FREQUENTLY ASKED QUESTIONS (FAQs) ON GOODS AND SERVICES TAX (GST) – 2nd Edition. 31st March, 2017
News and Press Release
Dated:- 3-4-2017
FREQUENTLY ASKED QUESTIONS (FAQs) ON GOODS AND SERVICES TAX (GST)
\n2nd Edition. 31st March, 2017
\n=============
\nDocument 1
\nCENTRAL BOARD OF EXCISE &
\nCUSTOMS
\nNEW DELHI
\nFREQUENTLY ASKED QUESTIONS
\n(FAQs)
\nON
\nGOODS AND SERVICES TAX (GST)
\n2nd Edition. 31st March, 2017
\nFOREWORD
\nThe compilation of frequently asked questions on
\nGST brought out by the apex training institute under the
\nCentral Board of Excise & Customs (CBEC) the National
\nAcademy of Customs, Excise & Narcotics (NACEN), has
\nbeen extremely well received. These GST FAQs were
\nreleased on 21st September, 2016 by the Hon'ble
\nFinance Minister and were based on the Model GST Law
\nas on June, 2016. The GST FAQs were translated in many
\nregional languages to ensure dissemination across the
\ncountry.
\nA number of significant developments have taken
\nplace since the first editi<\/p>\n
= = = = = = = =<\/p>\n
Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n f Tax = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n SGST\/UTGST\/IGST = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ax (all forms) = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ave temporarily been kept out and GST = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ctive domains. The = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n e required to deposit the CGST = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n xes, it would mitigate = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n sel, motor sprit = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ble person crosses the turnover = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n rvices will be classified as per the Services Accounting = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n Whether the composition scheme will be = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n one or more other Sates on the other = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ted to a bank account or consumption of = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n easure? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n Government or State Government, on the = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n y Reverse Charge? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n other Act also. So, = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n nput tax credit. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n tances of an exceptional nature, by special = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ion limit for paying tax, = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n e of goods after completion of job work is not = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n \nAns. No. Every person who is liable to take a Registration = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n in registration, the proper officer may, without = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n g inter-state purchases. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n for the period for which the registration is sought. If = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ion under one Act (say = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n quired to be separately registered = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n stered, or if not, the principal declares the place of = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n signing the application or other = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n icant will be = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n r, equivalent to the credit of input tax in respect of = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n of 'supply' under the GST = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n . = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n supply in terms of CGST\/SGST = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ther Works contracts and Catering = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n e consisting of = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n liability to = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n in case of = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n to change in rate of tax? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n r Section 28 of CGST\/SGST Act a registered = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ply of goods and services shall = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n discounts or incentives = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n st or late fee or penalty for delayed = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n the time of supply of services = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ent of taxes to be made by the = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n istered on Common Portal (GSTN), two e-ledgers (Cash = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ax = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n e under the Act or the = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n cting TDS failing = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n Commerce Operator has been defined to = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n t customers of e- = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n submitted in the statement? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ioner may issue a notice to the electronic = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n the goods of principal directly = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n apital goods sent to a = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n lso be sent = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n red as input tax? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n be added to output tax liability = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ch results = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n eceding the date on which he became liable = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n lowing is included for = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n eligible for input tax credit on Ans. Mr. B is eligible for input tax credit on inputs held in = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n atched by the system and = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n limit of registration is not applicable to ISD. The = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n Can a company have multiple ISD? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n o used such = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n returns for the period of activity = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n different. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n tax on it. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n rvice provider and the credit distributed by = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ilt from details of = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n nute rush will make uploading difficult and will = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ate, will be levied. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ere he is unable to = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ost Accountant nominated for = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n or furnishing the = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n eeds the = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n the authorities may = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n re = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n d IGST or vice versa? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n e Government = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n of the CGST\/SGST Act, will the taxable = = = = = = = =<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\n..64
\n8.
\nElectronic Commerce ..
\n.74
\n9.
\nJob Work………….
\n.79
\n10. Input Tax Credit ……
\n…84
\n11. Concept of Input Service Distributor in GST…..
\n.94
\n12. Returns Process and matching of Input Tax Credit
\n………99
\n13. Assessment and Audit ….
\n….108
\n14. Refunds…..
\n……..116
\n15. Demands and Recovery
\n…..127
\n16. Appeals, Review and Revision in GST ….
\n…135
\n17. Advance Ruling
\n.141
\n18. Settlement Commission [Omitted]….
\n.149
\n19. Inspection, Search, Seizure and Arrest
\n..150
\n……..
\n20 Offences, Penalties, Prosecution and Compounding \u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026.169
\n21. Overview of the IGST Act……….
\n….182
\n22. Place of Supply of Goods and Service……
\n..187
\n23. GSTN and Frontend Business Process on GST Portal………..196
\n24. Transitional Provisions……
\n..213
\nPrepared by: Shri Deepak Mata, Assistant Director, NACEN
\nMumbai and Sanjeev Nair, Examiner, CESTAT Mumbai
\nunder the super<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nAct(s). This FAQ is for training and academic purposes
\nonly.
\nThe information in this booklet is intended only to
\nprovide a general overview and is not intended to be
\ntreated as legal ad vice or opinion. For greater details, you
\nare requested to refer to the respective
\nCGST\/SGST\/UTGST\/IGST Acts.
\nThe FAQs refer to CGST and SGST Acts as CGST\/SGST as
\nCGST Act and SGST Act are identical in most of the
\nprovisions. CGST Act has been introduced in the
\nParliament. The SGST Acts will be passed by respective
\nstate legislatures. A few provisions may be specific to state
\nand may not be in CGST Act.
\n1.
\nOverview of Goods and Services Tax
\n(GST)
\nQ1. What is Goods and Services Tax
\n(GST)?
\nAns. It is a destination based tax on consumption of goods
\nand services. It is proposed to be levied at all stages right
\nfrom manufacture up to final consumption with credit of
\ntaxes paid at previous stages available as setoff. In a
\nnutshell, only value addition will be taxed and b<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\ne.
\nEntertainment and Amusement Tax (except when
\nlevied by the local bodies)
\nTaxes on advertisements
\nPurchase Tax
\nf.
\ng.
\nh.
\nTaxes on lotteries, betting and gambling
\ni.
\nState Surcharges and Cesses sofar as they relate to
\nsupply of goods and services
\nThe GST Council shall make recommendations to the Union
\nand States on the taxes, cesses and surcharges levied by
\nthe Centre, the States and the local bodies which may be
\nsubsumed in the GST.
\nQ4. What principles were adopted for subsuming
\nthe above taxes under GST?
\nAns. The various Central, State and Local levies were
\nexamined to identify their possibility of being subsumed
\nunder GST. While identifying, the following principles were
\nkept in mind:
\n(i) Taxes or levies to be subsumed should be primarily in
\nthe nature of indirect taxes, either on the supply of goods
\nor on the supply of services.
\n(ii) Taxes or levies to be subsumed should be part of
\nthe transaction chain which commences with import\/
\nmanufac<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nCouncil shall decide the date from which they shall be
\nincluded in GST. Furthermore, electricity has been kept out
\nof GST.
\nQ 6. What will be the status in respect of taxation of
\nabove commodities after introduction of GST?
\nAns. The existing taxation system (VAT & Central Excise)
\nwill continue in respect of the above commodities.
\nQ7. What will be status of Tobacco and Tobacco
\nproducts under the GST regime?
\nAns. Tobacco and tobacco products would be subject to
\nGST. In addition, the Centre would have the power to levy
\nCentral Excise duty on these products.
\nQ8. What type of GST is proposed to be
\nimplemented?
\nAns. It would be a dual GST with the Centre and States
\nsimultaneously levying it on a common tax base. The GST
\nto be levied by the Centre on intra-State supply of goods
\nand\/or services would be called the Central GST (CGST)
\nand that to be levied by the States\/ Union territory would
\nbe called the State GST (SGST)\/ UTGST. Similarl<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nCentre has the powers to levy tax on the manufacture of
\ngoods (except alcoholic liquor for human consumption,
\nopium, narcotics etc.) while the States have the powers
\nto levy tax on the sale of goods. In the case of inter-State
\nsales, the Centre has the power to levy a tax (the Central
\nSales Tax) but, the tax is collected and retained entirely
\nby the States. As for services, it is the Centre alone that
\nis empowered to levy service tax.
\nIntroduction of the GST required amendments in the
\nConstitution so as to simultaneously empower the Centre
\nand the States to levy and collect this tax. The Constitution
\nof India has been amended by the Constitution (one hundred
\nand first amendment) Act, 2016 for this purpose. Article
\n246A of the Constitution empowers the Centre and the
\nStates to levy and collect the GST.
\nQ 12. How a particular transaction of goods
\nand services would be taxed simultaneously
\nunder Central GST (CGST) and State GST (SGST)?
\nAns. The Centra<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\ncomponent into a Central Government account
\nwhile the SGST portion into the account of the concerned
\nState Government. Of course, he need not actually pay Rs.
\n20 (Rs. 10+ Rs. 10) in cash as he would be entitled to set-
\noff this liability against the CGST or SGST paid on his
\npurchases (say, inputs). But for paying CGST he would be
\nallowed to use only the credit of CGST paid on his
\npurchases while for SGST he can utilize the credit of SGST
\nalone. In other words, CGST credit cannot, in general, be
\nused for payment of SGST. Nor can SGST credit be used for
\npayment of CGST.
\nIllustration II: Suppose, again hypothetically, that the
\nrate of CGST is 10% and that of SGST is 10%. When an
\nadvertising company located in Mumbai supplies
\nadvertising services to a company manufacturing soap
\nalso located within the State of Maharashtra for, let us
\nsay Rs. 100, the ad company would charge CGST of
\nRs. 10 as well as SGST of Rs. 10 to the basic value of
\nthe <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nthe ill effects of cascading and pave the way for a common
\nnational market. For the consumers, the biggest gain would
\nbe in terms of a reduction in the overall tax burden on goods,
\nwhich is currently estimated at 25%-30%. Introduction
\nof GST would also make our products competitive in the
\ndomestic and international markets. Studies show that this
\nwould instantly spur economic growth. There may also be
\nrevenue gain for the Centre and the States due to widening
\nof the tax base, increase in trade volumes and improved
\ntax compliance. Last but not the least, this tax, because of
\nits transparent character, would be easier to administer.
