FAQ FOR GOVERNMENT DEPARTMENTS, LOCAL AUTHORITIES AND OTHER LINE DEPARTMENT
GST
Dated:- 22-8-2017
FAQ FOR GOVERNMENT DEPARTMENTS, LOCAL AUTHORITIES AND OTHER LINE DEPARTMENT
\n=============
\nDocument 1
\nFAQ FOR GOVERNMENT DEPARTMENTS, LOCAL
\nAUTHORITIES AND OTHER LINE DEPARTMENTS
\n1. ARE ALL SERVICES PROVIDED BY THE GOVERNMENT OR LOCAL AUTHORITY EXEMPTED
\nFROM PAYMENT OF TAX ?
\nNo, all services provided by the Government or a local authority are not exempt from tax. As for
\ninstance, services, namely, (i) services by the Department of Posts by way of speed post,
\nexpress parcel post, life insurance, and agency services provided to a person other than
\nGovernment; (ii) services in relation to an aircraft or a vessel, inside or outside the precincts of
\nan airport or a port; (iii) transport of goods or passengers; or (iv) any service, other than
\nservices covered under (i) to (iii) above, provided to business entities are not exempt and that
\nthese services are liable to tax.\n<\/p>\n
= = = = = = = =<\/p>\n
Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ent of Posts by way of speed post, express parcel post, life insurance, and agency = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n tate = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n abad = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n are exempt under notification No. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n o not fall under the definition of Government. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n red post provided exclusively by the Department of Posts to meet the universal = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n THE CONSTITUTION? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n \nscale industries, including food processing industries. (ix). Khadi, village and cottage = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ceived the consideration in the form of fines or penalty = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n his gets covered under the exemption by way of tolerating non-performance of a = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n able property, = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n nment or local = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n account of SGST and make a net payment of Rs. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n x at source on the basis of = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ide the state. IGST = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n cannot be incorporated in TR-5, invoice will have to be issued in GST. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n n Form GSTR 7A) furnishing details = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n","protected":false},"excerpt":{"rendered":" FAQ FOR GOVERNMENT DEPARTMENTS, LOCAL AUTHORITIES AND OTHER LINE DEPARTMENT GSTDated:- 22-8-2017FAQ FOR GOVERNMENT DEPARTMENTS, LOCAL AUTHORITIES AND OTHER LINE DEPARTMENT ============= Document 1 FAQ FOR GOVERNMENT DEPARTMENTS, LOCAL AUTHORITIES AND OTHER LINE DEPARTMENTS 1. ARE ALL SERVICES PROVIDED BY THE GOVERNMENT OR LOCAL AUTHORITY EXEMPTED FROM PAYMENT OF TAX ? No, all services provided … Continue reading “FAQ FOR GOVERNMENT DEPARTMENTS, LOCAL AUTHORITIES AND OTHER LINE DEPARTMENT”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-7335","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/7335","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=7335"}],"version-history":[{"count":0,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/7335\/revisions"}],"wp:attachment":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=7335"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=7335"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=7335"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
For full text:-Visit the Source <\/a><\/p>\n
\nservices provided to a person other than Government; and (iii) services in relation to an aircraft
\nor a vessel, inside or outside the precincts of an airport or a port, the service recipients are
\nrequired to pay the tax under reverse charge mechanism.
\n3. WHAT IS THE MEANING OF \u2018GOVERNMENT' ?
\nAs per section 2(53) of the GST Act, 'Government' means the Central Government. As per
\nclause (23) of section 3 of the General Clauses Act, 1897 the 'Government' includes both the
\nCentral Government and any State Government. As per clause (8) of section 3 of the said Act,
\nthe 'Central Government', in relation to anything done or to be done after the commencement
\n2
\nof the Constitution, means the President. As per Article 53 of the Constitution, the executive
\npower of the Union shall be vested in the President and shall be exercised by him either directly
\nor indirectly through officers subordinate to <\/p>\n
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\nshall be expressed to be taken in the name of Governor. Therefore, State Government means
\nthe Governor or the officers subordinate to him who exercise the executive powers of the State
\nvested in the Governor and in the name of the Governor.
\n4. WHO IS A LOCAL AUTHORITY?
