized in its books of accounts to the transferee provided that there is a specific provision for transfer of liabilities. – Stat

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Question 9 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 9 – Q 9. Where goods and/or services received by a taxable person are used for the purpose of business and non-business supplies, whether the input tax credit is available to the registered taxable person? Ans. As per section 16(5) of the MGL, the input tax credit of goods and / or service attributable to only supplies effected for business purpose can be taken by registered taxa

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Question 8 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 8 – Q 8. Where goods and/or services 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. As per section 16(6) of MGL, the input tax credit of goods and / or service attributable to only taxable supplies can be taken by registered taxable person. The amount of el

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Question 7 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 7 – Q 7. What is the eligibility of input tax credit on inputs in stock for a person who obtains voluntary registration? Ans. As per section 16(2A) of MGL, the person who obtains voluntary registration is entitled to take the input tax credit of input tax on inputs in stock, inputs in semifinished goods and finished goods in stock, held on the day immediately preceding the date o

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Question 6 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 6 – Q 6. A person becomes liable to pay tax on 1st August, 2017 and has obtained r

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Question 5 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 5 – Q 5. What is the ITC entitlement of a person who has applied for registration under the Act within thirty days from the date on which he becomes liable to registration and has been granted such registration? (Section 16(2)) Ans. He shall be entitled to take credit of input tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in s

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Does input tax includes tax (CGST/ IGST/SGST) paid on input goods, input services and/ or capital goods? – Question 4 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 4 – Q 4. Does input tax includes tax (CGST/ IGST/SGST) paid on input goods, input services and/ or capital goods? Ans. Yes, in terms of section 2(54), 2(55) & 2(20) of the MGL respectively. It may be noted that credit of tax paid on capital goods also is permitted to be a

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Question 3 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 3 – Q 3. Can GST paid on reverse charge be considered as input tax? Ans. Yes. The definition of input tax includes the tax payable under sub-section (3) of section 7 (Reverse Charge). The credit can be availed if such goods and/or services are used, or are intended to be used, in the course or furtherance of his business. – Statutory Provisions, Acts, Rules, Regulations, Taxation

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Question 2 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 2 – Q 2. What is the implication of different definition of input tax in three acts viz CGST, SGST and IGST Acts? Ans. It implies that input tax consists of IGST & CGST in CGST Act and IGST & SGST in SGST Act. In the IGST Act, input tax consists of all three taxes namely, IGST, CGST and SGST. It further implies that credit of all three can be used for discharging IGST lia

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Question 1 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 1 – Q 1. What is input tax? Ans. Input tax has been defined in section 2 (57) of the MGL and section 2 (1) (d) of the IGST Act. Input tax in relation to a taxable person, means the {IGST and CGST} in respect of CGST Act and {IGST and SGST} in respect of SGST Act, charged on any supply of goods and/or services to him which are used, or are intended to be used, in the course or fur

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Question 9 – Draft-Bills-Reports – Job Work – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 9 – Q 9. Are the provisions of job-work applicable to all category 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. – Statutory Provisions, Acts, Ru

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Question 8 – Draft-Bills-Reports – Job Work – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 8 – Q 8. What are the provisions concerning taking of ITC in respect of inputs/capital goods sent to a job-worker? Ans. In the MGL, aspects relating to taking input tax credit in respect of inputs/capital goods sent for job-work have been specifically dealt in Section 16A, which provides that the credit of taxes paid on inputs or capital goods can be taken in the following manner: Princi

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Question 7 – Draft-Bills-Reports – Job Work – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 7 – Q 7. Under what circumstances can the principal directly supply goods from the premises of job-worker? Ans. The goods can be supplied directly from the place of business of job-worker without declaring it as additional place of business in two circumstances namely where the job-worker is a registered taxable person or where the principal is engaged in supply of such goods as may be n

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Question 6 – Draft-Bills-Reports – Job Work – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 6 – 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 with a rider that the principal should have declared the premises of such job-worker as his additional place of business or where the job-worker is a registered person or where the goods have been notified. – Statutory Provisions, Acts, Rules

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Question 5 – Draft-Bills-Reports – Job Work – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 5 – Q 5. Whether the goods of principal directly supplied from the job-worker s premises w

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Is a job-worker required to take registration? – Question 4 – Draft-Bills-Reports – Job Work – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 4 – Q 4. Is a job-worker required to take

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Question 3 – Draft-Bills-Reports – Job Work – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 3 – Q 3. Can a registered taxable person send goods without payment of tax to his job-worker? Ans. Yes. Section 43A of the MGL provides that the registered taxable person (principal) can send the taxable goods to a job-worker for job-work without payment of tax. He can further send the goods from one job-worker to another job-worker and so on subject to certain condition. It may be noted

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Question 2 – Draft-Bills-Reports – Job Work – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 2 – Q 2. Whether goods sent by a taxable person to a job-worker will be treated as supply and liable to GST? Why? Ans. No. It will not be treated as a supply. In terms of proviso to Para 5 of Schedule I of the MGL the supply of goods by a registered taxable person (principal) to jobworker, in terms of Section 43A, shall not be regarded as supply of goods. Therefore, it can be inferred th

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Question 1 – Draft-Bills-Reports – Job Work – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 1 – Q 1. What is job-work? Ans. Section 2(62) of the MGL provides that job-work means undertaking any treatment or process by a person on goods belonging to another registered taxable person and the expression job-worker shall be construed accordingly. This definition is much wider than the one given in Notification No. 214/86 – CE dated 23rd March, 1986 as amended, wherein job-work has

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Question 14 – Draft-Bills-Reports – Electronic Commerce – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 14 – Q 14. What will happen if the details remain mismatched? Ans. As per section 43C (8), the value of a supply relating to any payment in respect of which any discrepancy is communicated and which is not rectified by the supplier in his valid return for the month in which discrepancy is communicated shall be added to the output liability of the said supplier, for the calend

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