\nQ 14. What is IGST?
\nAns. Under the GST regime, an Integrated GST (IGST)
\nwould be levied and collected by the Centre on inter-State
\nsupply of goods and services. Under Article 269A of the
\nConstitution, the GST on supplies in the course of inter-
\nState trade or commerce shall be levied and collected by
\nthe Government of <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\n(commonly known as petrol), natural gas and
\naviation turbine fuel;
\n(iv) model GST laws, principles of levy, apportionment
\nof IGST and the principles that govern the place
\nof supply;
\n(v) the threshold limit of turnover below which the
\ngoods and services may be exempted from GST;
\n(vi) the rates including floor rates with bands of
\nGST;
\n(vii) any special rate or rates for a specified period
\nto raise additional resources during any natural
\ncalamity or disaster;
\n(viii) special provision with respect to the North-
\nEast States, J&K, Himachal Pradesh and
\nUttarakhand; and
\n(ix) any other matter relating to the GST, as the
\nCouncil may decide.
\nQ 16. What is the guiding principle of GST Council?
\nAns. The mechanism of GST Council would ensure
\nharmonization on different aspects of GST between the
\nCentre and the States as well as among States. It has been
\nprovided in the Constitution (one hundred
\nand first amendment) Act, 2016 that the GST Council, in
\nits discha<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nthreshold of Rs.20 lakhs (Rs. 10 lakhs for NE & Special
\nCategory States) except in certain specified cases where the
\ntaxable person is liable to pay GST even though he has not
\ncrossed the threshold limit. The CGST\/SGST is payable on
\nall intra-State supply of goods and\/or services and IGST is
\npayable on all inter- State supply of goods and\/or services.
\nThe CGST \/SGST and IGST are payable at the rates
\nspecified in the Schedules to the respective Acts.
\nQ 19. What are the benefits available to small tax
\npayers under the GST regime?
\nAns. Tax payers with an aggregate turnover in a financial
\nyear up to [Rs.20 lakhs & Rs.10 Lakhs for NE and special
\ncategory states] would be exempt from tax. Further,
\na person whose aggregate turnover in the preceding
\nfinancial year is less than Rs.50 Lakhs can opt for a
\nsimplified composition scheme where tax will payable at a
\nconcessional rate on the turnover in a state.
\n[Aggregate turnover shall include the ag<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nCode (SAC)
\nQ 21. How will imports be taxed under GST?
\nAns. Imports of Goods and Services will be treated as
\ninter-state supplies and IGST will be levied on import of
\ngoods and services into the country. The incidence of tax
\nwill follow the destination principle and the tax revenue in
\ncase of SGST will accrue to the State where the imported
\ngoods and services are consumed. Full and complete set-off
\nwill be available on the GST paid on import on goods and
\nservices.
\nQ 22. How will Exports be treated under GST?
\nAns. Exports will be treated as zero rated supplies. No tax
\nwill be payable on exports of goods or services, however
\ncredit of input tax credit will be available and same will be
\navailable as refund to the exporters. The Exporter will
\nhave an option to either pay tax on the output and claim
\nrefund of IGST or export under Bond without payment of
\nIGST and claim refund of Input Tax Credit (ITC).
\nQ 23. What is t<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\noptional or compulsory?
\nAns. Optional.
\nQ 25. What is GSTN and its role in the GST regime?
\nAns. GSTN stands for Goods and Service Tax Network
\n(GSTN). A Special Purpose Vehicle called the GSTN has
\nbeen set up to cater to the needs of GST. The GSTN shall
\nprovide a shared IT infrastructure and services to Central
\nand State Governments, tax payers and other stakeholders
\nfor implementation of GST. The functions of the GSTN
\nwould, inter alia, include: (i) facilitating registration; (ii)
\nforwarding the returns to Central and State authorities;
\n(iii) computation and settlement of IGST; (iv) matching
\nof tax payment details with banking network; (v)
\nproviding various MIS reports to the Central and the State
\nGovernments based on the tax payer return information;
\n(vi) providing analysis of tax payers' profile; and (vii)
\nrunning the matching engine for matching, reversal and
\nreclaim of input tax credit.
\nThe GSTN is developing a common GST por<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nside; or
\n(c) between two or more States,
\narising out of the recommendations of the Council or
\nimplementation thereof.
\nQ 27. What is the purpose of Compliance rating
\nmechanism?
\nAns. As per Section 149 of the CGST\/SGST Act, every
\nregistered person shall be assigned a compliance rating
\nbased on the record of compliance in respect of specified
\nparameters. Such ratings shall also be placed in the public
\ndomain. A prospective client will be able to see the
\ncompliance ratings of suppliers and take a decision as to
\nwhether to deal with a particular supplier or not. This will
\ncreate healthy competition amongst taxable persons.
\nQ 28. Whether actionable claims liable to GST?
\nAns. As per section 2(52) of the CGST\/SGST Act
\nactionable claims are to be considered as goods. Schedule III
\nread with Section 7 of the CGST\/SGST Act lists the activities
\nor transactions which shall be treated neither as supply of
\ngoods nor supply of services. The Sched<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nelectricity or transaction of purchase, sale or exchange of
\ngoods or property or right or interest in a property under
\nany law for the time being in force, are mandated to furnish
\nan information return of the same in respect of such
\nperiods, within such time, in such form and manner and to
\nsuch authority or agency as may be prescribed. Failure to do
\nso may result in penalty being imposed as per Section 123.
\nQ 31. Different companies have different types of
\naccounting software packages and no specific
\nformat are mandated for keeping records. How
\nwill department be able to read into these
\ncomplex software?
\nAns. As per Section 153 of the CGST\/SGST Act, having
\nregard to the nature and complexity of a case and in the
\ninterest of revenue, department may take assistance from
\nan expert at any state of scrutiny, inquiry, investigation or
\nany other proceedings.
\nQ 32. Is there any provision in GST for tax treatment of
\ngoods returned by th<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nAns. As per section 171 of the CGST\/SGST Act, any
\nreduction in rate of tax on any supply of goods or services
\nor the benefit of input tax credit shall be passed on to the
\nrecipient by way of commensurate reduction in prices. An
\nauthority may be constituted by the government to
\nexamine whether input tax credits availed by any
\nregistered person or the reduction in the tax rate have
\nactually resulted in a commensurate reduction in the price
\nof the goods or services or both supplied by him.
\n****
\n2.
\nLevy of and Exemption from Tax
\nQ1. Where is the power to levy GST derived from?
\nAns. Article 246A of the Constitution, which was
\nintroduced by the Constitution (101st Amendment) Act,
\n2016 confers concurrent powers to both, Parliament and
\nState Legislatures to make laws with respect to GST i e
\ncentral tax (CGST) and state tax (SGST) or union territory tax (UTGST).
\nHowever, clause 2 of Article 246A read with Article 269A
\nprovides exclusive power to the Parliament to leg<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nrecommendations of the GST Council, can notify an activity
\nto be the supply of goods and not supply of services or
\nsupply of services and not supply of goods or neither a
\nsupply of goods nor a supply of services.
\nQ6. What are composite supply and mixed supply?
\nHow are these two different from each other?
\nAns. Composite supply is a supply consisting of two or
\nmore taxable supplies of goods or services or both or any
\ncombination thereof, which are bundled in natural course
\nand are supplied in conjunction with each other in the
\nordinary course of business and where one of which is a
\nprincipal supply. For example, when a consumer buys a
\ntelevision set and he also gets warranty and a
\nmaintenance contract with the TV, this supply is a
\ncomposite supply. In this example, supply of TV is the
\nprincipal supply, warranty and maintenance service are
\nancillary.
\nMixed supply is combination of more than one individual
\nsupplies of goods or servi<\/p>\n
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\nAns. It means the liability to pay tax is on the recipient of
\nsupply of goods and services instead of the supplier of such
\ngoods or services in respect of notified categories of
\nsupply.
\nQ 10. Is the reverse charge mechanism applicable
\nonly to services?
\nAns. No, reverse charge applies to supplies of both goods
\nand services, as notified by the Government on the
\nrecommendations of the GST Council.
\nQ 11. What will be the implications in case of
\nreceipt of supply from unregistered persons?
\nAns. In case of receipt of supply from an unregistered
\nperson, the registered person who is receiving goods or
\nservices shall be liable to pay tax under reverse charge
\nmechanism.
\nQ 12.
\nCan any person other than the supplier
\nor recipient be liable to pay tax under GST?
\nAns. Yes, the Central\/State government can specify
\ncategories of services the tax on which shall be paid by the
\nelectronic commerce operator, if such services are supplied
\nthrough it and all the provis<\/p>\n
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\neffectively, the composition rates (combined rate under
\nCGST and SGST\/UTGST) are 1%, 2% and 5% for normal
\nsupplier,
\nrespectively.
\nmanufacturer and restaurant service
\nQ 15.
\nA person availing composition scheme
\nduring a financial year crosses the turnover of
\nRs.50 Lakhs during the course of the year i.e. say
\nhe crosses the turnover of Rs.50 Lakhs in
\nDecember? Will he be allowed to pay tax under
\ncomposition scheme for the remainder of the year
\ni.e. till 31st March?
\nAns. No. The option availed shall lapse from the day on
\nwhich his aggregate turnover during the financial year
\nexceeds Rs.50 Lakhs.
\nQ 16. Will a taxable person, having multiple
\nregistrations, be eligible to opt for composition
\nscheme only for a few of registrations?
\nAns. All registered persons having the same Permanent
\nAccount Number (PAN) have to opt for composition
\nscheme. If one registered person opts for normal scheme,
\nothers become ineligible for composition scheme.
\nQ 17. Can com<\/p>\n
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\nQ 20. Can the customer who buys from a registered
\nperson who is under the composition scheme
\nclaim composition tax as input tax credit?
\nAns. No, customer who buys goods from registered person
\nwho is under composition scheme is not eligible for
\ncomposition input tax credit because a composition
\nscheme supplier cannot issue a tax invoice.
