FREQUENTLY ASKED QUESTIONS – GST
GST
Dated:- 18-1-2018
1. Overview of Goods and Services Tax (GST)
\nQ 1. What is Goods and Services Tax (GST)?
\nAns. It is a destination based tax on consumption of goods and services. It is proposed to be levied at all stages right from manufacture up to final consumption with credit of taxes paid at previous stages available as setoff. In a nutshell, only value addition will be taxed and burden of tax is to be borne by the final consumer.
\nQ 2. What exactly is the concept of destination based tax on consumption?
\nAns. The tax would accrue to the taxing authority which has jurisdiction over the place of consumption which is also termed as place of supply.
\nQ 3. Which of the existing taxes are proposed to be subsumed under GST?
\nAns. The GST would replace the following taxes:
\n(i) taxes currently levied and collected by the Centre:
\na. Central Excise duty
\nb. Duties of Excise (Medicinal and Toilet Preparations)
\nc. Additional Duti<\/p>\n
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Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n Central, State and Local levies were examined to identify their possibility of being subsumed under GST. While identifying, the following principles were kept in mind: = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n would be subject to GST. In addition, the Centre would have the power to levy Central Excise duty on these products. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ndments in the Constitution so as to simultaneously empower the Centre and the States to levy and collect this tax. The Constitution of India has been amended by the Constitution (one hundred and first amendment) Act, 2016 for this purpose. Article 246A of the Constitution empowers the Centre and the States to levy and collect the GST. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ed for payment of SGST. Nor can SGST credit be used for payment of CGST. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ax compliance. Last but not the least, this tax, because of its transparent character, would be easier to administer. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n al Pradesh and Uttarakhand; and = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ime? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n SGST will accrue to the State where the imported goods and services are consumed. Full and complete set-off will be available on the GST paid on import on goods and services. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n r Goods and Service Tax Network (GSTN). A Special Purpose Vehicle called the GSTN has been set up to cater to the needs of GST. The GSTN shall provide a shared IT infrastructure and services to Central and State Governments, tax payers and other stakeholders for implementation of GST. The functions of the GSTN would, inter alia, include: (i) facilitating registration; (ii) forwarding the returns to Central and State authorities; (iii) computation and settlement of IGST; (iv) matching of tax payment details with banking network; (v) providing various MIS reports to the Central and the State Governments based on the tax payer return information; (vi) providing analysis of tax payers' profile; and (vii) running the matching engine for matching, reversal and reclaim of input tax credit. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n purpose of Compliance rating mechanism? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n e mandated to furnish an information return of the same in respect of such periods, within such time, in such form and manner and to such authority or agency as may be prescribed. Failure to do so may result in penalty being imposed as per Section 123. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n prices. In pursuance of the powers conferred by this section, the government has constituted the National Anti-Profiteering Authority (NAPA). NAPA is required to examine whether input tax credits availed by any registered person or the reduction in the tax rate have actually resulted in a commensurate reduction in the price of the goods or services or both supplied by him. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n by the Constitution (101st Amendment) Act, 2016 confers concurrent powers to both, Parliament and State Legislatures to make laws with respect to GST i. e. central tax (CGST) and state tax (SGST) or union territory tax (UTGST). However, clause 2 of Article 246A read with Article 269A provides exclusive power to the Parliament to legislate with respect to inter-State trade or commerce i.e. integrated tax (IGST). = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n conjunction with each other in the ordinary course of business and where one of which is a principal supply. For example, when a consumer buys a television set and he also gets warranty and a maintenance contract with the TV, this supply is a composite supply. In this example, supply of TV is the principal supply, warranty and maintenance service are ancillary. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ns have been issued under IGST Act also. Reverse charge also applies to supplies received by a registered person from unregistered persons. However, the provision of reverse charge liability on supplies received from unregistered persons, as provided in sections 9 (4) and 5 (4) of the CGST Act and the IGST Act respectively, have been kept in abeyance till 31.03.2018. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n except where the person supplying such service through electronic commerce operator is liable for registration under sub-section (1) of section 22 of the CGST Act. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n aving the same Permanent Account Number (PAN) have to opt for composition scheme. If one registered person opts for normal scheme, others become ineligible for composition scheme. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n \nAns. No, the registered person under composition scheme is not permitted to collect tax. It means that a composition scheme supplier cannot issue a tax invoice. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n goods or services or both shall not collect the tax in excess of the effective rate. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n egate turn over in a financial year exceeds the threshold limit of twenty lakh rupees shall be liable to register himself in the State or the Union territory of Delhi or Puducherry from where he makes the taxable supply. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n persons making any inter-State taxable supply, except persons making inter-state supply of certain handicraft goods, and services; = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ng in different states, with the same PAN number, whether he can operate with a single Registration? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n 8) of Section 25, where a person who is liable to be registered under this Act fails to obtain registration, the proper officer may, without prejudice to any action which may be taken under this Act, or under any other law for the time being in force, proceed to register such person in the manner as is prescribed in the Registration rules. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ST goods (and thus not liable to obtain GST registration) but are making inter-state purchases. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n alent to the estimated tax liability of such person for the period for which the registration is sought. If registration is to be extended beyond the initial period of ninety days, an advance additional amount of tax equivalent to the estimated tax liability is to be deposited for the period for which the extension beyond ninety days is being sought. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n e cancellation of registration under one Act (say CGST Act) shall be deemed to be a cancellation of registration under the other Act (i.e. SGST Act). (Section 29 (4)) = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ISD be required to be separately registered other than the existing tax payer registration? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n declares the place of business of the job worker as his additional place of business. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n g the application or other submissions- by e-signing through Aadhar number, or = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ut the reasons for such refusal through a speaking order. The applicant shall have the right to appeal against the decision of the Authority. As per sub-section (2) of section 26 of the CGST Act, any rejection of application for registration by one authority (i.e. under the CGST Act \/ SGST Act) shall be deemed to be a rejection of application for registration by the other tax authority (i.e. under the SGST Act \/ UTGST Act\/ CGST Act). = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock or capital goods or plant and machinery on the day immediately preceding the date of such cancellation or the output tax payable on such goods, whichever is higher. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n s all forms of supply of goods or services or both that includes sale, transfer, barter, exchange, license, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business. It also includes import of service. The GST law also provides for including certain transactions made without consideration within the scope of supply. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n der GST? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n reasons for the answer. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n s and catering services shall be treated = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n h of these items can be supplied separately and it is not dependent on any other. It shall not be a mixed supply if these items are supplied separately. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n the liability to pay GST arise in respect of supply of goods? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ed, then the due date of filing of such periodical return shall be the time of supply. In other cases, it will be the date on which the CGST\/SGST\/IGST is actually paid. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n apply. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n nvoice has been issued after the change in rate of tax but the payment is received before the change in rate of tax, the time of supply shall be the date of issue of invoice = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n efore the expiry of the quarter during which the supply was made. Further a registered person liable to pay tax on reverse charge basis is also required to issue invoice on the date of receipt of goods or services or both. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n tion value shall not include refundable deposit, discount allowed subject to certain conditions before or at the time of supply. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n includible in the transaction value? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n of the goods and where no input tax credit has been availed on the purchase of such goods, the value of supply shall be the difference between the selling price and the purchase price and where the value of such supply is negative, it shall be ignored = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ttery authorised by State Government. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n of supply. Different situations envisaged and different tax points have been explained in the aforesaid sections. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n the 20th of the succeeding month. Cash payments will be first deposited in the Cash Ledger and the tax payer shall debit the ledger while making payment in the monthly returns and shall reflect the relevant debit entry number in his return. As mentioned earlier, payment can also be debited from the Credit Ledger. Payment of taxes for the month of March shall be paid by the 20th of April. Composition tax payers will need to pay tax on quarterly basis. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ed and displayed on his dash board at all times. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n n be made to it by the taxpayer. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n d to collect payment of GST. Each authorized bank will nominate only one branch as its E-FPB for pan India Transactions. The E-FPB will have to open accounts under each major head for all governments. Total 38 accounts (one each for CGST, IGST and one each for SGST for each State\/UT Govt.) will have to be opened. Any amount received by such E-FPB towards GST will be credited to the appropriate account held by such E-FPB. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ax Collected at Source (TCS)? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n 3. Is it mandatory for e-commerce operator to obtain registration? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n g to be adjusted? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n onically, containing the details of outward supplies of goods or services effected through it, including the supplies of goods or services returned through it, and the amount collected by it as TCS during a month within ten days after the end of such month. The operator is also required to file an annual statement by 31st day of December following the end of the financial year in which the tax was collected. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n date of service of such notice. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n be included in the aggregate turnover of the principal. However, the value of goods or services used by the job worker for carrying out the job work will be included in the value of services supplied by the job worker. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ing them at his place of business or even when such the inputs or capital goods are directly sent to a job worker without their being first brought to his place of business. However, the inputs or capital goods, after completion of job work, are required to be received back or supplied from job worker's premises, as the case may be, within a period of one year or three years of their being sent out. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n b worker. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n Yes, it includes taxes paid on input goods, input services and capital goods. Credit of tax paid on capital goods is permitted to be availed in one instalment. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ke ITC again on payment of consideration and tax. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n e factory premises, etc. and taxes paid as a result of detection of evasion of taxes. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n n on 15th August, 2017. Such person is eligible for input tax credit on inputs held in stock as on: = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n (c) Both = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n . = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n lapse. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n utor in GST = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n done in the ratio of turnover in a State or Union territory of the recipient during the period to the aggregate of all recipients to whom input service being distributed is attributable. Lastly, the credit distributed should not exceed the credit available for distribution. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n l the recipients of an ISD? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n of tax administration. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n Only certain prescribed fields of information from invoices need to be uploaded. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n e amount will be added to the output tax liability of the recipient in the returns for the month subsequent to the month in which such discrepancy was communicated. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n the special feature of GSTR-2? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n TR-2 to avail the credit for deductions made on his behalf. To avail this credit, he does not require to produce any certificate in physical or electronic form. The certificate will only be for record keeping of the tax payer and can be downloaded from the Common Portal. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n taxpayers with large number of invoices. For such taxpayers, an offline utility will be provided that can be used for preparing the statements offline after downloading the auto populated details and uploading them on the Common Portal. GSTN has also developed an ecosystem of GST Suvidha Providers (GSP) that will integrate with the Common Portal. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n d for invoices issued by a supplier. The Common Portal of GST would have pan India data at one place which will enable valuable services to the taxpayers. Efforts are being made to make regular uploading of invoices as easy as possible and it is expected that an enabling eco- system will be developed to achieve this objective. Taxpayers should make efficient use of this ecosystem for easy and hassle free compliance under GST. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ed by way of reducing the output tax liability during the subsequent tax period. [Section 42(7)]. Similar provisions have also been made in Section 43 of the Act in respect of the credit notes issued by the supplier. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n orm GSTR-1 and the adjustment of the tax paid on advances against the tax payable on the invoices uploaded in Form GSTR-1 shall have to be done in Table 11 of Form GSTR-1. It may be noted that in terms of notification 66\/2017-Central Tax dated 15.11.2017, there is no liability to pay tax at the time of receipt of advance in case of supply of goods. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n n and for reasons to be recorded in writing, the above period of six months may be extended: = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n days. If the taxable person fails to file return within the given time, the proper officer shall proceed to assess the tax liability of the return defaulter to the best of his judgement taking into account all the relevant material available with him. (Section 62). = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n er than appellate remedy, is there any other recourse available to the taxpayer against a summary assessment order? = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n er special audit by chartered accountant or cost accountant, nominated by department. (Section 66 of the CGST\/SGST Act) = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n is given in section 66 of CGST \/SGST Act. = = = = = = = =<\/p>\n
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\n(i) Taxes or levies to be subsumed should be primarily in the nature of indirect taxes, either on the supply of goods or on the supply of services.
\n(ii) Taxes or levies to be subsumed should be part of the transaction chain which commences with import\/ manufacture\/ production of goods or provision of services at one end and the consumption of goods and services at the other.
\n(iii) The subsumation should result in free flow of tax credit in intra and inter-State levels. The taxes, levies and fees that are not specifically related to supply of goods & services should not be subsumed under GST.
\n(v) Revenue fairness for both the Union and the States individually would need to be attempted.
\nQ 5. Which are the commodities proposed to be kept outside the purview of GST?
\nAns. Article 366(12A) of the Constitution as <\/p>\n
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\nQ 8. What type of GST is proposed to be implemented?
\nAns. It would be a dual GST with the Centre and States simultaneously levying it on a common tax base. The GST to be levied by the Centre on intra-State supply of goods and \/ or services would be called the Central GST (CGST) and that to be levied by the States\/ Union territory would be called the State GST (SGST)\/ UTGST. Similarly, Integrated GST (IGST) will be levied and administered by Centre on every inter-state supply of goods and services.
\nQ 9. Why is Dual GST required?
\nAns. India is a federal country where both the Centre and the States have been assigned the powers to levy and collect taxes through appropriate legislation. Both the levels of Government have distinct responsibilities to perform according to the division of powers prescribed in the Constitution for which they need to raise resources. A d<\/p>\n
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\nQ 12. How a particular transaction of goods and services would be taxed simultaneously under Central GST (CGST) and State GST (SGST)?
\nAns. The Central GST and the State GST would be levied simultaneously on every transaction of supply of goods and services made by registered persons except the exempted goods and services, goods and services which are outside the purview of GST. Further, both would be levied on the same price or value unlike State VAT which is levied on the value of the goods inclusive of CENVAT. While the location of the supplier and the recipient within the country is immaterial for the purpose of CGST, SGST would be chargeable only<\/p>\n
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\nIllustration II: Suppose, again hypothetically, that the rate of CGST is 10% and that of SGST is 10%. When an advertising company located in Mumbai supplies advertising services to a company manufacturing soap also located within the State of Maharashtra for, let us say ₹ 100, the ad company would charge CGST of
\n₹ 10 as well as SGST of ₹ 10 to the basic value of the service. He would be required to deposit the CGST component into a Central Government account while the SGST portion into the account of the concerned State Government. Of course, he need not again actually pay ₹ 20 (Rs. 10+Rs. 10) in cash as it would be entitled to set-off this liability against the CGST or SGST paid on his purchase (say, of inputs such as stationery, office
\nequipment, services of an artist etc.). But for paying CGST he would be allowed to use only the credit of CGST paid on its purchase while for SGST he<\/p>\n
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\nQ 14. What is IGST?
\nAns. Under the GST regime, an Integrated GST (IGST) would be levied and collected by the Centre on inter-State supply of goods and services. Under Article 269A of the Constitution, the GST on supplies in the course of inter- State trade or commerce shall be levied and collected by the Government of India and such tax shall be apportioned between the Union and the States in the manner as may be provided by Parliament by law on the recommendations of the Goods and Services Tax Council.
\nQ 15. Who will decide rates for levy of GST?
\nAns. The CGST and SGST would be levied at rates to be jointly decided by the Centre and States. The rates would be notified on the recommendations of the GST Council.
\nQ 16. What would be the role of GST Council?
\nAns. A GST Council would be constituted comprising the Union Finance Minister (who will be the Chairman <\/p>\n
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\n(ix) any other matter relating to the GST, as the Council may decide.
\nQ 17. What is the guiding principle of GST Council?
\nAns. The mechanism of GST Council would ensure harmonization on different aspects of GST between the Centre and the States as well as among States. It has been provided in the Constitution (one hundred and first amendment) Act, 2016 that the GST Council, in its discharge of various functions, shall be guided by the need for a harmonized structure of GST and for the development of a harmonized national market for goods and services.
\nQ 18. How will decisions be taken by GST Council?
\nAns. The Constitution (one hundred and first amendment) Act, 2016 provides that every decision of the GST Council shall be taken at a meeting by a majority of not less than
\n3\/4th of the weighted votes of the Members present and voting. The vote of the Central Government shall have a weightage of 1\/3rd of the votes cast and the votes of all the St<\/p>\n
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\nAns. Tax payers with an aggregate turnover in a financial year up to [Rs.20 lakhs & ₹ 10 Lakhs for NE and special category states] would be exempt from taking registration under GST. Further, a person whose aggregate turnover in the preceding financial year is less than ₹ 1 Crore (75 lakhs for 9 special category states viz 1. Arunachal Pradesh, 2. Assam, 3. Manipur, 4. Meghalaya, 5. Mizoram, 6. Nagaland, 7. Sikkim, 8. Tripura, and 9. Himachal Pradesh) can opt for a simplified composition scheme where tax will payable at a concessional rate on the turnover in a state.
\n[Aggregate turnover shall include the aggregate value of all taxable supplies, exempt supplies and exports of goods and\/or services and exclude taxes viz. GST.] Aggregate turnover shall be computed on all India basis. For NE States and special category states, the exemption threshold shall be [Rs. 10 lakhs]. All taxpayers eligible for threshold exemption will have the option of paying tax with input ta<\/p>\n
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\nQ 23. How will Exports be treated under GST?
\nAns. Exports will be treated as zero rated supplies. No tax will be payable on exports of goods or services, however credit of input tax credit will be available and same will be available as refund to the exporters. The Exporter will have an option to either pay tax on the output and claim refund of IGST or export under Bond without payment of IGST and claim refund of Input Tax Credit (ITC).