\nLocal authority is defined in clause (69) of section 2 of the CGST Act and means the
\nfollowing:-
\na “Panchayat” as defined in clause (d) of article 243 of the Constitution;
\na “Municipality” as defined in clause (e) of article 243P of the Constitution;
\na Municipal Committee, a Zilla Parishad, a District Board, and any other authority legally
\nentitled to, or entrusted by the Central Government or any State Government with the
\ncontrol or management of a municipal or local fund;
\na Cantonment Board as defined in section 3 of the Cantonments Act, 2006;
\na Regional Council or a District Council constituted under the Sixth Schedule to the
\nConstitution;
\na Development Board constituted under article 371 of the Co<\/p>\n
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\nDevelopment Authority, Bangalore Development Authority, Chennai Metropolitan
\nDevelopment Authority, Bihar Industrial Area Development Authority, etc. Such developmental
\nauthorities formed under the Town and Planning Act are not qualified as local authorities for
\nthe purposes of the GST Act.
\n6.
\nWOULD A STATUTORY BODY, CORPORATION OR AN AUTHORITY CONSTITUTED
\nUNDER AN ACT PASSED BY THE PARLIAMENT OR ANY OF THE STATE LEGISLATURES BE
\nREGARDED AS 'GOVERNMENT' OR “LOCAL AUTHORITY” FOR THE PURPOSES OF THE
\nGST ACT?
\nA statutory body, corporation or an authority created by the Parliament or a State
\nLegislature is neither 'Government' nor a local authority'. Such statutory bodies, corporations
\nor authorities are normally created by the Parliament or a State Legislature in exercise of the
\npowers conferred under article 53(3)(b) and article 154(2)(b) of the Constitution respectively. It
\nis a settled position of law (Agarwal Vs. Hindustan Steel AIR 1970 Supreme Court 1150) that the<\/p>\n
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\n12\/2017-Central Tax (Rate), dated 28.06.2017 [S No 8 of the Table].
\nHowever, this exemption is not applicable to
\na) services provided by the Department of Posts by way of speed post, express parcel post,
\nlife insurance, and agency services provided to a person other than the Central
\nGovernment, the State Government and Union Territory;
\nb) services in relation to a vessel or an aircraft inside or outside the precincts of a port or
\nan airport;
\nc) services of transport of goods and\/or passengers;
\n8. WHAT ARE THE TRANSPORT SERVICES PROVIDED BY THE GOVERNMENT OR LOCAL
\nAUTHORITIES EXEMPT FROM TAX?
\nTransport services provided by the Government to passengers by
\n–
\nrailways in a class other than \u2014 (a) first class; or (b) an air-conditioned coach;
\nmetro, monorail or tramway;
\ninland waterways;
\npublic transport, other than predominantly for tourism purpose, in a vessel between
\nplaces located in India; and
\nmetered cabs or auto rickshaws (inc<\/p>\n
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\nExamples of regulatory bodies are – Competition Commission of India, Press Council of India,
\nDirectorate General of Civil Aviation, Forward Market Commission, Inland Water Supply
\nAuthority of India, Central Pollution Control Board, Securities and Exchange Board of India.
\n11. WILL THE SERVICES PROVIDED BY POLICE, FIRE AND RESCUE SERVICES OR SECURITY
\nAGENCIES OF GOVERNMENT TO PSUS OR CORPORATE ENTITIES OR SPORTS EVENTS
\nHELD BY PRIVATE ENTITIES BE TAXABLE?
\nYes. Services provided by Police, Fire and Rescue Services or security agencies of
\nGovernment to PSU\/private business entities are not exempt from GST. Such services are
\ntaxable supplies and the recipients are required to pay the tax under reverse charge mechanism
\non the amount of consideration paid to Government for such supply of services.
\nIllustration: The Kerala Cricket Association, Kochi requests the Commissioner of Police, Kochi to
\nprovide security in and around the Cricke<\/p>\n
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\npostal obligations.
\nTransfer of money through money orders, operation of savings accounts, issue of postal
\norders, pension payments and other such services.