\nQ 21. Can composition tax be collected from
\ncustomers?
\nAns. No, the registered person under composition scheme
\nis not permitted to collect tax. It means that a composition
\nscheme supplier cannot issue a tax invoice.
\nQ 22. How to compute 'aggregate turnover' to
\ndetermine eligibility for composition scheme?
\nAns. The methodology to compute aggregate turnover is
\ngiven in Section 2(6). Accordingly, 'aggregate turnover'
\nmeans value of
\nof
\nall outward supplies (taxable
\nsupplies+exempt supplies+exports + inter-state supplies)
\nof a person having the same PAN and it excludes taxes
\nlevied under central tax (CGST), State tax (S<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\norder any goods or services or both. It has also been
\nprovided in the SGST Act and UTGST Act that any
\nexemption granted under CGST Act shall be deemed to be
\nexemption under the said Act.
\nQ 25. When exemption from whole of tax collected
\non goods or services or both has been granted
\nabsolutely, can a person pay tax?
\nAns. No, the person supplying exempted goods or services
\nor both shall not collect the tax in excess of the effective
\nrate.
\n3.
\nQ 1.
\nRegistration
\nWhat is advantage of taking registration in
\nGST?
\nAns. Registration under Goods and Service Tax (GST)
\nregime will confer following advantages to the business:
\nLegally recognized as supplier of goods or services.
\nProper accounting of taxes paid on the input goods
\nor services which can be utilized for payment of GST due on
\nsupply of goods or services or both by the business.
\nLegally authorized to collect tax from his purchasers
\nand pass on the credit of the taxes paid on<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nthe effective date of registration shall be the date of order of
\nregistration.
\nQ4.
\nWho are the persons liable to take a
\nRegistration under the Model GST Law?
\nAns. As per Section 22 of the CGST\/SGST Act 2017, every
\nsupplier (including his agent) who makes a taxable supply
\ni.e. supply of goods and \/ or services which are leviable to
\ntax under GST law, and his aggregate turn over in a
\nfinancial year exceeds the threshold limit of twenty lakh
\nrupees shall be liable to register himself in the State or the
\nUnion territory of Delhi or Puducherry from where he
\nmakes the taxable supply.
\nIn case of eleven special category states (as mentioned in
\nArt.279A(4)(g) of the Constitution of India), this threshold
\nlimit for registration liability is ten lakh rupees.
\nBesides, Section 24 of the Act mentions certain categories of
\nsuppliers, who shall be liable to take registration even if
\ntheir aggregate turnover is below the said threshold limit of
\n20 lakh rupe<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nincludible in the turnover of the job-worker. It will be
\ntreated as supply of goods by the principal and will
\naccordingly be includible in the turnover of the Principal.
\nQ 6.
\nWhich are the cases in which registration is
\ncompulsory?
\nAns. As per Section 24 of the CGST\/SGST Act, the following
\ncategories of persons shall be required to be registered
\ncompulsorily irrespective of the threshold limit:
\ni) persons making any inter-State taxable supply;
\nii)
\niii)
\ncharge;
\niv)
\nv)
\ncasual taxable persons;
\npersons who are required to pay tax under reverse
\nelectronic commerce operators required to pay tax
\nunder sub-section (5) of section 9;
\nnon-resident taxable persons;
\nvi) persons who are required to deduct tax under
\nsection 51;
\nvii)
\npersons who supply goods and\/or services on behalf
\nof other registered taxable persons whether as an
\nagent or otherwise;
\nviii) Input service distributor (whether or not separately
\nregistered under <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nwill have to get registered separately for each of the States
\nwhere he has a business operation and is liable to pay GST
\nin terms of Sub-section (1) of Section 22 of the CGST\/SGST
\nAct.
\nQ 9.
\nWhether a person having multiple business
\nverticals in a state can obtain for different
\nregistrations?
\nAns. Yes. In terms of the proviso to Sub-Section (2) of Section
\n25, a person having multiple business verticals in a State
\nmay obtain a separate registration for each business
\nvertical, subject to such conditions as may be prescribed.
\nQ 10. Is there a provision for a person to get himself
\nvoluntarily registered though he may not be liable
\nto pay GST?
\nAns. Yes. In terms of Sub-section (3) of Section 25, a person,
\nthough not liable to be registered under Section 22 may get
\nhimself registered voluntarily, and all provisions of this Act,
\nas are applicable to a registered taxable person, shall apply
\nto such person.
\nQ 11. I<\/p>\n
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\nprejudice to any action which may be taken under this Act,
\nor under any other law for the time being in force, proceed
\nto register such person in the manner as is prescribed in the
\nRegistration rules.
\nQ 13. Whether the proper officer can reject an
\nApplication for Registration?
\nAns. Yes. In terms of sub-section 10 of section 25 of the
\nCGST\/SGST Act, the proper officer can reject an application
\nfor registration after due verification.
\nQ 14. Whether the Registration granted to any person
\nis permanent?
\nAns. Yes, the registration Certificate once granted is
\npermanent unless surrendered, cancelled, suspended or
\nrevoked.
\nQ 15. Is it necessary for the UN bodies to get
\nregistration under GST?
\nAns. Yes. In terms of Section 25(9) of the CGST\/SGST Act, all
\nnotified UN bodies, Consulate or Embassy of foreign
\ncountries and any other class of persons so notified would
\nbe required to obtain a unique identification number (UIN)
\nfrom <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nQ 18. Who is a Casual Taxable Person?
\nAns. Casual Taxable Person has been defined in Section 2
\n(20) of the CGST\/SGST Act meaning a person who
\noccasionally undertakes transactions involving supply of
\ngoods and\/or services in the course or furtherance of
\nbusiness, whether as principal, or agent or in any other
\ncapacity, in a State or a Union territory where he has no
\nfixed place of business.
\nQ 19. Who is a Non-resident Taxable Person?
\nAns. In terms of Section 2(77) of the CGST\/SGST Act, a non-
\nresident taxable person means any person who occasionally
\nundertakes transactions involving supply of goods and\/or
\nservices whether as principal or agent or in any other
\ncapacity, but who has no fixed place of business or residence
\nin India.
\nQ 20. What is the validity period of the Registration
\ncertificate issued to a Casual Taxable Person and
\nnon-Resident Taxable person?
\nAns. In terms of Section 27(1) read with proviso thereto, the
\ncertificate of regist<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nregistration is to be extended beyond the initial period of
\nninety days, an advance additional amount of tax
\nequivalent to the estimated tax liability is to be deposited
\nfor the period for which the extension beyond ninety days is
\nbeing sought.
\nQ 22. Whether Amendments to the Registration
\nCertificate is permissible?
\nAns. Yes. In terms of Section 28, the proper officer may, on
\nthe basis of such information furnished either by the
\nregistrant or as ascertained by him, approve or reject
\namendments in the registration particulars within a period
\nof 15 common working days from the date of receipt of
\napplication for amendment.
\nIt is to be noted that permission of the proper officer for
\nmaking amendments will be required for only certain core
\nfields of information, whereas for the other fields, the
\ncertificate of registration shall stand amended upon
\nsubmission of application in the GST common portal.
\nQ 23. Whether
\nCa<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nCGST Act) shall be deemed to be a cancellation of
\nregistration under the other Act (i.e. SGST Act). (Section 29
\n(4))
\nQ 25. Can the proper Officer Cancel the Registration
\non his own?
\nAns. Yes, in certain circumstances specified under section
\n29(2) of the CGST\/SGST Act, the proper officer can cancel
\nthe registration on his own. Such circumstances include
\ncontravention of any of the prescribed provisions of the
\nCGST Act or the rules made there under, not filing return by
\na composition dealer for three consecutive tax periods or
\nnon-furnishing of returns by a regular taxpayer for a
\ncontinuous period of six months, and not commencing
\nbusiness within six months from the date of voluntary
\nregistration. However, before cancelling the registration,
\nthe proper officer has to follow the principles of natural
\njustice. (proviso to Section 29(2)(e))
\nQ 26. What happens when the registration is
\nobtained by means of willful mis-statement, fraud
\nor suppression <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nother than the existing tax payer registration?
\nAns. Yes, the ISD registration is for one office of the
\ntaxpayer which will be different from the normal
\nregistration.
\nQ 31. Can a tax payer have multiple ISDs?
\nAns. Yes. Different offices of a tax payer can apply for ISD
\nregistration.
\nQ 32. What could be the liabilities (in so far as
\nregistration is concerned) on
\nconcerned) on
\ntransfer
\ntransfer
\nof a
\nbusiness?
\nAns. The transferee or the successor shall be liable to be
\nregistered with effect from such transfer or succession and
\nhe will have to obtain a fresh registration with effect from
\nthe date of such transfer or succession. (Section 22(3)).
\nQ 33. Whether all assesses \/ dealers who are already
\nregistered under existing central excise\/service
\ntax\/vat laws will have to obtain fresh registration?
\nAns. No, GSTN shall migrate all such assessees\/dealers to
\nthe GSTN network and shall issue a provisional registration
\ncertificate with GS<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nbusiness of the job worker as his additional place of
\nbusiness.
\nQ 36. At the time of registration will the assessee
\nhave to declare all his places of business?
\nAns. Yes. The principal place of business and place of
\nbusiness have been separately defined under section 2(89) &
\n2(85) of the CGST\/SGST Act respectively. The taxpayer will
\nhave to declare the principal place of business as well as the
\ndetails of additional places of business in the registration
\nform.
\nQ 37. Is there any system to facilitate smaller dealers
\nor dealers having no IT infrastructure?
\nAns. In order to cater to the needs of tax payers who are
\nnot IT savvy, following facilities shall be made available: –
\nTax Return Preparer(TRP): A taxable person may prepare
\nhis registration application \/returns himself or can
\napproach the TRP for assistance. TRP will prepare the said
\nregistration document \/ return in prescribed format on the
\nbasis of the informa<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nsubmissions- by e-signing through Aadhar number, or
\nthrough DSC i.e. by registering the tax payer's digital
\nsignature certificate with GST portal. However, companies
\nor limited liability partnership entities will have to sign
\nmandatorily through DSC only. Only level 2 and level 3 DSC
\ncertificates will be acceptable for signature purpose.