\nQ 24. What is the scope of composition scheme under GST?
\nAns. Small taxpayers with an aggregate turnover in a preceding financial year up to Rs. One Crore (75 lakhs for special category States – except Jammu & Kashmir and Uttarakhand) shall be eligible for composition levy. This scheme is basically for suppliers of goods and restaurant service providers only. Under the sch<\/p>\n
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\nThe GSTN is developing a common GST portal and applications for registration, payment, return and MIS\/ reports. The GSTN would also be integrating the common GST portal with the existing tax administratio<\/p>\n
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\nAns. As per Section 149 of the CGST\/SGST Act, every registered person shall be assigned a compliance rating based on the record of compliance in respect of specified parameters. Such ratings shall also be placed in the public domain. A prospective client will be able to see the compliance ratings of suppliers and take a decision as to whether to deal with a particular supplier or not. This will create healthy competition amongst taxable persons.
\nQ 29. Whether actionable claims liable to GST?
\nAns. As per section 2(52) of the CGST\/SGST Act actionable claims are to be considered as goods. Schedule III read with Section 7 of the CGST\/SGST Act lists the activities or transactions which shall be treated neither as supply of goods nor supply of services. The Schedule lists actionable claims other than lottery, betting and gambling as one of such transactions. Thus only lottery, betting and gambling shall be treated as supplies under the GST regim<\/p>\n
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\nQ 32. Different companies have different types of accounting software packages and no specific format are mandated for keeping records. How will department be able to read into these complex software?
\nAns. As per Section 153 of the CGST\/SGST Act, having regard to the nature and complexity of a case and in the interest of revenue, department may take assistance from an expert at any state of scrutiny, inquiry, investigation or any other proceedings.
\nQ 33. Is there any provision in GST for tax treatment of goods returned by the recipient?
\nAns. Yes, Section 34 deals with such situations. Where the goods supplied are returned by the recipient, the registered person (supplier of goods) may issue to the recipient a credit note containi<\/p>\n
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\nNAPA has power to investigate cases against the registered person who has not passed on the benefits by way of commensurate reduction in prices and order reduction in prices, cancel registration, impose penalty and\/or return to the recipient, an amount equivalent to the amount not passed on by way of commensurate reduction in prices along with interest.
\nQ 35. What tax will be levied on goods manufactured but not cleared from factory before 01.07.2017?
\nAns. Goods manufactured, but not cleared from factory before 01.07.2017 have been exempted from Central Excise duty vide Tariff Notification No. 12\/2017-CE dated<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nQ 2. What is the taxable event under GST?
\nAns. Taxable event under GST is supply of goods or services or both. CGST and SGST\/ UTGST will be levied on intra-State supplies. IGST will be levied on inter-State supplies.
\nQ 3. Whether supplies made without consideration will also come within the purview of supply under GST?
\nAns. Yes, but only those activities which are specified in Schedule I to the CGST Act \/ SGST Act. The said provision has been adopted in IGST Act as well as in UTGST Act also. In cases where the inputs\/ capital goods sent for job work are not returned with<\/p>\n
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\nMixed supply is combination of more than one individual supplies of goods or services or any combination thereof made in conjunction with each other for a single price, which can ordinarily be supplied separately. For example, a shopkeeper selling storage water bottles along with refrigerator. Bottles and the refrigerator can easily be priced and sold separately.
\nQ 7. What is the treatment of composite supply and mixed supply under GST?
\nAns. Composite supply shall be treated as supply of the principal supply. Mixed supply would be treated as supply of that particular goods or services which attracts the highest rate of ta<\/p>\n
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\nQ 11. What will be the implications in case of receipt of supply from unregistered persons?
\nAns. In case of receipt of supply from an unregistered person, the registered person who is receiving goods or services shall be liable to pay tax under reverse charge mechanism. However, this provision (of reverse charge on supplies received from unregistered persons) have been kept in abeyance till 31.03.2018
\nQ 12. Can any person other than the supplier or recipient be liable to pay tax under GST?
\nAns. Yes, the Government can specify categories of services the tax on which shall be paid by the electronic commerce operator,<\/p>\n
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\nQ 13. What is the threshold for opting to pay tax under the composition scheme?
\nAns. The threshold for composition scheme is ₹ 1 Crore of aggregate turnover in the preceding financial year. The benefit of composition scheme can be availed up to the turnover of ₹ 1 Crore in current financial year. (75 lakhs for 9 special category states viz 1. Arunachal Pradesh, 2. Assam, 3. Manipur, 4. Meghalaya, 5. Mizoram, 6. Nagaland, 7. Sikkim, 8. Tripura, and 9. Himachal Pradesh)
\nQ 14. What are the rates of tax for composition scheme?
\nAns. There are different rates for different sectors. In normal cases of supplier of goods (i.e. traders), the composition rate is 0.5 % of the turnover in a State or Union territory. If the person opting for composition scheme is manufacturer, then the rate is 1% of the turnover in a <\/p>\n
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\nQ 17. Can composition scheme be availed of by a manufacturer and a service supplier?
\nAns. Yes, a manufacturer can opt for composition scheme generally. However, a manufacturer of goods, which would be notified on the recommendations of the GST Council, cannot opt for this scheme. The goods so notified are ice cream and other edible ice, whether or not containing cocoa (Tariff Heading-21050000), pan masala (Tariff Heading – 21069020) & tobacco and manufactured tobacco substitutes (Tariff Heading – 24). This scheme is not available for services sector, except restaurants.
\nQ 18. Who are not eligible to opt for composition scheme?
\nAns. Broadly, following categories of registered person are not eligible to opt for the composition scheme:
\n(i) supplier of services other than supplier of restaurant service;<\/p>\n
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\nQ 22. How to compute 'aggregate turnover' to determine eligibility for composition scheme?
\nAns. The methodology to compute aggregate turnover is given in Section 2(6). Accordingly, 'aggregate turnover' means value of all outward supplies (taxable supplies +exempt supplies +exports + inter-state supplies) of a person having the same PAN and it excludes taxes levied under central tax (CGST), State tax (SGST), Union territory tax (UTGST), integrated tax(IGST) and compensation cess. Also, the value of inward supplies on which tax is payable under reverse charge is not taken into account for calculation of 'aggregate turnover'.
\nQ 23. What are the penal consequences if a person opts for the composition scheme in violation of the conditions?
\nAns. If a taxable person has paid tax under the composition scheme though he was not<\/p>\n
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\n3. Registration
\nQ 1. What is advantage of taking registration in GST?
\nAns. Registration under Goods and Service Tax (GST) regime will confer following advantages to the business:
\n• Legally recognized as supplier of goods or services.
\n• Proper accounting of taxes paid on the input goods or services which can be utilized for payment of GST due on supply of goods or services or both by the business.
\n• Legally authorized to collect tax from his purchasers and pass on the credit of the taxes paid on the goods or services supplied to purchasers or recipients.
\n• Getting eligible to avail various other benefits and privileges rendered under the GST laws.
\nQ 2. Can a person without GST registration claim ITC and collect tax?
\nAns. No, a person without GST registration can neither collect GST from his customers nor can claim any input tax credit of GST paid by him.
\nQ 3. What <\/p>\n
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\nIn case of eleven special category states (as mentioned in Art.279A(4)(g) of the Constitution of India), this threshold limit for registration liability is ten lakh rupees.
\nBesides, Section 24 of the Act mentions certain categories of suppliers, who shall be liable to take registration even if their aggregate turnover is below the said threshold limit of 20 lakh rupees.
\nOn the other hand, as per Section 23 of the Act, an agriculturist in respect of supply of his agricultural produce; as also any person exclusively making supply of non-taxable or wholly exempted goods and\/or services under GST law will not be liable for registration.
\nQ 5. What is aggregate turnover?
\nAns. As per section 2(6) of the CGST\/SGST Act “aggregate turnover” includes the aggregate value<\/p>\n
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\nii) casual taxable persons except persons making supply of certain handicraft goods;
\niii) persons who are required to pay tax under reverse charge;
\niv) persons who are required to pay tax under sub-section (5) of section 9;
\nv) non-resident taxable persons making taxable supply;
\nvi) persons who are required to deduct tax under section 51;
\nvii) persons who make taxable supply of goods or services on behalf of other registered taxable persons whether as an agent or otherwise;
\nviii) Input service distributor (whether or not separately registered under the Act);
\nix) persons who supply goods, other than supplies specified under Section 9(5), through such e-commerce operator who is required to collect tax at source under section 52;
\nx) every electronic commerce operator;
\nxi) every person supplying online information and data base retrieval ser<\/p>\n
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\nAns. No. Every person who is liable to take a Registration will have to get registered separately for each of the States where he has a business operation and is liable to pay GST in terms of Sub-section (1) of Section 22 of the CGST\/SGST Act.