\nAgency services provided to the Government or Union territory
\nWHAT IS THE SCOPE OF AGENCY SERVICES PROVIDED BY THE DEPARTMENT OF
\nPOSTS MENTIONED IN THE NOTIFICATION BY SRO NO.371\/2017 DTD.30TH JUNE, 2017
\n(KERALA) AND NO. 12\/2017-CENTRAL TAX(RATE), DATED 28.06.2017?
\nThe Department of Posts also provides services like distribution of mutual funds, bonds,
\npassport applications, collection of telephone and electricity bills on commission basis. These
\nservices are in the nature of intermediary and generally called agency services. In these cases,
\nthe Department of Posts is liable to pay tax without application of reverse charge.
\nA
\n14. WOULD SERVICES RECEIVED BY GOVERNMENT, A LOCAL AUTHORITY,
\nGOVERNMENTAL AUTHORITY FROM A PROVIDER OF SERVICE LOCA<\/p>\n
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\nKERALA STATE GOODS AND SERVICE TAX DEPARTMENT
\nKERALA GST
\n7
\nThe functions entrusted to a municipality under the Twelfth Schedule to Article 243W of
\nthe Constitution are as under:
\n(i) Urban planning including town planning.
\n(ii) Regulation of land-use and construction of buildings.
\n(iii) Planning for economic and social development.
\n(iv) Roads and bridges.
\n(v)Water supply for domestic, industrial and commercial purposes.
\n(vi) Public health, sanitation conservancy and solid waste management.
\n(vii) Fire services.
\n(viii) Urban forestry, protection of the environment and promotion of ecological
\naspects.
\n(ix) Safeguarding the interests of weaker sections of society, including the handicapped and
\nmentally retarded.
\n(x) Slum improvement and upgradation.
\n(xi) Urban poverty alleviation.
\n(xii). Provision of urban amenities and facilities such as parks, gardens, playgrounds.
\n(xiii). Promotion of cultural, educational and aesthetic aspects.
\n(xiv). Burials and <\/p>\n
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\nindustries. (x). Rural housing. (xi). Drinking water. (xii). Fuel and fodder. (xiii). Roads,
\nculverts, bridges, ferries, waterways and other means of communication. (xiv). Rural
\nelectrification, including distribution of electricity. (xv). Non-conventional energy sources.
\n(xvi). Poverty alleviation programme. (xvii). Education, including primary and secondary
\nschools. (xviii). Technical training and vocational education. (xix). Adult and non-formal
\neducation. (xx). Libraries. (xxi). Cultural activities. (xxii). Markets and fairs. (xxiii). Health and
\nsanitation, including hospitals, primary health centres and dispensaries. (xxiv). Family
\nwelfare. (xxv). Women and child development. (xxvi). Social welfare, including welfare of
\nthe handicapped and mentally retarded. (xxvii). Welfare of the weaker sections, and in
\nparticular, of the Scheduled Castes and the Scheduled Tribes. (xxviii). Publi<\/p>\n
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\nand is, accordingly, required to pay tax on such amount.
\nHowever, non performance of contract by the supplier of service in case of supplies to
\nGovernment is covered under the exemption from payment of tax. Thus any consideration
\nKERALA STATE GOODS AND SERVICE TAX DEPARTMENT
\nKERALA GST
\n9
\nreceived by the Government from any person or supplier for non performance of contract is
\nexempted from tax.
\nIllustration: Public Works Department of Kerala entered into an agreement with M\/s. XYZ, a
\nconstruction company for construction of office complex for certain amount of consideration.
\nIn the agreement dated 10.7.2017, it was agreed by both the parties that M\/s. XYZ shall
\ncomplete the construction work and handover the project on or before 31.12.2017. It was
\nfurther agreed that any breach of the terms of contract by either party would give right to the
\nother party to claim for damages or penalty. Assuming that M\/s. XYZ does no<\/p>\n
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\ncontract for which consideration in the form of fines or liquidated damages is payable to the
\nGovernment or the local authority.
\n22. A SMALL BUSINESS ENTITY IS CARRYING ON A BUSINESS RELATING TO CONSULTING
\nENGINEER SERVICES IN DELHI. DOES IT NEED TO PAY TAX ON THE SERVICES RECEIVED
\nFROM GOVERNMENT OR A LOCAL AUTHORITY?
\nIf turnover of the entity is less than the limit of Rs. 20 lakhs in a financial year, no tax would be
\npayble.