\nQ 39. What will be the time limit for the decision on
\nthe on line registration application?
\nAns. If the information and the uploaded documents are
\nfound in order, the State and the Central authorities shall
\nhave to respond to the application within three common
\nworking days. If they communicate any deficiency or
\ndiscrepancy in the application within such time, then the
\napplicant will have to remove the discrepancy \/ deficiency
\nwithin 7 days of such communication. Thereafter, for either
\napproving the application or rejecting it, the State and the
\nCentral authorities will have 7 days from the date when th<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\ninformed about the reasons for such refusal through a
\nspeaking order. The applicant shall have the right to appeal
\nagainst the decision of the Authority. As per sub-section (2)
\nof section 26 of the CGST Act, any rejection of application
\nfor registration by one authority (i.e. under the CGST Act \/
\nSGST Act) shall be deemed to be a rejection of application
\nfor registration by the other tax authority (i.e. under the
\nSGST Act\/UTGST Act\/ CGST Act).
\nQ 42. Will there be any communication related to the
\napplication disposal?
\nAns. The applicant shall be informed of the fact of grant or
\nrejection of his registration application through an e-mail
\nand SMS by the GST common portal. Jurisdictional details
\nwould be intimated to the applicant at this stage.
\nQ 43. Can the registration certificate be downloaded
\nfrom the GSTN portal?
\nAns. In case registration is granted; applicant can download
\nthe Registration Certificate from the GST common portal.
\nQ44. Can cancellation <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\ninputs held in stock and inputs contained in semi-finished or
\nfinished goods held in stock or capital goods or plant and
\nmachinery on the day immediately preceding the date of
\nsuch cancellation or the output tax payable on such goods,
\nwhichever is higher.
\nQ 46. What is the difference between casual and non-
\nresident taxable persons?
\nAns. Casual and Non-resident taxable persons are
\nseparately defined in the CGST\/SGST Act in Sections 2(20)
\nand 2(77) respectively. Some of the differences are outlined
\nbelow:
\nCasual Taxable Person
\nOccasional
\nundertakes
\ntransactions involving supply
\nof goods or services in a state
\nor UT where he has no fixed
\nplace of business.
\nNon-resident Taxable
\nPerson
\nOccasional undertakes
\ntransactions involving
\nsupply of goods or
\nservices but has
\nhas
\nno
\nfixed place of business
\nresidence in India.
\nHas a PAN Number
\nSame application form for
\nregistration as for normal
\ntaxable persons viz <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nlaw?
\nAns. The term 'supply' is wide in its import covers all
\nforms of supply of goods or services or both that includes
\nsale, transfer, barter, exchange, license, rental, lease or
\ndisposal made or agreed to be made for a consideration by a
\nperson in the course or furtherance of business. It also
\nincludes import of service. The model GST law also provides
\nfor including certain transactions made without
\nconsideration within the scope of supply.
\nQ 3.
\nWhat is a taxable supply?
\nAns. A 'taxable supply' means a supply of goods or
\nservices or both which is chargeable to goods and services
\ntax under the GST Act.
\nQ4.
\nWhat are the necessary elements that
\nconstitute supply under CGST\/SGST Act?
\nAns. In order to constitute a 'supply, the following elements
\nare required to be satisfied, i.e.-
\n(i) the activity involves supply of goods or services
\nor both;
\n(ii) the supply is for a consideration unless otherwise
\nspecifically provided for;
\n(iii) the supp<\/p>\n
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\nAre self-supplies taxable under GST?
\nInter-state self-supplies such as stock transfers,
\nbranch transfers or consignment sales shall be taxable
\nunder IGST even though such transactions may not involve
\npayment of consideration. Every supplier is liable to
\nregister under the GST law in the State or Union territory
\nfrom where he makes a taxable supply of goods or
\nservices or both in terms of Section 22 of the model GST
\nlaw. However, intra-state self-supplies are not taxable
\nsubject to not opting for registration as business vertical.
\nQ 8.
\nWhether transfer of title and\/or possession
\nis necessary for a transaction to constitute supply
\nof goods?
\nAns. Title as well as possession both have to be transferred
\nfor a transaction to be considered as a supply of goods.
\nIn case title is not transferred, the transaction would be
\ntreated as supply of service in terms of Schedule II (1) (b).
\nIn some cases, possession may be transferred immediately
\nbut title may be transferred at a f<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nAct? Give reasons for the answer.
\nAns. No, because supply is not made by the individual in
\nthe course or furtherance of business. Further, no input
\ntax credit was admissible on such car at the time of its
\nacquisition as it was meant for non-business use.
\nQ 11. A dealer of air-conditioners permanently
\ntransfers an air conditioner from his stock in
\ntrade, for personal use at his residence. Will the
\ntransaction constitute a supply?
\nAns. Yes. As per Sl. No.1 of Schedule-I, permanent transfer
\nor disposal of business assets where input as credit has
\nbeen availed on such assets shall constitute a supply under
\nGST even where no consideration is involved.
\nQ 12. Whether provision of service or goods by a
\nclub or association or society to its members will
\nbe treated as supply or not?
\nAns. Yes. Provision of facilities by a club, association,
\nsociety or any such body to its members shall be treated
\nas supply. This is included in the definition of 'bus<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nservices will be treated as supply of goods or
\nsupply of services? Why?
\nAns. Works contracts and catering services shall be treated
\nas supply of services as both are specified under Sl. No.
\n6 (a) and (b) in Schedule-II of the model GST law.
\nQ 17. Whether supply of software would be
\ntreated as supply of goods or supply of
\nservices under GST law?
\nAns. Development,
\ndesign, programming,
\ncustomization, adaptation, upgradation, enhancement,
\nimplementation of information technology software
\nshall be treated as supply of services as listed in Sl. No.
\n5(2)(d) of Schedule -II of the model GST law.
\nQ 18. Whether goods supplied on hire purchase
\nbasis will be treated as supply of goods or supply
\nof services? Why?
\nAns. Supply of goods on hire purchase shall be treated
\nas supply of goods as there is transfer of title, albeit at a
\nfuture date.
\nQ 19. What is a Composite Supply under CGST\/
\nSGST\/UTGST Act?
\nAns.
\nComposite Supply means a supply made<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\ncanned foods, sweets, chocolates, cakes, dry fruits, aerated
\ndrink and fruit juice when supplied for a single price is a
\nmixed supply. Each of these items can be supplied
\nseparately and it is not dependent on any other. It shall not
\nbe a mixed supply if these items are supplied separately.
\nQ 22. How will tax liability on a mixed supply be
\ndetermined under GST?
\nAns. A mixed supply comprising two or more supplies
\nshall be treated as supply of that particular supply which
\nattracts the highest rate of tax.
\nQ 23. Are there any activities which are treated as
\nneither a supply of goods nor a supply of services?
\nAns. Yes. Schedule-III of the model GST law lists certain
\nactivities such as (i) services by an employee to the
\nemployer in the course of or in relation to his employment,
\n(ii) services by any Court or Tribunal established under any
\nlaw, (iii) functions performed by members of Parliament,
\nState Legislatures, members of the local authorities,
\nConstitut<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\ncharge GST arises. It also indicates when a supply is
\ndeemed to have been made. The CGST\/SGST Act provides
\nseparate time of supply for goods and services.
\nQ 2.
\nAns.
\nWhen does the liability to pay GST arise in
\nrespect of supply of goods and Services?
\nSection 12 & 13 of the CGST\/SGST Act provides for
\ntime of supply of goods. The time of supply of goods shall
\nbe the earlier of the following namely,
\n(i) the date of issue of invoice by the supplier or the last
\ndate on which he is required under Section 28, to issue the
\ninvoice with respect to the supply; or
\n(ii) the date on which the supplier receives the payment
\nwith respect to the supply.
\nQ3.
\nWhat is time of supply in case of supply of
\nvouchers in respect of goods and services?
\nAns. The time of supply of voucher in respect of goods and
\nservices shall be;
\nQ4.
\na) the date of issue of voucher, if the supply is
\nidentifiable at that point; or
\nb) the date of redemption of voucher in all other
\ncases.
\nWhere <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\ntax payable under reverse charge?
\nAns. The time of supply will be the earliest of the following
\ndates:
\na)
\nb)
\nc)
\ndate of receipt of goods; or
\ndate on which payment is made; or
\nthe date immediately following 30 days from the
\ndate of issue of invoice by the supplier.
\nQ 8.
\nWhat is the time of supply of service in case of
\ntax payable under reverse charge?
\nAns. The time of supply will be the earlier of the following
\ndates:
\na)
\ndate on which payment is made; or
\nb)
\nthe date immediately following sixty days
\nfrom the date of issue of invoice by the
\nsupplier.
\nQ 9.
\nWhat is the time of supply applicable with
\nregard to addition in the value by way of interest,
\nlate fee or penalty or any delayed payment of
\nconsideration?
\nAns. The time of supply with regard to an addition in value
\non account of interest, late fee or penalty or delayed
\nconsideration shall be the date on which the supplier
\nreceipts such additional consideration.
\nQ 10. Is there any change in time <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nAns.
\nIn such cases time of supply will be
\n(i)
\n(ii)
\n(iii)
\nwhere the payment is received after the
\nchange in rate of tax but the invoice has been
\nissued prior to the change in rate of tax, the
\ntime of supply shall be the date of receipt of
\npayment; or
\nwhere the invoice has been issued and the
\npayment is received before the change in
\nrate of tax, the time of supply shall be the
\ndate of receipt of payment or date of issue of
\ninvoice, whichever is earlier; or
\nwhere the invoice has been issued after the
\nchange in rate of tax but the payment is
\nreceived before the change in rate of tax, the
\ntime of supply shall be the date of issue of
\ninvoice
\nQ 13. Let's say there was increase in tax rate from
\n18% to 20% w.e.f.1.6.2017. What is the tax rate
\napplicable when services provided and invoice
\nissued before change in rate in April 2017, but
\npayment received after change in rate in
\nJune2017?