\nQ 9. Whether a person having multiple business verticals in a state can obtain different registrations?
\nAns. Yes. In terms of the proviso to Sub-Section (2) of Section 25, a person having multiple business verticals in a State may obtain a separate registration for each business vertical, subject to such conditions as prescribed in the registration rules.
\nQ 10. Is there a provision for a person to get himself voluntarily registered though he may not be liable to pay GST?
\nAns. Yes. In terms of Sub-section (3) of Section 25, a person, though not liable to be registered under Section 22 may get himself registered voluntarily, and all provis<\/p>\n
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\nQ 13. Whether the proper officer can reject an Application for Registration?
\nAns. Yes. In terms of sub-section 10 of section 25 of the CGST\/SGST Act, the proper officer can reject an application for registration after due verification.
\nQ 14. Whether the Registration granted to any person is permanent?
\nAns. Yes, the registration Certificate once granted is permanent unless surrendered, cancelled, suspended or revoked.
\nQ 15. Is it necessary for the UN bodies to get registration under GST?
\nAns. Yes. In terms of Section 25(9) of the CGST\/SGST Act, all notified UN bodies, Consulate or Embassy of foreign countries and any other class of persons<\/p>\n
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\nQ 18. Who is a Casual Taxable Person?
\nAns. Casual Taxable Person has been defined in Section 2 (20) of the CGST\/SGST Act meaning a person who occasionally undertakes transactions involving supply of goods and\/or services in the course or furtherance of business, whether as principal, or agent or in any other capacity, in a State or a Union territory where he has no fixed place of business.
\nQ 19. Who is a Non-resident Taxable Person?
\nAns. In terms of Section 2(77) of the CGST\/SGST Act, a non-resident taxable person means any person who occasionally undertakes transactions involving supply of goods and\/or services whether as principal or agent or in any other capacity, but who has no fixed place of business or residence in India.
\nQ 20. What is the validity period of the Registration certificate issued to a Casual Taxable Person and non- Resident Taxable person?
\nAns. In terms of Sec<\/p>\n
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\nQ 22. Whether Amendments to the Registration Certificate is permissible?
\nAns. Yes. In terms of Section 28, the proper officer may, on the basis of such information furnished either by the registrant or as ascertained by him, approve or reject amendments in the registration particulars within a period of 15 common working days from the date of receipt of application for amendment.
\nIt is to be noted that permission of the proper officer for making amendments will be required for only certain core fields of information, whereas for the other fields, the certificate of registration shall stand amended upon submission of application in th<\/p>\n
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\nQ 25. Can the proper Officer Cancel the Registration on his own?
\nAns. Yes, in certain circumstances specified under section 29(2) of the CGST\/SGST Act, the proper officer can cancel the registration on his own. Such circumstances include contravention of any of the prescribed provisions of the CGST Act or the rules made there under, not filing return by a composition dealer for three consecutive tax periods or non-furnishing of returns by a regular taxpayer for a continuous period of six months, and not commencing business within six months from the date of voluntary registration. However, before cancelling the registration, the proper officer has to follow the principles of natural justice. (Proviso to Section 29(2) (e))
\nQ 26. What happens when the registration is obtained by means of willful mis-statement, fraud o<\/p>\n
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\nAns. Yes, the ISD registration is for one office of the taxpayer which will be different from the normal registration.
\nQ 31. Can a tax payer have multiple ISDs?
\nAns. Yes. Different offices of a tax payer can apply for ISD registration.
\nQ 32. What could be the liabilities (in so far as registration is concerned) on transfer of a business?
\nAns. The transferee or the successor shall be liable to be registered with effect from such transfer or succession and he will have to obtain a fresh registration with effect from the date of such transfer or succession. (Section 22(3)).
\nQ 33. Whether all assesses \/ dealers who are already registered under existing central excise\/service tax\/ vat laws will have to obtain fresh registration?
\nAns. No, GSTN shall migrate all such assessees\/dealers to the GSTN network and shall issue a provisional registration certificate with GSTIN number on the appo<\/p>\n
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\nQ 36. At the time of registration will the assessee have to declare all his places of business?
\nAns. Yes. The principal place of business and place of business have been separately defined under section 2(89) & 2(85) of the CGST\/SGST Act respectively. The taxpayer will have to declare the principal place of business as well as the details of additional places of business in the registration form.
\nQ 37. Is there any system to facilitate smaller dealers or dealers having no IT infrastructure?
\nAns. In order to cater to the needs of tax payers who are not IT savvy, following facilities shall be made available: –
\nGST Practitioners: A taxable person may prepare his registration application \/returns himself or can approach the GST Practitioner for assistance. GST Practitioner will prepare the said registration document \/ return in prescribed format on the basis of the information furnished to him b<\/p>\n
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\nthrough DSC i.e. by registering the tax payer's digital signature certificate with GST portal. However, companies or limited liability partnership entities will have to sign mandatorily through DSC only. Only level 2 and level 3 DSC certificates will be acceptable for signature purpose.
\nQ 39. What will be the time limit for the decision on the on line registration application?
\nAns. If the information and the uploaded documents are found in order, the State and the Central authorities shall have to respond to the application within three common working days. If they communicate any deficiency or discrepancy in the application within such time, then the applicant will have to remove the discrepancy \/ deficiency within 7 days of such communication. Thereafter, for either approving the application or rejecting it, the State and the Central authorities will have 7 days from the date when the taxable person <\/p>\n
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\nQ 42. Will there be any communication related to the application disposal?
\nAns. The applicant shall be informed of the fact of grant or rejection of his registration application through an e-mail and SMS by the GST common portal. Jurisdictional details would be intimated to the applicant at this stage.
\nQ 43. Can the registration certificate be downloaded from the GSTN portal?
\nAns. In case registration is granted; applicant can download the Registration Certificate from the GST common portal.
\nQ 44. Can cancellation of registration order be revoked<\/p>\n
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\nQ 46. What is the difference between casual and non-resident taxable persons?
\nAns. Casual and Non-resident taxable persons are separately defined in the CGST\/SGST Act in Sections 2(20) and 2(77) respectively. Some of the differences are outlined below:
\nCasual Taxable Person
\nNon-resident Taxable Person
\nOccasional undertakes transactions involving supply of goods or services in a state or UT where he has no fixed place of business.
\nOccasional undertakes transactions involving supply of goods or services but has no fixed place of business residence in India.
\nHas a PAN Number
\nDo not have a PAN Number; A non-resident person, if having PAN number may take registration as a casual taxable person
\nSame application<\/p>\n
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\nQ 3. What is a taxable supply?
\nAns. A 'taxable supply' means a supply of goods or services or both which is chargeable to goods and services tax under the GST Act.
\nQ 4. What are the necessary elements that constitute supply under CGST\/SGST Act?
\nAns. In order to constitute a 'supply', the following elements are required to be satisfied, i.e.-
\n(i) the activity involves supply of goods or services or both;
\n(ii) the supply is for a consideration unless otherwise specifically provided for;
\n(iii) the supply is made in the course or furtherance of business;
\n(iv) the supply is made in the taxable te<\/p>\n
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\nAns. Inter-state self-supplies such as stock transfers, branch transfers or consignment sales shall be taxable under IGST even though such transactions may not involve payment of consideration. Every supplier is liable to register under the GST law in the State or Union territory from where he makes a taxable supply of goods or services or both in terms of Section 22 of the CGST Act. However, intra-state self-supplies are not taxable subject to not opting for registration as business vertical.
\nQ 8. Whether transfer of title and\/or possession is necessary for a transaction to constitute supply of goods?
\nAns. Title as well as possession both have to be transferred for a transaction to be considered as a supply of goods. In case title is not transferred, the transaction would be treated as supply of service in terms of Schedule II (1) (b). In some cases, possession may be transferred immediately but title may be transferred at a future date like in case of sale on approval <\/p>\n
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\nAns. No, because the sale of old and used car by an individual is not in the course or furtherance of business and hence does not constitute supply.
\nQ 11. A dealer of air-conditioners permanently transfers an air conditioner from his stock in trade, for personal use at his residence. Will the transaction constitute a supply?
\nAns. Yes. As per Sl. No.1 of Schedule-I, permanent transfer or disposal of business assets where input tax credit has been availed on such assets shall constitute a supply under GST even where no consideration is involved.
\nQ 12. Whether provision of service or goods by a club or association or society to its members will be treated as supply or not?
