INTERPRETATION OF CENTRAL GOODS AND SERVICES TAX (CGST) ACT (PART-9) (Meaning of Important Terms)
By: – Dr. Sanjiv Agarwal
Goods and Services Tax – GST
Dated:- 12-6-2017<\/p>\n
This part of the series contains meanings of certain terms covered in Section 2 of the CGST Act, 2017. These are Non-resident Taxable Person, Output Tax, Outward Supply, Person, Place of Business, Principal Place of Business and Principal Supply.
\n Non-resident Taxable Person [Section 2(77)]
\n'Non-resident taxable person' means any person who occasionally undertakes transactions involving supply of goods or services or both, whether as principal or agent or in any other capacity, but who has no fixed place of business or residence in India.
\nNot resident taxable person has no fixed place of business or residence in India. Such person occasionally undertakes transactions of supply of goods or services or both, as agent or principal or in any other capacity.
\nIt is important to note that the feat<\/p>\n
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\nIt is important to note that even though tax on reverse charge basis is also payable by a taxable person but payment of such tax will not be considered to be output tax.
\nOutward Supply [Section 2(83)]
\n'Outward supply' in relation to a taxable person, means supply of goods or services or both, whether by sale, transfer, barter, exchange, licence, rental, lease or disposal or any other mode, made or agreed to be made by such person in the course or furtherance of business.
\nThe term ' outward supply' in relation to a person has been defined to mean :
\n * supply of goods and \/ or services,
\n * whether by sale, transfer, barter, exchange, license, rental, lease or disposal,
\n * made or agreed to be made by such person,
\n * in the course or furtherance of business,
\n * but excludes the cases where the tax is payable on reverse char<\/p>\n
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\n * every artificial juridical person, not falling within any of the preceding sub-clauses.
\n'Person' would therefore, include both, natural persons as well as artificial juristic persons.
\nPlace of Business [Section 2(85)]
\n'Place of business' has been defined as an inclusive definition and it includes –
\n * a place from where the business is ordinarily carried on, and includes a warehouse, a godown or any other place where a taxable person stores his goods, provides or receives goods and\/or services; or
\n * a place where a taxable person maintains his books of account; or
\n * a place where a taxable person is engaged in business through an agent, by whatever name called.
\nPlace of business would include the following places :
\n * place from where business is ordinarily carried on,
\n * warehouse,
\n * godown,
\n * any other place used for storing goods or place to provide or receive goods or services by taxable person,
\n * place where books of accounts are mainta<\/p>\n
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\n * It should be a place of business
\n * It should be specified as such in registration certificate
\n * Taxable person should keep and maintain the accounts and records
\nPrincipal Supply [Section 2(90)]
\n'Principal Supply' means the supply of goods or services which constitutes the predominant element of a composite supply and to which any other supply forming part of that composite supply is ancillary.
\nThe term 'principal supply' needs to be read in reference to 'composite supply'. As composite supply consists of two or more than two goods and \/ or services, one of such will be principal supply and other goods and \/ or services will be termed as ancillary supply.
\nIn the case of composite supply, the rate of tax is determined in reference to rate of tax applicable on principal supply constituted in the contract of composite supply.
\nPrincipal supply in a case of <\/p>\n
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