\nAns. The old rate of 18% shall be applicable as services <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\ntaxable person shall, before or after the provision of service,
\nbut within a period prescribed in this behalf, issue a tax
\ninvoice showing description, value of goods, tax payable
\nthereon and other prescribed particulars.
\nQ 17. What is the time period within which invoice
\nhas to be issued in a case involving continuous
\nsupply of goods?
\nAns.
\nIn case of continuous supply of goods, where
\nsuccessive statements of accounts or successive payments
\nare involved, the invoice shall be issued before or at the time
\neach such statement is issued or, as the case may be, each
\nsuch payment is received.
\nQ 18. What is the time period within which invoice
\nhas to be issued in a case involving continuous
\nsupply of services?
\nAns. In case of continuous supply of services,
\n(a) where the due date of payment is ascertainable
\nfrom the contract, the invoice shall be issued
\nbefore or after the payment is liable to be made
\nby the recipient but within a<\/p>\n
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\nordinarily be 'the transaction value' which is the price paid
\nor payable, when the parties are not related and price is the
\nsole consideration. Section 15 of the CGST\/SGST Act further
\nelaborates various inclusions and exclusions from the
\nambit of transaction value. For example, the transaction
\nvalue shall not include refundable deposit, discount allowed
\nsubject to certain conditions before or at the time of supply.
\nQ2.
\nWhat is transaction value?
\nAns. Transaction value refers to the price actually paid or
\npayable for the supply of goods and or services where the
\nsupplier and the recipient are not related and price is the
\nsole consideration for the supply. It includes any amount
\nwhich the supplier is liable to pay but which has been
\nincurred by the recipient of the supply.
\nQ3. Are there separate valuation provisions for
\nCGST, SGST and IGST and for Goods and Services?
\nAns. No, section 15 is common for all three taxes and also
\ncommon for g<\/p>\n
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\nare to be included in the transaction value?
\nAns. Yes. where the post-supply discount is established as
\nper the agreement which is known at or before the time of
\nsupply and where such discount specifically linked to the
\nrelevant invoice and the recipient has reversed input tax
\ncredit attributable to such discount, the discount is allowed
\nas admissible deduction under Section 15 of the model GST
\nlaw.
\nQ 8.
\nWhether pre-supply
\ndiscounts allowed
\nbefore or at the time of supply are includible in the
\ntransaction value?
\nAns. No, provided it is allowed in the course of normal
\ntrade practice and has been duly recorded in the invoice.
\nQ 9.
\nWhen are the provisions of the
\nValuation Rules applicable?
\nAns. Valuation Rules are applicable when (i) consideration
\neither wholly or in part not in money terms; (ii) parties are
\nrelated or supply by any specified category of supplier; and
\n(iii) transaction value declared is not reliable.
\nQ 10. What are the inclu<\/p>\n
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\npayment of any consideration for any supply; and
\ne)
\nSubsidies directly linked to the price excluding
\nsubsidies provided by the Central and State Government.
\n7.
\nGST Payment of Tax
\nQ 1.
\nWhat are the Payments to be made in GST
\nregime?
\nAns. In the GST regime, for any intra-state supply, taxes to
\nbe paid are the Central GST (CGST), going into the account
\nof the Central Government) and the State\/UT GST (SGST,
\ngoing into the account of the concerned State Government).
\nFor any inter-state supply, tax to be paid is Integrated GST
\n(IGST) which will have components of both CGST and SGST.
\nIn addition, certain categories of registered persons will be
\nrequired to pay to the government account Tax Deducted at
\nSource (TDS) and Tax Collected at Source (TCS). In addition,
\nwherever applicable, Interest, Penalty, Fees and any other
\npayment will also be required to be made.
\nQ2.
\nWho is liable to pay GST?
\nAns. In general, the supplier of goods or s<\/p>\n
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\nas explained in Section 13.
\nThe time is generally the earliest of one of the three events,
\nnamely receiving payment, issuance of invoice or
\ncompletion of supply. Different situations envisaged and
\ndifferent tax points have been explained in the aforesaid
\nsections.
\nQ4.
\nAns.
\nWhat are the main features of GST payment
\nprocess?
\nThe payment processes under GST Act(s) have the
\nfollowing features:
\nElectronically generated challan from GSTN
\nCommon Portal in all modes of payment and no use of
\nmanually prepared challan;
\nFacilitation for the tax payer by providing hassle
\nfree, anytime, anywhere mode of payment of tax;
\nConvenience of making payment online;
\nLogical tax collection data in electronic format;
\nFaster remittance of tax revenue to the Government
\nAccount;
\nPaperless transactions;
\nSpeedy Accounting and reporting;
\nElectronic reconciliation of all receipts;
\nSimplified procedure for banks
\nWarehousing of Digital Challan.
\nQ5.
\nHow can paym<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nSupplier?
\nAns. Payment of taxes by the normal tax payer is to be done
\non monthly basis by the 20th of the succeeding month. Cash
\npayments will be first deposited in the Cash Ledger and the
\ntax payer shall debit the ledger while making payment in
\nthe monthly returns and shall reflect the relevant debit
\nentry number in his return. As mentioned earlier, payment
\ncan also be debited from the Credit Ledger. Payment of
\ntaxes for the month of March shall be paid by the 20th of
\nApril. Composition tax payers will need to pay tax on
\nquarterly basis.
\nQ7.
\nWhether time limit for payment of tax can be
\nextended or paid in monthly installments?
\nAns. No, this is not permitted in case of self-assessed
\nliability. In other cases, competent authority has been
\nempowered to extend the time period or allow payment in
\ninstalments. (Section 80 of the CGST\/SGST Act).
\nQ8. What happens if the taxable person files the return
\nbut does not make payment of tax?
\nAns. I<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\n&Input Tax Credit ledger) and an electronic tax liability
\nregister will be automatically opened and displayed on his
\ndash board at all times.
\nQ 11. What is a tax liability register?
\nAns. Tax Liability Register will reflect the total tax liability
\nof a taxpayer (after netting) for the particular month.
\nQ 12. What is a Cash Ledger?
\nAns. The cash ledger will reflect all deposits made in cash,
\nand TDS\/TCS made on account of the taxpayer. The
\ninformation will be reflected on real time basis. This
\nledger can be used for making any payment on account of
\nGST.
\nQ 13. What is an ITC Ledger?
\nAns. Input Tax Credit as self-assessed in monthly returns
\nwill be reflected in the ITC Ledger. The credit in this ledger
\ncan be used to make payment of TAX ONLY and not other
\namounts such as interest, penalty, fees etc.
\nQ 14. What is the linkage between GSTN and the
\nauthorized Banks?
\nAns. There will be real time two-way linkage between th<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\npayer or his authorized person. He can save the challan
\nmidway for future updation. However once the challan is
\nfinalized and CPIN generated, no further changes can be
\nmade to it by the taxpayer.
\nQ 17. Is there a validity period of challan?
\nAns. Yes, a challan will be valid for fifteen days after its
\ngeneration and thereafter it will be purged from the System.
\nHowever, the tax payer can generate another challan at his
\nconvenience.
\nQ 18. What is a CPIN?
\nAns. CPIN stands for Common Portal Identification
\nNumber (CPIN) given at the time of generation of challan.
\nIt is a 14-digit unique number to identify the challan. As
\nstated above, the CPIN remains valid for a period of 15
\ndays.
\nQ 19. What is a CIN and what is its relevance?
\nAns. CIN stands for Challan Identification Number. It
\nis a 17-digit number that is 14-digit CPIN plus 3-digit
\nBank Code. CIN is generated by the authorized banks\/
\nReserve Bank of India (RBI) when payment is actually
\nreceived by such authorized<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nrules made thereunder.
\nQ 22. What is an E-FPB?
\nAns. E-FPB stands for Electronic Focal Point Branch.
\nThese are branches of authorized banks which are
\nauthorized to collect payment of GST. Each authorized
\nbank will nominate only one branch as its E-FPB for
\npan India Transactions. The E-FPB will have to open
\naccounts under each major head for all governments.
\nTotal 38 accounts (one each for CGST, IGST and one each
\nfor SGST for each State\/UT Govt.) will have to be opened.
\nAny amount received by such E-FPB towards GST will
\nbe credited to the appropriate account held by such E-
\nFPB.
\nFor NEFT\/RTGS Transactions, RBI will act as E-FPB.
\nQ 23. What is TDS?
\nAns. TDS stands for Tax Deducted at Source (TDS). As
\nper section 51, this provision is meant for Government
\nand Government undertakings and other notified
\nentities making contractual payments where total
\nvalue of such supply under a contract
\nexceeds Rs. 2.5 Lakhs to suppliers. While making any
\npaymen<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nwhich fees of Rs. 100 per day subject to maximum of
\nRs. 5000\/- will be payable by such deductor.
\nQ 26. What is Tax Collected at Source (TCS)?
\nAns. This provision is applicable only for E-Commerce
\nOperator under section 52 of CGST\/SGST Act. Every E-
\nCommerce Operator, not being an agent, needs to
\nwithhold an amount calculated at the rate not exceeding
\none percent of the “net value of taxable supplies” made
\nthrough it where the consideration with respect to such
\nsupplies is to be collected by the operator. Such withheld
\namount is to be deposited by such E-Commerce Operator
\nto the appropriate GST account by the 10th of the next
\nmonth. The amount deposited as TCS will be reflected in
\nthe electronic cash ledger of the supplier.
\nQ 27. What does the expression “Net value of taxable
\nsupplies” mean?
\nAns. The expression “net value of taxable supplies” means
\nthe aggregate value of taxable supplies of goods or
\nservices, other than services notified under Sectio<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nmean any person who owns, operates or manages digital
\nor electronic facility or platform for electronic commerce.
\nQ3. Is it mandatory for e-commerce operator to
\nobtain registration?
\nAns. Yes. The benefit of threshold exemption is not
\navailable to e-commerce operators and they would be
\nliable to be registered irrespective of the value of supply
\nmade by them.
\nQ4. Whether
\na
\nsupplier of goods or
\nservices supplying through e-commerce operator
\nwould be entitled to threshold exemption?