\nAns. Yes. Provision of facilities by a club, association, society or any such body to its members shall be treated as supply. This is included in the definition of 'business' in section 2(17) of CGST\/SGST Act.
\nQ 13. What are the different types of supplies under the GST law?
\nAns. (<\/p>\n
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\nas supply of services as both are specified under Sl. No. 6 (a) and (b) in Schedule-II of the GST law.
\nQ 17. Whether supply of software would be treated as supply of goods or supply of services under GST law?
\nAns. Development, design, programming, customization, adaptation, upgradation, enhancement, implementation of information technology software shall be treated as supply of services as listed in Sl. No. 5 (2)(d) of Schedule -II of the GST law.
\nQ 18. Whether goods supplied on hire purchase basis will be treated as supply of goods or supply of services? Why?
\nAns. Supply of goods on hire purchase shall be treated as supply of goods as there is transfer of title, albeit at a future date.
\nQ 19. What is a Composite Supply under CGST\/ SGST\/UTGST Act?
\nAns. Composite Supply means a supply made by a taxable person to a recipient comprising two or more supplies of goods or services, or any combination thereof, which are naturally bundled <\/p>\n
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\nQ 22. How will tax liability on a mixed supply be determined under GST?
\nAns. A mixed supply comprising two or more supplies shall be treated as supply of that particular supply which attracts the highest rate of tax.
\nQ 23. Are there any activities which are treated as neither a supply of goods nor a supply of services?
\nAns. Yes. Schedule-III of the GST law lists certain activities such as (i) services by an employee to the employer in the course of or in relation to his employment, (ii) services by any Court or Tribunal established under any law, (iii) functions performed by members of Parliament, State Legislatures, members of the local authorities, Constitutional functionaries (iv) services of funeral, burial, crematorium or mortuary and (v) sale of land and (vi), actionable claims other than lottery, betting and gambling shal<\/p>\n
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\nAns. Section12 of the CGST\/SGST Act provides for time of supply of goods. The time of supply of goods shall be the earlier of the following namely,
\n(i) the date of issue of invoice by the supplier or the last date on which he is required under Section 31, to issue the invoice with respect to the supply; or
\n(ii) the date on which the supplier receives the payment with respect to the supply.
\nHowever, vide Notification No. 66\/2017-Central Tax dated 15.11.2017, liability to pay tax at the time of receipt of advance has been relaxed in case of goods.
\nQ 3. When does the liability to pay GST arise in respect of supply of services?
\nAns. Section 13 of the CGST\/SGST Act provides for time of supply of services. The time of supply of services shall be the earlier of the following namely,
\n(a) the date of issue of invoice by the supplier if the invoice is issued within the period prescribed under section 31(2) or the date o<\/p>\n
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\nQ 6. What does “date of receipt of payment” mean?
\nAns. It is the earliest of the date on which the payment is entered in the books of accounts of the supplier or the date on which the payment is credited to his bank account.
\nQ 7. Suppose, part advance payment is made or invoice issued is for part payment, whether the time of supply will cover the full supply?
\nAns. No. The supply of services shall be deemed to have been made to the extent it is covered by the invoice or the part payment. However, for goods payment of tax will need to be made upon date of issue of invoice, irrespective of the fact whether or not advance or part payment is received.
\nQ 8. What is the time of supply of goods in case of tax payable under reverse charge?
\nAns. The time of supply will be the earliest of the following dates:
\na) date<\/p>\n
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\nQ 12. What is the time of supply, where supply is completed prior to change in rate of tax?
\nAns. In such cases time of supply will be
\n(i) where the invoice for the same has been issued and the payment is also received after the change in rate of tax, the time of supply shall be the date of receipt of payment or the date of issue of invoice, whichever is earlier; (However, for supply of goods payment of tax need to be made only at the time of issue of invoice in terms of notification 66\/2017-Central Tax dated 15.11.2017) or
\n(ii) where the invoice has been issued prior to change in rate of tax but the payment is received after the change in rate of tax, the time of supply shall be the date of issue of invoice; or
\n(iii) where the payment is received before the change in rate of tax, but the invoice for the same has been issued after the change in rate of tax, the time of supply shall be the date of receipt of payment; (However for supply of goods payment of tax need to b<\/p>\n
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\nQ 14. Let's say there was increase in tax rate from 18% to 20% w.e.f.1.9.2017. What is the tax rate applicable when services provided and invoice issued before change in rate in July, 2017, but payment received after change in rate in September, 2017?
\nAns. The old rate of 18% shall be applicable as services are provided prior to 1.9.2017.
\nQ 15. Let's say there was increase in tax rate from 18% to 20% w.e.f. 1.9.2017. What is the tax rate applicable when goods are supplied and invoice issued after change in rate in September, 2017, but full advance payment was already received in July, 2017?
\nAns. The new rate of 20% shall be applicable as goods are supplied and invoice issued after 1.9.2017
\nQ 16. What is the time period within which invoice has to be issued for supply of Goods?
\nAns. As per Section 31 of <\/p>\n
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\nQ 18. What is the time period within which invoice has to be issued in a case involving continuous supply of goods?
\nAns. In case of continuous supply of goods, where successive statements of accounts or successive payments are involved, the invoice shall be issued before or at the time each such statement is issued or, as the case may be, each such payment is received.
\nQ 19. What is the time period within which invoice has to be issued in a case involving continuous supply of services?
\nAns. In case of continuous supply of services,
\n(a) where the due date of payment is ascertainable from the contract, the invoice shall be issued on or before due date of payment.;
\n(b) where the due date of payment is not ascertainable from the contract, the invoice shall be<\/p>\n
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\nQ 2. What is transaction value?
\nAns. Transaction value refers to the price actually paid or payable for the supply of goods and or services where the supplier and the recipient are not related and price is the sole consideration for the supply. It includes any amount which the supplier is liable to pay but which has been incurred by the recipient of the supply.
\nQ 3. Are there separate valuation provisions for CGST, SGST and IGST and for Goods and Services?
\nAns. No, section 15 is common for all three taxes and also common for goods and services.
\nQ 4. Is contract price not sufficient to determine valuation of supply?
\nAns. Contract price is more specifically referred to as 'transaction value' and that is the basis for computing tax. However, when the price is influenced by factors like relationship of parties or where certain transactions are deemed <\/p>\n
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\nAns. No, provided it is allowed in the course of normal trade practice and has been duly recorded in the invoice.
\nQ 9. When are the provisions of the Valuation Rules applicable?
\nAns. Valuation Rules are applicable when (i) consideration either wholly or in part not in money terms; (ii) parties are related or supply by any specified category of supplier; and (iii) transaction value declared is not reliable.
\nQ 10. What are the inclusions specified in Section 15(2) which could be added to Transaction Value?
\nAns. The inclusions specified in Section15 (2) which could be added to transaction value are as follows:
\na) Any taxes, duties, cesses, fees and charges levied under any statute, other than the SGST\/CGST Act and the Goods and Services Tax (Compensation to the States for Loss of Revenue) Act, 2016, if charged separately by the supplier to the recipient;
\nb) Any amount that the supplier is liable to pay in relation to such supply but whic<\/p>\n
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\nQ 12. How will goods re-possessed from defaulting borrowers be valued?
\nAns. The proviso to Rule 32(5) of the CGST Rules provides that in case of the purchase value of goods repossessed from an unregistered defaulting borrower, for the purpose of recovery of a loan or debt shall be deemed to be the purchase price of such goods by the defaulting borrower reduced by five percentage points for every quarter or part thereof, between the date of purchase and the date of disposal by the person making such repossession.
\nQ 13. How will works contract service provided by a builder\/developer to a prospective flat buyer be valued under GST?
\nAns. In case of supply of construction service (works contract), involving transfer of property in lan<\/p>\n
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\n7. GST Payment of Tax
\nQ 1. What are the Payments to be made in GST regime?
\nAns. In the GST regime, for any intra-state supply, taxes to be paid are the Central GST (CGST), going into the account of the Central Government) and the State\/UT GST (SGST, going into the account of the concerned State Government). For any inter-state supply, tax to be paid is Integrated GST (IGST) which will have components of both CGST and SGST. In addition, certain categories of registered persons will be required to pay to the government account Tax Deducted at Source (TDS) and Tax Collected at Source (TCS). In addition, wherever applicable, Interest, Penalty, Fees and any other payment will also be required to be made.
\nQ 2. Who is liable to pay GST?
\nAns. In general, the supplier of goods or services is liable to pay GST. However, in specified cases like imports and other notified supplies, the liability may be cast on the recipient under the reverse charge me<\/p>\n
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\nQ 4. What are the main features of GST payment process?