\nKERALA STATE GOODS AND SERVICE TAX DEPARTMENT
\nKERALA GST
\n10
\n10
\nIf the turnover of a business entity is above Rs.20 lakhs, the business entity is liable to pay tax
\non the servies received from Govt. on reverse charge basis.
\nHowever, with regard to the following services,
\nservices by the Department of Posts by way of speed post, express parcel post, life insurance,
\nand agency services provided to a person other than Government;
\nservices in relation to an aircraft or a ve<\/p>\n
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\n(ii) services by the Department of Posts by way of speed post, express parcel post, life
\ninsurance, and agency services provided to a person other than Government,
\n(ii) services in relation to an aircraft or a vessel, inside or outside the precincts of an
\nairport or a port;
\n(iii) transport of goods or passengers.
\nKERALA STATE GOODS AND SERVICE TAX DEPARTMENT
\nKERALA GST
\n11
\nThus, the recipient of supply of goods or services is liable to pay the entire amount of tax
\ninvolved in such supply of services or goods or both.
\n28.06.2017
\nAND
\n25.WHAT IS THE SCOPE OF 'PURE SERVICES' MENTIONED IN THE EXEMPTION
\nNOTIFICATION NO. 12\/2017-CENTRAL TAX (RATE), DATED
\nS.R.O.NO.371\/2017 DATED 30.06.2017?
\nIn the context of the language used in the notification, supply of services without involving
\nany supply of goods would be treated as supply of 'pure services'. For example, supply of man
\npower for cleanliness of roads, public places, architect services, consulting engineer s<\/p>\n
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\nauthority. Generally, such State transport undertakings\/corporations are established by law
\nwith a view to providing public transport facility to the commuters. In some cases, transport
\nundertakings hire the buses on lease basis from private persons on payment of consideration.
\nThe services by way of supply of motor vehicles to such state transport undertaking are exempt
\nfrom payment of tax. However, supplies of motor vehicles to Government Departments other
\nthan the state transport undertakings are taxable.
\n27. CAN THE SUPPLIER OF SERVICES CLAIM THE TAX PAID UNDER REVERSE CHARGE
\nMECHANISM AS INPUT TAX CREDIT?
\nYes. The supplier of services may claim the input tax credit on the amount of tax paid under
\nreverse charge mechanism subject to the provisions of Input Tax Credit Rules.
\n28. WHAT IS THE CONCEPT CALLED \u2018TAX DEDUCTION AT SOURCE'?
\nKERALA STATE GOODS AND SERVICE TAX DEPARTMENT
\nKERALA GST
\n12
\n12
\nAs per section 51 of the CGST Act, the Government may<\/p>\n
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\n2,94,000\/- to ABC. Thereafter, the department shall pay the amount of Rs. 3,000\/- to the
\nCentral Government and Rs. 3,000\/- to the State Government and furnish a certificate to the
\ndeductee, containing the details of such deduction including the details of such deductee.
\n29. WHETHER THE DEDUCTEE CAN CLAIM THE INPUT TAX CREDIT ON THE DEDUCTION OF
\nTAX AT SOURCE AMOUNT?
\nNo. The tax deducted at source is not input tax credit. However, the amount deducted shall be
\ncredited to the electronic cash ledger (upon being accepted by the deductee in his Form GSTR-
\n2A) of the deductee and can be utilized for payment of output tax.
\n30. WHETHER AN AMOUNT IN THE FORM OF ROYALTY OR ANY OTHER FORM
\nPAID\/PAYABLE TO THE GOVERNMENT FOR ASSIGNING THE RIGHTS TO USE OF
\nNATURAL RESOURCES IS TAXABLE?
\nThe Government provides license to various companies including Public Sector Undertakings for
\nexploration of natural resources like oil, hydrocarbons, iron o<\/p>\n
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\nTAN\/PAN.
\n32. WHETHER A GOVERNMENT DEPARTMENT MAKING ONLY NON TAXABLE OR EXEMPTED
\nSUPPLIES NEED TO TAKE REGULAR REGISTRATION?
\nNo. but if it has liability to deduct TDS it will have to take TDS registration.