\nAns. No. The threshold exemption is not available to such
\nsuppliers and they would be liable to be registered
\nirrespective of the value of supply made by them. This
\nrequirement, however, is applicable only if the supply is
\nmade through such electronic commerce operator who is
\nrequired to collect tax at source.
\nQ5. Will an e-commerce operator be liable to pay
\ntax in respect of supply of goods or services made
\nthrough it, instead of actual supplier?
\nAn<\/p>\n
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\ncommerce companies return goods. How these
\nreturns are going to be adjusted?
\nAns. An e-commerce company is required to collect tax
\nonly on the net value of taxable supplies. In other words,
\nvalue of the supplies which are returned are adjusted in
\nthe aggregate value of taxable supplies.
\nQ 9. What is meant by “net value of taxable
\nsupplies”?
\nAns. The “net value of taxable supplies” means the
\naggregate value of taxable supplies of goods or services
\nor both, other than the services on which entire tax is
\npayable by the e-commerce operator, made during any
\nmonth by all registered persons through such operator
\nreduced by the aggregate value of taxable supplies
\nreturned to the suppliers during the said month.
\nQ 10. Is every e-commerce operator required to
\ncollect tax on behalf of actual supplier?
\nAns. Yes, every e-commerce operator is required to
\ncollect tax where consideration with respect to the
\nsupply is being collected by the e-commerce operator.
\nQ <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nAns.
\nYes, every operator is required to furnish a
\nstatement, electronically, containing the details of
\noutward supplies of goods or services effected through it,
\nincluding the supplies of goods or services returned
\nthrough it, and the amount collected by it as TCS during a
\nmonth within ten days after the end of such month. The
\noperator is also required to file an annual statement by
\n31st day of December following the end of the financial
\nyear in which the tax was collected.
\nQ 15. What is the concept of matching in e-commerce
\nprovisions and how it is going to work?
\nAns. The details of supplies and the amount collected
\nduring a calendar month, and furnished by every operator
\nin his statement will be matched with the corresponding
\ndetails of outward supplies furnished by the concerned
\nsupplier in his valid return for the same calendar month or
\nany preceding calendar month. Where the details of
\noutward supply, on which the tax has been collec<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\noperator to furnish specified details within a period of 15
\nworking days from the date of service of such notice.
\n9. Job Work
\nQ1. Q 1. What is job
\nwork?
\nAns. Job work means undertaking any treatment or
\nprocess by a person on goods belonging to another
\nregistered taxable person. The person who is treating or
\nprocessing the goods belonging to other person is called
\n\u2018job worker' and the person to whom the goods belongs is
\ncalled 'principal'.
\nThis definition is much wider than the one given in
\nNotification No. 214\/86 – CE dated 23rd March, 1986. In
\nthe said notification, job work has been defined in such a
\nmanner so as to ensure that the activity of job work must
\namount to manufacture. Thus the definition of job work
\nitself reflects the change in basic scheme of taxation
\nrelating to job work in the proposed GST regime.
\nQ2. Whether goods sent by a taxable person to a
\njob worker will be treated as supply and liable to
\nGST?<\/p>\n
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\nsupplied from the job worker's premises will be
\nincluded in the aggregate turnover of the job
\nworker?
\nAns. No. It will be included in the aggregate turnover of
\nthe principal. However, the value of goods or services used
\nby the job worker for carrying out the job work will be
\nincluded in the value of services supplied by the job
\nworker.
\nQ 5. Can a principal send inputs and capital goods
\ndirectly to the premises of job worker without
\nbringing it to his premises?
\nAns. Yes, the principal is allowed to do so. The input tax
\ncredit of tax paid on inputs or capital goods can also be
\navailed by the principal in such a scenario. The inputs or
\ncapital goods must be received back within one year or
\nthree years respectively failing which the original
\ntransaction would be treated as supply and the principal
\nwould be liable to pay tax accordingly.
\nQ6. Can the principal supply the goods directly
\nfrom the premises of the job worker without
\nbringing <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\njob worker?
\nAns. Principal shall be entitled to take credit of taxes paid
\non inputs or capital goods sent to a job worker whether
\nsent after receiving them at his place of business or even
\nwhen such the inputs or capital goods are directly sent to
\na job worker without their being first brought to his place
\nof business. However, the inputs or capital goods, after
\ncompletion of job work, are required to be received back
\nor supplied from job worker's premises, as the case may
\nbe, within a period of one year or three years of their
\nbeing sent out.
\nQ9. What happens when the inputs or capital goods
\nare not received back or supplied from the place
\nof business of job worker within prescribed time
\nperiod?
\nAns. If the inputs or capital goods are not received back by
\nthe principal or are not supplied from the place of
\nbusiness of job worker within the prescribed time limit, it
\nwould be deemed that such inputs or capital goods had
\nbeen supplied by the pri<\/p>\n
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\nfor job work?
\nAns. Yes. The term inputs, for the purpose of job work,
\nincludes intermediate goods arising from any treatment
\nor process carried out on the inputs by the principal or job
\nworker.
\nQ 13.
\nWho is
\nresponsible
\nfor the
\naccounts
\nmaintenance of proper
\nrelated to job work?
\nAns. It is completely the responsibility of the principal to
\nmaintain proper accounts of job work related inputs and
\ncapital goods.
\nQ 14.
\nAre the provisions of job work applicable
\nto all categories of goods?
\nAns. No. The provisions relating to job work are applicable
\nonly when registered taxable person intends to send taxable
\ngoods. In other words, these provisions are not applicable
\nto exempted or non-taxable goods or when the sender is a
\nperson other than registered taxable person.
\nQ 15.
\nIs it compulsory that job work provisions
\nshould be followed by the principal?
\nAns. No. The principal can send the inputs or capital
\ngoods after payment of GST without following the spec<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nAns. Yes. The definition of input tax includes the tax payable
\nunder the reverse charge.
\nQ3. Does input tax includes tax (CGST\/IGST\/SGST)
\npaid on input goods, input services and capital
\ngoods?
\nAns. Yes, it includes taxes paid on input goods, input
\nservices and capital goods. Credit of tax paid on capital
\ngoods is permitted to be availed in one instalment.
\nQ4. Is credit of all input tax charged on supply of
\ngoods or services allowed under GST?
\nAns. A registered person is entitled to take credit of input
\ntax charged on supply of goods or services or both to him
\nwhich are used or intended to be used in the course or
\nfurtherance of business, subject to other conditions and
\nrestrictions.
\nQ5. What are the conditions
\nobtaining ITC?
\nnecessary for
\nAns. Following four conditions are to be satisfied by the
\nregistered taxable person for obtaining ITC:
\n(a) he is in possession of tax invoice or debit note or
\nsuch other tax paying documents as may be
\nprescribe<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nof the person. He would also be required to pay interest.
\nHowever, he can take ITC again on payment of consideration
\nand tax.
\nQ9. Who will get the ITC where goods have been
\ndelivered to a person other than taxable person
\n('bill to'- 'ship to 'scenarios)?
\nAns. It would be deemed that the registered person has
\nreceived the goods when the goods have been delivered to a
\nthird party on the direction of such taxable person. So ITC will
\nbe available to the person on whose order the goods are
\ndelivered to third person.
\nQ 10. What is the time limit for taking ITC
\nand reasons therefor?
\nAns. A registered person cannot take ITC in respect of any
\ninvoice or debit note for supply of goods or services after
\nthe due date for furnishing the return under section 39 for
\nthe month of September following the end of financial year
\nto which such invoice\/invoice relating to debit note
\npertains or furnishing of the relevant annual return,
\nwhichever is earli<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\ninto formation of an immovable property (except plant
\nand machinery), telecommunication towers, pipelines laid
\noutside the factory premises, etc. and taxes paid as a
\nresult of detection of evasion of taxes.
\nQ 13. A taxable person is in the business of
\ninformation technology. He buys a motor vehicle
\nfor use of his Executive Directors. Can he avail
\nthe ITC in respect of GST paid on purchase of such
\nmotor vehicle?
\nAns. No. ITC on motor vehicles can be availed only if the
\ntaxable person is in the business of transport of passengers
\nor goods or is providing the services of imparting training
\non motor vehicles.
\nQ 14. Sometimes goods are destroyed or lost due to
\nvarious reasons? Can a person take ITC to the
\nextent of such goods?
\nAns. No, a person cannot take ITC with respect to goods lost,
\nstolen, destroyed or written off. In addition, ITC with respect
\nof goods given as gifts or free samples are also not allowed.
\nQ 15. Can a registered person get ITC with respec<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nto pay tax can be taken.
\nQ17. A person becomes liable to pay tax on 1st
\nAugust, 2017and has obtained registration on
\n15th August, 2017. Such person is eligible for
\ninput tax credit on inputs held in stock as on:
\n(a) 1st August, 2017
\n(b) 31st July, 2017
\n(c) 15th August, 2017
\n(d) He cannot take credit for the past period
\nAns. 31st July, 2017.
\nQ 18. What is the eligibility of input tax credit on
\ninputs in stock for a person who obtains
\nvoluntary registration?
\nAns. The person who obtains voluntary registration is
\nentitled to take the input tax credit of input tax on inputs in
\nstock, inputs in semi-finished goods and finished goods in
\nstock, held on the day immediately preceding the date of
\nregistration.
\nQ 19. What would be input tax eligibility in cases
\nwhere there is a change in the constitution of a
\nregistered person?
\nAns. The registered person shall be allowed to transfer the
\ninput tax credit that remains unutilized in it<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\ncomputation of taxable supplies for the purpose
\nof availing credit?
\n(a) Zero-rated supplies
\n(b) Exempt supplies
\n(c) Both
\nAns. Zero rated supplies.
\nQ 23. Where goods or services received by a
\nregistered person are used partly for the
\npurpose of business and partly for other
\npurposes, whether the input tax credit is
\navailable to the person?
\nAns. The input tax credit of goods or services or both
\nattributable only to the purpose of business can be taken by
\nregistered person. The manner of calculation of eligible
\ncredit would be provided by rules.