\nAns. The payment processes under GST Act(s) have the following features:
\n• Electronically generated challan from GSTN Common Portal in all modes of payment and no use of manually prepared challan;
\n• Facilitation for the tax payer by providing hassle free, anytime, anywhere mode of payment of tax;
\n• Convenience of making payment online;
\n• Logical tax collection data in electronic format;
\n• Faster remittance of tax revenue to the Government Account;
\n• Paperless transactions;
\n• Speedy Accounting and reporting;
\n• Electronic reconciliation of all receipts;
\n• Simplified procedure for banks
\n• Warehousing of Digital Challan.
\nQ 5. How can payment be done?
\nAns. Payment can be done by the following methods:
\n(i) Through debit of Credit Ledger of the ta<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nQ 7. Whether time limit for payment of tax can be extended or paid in monthly installments?
\nAns. No, this is not permitted in case of self-assessed liability. In other cases, competent authority has been empowered to extend the time period or allow payment in instalments. (Section 80 of the CGST\/SGST Act).
\nQ 8. What happens if the taxable person files the return but does not make payment of tax?
\nAns. In such cases, the return is not considered as a valid return. Section 2(117) defines a valid return to mean a return furnished under <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nQ 11. What is a tax liability register?
\nAns. Tax Liability Register will reflect the total tax liability of 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, and TDS\/TCS made on account of the taxpayer. The information will be reflected on real time basis. This ledger can be used for making any payment on account of GST.
\nQ 13. What is an ITC Ledger?
\nAns. Input Tax Credit as self-assessed in monthly returns will be reflected in the ITC Ledger. The credit in this ledger can be used to make payment of TAX ONLY and no other amounts such as interest, penalty, fees etc.
\nQ 14. What is the linkage between GSTN and the authorized Banks?
\nAns. There will be real time two-way linkage between the GSTN and the Core Banking Solution (CBS) of the Bank. CPIN is automatically routed to the Bank via electronic string for verification and receiving paym<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nQ 17. Is there a validity period of challan?
\nAns. Yes, a challan will be valid for fifteen days after its generation and thereafter it will be purged from the System. However, the tax payer can generate another challan at his convenience.
\nQ 18. What is a CPIN?
\nAns. CPIN stands for Common Portal Identification Number (CPIN) given at the time of generation of challan. It is a 14-digit unique number to identify the challan. As stated above, the CPIN remains valid for a period of 15 days.
\nQ 19. What is a CIN and what is its relevance?
\nAns. CIN stands for Challan Identification Number. It is a 17-digit number that is 14-digit CPIN plus 3-digit Bank Code. CIN is generated by the authorized banks\/ Reserve Bank of India (RBI) when payment is actually received by such authorized banks or RBI and credited in the relevant government account held with them. It is an indication that the payment has been realized and credited to the appropriate government<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\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 per section 51, this provision is meant for Government and Government undertakings and other notified entities making contractual payments where total value of such supply under a contract exceeds ₹ 2.5 Lakhs to suppliers. While making any payments under such contracts, the concerned Government\/authority shall deduct 2% of the total payment made (1% under each Act and 2% in case of IGST) and remit it into the appropriate GST account.\n<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nAns. This provision is applicable only for E-Commerce Operator under section 52 of CGST\/SGST Act. Every E-Commerce Operator, not being an agent, needs to withhold an amount calculated at the rate not exceeding one percent of the “net value of taxable supplies” made through it where the consideration with respect to such supplies is to be collected by the operator. Such withheld amount is to be deposited by such E-Commerce Operator to the appropriate GST account by the 10th of the next month. The amount deposited as TCS will be reflected in the electronic cash ledger of the supplier.
\nQ 27. What does the expression “Net value of taxable supplies” mean?
\nAns. The expression “net value of taxable supplies” means the aggregate value of taxable supplies of goods or services, other than services notified under Section 9(5), made during any month by all registered taxable persons through the operator reduced by the aggregate value of taxable supplies returned<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nAns. Yes. The benefit of threshold exemption is not available to e-commerce operators and they would be liable to be registered irrespective of the value of supply made by them.
\nQ 4. Whether a supplier of goods or services supplying through e-commerce operator would be entitled to threshold exemption?
\nAns. The threshold exemption shall be available for supplier of services, other than supplies under section 9 (5) of the CGST Act. A person supplying goods through an e-commerce operator shall be mandatorily required to register.
\nQ 5. Will an e-commerce operator be liable to pay tax in respect of supply of goods or services made through it, instead of actual supplier?
\nAns. Yes, but only in case of certain notified services. In such cases tax shall be paid by the electronic commerce operator if such services are supplied through it and all the provisions of the Act shall apply to such electronic commerce operator <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nAns. An e-commerce company is required to collect tax only on the net value of taxable supplies. In other words, value of the supplies which are returned are adjusted in the aggregate value of taxable supplies.
\nQ 9. What is meant by “net value of taxable supplies”?
\nAns. The “net value of taxable supplies” means the aggregate value of taxable supplies of goods or services or both, other than the services on which entire tax is payable by the e-commerce operator, made during any month by all registered persons through such operator reduced by the aggregate value of taxable supplies returned to the suppliers during the said month.
\nQ 10. Is every e-commerce operator required to collect tax on behalf of actual supplier?
\nAns. Yes, every e-commerce operator is required to collect tax where consideration with respect to the supply is being collected by the e-commerce operator.
\nQ 11. At what time should the e-commerce operator make such collection?
\nAns. The e-com<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nQ 15. What is the concept of matching in e-commerce provisions and how it is going to work?
\nAns. The details of supplies and the amount collected during a calendar month, and furnished by every operator in his statement will be matched with the corresponding details of outward supplies furnished by the concerned supplier in his valid return for the same calendar month or any preceding calendar month. Where the details of outward supply, on which the tax has been collected, as declared by the operator in his statement do not match with the corresponding details declared by the s<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\n9. Job Work
\nQ 1. What is job work?
\nAns. Job work means undertaking any treatment or process by a person on goods belonging to another registered taxable person. The person who is treating or processing the goods belonging to other person is called 'job worker' and the person to whom the goods belongs is called 'principal'.
\nThis definition is much wider than the one given in Notification No. 214\/86 – CE dated 23rd March, 1986. In the said notification, job work has been defined in such a manner so as to ensure that the activity of job work must amount to manufacture. Thus the definition of job work itself reflects the change in basic scheme of taxation relating to job work in the proposed GST regime.
\nQ 2. Whether goods sent by a taxable person to a job worker will be treated as supply and liable to GST? Why?
\nAns. It will be treated as a supply as supply includes all forms of supply such as sale, transfer, etc. However, the registered taxable p<\/p>\n
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\nQ 5. Can a principal send inputs and capital goods directly to the premises of job worker without bringing it to his premises?
\nAns. Yes, the principal is allowed to do so. The input tax credit of tax paid on inputs or capital goods can also be availed by the principal in such a scenario. The inputs or capital goods must be received back within one year or three years respectively failing which the original transaction would be treated as supply and the principal would be liable to pay tax accordingly.
\nQ 6. Can the principal supply the goods directly from the premises of the job worker without bringing it back to his own premises?
\nAns. Yes. But the principal should have declared the premises of an unregistered job worker as his additional place of business. If th<\/p>\n
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\nQ 9. What happens when the inputs or capital goods are not received back or supplied from the place of business of job worker within prescribed time period?
\nAns. If the inputs or capital goods are not received back by the principal or are not supplied from the place of business of job worker within the prescribed time limit, it would be deemed that such inputs or capital goods had been supplied by the principal to the job worker on the day when the said inputs or capital goods were sent out by the principal (or on the date of receipt by the job worker where the inputs or capital goods w<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nQ 13. Who is responsible for the maintenance of proper accounts related to job work?
\nAns. It is completely the responsibility of the principal to maintain proper accounts of job work related inputs and capital goods.
\nQ 14. Are the provisions of job work applicable to all categories of goods?
\nAns. No. The provisions relating to job work are applicable only when registered taxable person intends to send taxable goods. In other words, these provisions are not applicable to exempted or non-taxable goods or when the sender is a person other than registered taxable person.
\nQ 15. Is it compulsory that job work provisions should be followed by the principal?
\nAns. No. The principal can send the inputs or capital goods after payment of GST without following the special procedure. In such a case, the job-worker would take the input tax credit and supply back the processed goods (after completion of job-work) on payment of GST.
\nQ 16. Should job worker and principal be locat<\/p>\n
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\nQ 4. Is credit of all input tax charged on supply of goods or services allowed under GST?
\nAns. A registered person is entitled to take credit of input tax charged on supply of goods or services or both to him which are used or intended to be used in the course or furtherance of business, subject to other conditions and restrictions.