\n33. WHETHER THE GOVERNMENT DEPARTMENT WILL HAVE TO TAKE REGULAR
\nREGISTRATION FOR ALL ITS UNITS OR DISTRICT WISE OR OFFICE WISE?
\nInstitutional PAN can be obtained from IT department by any office. Hence, any office can get
\nregistered under GST Act. But registration brings in responsibilities like timely return filing,, . It
\nis ideal that, an office of a department which is making regular taxable supplies should take
\nregistration and those offices which have only occasional transactions can file their details
\nthrough higher offices having regular taxable supplies. However, the matter is to be decided
\ninternally in the department.
\n34. WHETHER SEPARATE REGISTRATION IS REQUIRED FOR REGULAR TAXABLE SUPPLIES
\nAND FOR TDS+
\nYes, if the Department make<\/p>\n
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\nwould be the combined rate of CGST and SGST. This should be shown separately in the tax
\ninvoice.
\nEg: If for an intra state sale of timber tax to be collected is 9% CGST and 9% SGST. If the timber
\nis sold interstate, IGST would be 18%.
\n38. What would be the rate applicable for CGST and SGST?
\nThe notifications of tax rates under CGST AND SGST are given below
\nDescription
\nNotification
\n11\/2017-Central Tax (Rate),dt. 28-06-2017
\nrates for supply of services under CGST Act
\nexemptions on supply of services under CGST Act
\n12\/2017-Central Tax (Rate), dt. 28-06-2017
\nCGST Rate Schedule for goods notified under
\nsection 9 (1)
\n01\/2017-Central Tax (Rate), dt. 28-06-2017
\nCGST exempt goods notified under section 11 (1)
\nKGST rates for services
\n02\/2017-Central Tax (Rate), dt. 28-06-2017
\nS.R.O 370\/2017
\nexemptions on supply of services under KGST Act
\nKGST Rate Schedule for goods notified under
\nsection 9 (1)
\nS.R.O 371\/2017
\nS.R.O 360\/2017
\nKGST exempt goods notified <\/p>\n
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\n42. WHAT WOULD THE CONSEQUENCES, IF THE DEPARTMENT DOES NOT FILE RETURNS ?
\nThere will be automated interest and late fee. Penalty can also be levied.
\nThe registered person who have bought goods from Government will not be able to claim input
\ntax credit in his returns.
\n43.WHO IS LIABLE TO DEDUCT TDS?
\nA department or establishment of the Central or State Government, or a Local authority, or
\nGovernmental agencies, or Persons or category of persons as may be notified, by the Central or
\na State Government on the recommendations of the Council,
\n44. WHICH ARE THE TRANSACTIONS LIABLE FOR TDS ?
\nAll transactions where the total value of a taxable supply received under a contract exceeds two
\nlakh and Fifty thousand rupees (excluding GST). For the purpose of deciding TDS liability, the
\nwhole contract amount is to be reckoned, irrespective of individual periodic payments and TDS
\nis to be deducted for such individua<\/p>\n
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\nof the decution made. It is to be issued to the deductee within 5 days of crediting the amount
\nto the Govt. failing which fees of Rs. 100 per day subject to maximum of Rs. 5000\/- will be
\npayable by such deductor.
\n50. WHAT HAPPENS IF THE DEDUCTOR DEFAULTS IN PAYMENT OF THE AMOUNT?
\nHe will be liable to pay interest, in addition to the tax.
\n51. WHAT IS THE GST RATE OF PRINTED TENDER FORMS SOLD BY THE DEPARTMENT?
\n12%. It should be collected by the Department and paid along with the returns.
\n52. WHAT IS THE GST RATE OF TENDER SUBMISSION FEES COLLECTED BY THE
\nDEPARTMENT WHILE SUBMISSION OF E-TENDER?
\nIt is a service provided by the Department and the tax rate is 18%. But the department need
\nnot collect the tax. It will be paid by the contractor on reverse charge basis while filing his
\nreturns.
\n53. WHETHER TDS IS TO BE MADE OR EFFECTED FOR THE TAXABLE SUPPLY RECEIVED
\nFROM 01-07-2017?
\nKERALA STATE GOODS AND SERVICE TAX DEPARTMENT
\nKERALA GST
\n17<\/p>\n
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