\nQ 24. A person paying tax under compounding
\nscheme crosses the compounding threshold and
\nbecomes a regular taxable person. Can he avail
\nITC and if so from what date?
\nAns. He can avail ITC in respect of inputs held in stock and
\ninputs contained in semi-finished or finished goods held in
\nstock and on capital goods (reduced by prescribed
\npercentage points) on the day immediately preceding the
\ndate from w<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\ninputs in stock as on\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026\u2026..<\/p>\n
\nstock and inputs contained in semi-finished or finished
\ngoods held in stock as on 21st June, 2017. Mr. B cannot take
\ninput tax credit in respect of capital goods.
\nQ 28. What would happen to the input tax credit
\navailed by a registered person who opts for
\ncomposition scheme or where the goods or
\nservices or both supplied by him become wholly
\nexempt?
\nAns. The registered person has to pay an amount equal to
\nthe input tax credit in respect of stocks held on the day
\nimmediately preceding the date of exercise of option or
\ndate of exemption. In respect of capital goods, the
\npayable amount would be calculated by reducing by a
\nprescribed percentage point. The payment can be made
\nby debiting electronic credit ledger, if there is sufficient
\nbalance in the credit ledger, or by debitin<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\ndiscrepancies are communicated to concerned supplier and
\nrecipient. In case mismatch continues, the ITC taken would
\nbe reversed automatically.
\nQ 32. Can provisionally allowed ITC be used for
\npayment of all liabilities?
\nAns. No, provisionally allowed ITC can be used only for the
\npayment of self-assessed output tax in the return.
\nQ 33. What will be the tax impact when capital
\ngoods on which ITC has been taken are supplied
\nby taxable person?
\nAns. In case of supply of capital goods or plant and
\nmachinery on which input tax credit has been taken, the
\nregistered person shall pay an amount equal to the input
\ntax credit taken on the said capital goods or plant and
\nmachinery reduced by the percentage points as may be
\nspecified in this behalf or the tax on the transaction value of
\nsuch capital goods, whichever is higher.
\nQ 34. What is the tax implication of supply of capital
\ngoods by a registered person who had taken ITC
\non such capital goods?
\nAns. T<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nregistration of ISD under the existing regime (i.e. under
\nService Tax) would not be migrated in GST regime. All the
\nexisting ISDs will be required to obtain fresh registration
\nunder new regime in case they want to operate as an ISD.
\nQ3. What are the documents for distribution of
\ncredit by ISD?
\nAns. The distribution of credit would be done through a
\ndocument especially designed for this purpose. The said
\ndocument would contain the amount of input tax credit
\nbeing distributed.
\nQ4. Can an ISD distribute the input tax credit to all
\nsuppliers?
\nAns. No. The input tax credit of input services shall be
\ndistributed only amongst those registered persons who
\nhave used the input services in the course or furtherance of
\nbusiness.
\nQ5. It is not possible many a times to establish a
\none-to-one link between quantum of input
\nservices used in the course or furtherance of
\nbusiness by a supplier. In such situations, how
\ndistribution <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nAns. Yes, different offices like marketing division, security
\ndivision etc. may apply for separate ISD.
\nQ9. What are the provisions for recovery of
\nexcess\/wrongly distributed credit by ISD?
\nAns. The excess\/wrongly distributed credit can be
\nrecovered from the recipients of credit along with interest
\nby initiating action under section 73 or 74.
\nQ 10.
\nWhether CGST and IGST
\ncredit
\ncan
\nbe distributed by ISD as IGST credit to recipients
\nlocated in different States?
\nAns. Yes, CGST credit can be distributed as IGST and IGST
\ncredit can be distributed as CGST by an ISD for the
\nrecipients located in different States.
\nQ 11.
\nAns.
\nWhether SGST \/ UTGST credit can be
\ndistributed as IGST credit by an ISD to recipients
\nlocated in different States?
\nYes, an ISD can distribute SGST \/UTGST credit as
\nIGST for the recipients located in different States.
\nQ 12.
\nWhether the ISD can distribute the CGST
\nand IGST Credit as CGST credit?
\nAns. Yes, CGST and I<\/p>\n
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\ninput service on pro rata basis of turnover in
\nsuch State.
\n(b) Distributed equally among all the suppliers.
\n(c) Distributed only to one supplier.
\n(d) Cannot be distributed.
\nAns. (a) Distributed among the suppliers who used such
\ninput service on pro rata basis of turnover in such State.
\nQ 18. Whether the excess credit distributed could
\nbe recovered from ISD by the department?
\nAns. No. Excess credit distributed can be recovered
\nalong with interest only from the recipient and not ISD.
\nThe provisions of section 73 or 74 would be applicable for
\nthe recovery of credit.
\nQ 19. What are the consequences of credit distributed
\nin contravention of the provisions of the Act?
\nAns. The credit distributed in contravention of provisions
\nof Act could be recovered from the recipient to which it is
\ndistributed along with interest.
\n*****
\n12. Returns Process and matching of
\nInput Tax Credit
\nQ 1.
\nWhat is the purpose of returns?
\nAns.
\na) Mode for transfer of information to <\/p>\n
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\nundertaken.
\nQ3. What type of outward supply details are to be
\nfiled in the return?
\nAns. A normal registered taxpayer has to file the outward
\nsupply details in GSTR-1 in relation to various types of
\nsupplies made in a month, namely outward supplies to
\nregistered persons, outward supplies to unregistered
\npersons (consumers), details of Credit\/Debit Notes, zero
\nrated, exempted and non-GST supplies, exports, and
\nadvances received in relation to future supply.
\nQ4. Is the scanned copy of invoices to be uploaded
\nalong with GSTR-1?
\nAns. No scanned copy of invoices is to be uploaded. Only
\ncertain prescribed fields of information from invoices need
\nto be uploaded.
\nQ5. Whether all invoices will have to
\nuploaded?
\nbe
\nAns. No. It depends on whether B2B or B2C plus whether
\nIntra-state or Inter-state supplies.
\nFor B2B supplies, all invoices, whether Intra-state or Inter-
\nstate supplies, will have to be uploaded. Why So? Because
\nITC will be take<\/p>\n
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\nIn case there is no consideration, but it is supply by
\nvirtue of schedule 1, the taxable value will have to be
\nworked out as prescribed and uploaded.
\nQ8. Can a recipient feed information in his GSTR-2
\nwhich has been missed by the supplier?
\nAns. Yes, the recipient can himself feed the invoices not
\nuploaded by his supplier. The credit on such invoices will
\nalso be given provisionally but will be subject to matching.
\nOn matching, if the invoice is not uploaded by the supplier,
\nboth of them will be intimated. If the mismatch is rectified,
\nprovisional credit will be confirmed. But if the mismatch
\ncontinues, the amount will be added to the output tax
\nliability of the recipient in the returns for the month
\nsubsequent to the month in which such discrepancy was
\ncommunicated.
\nQ9. Does the taxable person have to feed
\nanything in the GSTR-2 or everything is auto-
\npopulated from GSTR-1?
\nAns. While a large part of GSTR-2 will be auto-populated,
\nthere are some details <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nQ 11. What will be the legal position in regard to the
\nreversed input tax credit if the supplier later
\nrealizes the mistake and feeds the information?
\nAns. At any stage, but before September of the next
\nfinancial year, supplier can upload the invoice and pay
\nduty and interest on such missing invoices in his GSTR-3 of
\nthe month in which he had earlier failed to upload the
\ninvoice. The recipient shall be eligible to reduce his output
\ntax liability to the extent of the amount in respect of which
\nthe supplier has rectified the mis-match. The interest paid
\nby the recipient at the time of reversal will also be
\nrefunded to the recipient by crediting the amount in
\ncorresponding head of his electronic cash ledger.
\nQ 12. What is the special feature of GSTR-2?
\nAns. The special feature of GSTR-2 is that the details of
\nsupplies received by a recipient can be auto populated
\non the basis of the details furnished by the counterparty
\nsupplier in his GSTR-1.
\nQ 13. Do tax pa<\/p>\n
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\nthem to the recipient units. Since their return itself covers
\nthese aspects, there is no requirement to file separate
\nstatement of inward and outward supplies.
\nQ 15. How does a taxpayer get the credit of the tax
\ndeducted at source on his behalf? Does he need
\nto produce TDS certificate from the deductee to
\nget the credit?
\nAns. Under GST, the deductor will be submitting the
\ndeductee wise details of all the deductions made by him
\nin his return in Form GSTR-7 to be filed by 10th of the
\nmonth next to the month in which deductions were made.
\nThe details of the deductions as uploaded by the deductor
\nshall be auto populated in the GSTR-2 of the deductee.
\nThe taxpayer shall be required to confirm these details
\nin his GSTR-2 to avail the credit for deductions made
\non his behalf. To avail this credit, he does not require to
\nproduce any certificate in physical or electronic form.
\nThe certificate will only be for record keeping of the\n<\/p>\n
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\nindividual transactions, there is no requirement for having
\na revised return. Any need to revise a return may arise
\ndue to the need to change a set of invoices or debit\/credit
\nnotes. Instead of revising the return already submitted, the
\nsystem will allow changing the details of those transactions
\n(invoices or debit\/credit notes) that are required to be
\namended. They can be amended in any of the future GSTR-
\n1\/2 in the tables specifically provided for the purposes of
\namending previously declared details.
\nQ 19. How can taxpayers file their returns?
\nAns. Taxpayers will have various modes to file the
\nstatements and returns. Firstly, they can file their statement
\nand returns directly on the Common Portal online. However,
\nthis may be tedious and time consuming for taxpayers
\nwith large number of invoices. For such taxpayers, an
\noffline utility will be provided that can be used for
\npreparing the statements offline after downloading the
\nauto populated detai<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\ncome with higher risk of possible failure and default. The
\nsecond thing would be to ensure that taxpayers follow up
\non uploading the invoices of their inward supplies by their
\nsuppliers. This would be helpful in ensuring that the input tax
\ncredit is available without any hassle and delay. Recipients
\ncan also encourage their suppliers to upload their invoices on
\na regular basis instead of doing it on or close to the due date.