\nQ 5. What are the conditions necessary for obtaining ITC?
\nAns. Following four conditions are to be satisfied by the registered taxable person for obtaining ITC:
\n(a) he is in possession of tax invoice or debit note or such other tax paying documents (such as bill of entry or any other document prescribed under the Customs Act, ISD invoice as prescribed in Rule 36(1) of the CGST Rules).
\n(b) he has received the goods or services or both;
\n(c) the supplier has actually paid the tax charged <\/p>\n
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\nQ 9. Who will get the ITC where goods have been delivered to a person other than taxable person ('bill to'- 'ship to 'scenarios)?
\nAns. It would be deemed that the registered person has received the goods when the goods have been delivered to a third party on the direction of such taxable person. So ITC will be available to the person on whose order the goods are delivered to third person.
\nQ 10. What is the time limit for taking ITC and reasons therefor?
\nAns. A registered person cannot take ITC in respect of any invoice or debit note for supply of goods or services after the due date for furnishing the return under section 39 for the month of September following the end of financial year to which such invoice\/invoice relating to debit note pertains or furnishing of the relevant annual return, whichever is earlier. So, the upper time limit for taking ITC is 20th October of the next FY or the date of filing of annual return whichev<\/p>\n
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\nQ 13. A taxable person is in the business of information technology. He buys a motor vehicle for use of his Executive Directors. Can he avail the ITC in respect of GST paid on purchase of such motor vehicle?
\nAns. No. ITC on motor vehicles can be availed only if the taxable person is in the business of transport of passengers or goods or is providing the services of imparting training on motor vehicles.
\nQ 14. Sometimes goods are destroyed or lost due to various reasons? Can a person take ITC to the extent of such goods?
\nAns. No, a person cannot take ITC with respect to goods lost, stolen, destroyed or written off. In addition, ITC with respect of goods given as gifts or free samples are also not allowed.
\nQ 15. Can a registered person get ITC with respect of goods or services used for construction of a building for business purposes?
\nAns. No. ITC on goods or services by a person for construc<\/p>\n
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\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 inputs in stock for a person who obtains voluntary registration?
\nAns. The person who obtains voluntary registration is entitled to take the input tax credit of input tax on inputs in stock, inputs in semi- finished goods and finished goods in stock, held on the day immediately preceding the date of registration.
\nQ 19. What would be input tax eligibility in cases where there is a change in the constitution of a registered person?
\nAns. The registered person shall be allowed to transfer the input tax credit that remains unutilized in its electronic credit ledger to the new entity, provided that there is a specific provision for transfer of liabilities.
\nQ 20. Where goods or services or both rece<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nAns. Zero rated supplies.
\nQ 23. Where goods or services received by a registered person are used partly for the purpose of business and partly for other purposes, whether the input tax credit is available to the person?
\nAns. The input tax credit of goods or services or both attributable only to the purpose of business can be taken by registered person. The manner of calculation of eligible credit is provided in rules.
\nQ 24. A person paying tax under compounding scheme crosses the compounding threshold and becomes a regular taxable person. Can he avail ITC and if so from what date?
\nAns. He can avail ITC in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock and on capital goods (reduced by prescribed percentage points) on the day immediately preceding the date from which he ceases to be eligible for composition scheme. The manner of calculation of eligible credit is provided in CGST Rules.
\nQ 25. Are there any special<\/p>\n
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\nQ 27. Mr. B applies for voluntary registration on 5th July, 2017 and obtained registration on 22nd July, 2017. Mr. B is eligible for input tax credit on inputs in stock as on…………..
\nAns. Mr. B is eligible for input tax credit on inputs held in stock and inputs contained in semi-finished or finished goods held in stock as on 21st July, 2017. This is subject to the further condition that the invoices pertaining to such inputs should not be more than a year old. Mr. B cannot take input tax credit in respect of capital goods.
\nQ 28. What would happen to the input tax credit availed by a registered person who opts for composition scheme or where the goods or services or both supplied by him become wholly exempt?
\nAns. The registered person has to pay an amount equal to the input tax credit in respect of stocks held and inputs contained in semi-finished or finished goods held in stock on the day immediately preceding the date of exercise of option or date o<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nQ 29. Is there any restriction on period for availment of ITC?
\nAns. In cases of new registration, change from composition to normal scheme, from exempt to taxable supplies, the concerned person cannot avail ITC after the expiry of one year from the date of issue of tax invoice relating to such supply.
\nQ 30. What happens where the details of inward supplies furnished by the recipient do not match with the outward supply details furnished by the supplier in his valid return?
\nAns. In case of mismatch, the communication would be made to the both parties. If the mismatch is not rectified, then the amount will be added to the output liability of recipient in the return for the month succeeding the month in which discrepancy is communicated.
\nQ 31. Is input tax credit allowed only after matching?
\nAns. No, input tax credit is allowed provisionally for two months. The supply details are matched by the system and discrepancies are communicated to concerned supplier and recipie<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nQ 1. What is Input Service Distributor (ISD)?
\nAns. ISD means an office of the supplier of goods or services or both which receives tax invoices towards receipt of input services and issues a prescribed document for the purposes of distributing the credit of central tax (CGST), State tax (SGST)\/ Union territory tax (UTGST) or integrated tax (IGST) paid on the said services to a supplier of taxable goods or services or both having same PAN as that of the ISD.
\nQ 2. What are the requirements for registration as ISD?
\nAns. An ISD is required to obtain a separate registration even though it may be separately registered. The threshold limit of registration is not applicable to ISD. The registration of ISD under the existing regime (i.e. under Service Tax) would not be migrated in GST regime. All the existing ISDs will be required to obtain fresh registration under new regime in case they want to operate as an ISD.
\nQ 3. What are the documents for distribution of credit by <\/p>\n
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\nQ 6. What does the turnover used for ISD cover?
\nAns. The turnover for the purpose of ISD does not include any duty or tax levied under entry 84 of List I and entry 51 and 54 of List II of the Seventh Schedule to the Constitution.
\nQ 7. Is the ISD required to file return?
\nAns. Yes, ISD is required to file monthly return by 13th of the following month in form GSTR-6.
\nQ 8. Can a company have multiple ISD?
\nAns. Yes, different offices like marketing division, security division etc. may apply for separate ISD.
\nQ 9. What are the provisions for recovery of excess\/wrongly distributed credit by ISD?
\nAns. The excess\/wrongly distributed credit can be recovered from the recipients of credit along with interest by <\/p>\n
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\nAns. The common credit used by all the recipients can be distributed by ISD on pro rata basis i.e. based on the turnover of each recipient to the aggregate turnover of all the recipients to which credit is distributed.
\nQ 15. The ISD may distribute the CGST and IGST credit to recipient outside the State as_______
\n(a) IGST
\n(b) CGST
\n(c) SGST
\nAns. (a) IGST.
\nQ 16. The ISD may distribute the CGST credit within the State as____
\n(a) IGST
\n(b) CGST
\n(c) SGST
\n(d) Any of the above.
\nAns. (b) CGST.
\nQ 17. The credit of tax paid on input service used by more than one supplier is ________
\n(a) Distributed among the suppliers who used such input service on pro rata basis of turnover in such 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<\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nQ 2. Who needs to file Return in GST regime?
\nAns. Every person registered under GST will have to file returns in some form or other. A registered person will have to file returns either monthly (normal supplier) or quarterly basis (Supplier opting for composition scheme). An ISD will have to file monthly returns showing details of credit distributed during the particular month. A person required to deduct tax (TDS) and persons required to collect tax (TCS) will also have to file monthly returns showing the amount deducted\/collected and other specified details. A non-resident taxable person will also have to file returns for the period of activity undertaken.
\nQ 3. What type of outward supply details are to be filed in the return?
\nAns. A normal registered taxpayer having aggregate turnover in the preceding or current financial year more than ₹ 1.5 Crore has to file the outward supply details in GSTR-1 in relation to various types of supplies made in a <\/p>\n
For full text:-Visit the Source <\/a><\/p>\n
\nQ 6. Whether all invoices will have to be uploaded?
\nAns. No. It depends on whether B2B or B2C plus whether Intra-state or Inter-state supplies.
\nFor B2B supplies, all invoices, whether Intra-state or Inter- state supplies, will have to be uploaded. Why So? Because ITC will be taken by the recipients, invoice matching is required to be done.
\nIn B2C supplies, uploading in general may not be required as the buyer will not be taking ITC. However still in order to implement the destination based principle, invoices of value more than ₹ 2.5 lacs in inter-state B2C supplies will have to be uploaded. For inter-state invoices below ₹ 2.5 lacs and all intra-state invoices, state wise summary will be sufficient.