\nThe system would allow recipients to see if their suppliers have
\nuploaded invoices pertaining to them. The GSTN system will
\nalso provide the track record about the compliance level of a
\ntax payer, especially about his track record in respect of timely
\nuploading of his supply invoices giving details about the auto
\nreversals that have happened for invoices issued by a supplier.
\nThe Common Portal of GST would have pan India data at one
\nplace which will enable valuable services to the taxpayers.
\nEfforts a<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nQ 23. What happens if ITC is taken on the basis of a
\ndocument more than once?
\nAns. In case the system detects ITC being taken on the
\nsame document more than once (duplication of claim), the
\namount of such credit would be added to the output tax
\nliability of the recipient in the return. [section 42(6)]
\nQ 24. Whether the amount of credit detected by the
\nsystem on account of mis-match between GSTR-1
\nand GSTR-2 and recovered as output tax can be
\nreclaimed?
\nAns. Yes, once the mismatch is rectified by the supplier by
\ndeclaring the details of the invoices or debit notes, as the
\ncase may be, in his valid return for the month\/quarter in
\nwhich the error had been detected. The said amount can be
\nreclaimed by way of reducing the output tax liability during
\nthe subsequent tax period. [section 42(7)]. Similar
\nprovisions have also been made in Section 43 of the Act in
\nrespect of the credit notes issued by the supplier.
\n13. Assessment and Audit
\nQ1. Who is the p<\/p>\n
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\ndetermine:
\na) the value of goods or services to be supplied by
\nhim, or
\nb) determine the tax rate applicable to the goods
\nor services to be supplied by him.
\nIn such cases the taxable person has to execute a bond in
\nthe prescribed form, and with such surety or security as
\nthe proper officer may deem fit.
\nQ3. What is the latest time by which final
\nassessment is required to be made?
\nAns. The final assessment order has to be passed by the
\nproper officer within six months from the date of the
\ncommunication of the order of provisional assessment.
\nHowever, on sufficient cause being shown and for reasons
\nto be recorded in writing, the above period of six months
\nmay be extended:
\na) by the Joint\/Additional Commissioner
\nfor a further period not exceeding six months,
\nand
\nb) by the Commissioner for such further period as
\nhe may deem fit not exceeding fours.
\nThus, a provisional assessment can remain provisional for a
\nmaximum of five years.
\nQ4. Where the tax<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nthis purpose by the Commissioner; or
\n(c) Undertake procedures of inspection, search and
\nseizure under Section 67 of the Act; or
\n(d) Initiate proceeding for determination of
\ntax and other dues under Section 73 or 74 of
\nthe Act.
\nQ6. If a taxable person fails to file the
\nreturn required under law (under section 39
\n(monthly\/quarterly), or 45 (final
\nreturn), what legal recourse is available to the
\ntax officer?
\nAns. The proper officer has to first issue a notice to the
\ndefaulting taxable person under section 46 of CGST\/SGST
\nAct requiring him to furnish the return within a period of
\nfifteen days. If the taxable person fails to file return within
\nthe given time, the proper officer shall proceed to assess
\nthe tax liability of the return defaulter to the best of his
\njudgement taking into account all the relevant material
\navailable with him. (Section 62).
\nbest
\nQ7. Under what circumstances can a
\njudgment assessment order issued under section
\n60 b<\/p>\n
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\nannual return for the financial year to which non-payment
\nof tax relates.
\nQ 10. Under what circumstances can a tax officer
\ninitiate Summary Assessment?
\nAns.
\nAs per section 64 of CGST\/SGST Act, Summary
\nAssessments can be initiated to protect the interest of
\nrevenue when:
\na) the proper officer has evidence that a taxable
\nperson has incurred a liability to pay tax under
\nthe Act, and
\nb) the proper officer believes that delay in passing
\nan assessment order will adversely affect the
\ninterest of revenue.
\nSuch order can be passed after seeking permission from the
\nAdditional Commissioner\/Joint Commissioner.
\nQ 11. Other than appellate remedy, is there
\nany other recourse available to the taxpayer
\nagainst a summary assessment order?
\nAns.
\nA taxable person against whom a summary
\nassessment order has been passed can apply for its
\nwithdrawal to the jurisdictional Additional\/Joint
\nCommissioner within thirty days of the date of receipt
\nof the order. If the said<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nprescribed limit, shall get his accounts audited by a
\nchartered accountant or a cost accountant. (Section
\n35(5) of the CGST\/SGST Act)
\n(b) Audit by Department: The Commissioner or any officer
\nof CGST or SGST or UTGST authorized by him by a
\ngeneral or specific order, may conduct audit of any
\nregistered person. The frequency and manner of audit
\nwill be prescribed in due course. (Section 65 of the
\nCGST\/SGST Act)
\n(c) Special Audit: If at any stage of scrutiny, inquiry,
\ninvestigations or any other proceedings, if department
\nis of the opinion that the value has not been correctly
\ndeclared or credit availed is not with in the normal
\nlimits, department may order special audit by
\nchartered accountant or cost accountant, nominated
\nby department. (Section 66 of the CGST\/SGST Act)
\nQ 14. Whether any prior intimation is required
\nbefore conducting the audit?
\nAns. Yes, prior intimation is required and the taxable
\nperson should be informed at least 15 working days prior to\n<\/p>\n
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\nrequire for the conduct of the audit, and
\nc) render assistance for timely completion of the
\naudit.
\nQ 18. What would be the action by the proper officer
\nupon conclusion of the audit?
\nAns. The proper officer shall, on conclusion of audit,
\nwithin 30 days inform the taxable person about his
\nfindings, reasons for findings and the taxable person's
\nrights and obligations in respect of such findings.
\nQ 19. Under what circumstances can a special audit
\nbe instituted?
\nAns. A special audit can be instituted in limited
\ncircumstances where during scrutiny, investigation, etc. it
\ncomes to the notice that a case is complex or the revenue
\nstake is high. This power is given in section 66 of CGST
\n\/SGST Act.
\nQ 20. Who can serve the notice of communication
\nfor special audit?
\nAns. The Assistant \/ Deputy Commissioner is to serve the
\ncommunication for special audit only after prior
\napproval of the Commissioner.
\nQ 21. Who will do the special audit?
\nAns. A Chartered A<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nthe credit has accumulated on account of rate of tax on
\ninputs being higher than the rate of tax on output supplies
\n(other than nil rated or fully exempt supplies),
\n(c) tax paid by specialized agency of United Nations or any
\nMultilateral Financial Institution and Organization notified
\nunder the United Nations (Privileges and Immunities) Act,
\n1947, Consulate or Embassy of foreign countries on any
\ninward supply
\nQ 2.
\nCan unutilized Input tax credit be allowed as
\nrefund?
\nAns. Unutilized input tax credit can be allowed as refund
\nin accordance with the provisions of sub-section (3) of
\nsection 54 in the following situations: –
\n(i) Zero rated supplies made without payment of tax;
\n(ii) Where credit has accumulated on account of rate of tax
\non inputs being higher than the rate of taxes on output
\nsupplies (other than nil rated or fully exempt supplies)
\nHowever, no refund of unutilized input tax credit shall be
\nallowed in cases where the goods exported out of India are
\nsubj<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nAns. The taxable person cannot adjust CGST\/SGST or
\nIGST with the wrongly paid IGST or CGST\/SGST but he is
\nentitled to refund of the tax so paid wrongly – Sec.77 of
\nthe CGST\/SGST Act.
\nQ6.
\nWhether purchases made by Embassies or UN
\nare taxed or exempted?
\nAns. Supplies to the Embassies or UN bodies will be taxed,
\nwhich later on can be claimed as refund by them in terms
\nof Section 54(2) of the CGST\/SGST Act. The claim has to
\nbe filed in the manner prescribed under CGST\/SGST
\nRefund rules, before expiry of six months from the last day
\nof the month in which such supply was received.
\n[The United Nations Organization and Consulates or
\nEmbassies are required to take a Unique Identity Number
\n[section 26(1) of the CGST\/SGST Act] and purchases made
\nby them will be reflected against their Unique Identity
\nNumber in the return of outward supplies of the
\nsupplier(s)]
\nQ7. What is the time limit for taking refund?
\nAns. A person claiming refund is required to file<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nif the incidence of tax or interest paid has not been
\npassed on to any other person;
\nsuch other class of persons who has borne the
\nincidence of tax as the Government may notify.
\nIn case the tax has been passed on to the
\nconsumer, whether refund will be sanctioned?
\nAns. Yes, the amount so refunded shall be credited to the
\nConsumer Welfare Fund – Section 57 of the CGST\/SGST Act
\nQ 10. Is there any time limit for sanctioning of
\nrefund?
\nAns. Yes, refund has to be sanctioned within 60 days from
\nthe date of receipt of application complete in all respects.
\nIf refund is not sanctioned within the said period of 60
\ndays, interest at the rate notified will have to be paid in
\naccordance with section 56 of the CGST\/SGST Act.
\nHowever, in case where provisional refund to the extent of
\n90% of the amount claimed is refundable in respect of
\nzero-rated supplies made by certain categories of
\nregistered persons in terms of sub-section (6) of section 54
\nof the CGST\/SGST Act, <\/p>\n
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\nperson be given interest?
\nAns. If as a result of appeal or further proceeding the
\ntaxable person becomes entitled to refund, then he shall
\nalso be entitled to interest at the rate notified [section
\n54(12) of the CGST\/SGST Act].
\nQ 13. Is there any minimum threshold for refund?
\nAns. No refund shall be granted if the amount is less than
\nRs.1000\/-. [Sec.54 (14) of the CGST\/SGST Act]
\nQ 14. How will the refunds arising out of existing law
\nbe paid?
\nAns. The refund arising out of existing law will be paid as
\nper the provisions of the existing law and will be made in
\ncash and will not be available as ITC.
\nQ 15. Whether
\nrefund
\ncan be made before
\nverification of documents?
\nAns. In case of any claim of refund to a registered person on
\naccount of zero rated supplies of goods or services or both
\n(other than registered persons as may be notified), 90%
\nrefund may be granted on provisional basis before
\nverification subject to such conditions<\/p>\n