\nQ 7. Whether description of each item in the invoice will have to be uploaded?
\nAns. No. In fact, description will not have to be uploaded. Only HSN code in respect of supply of goods an<\/p>\n
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\nQ 10. Does the taxable person have to feed anything in the GSTR-2 or everything is auto-populated from GSTR-1?
\nAns. While a large part of GSTR-2 will be auto-populated, there are some details that only recipient can fill like details of imports, details of purchases from non-registered or composition suppliers and exempt\/non-GST\/nil GST supplies etc.
\nQ 11. What if the invoices do not match? Whether ITC is to be given or denied? If denied, what action is taken against supplier?
\nAns. If invoices in GSTR-2 do not match with invoices in counter-party GSTR-1, then such mismatch shall be intimated to the supplier. Mismatch can be because of two reasons. First, it could be due to mistake at the side of the recipient, and in such a case, no further action is required. Secondly, it could be possible that the said invoice was<\/p>\n
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\nAns. The special feature of GSTR-2 is that the details of supplies received by a recipient can be auto populated on the basis of the details furnished by the counterparty supplier in his GSTR-1.
\nQ 14. Do tax payers under the composition scheme also need to file GSTR-1 and GSTR-2?
\nAns. No. Composition tax payers do not need to file any statement of outward or inward supplies. They have to file a quarterly return in Form GSTR-4 by the 18th of the month after the end of the quarter. Since they are not eligible for any input tax credit, there is no relevance of GSTR-2 for them and since the credit of tax paid under Composition Levy is not eligible, there is no relevance of GSTR-1 for them. In their return, they have to declare summary details of their outward supplies along with the details of tax payment. They also have to give details of their purchases in their quarterly return itself, most of which will be auto populated.
\nQ 15. Do Input Service Di<\/p>\n
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\nQ 17. Which type of taxpayers need to file Annual Return?
\nAns. All taxpayers filing return in GSTR-1 to GSTR-3, other than ISD's, casual\/non-resident taxpayers, taxpayers under composition scheme, TDS\/TCS deductors, are required to file an annual return. Casual taxpayers, non- resident taxpayers, ISDs and persons authorized to deduct\/collect tax at source are not required to file annual return.
\nQ 18. Is an Annual Return and a Final Return one and the same?
\nAns. No. Annual Return has to be filed by every registered person paying tax as a normal taxpayer. Final Return has to be filed only by those registered persons who have applied for cancellation of registration. The Final return has to be filed within three m<\/p>\n
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\nQ 21. What precautions, a taxpayer is required to take for a hassle free compliance under GST?
\nAns. One of the most important things under GST will be timely uploading of the details of outward supplies in Form GSTR-1 by 10th of next month. How best this can be ensured will depend on the number of B2B invoices that the taxpayer issues. If the number is small, the taxpayer can upload all the information in one go. However, if the number of invoices is large, the invoices (or debit\/ credit notes) should be uploaded on a regular basis. GSTN will allow regular uploading of invoices even on a real time basis. Till the statement is actually subm<\/p>\n
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\nQ 22. Is it compulsory for a taxpayer to file return by himself?
\nAns. No. A registered taxpayer can also get his return filed through a Tax Return Preparer, duly approved by the Central or the State tax administration.
\nQ 23. What is the consequence of not filing the return within the prescribed date?
\nAns. A registered person who files return beyond the prescribed date will have to pay late fees of rupees one hundred for every day of delay subject to a maximum of rupees five thousand. For failure to furnish Annual returns by due date, late fee of Rs. One hu<\/p>\n
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\nQ 26. What is GSTR-3B?
\nAns. GSTR-3B is a simplified monthly return that all taxpayers need to file from July 2017 to March 2018. It is a summarized return form which every taxpayer will be required to file on self-declaration basis till 31st March 2018. The same needs to be filed by 20th day of next month. i.e. for the month of December,2017 GSTR-3B needs to be filed by 20th January, 2018 after paying appropriate taxes, and for the month of February, 2017 the same needs to filed by 20th March, 2018.
\nQ 27. Is there any late fees for late filing of GSTR-3B?
\nAns. The late fees for filing GSTR-3B for the months of July to September 2017 has been waived by the Government. Where such late fee was paid, it will be re-credited to taxpayer's Electronic Cash Ledger under “Ta<\/p>\n
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\n13. Assessment and Audit
\nQ 1. Who is the person responsible to make assessment of taxes payable under the Act?
\nAns. Every person registered under the Act shall himself assess the tax payable by him for a tax period and after such assessment he shall file the return required under section 39.
\nQ 2. When can a taxable person pay tax on a provisional basis?
\nAns. As a taxpayer has to pay tax on self-assessment basis, a request for paying tax on provisional basis has to come from the taxpayer which will then have to be permitted by the proper officer. In other words, no tax officer can suo-moto order payment of tax on provisional basis. T<\/p>\n
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\na) by the Joint \/ Additional Commissioner for a further period not exceeding six months, and
\nb) by the Commissioner for such further period as he may deem fit not exceeding fours.
\nThus, a provisional assessment can remain provisional for a maximum of five years.
\nQ 4. Where the tax liability as per the final assessment is higher than in provisional assessment, will the taxable person be liable to pay interest?
\nAns. Yes. He will be liable to pay interest from the date the tax was due to be paid originally till the date of actual payment.
\nQ 5. What recourse may be taken by the officer in case proper explanation is not furnished for the discrepancy detected in the return filed, while conducting scrutiny under section 61 of CGST ACT?
\nAns. If the taxable person does not provide a satisfactory explanation within 30 days of being informed (extendable by the officer concerned) or after acc<\/p>\n
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\nQ 7. Under what circumstances can a best judgment assessment order issued under section 60 be withdrawn?
\nAns. The best judgment order passed by the Proper Officer under section 62 of CGST\/SGST Act shall automatically stand withdrawn if the taxable person furnishes a valid return for the default period (i.e. files the return and pays the tax as assessed by him), within thirty days of the receipt of the best judgment assessment order.
\nQ 8. What is the time limit for passing assessment order u\/s 62 (Best Judgment) and 63 (Non-filers)?
\nAns. The time limit for passing an assessment order under section 62 or 63 is five years from the due date for furnishing the annual return.
\nQ 9. What is the legal recourse available in <\/p>\n
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\nAns. A taxable person against whom a summary assessment order has been passed can apply for its withdrawal to the jurisdictional Additional\/Joint Commissioner within thirty days of the date of receipt of the order. If the said officer finds the order erroneous, he can withdraw it and direct the proper officer to carry out determination of tax liability in terms of section 73 or 74 of CGST\/SGST Act. The Additional\/Joint Commissioner can follow a similar course of action on his own motion if he finds the summary assessment order to be erroneous (section 64 of CGST\/SGST Act).
\nQ 12. Is summary assessment order to be necessarily passed against the taxable person?
\nAns. No. In certain cases, like when goods are under transportation or are stored in a warehouse, and the taxable person in respect of such goods cannot be ascertained, the person in charge of such goods shall b<\/p>\n
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\nQ 14. Whether any prior intimation is required before conducting the audit?
\nAns. Yes, prior intimation is required and the taxable person should be informed at least 15 working days prior to conduct of audit.
\nQ 15. What is the period within which the audit is to be completed?
\nAns. The audit is required to be completed within 3 months from the date of commencement of audit. The period is extendable for a further period of a maximum of 6 months by the Commissioner.
\nQ 16. What is meant by commencement of audit?
\nAns. The term 'commencement of audit' is important because audit has to be completed within a given time frame in reference to this date of commencement. Commencement of audit means the later of the following:
\na) the date on which the records\/accounts called for by the audit authorities are made available to them, or
\nb) the actual institution of au<\/p>\n
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\nQ 20. Who can serve the notice of communication for special audit?
\nAns. The Assistant \/ Deputy Commissioner is to serve the communication for special audit only after prior approval of the Commissioner.
\nQ 21. Who will do the special audit?
\nAns. A Chartered Accountant or a Cost Accountant so nominated by the Commissioner may undertake the audit.
\nQ 22. What is the time limit to submit the audit report?
\nAns. The auditor will have to submit the report within 90 days or within the further extended period of 90 days.
\nQ 23. Who will bear the cost of special audit?
\nAns. The expenses for examination and audit including the remuneration payable to the auditor will be determined and borne by the Commissioner.
\nQ 24. What action the tax authorities may take after the special audit?
\nAns. Based on the findings \/ observations of the special audit, action can be initiated under Section 73 or Section 74 of the CGST\/SGST Act.
\n14. Refunds
\nQ<\/p>\n