GST Scanner by Meeta Mangal Mam PDF

GST SCANNER
FOR CA INTER/IPCC
NOV 2018 (OLD & NEW SYLLABUS)
Total 93 Questions With Solution
Covering
♦ ICAI RTP
♦ ICAI MTP
♦ ICAI Practice Paper
♦ May 2018 Exam Paper
Compiled by:- Meeta Mangal

Index
Chapter No. Chapter Name Page No.
1. GST in India – Introduction 1–3
2. Supply Under GST 4 – 11
3. Charge of GST 12 – 15
4. Exemptions from GST 16 – 21
5. Time of Supply 22 – 25
6. Value of Supply 26 – 40
7. Input Tax Credit 41 – 55
8. Registration 56 – 64
Tax Invoice, Debit Note and
9. 65 – 70
Credit Note
10. Payment of Tax 71 – 74
11. Return 75
12. Composition scheme 76 – 82

SCANNER - CA INTER / IPCC - NOV 2018
Chapter – 1
GST in India - Introduction
1. Discuss any two significant benefits of GST.
(Source – Mock Test Paper 1- May 2018)
Solution – 1
• GST is a win-win situation for the entire country. It brings benefits to all the stakeholders
of industry, Government and the consumer. It will lower the cost of goods and services,
give a boost to the economy and make the products and services globally competitive.
• The significant benefits of GST are discussed hereunder:
1. Creation of unified national market: GST aims to make India a common market with
common tax rates and procedures and remove the economic barriers thus paving the way
for an integrated economy at the national level.
2. Mitigation of ill effects of cascading: By subsuming most of the Central and State taxes
into a single tax and by allowing a set-off of prior-stage taxes for the transactions across
the entire value chain, it would mitigate the ill effects of cascading, improve
competitiveness and improve liquidity of the businesses.
3. Elimination of multiple taxes and double taxation: GST has subsumed majority of existing
indirect tax levies both at Central and State level into one tax i.e., GST which is leviable
uniformly on goods and services. This will make doing business easier and will also tackle
the highly-disputed issues relating to double taxation of a transaction as both goods and
services.
4. Boost to ‘Make in India' initiative: GST will give a major boost to the ‘Make in India'
initiative of the Government of India by making goods and services produced in India
competitive in the national as well as international market.
5. Buoyancy to the Government Revenue: GST is expected to bring buoyancy to the
Government Revenue by widening the tax base and improving the taxpayer compliance.
2. List the central taxes which have been subsumed in GST in India?
(Source – Mock Test Paper 2:- May 2018)
Solution – 2
• The Central taxes which have been subsumed in GST in India are as follows:-
(b) Central Excise Duty & Additional Excise Duties
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(c) Service Tax

(d) Excise Duty under Medicinal & Toilet Preparation Act
(e) CVD & Special CVD
(f) Central Sales Tax
(g) Central surcharges and Cesses in so far as they relate to supply of goods & services
3. Explain the meaning of the term "recipient of supply of goods and/or services"
under the CGST Act, 2017.
Exam Paper May 18 – New Syllabus
Solution 3
• Recipient of supply of goods or services or both, means —
a) where a consideration is payable for the supply of goods or services or both, the
person who is liable to pay that consideration,
b) where no consideration is payable for the supply of goods, the person to whom the
goods are delivered or made available, or to whom possession or use of the goods is
given or made available; and
c) where no consideration is payable for the supply of a service, the person to whom
the service is rendered,
and (i) any reference to a person to whom a supply is made shall be construed as
a reference to the recipient of the supply, and (ii) shall include an agent acting as
such on behalf of the recipient in relation to the goods or services or both supplied.
4. List any six state levies, which are subsumed in GST.

Solution 4
• The State levies which are subsumed in GST are as under:-
i. State surcharges and cesses in so far as they relate to supply of goods & services
ii. Entertainment Tax (except those levied by local bodies)
iii. Tax on lottery, betting and gambling
iv. Entry Tax (All Forms) & Purchase Tax
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v. VAT/ Sales tax

vi. Luxury Tax
vii. Taxes on advertisements
By CA Meeta Mangal
SCANNER - CA INTER/IPCC - NOV 2018
Chapter – 2
Supply Under GST
1. Discuss the term ‘composite supply’ and its taxability under GST law.
(Source – Mock Test Paper 1 – May 2018)
Solution:- 1
2. Determine whether the following supplies amount to composite supplies:

i. A hotel provides 4 days-3 nights package wherein the facility of breakfast and dinner
is provided along with the room accommodation.
ii. A toothpaste company has offered the scheme of free toothbrush along with the
toothpaste.
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Solution:- 2
 Under composite supply, two or more taxable supplies of goods or services or both, or any
combination thereof, are naturally bundled and supplied in conjunction with each other,
in the ordinary course of business, one of which is a principal supply [Section 2(30) of the
CGST Act].
 In view of the same,
i. Since, supply of breakfast and dinner with the accommodation in the hotel are naturally
bundled, said supplies qualify as ‘composite supply’.
ii. Since supply of toothbrush alongwith the toothpaste are not naturally bundled, said
supplies do not qualify as ‘composite supply’.
3. “State Government has exclusive power to notify a transaction to be supply of goods

or services.” Discuss the correctness of the statement.
(Source – Practice Paper 1:- May 2018)
Solution:- 3
 The said statement is not correct.
 State Government can notify a transaction to be supply of goods or services but only
on the recommendations of the GST Council.
 Further, Central Government or State Government, both on the recommendations
of the GST Council, can notify an activity to be the supply of goods and not supply of
services or supply of services and not supply of goods or neither a supply of goods
nor a supply of services.
4. State the necessary elements for a supply to be chargeable to GST.

Solution – 4
 The following elements are required to be satisfied for a supply to be chargeable to GST,
i.e.-
1) the activity involves supply of goods or services or both;
2) the supply is for a consideration unless otherwise specifically provided for;
3) the supply is made in the course or furtherance of business;
4) the supply is a taxable supply; and
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5) the supply is made by a taxable person.
5. Modest Ltd., registered in Delhi dealing in supply of electronic items transferred

some of its stock to its another unit located in Haryana (inter-state transfer).
Whether such self-supplies are taxable under GST?
Solution – 5
 Yes, transfer of stock made by Modest Ltd. are taxable under GST.
 The definition of supply given under section 7 of CGST Act, 2017 is an inclusive one. It does
not specify that supply is to be made by one person to the another. So, self-supplies are to
be treated as supply in terms of section 7 of CGST Act.
 Further, section 25(5) provides that where a person who has obtained or is required to
obtain registration in a State or Union territory in respect of an establishment, has an
establishment in another State or Union territory, then such establishments shall be
treated as establishments of distinct persons.
 Clause (2) of Schedule I of CGST Act, 2017 inter alia provides that supply of goods between
distinct persons as specified in section 25 made in the course or furtherance of business is
to treated as supply even if made without consideration.
 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.
6. Sahab Sales, an air-conditioner dealer in Janakpuri, Delhi, needs 4 air-conditioners

for his newly constructed house in Safdarjung Enclave. Therefore, he transfers 4 air-
conditioners [on which ITC has already been availed by it] from its stock, for the said
purpose. Examine whether the said activity amounts to supply under section 7 of the
CGST Act, 2017.
 Further, a Janakpuri resident, Aakash, approached Sahab Sales. He sold an air-
conditioner to Sahab Sales for Rs. 5,000. Aakash had bought the said air-
conditioner six months before, for his residence. Does sale of the air conditioner by
Aakash to Sahab Sales amount to supply under section 7 of the CGST Act, 2017?
(Source – RTP 1:- May 2018)
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Solution – 6
 Section 7 of the CGST Act, 2017 stipulates that in order to qualify as supply:
a) Supply should be of goods and/or services.
b) Supply should be made for a consideration.
c) Supply should be made in the course or furtherance of business.
 Further, Schedule I of the CGST Act, 2017 illustrates the activities to be treated as
supply even if made without consideration.
 One such activity is permanent transfer or disposal of business assets where input
tax credit has been availed on such assets, i.e. said activity is to be treated as supply
even if made without consideration.
 In view of said provisions, permanent transfer of air conditioners by Sahab Sales
from its stock for personal use at its residence, though without consideration, would
amount to supply.
 However, sale of air-conditioner by Aakash to Sahab Sales will not qualify as supply
under section 7 of the CGST Act, 2017 as although it is made for a consideration,
but its not in the course or furtherance of business.
7. List any four activities which shall be neither treated as supply of goods nor a supply
of services under the GST law.
(Source – RTP - Nov 2018)
Solution – 7
 Section 7(2)(a) of CGST Act, 2017 read with Schedule III specifies the activities or
transactions which shall be treated neither as a supply of goods nor a supply of services:
1. Services by an employee to the employer in the course of or in relation to his employment.
2. Services by any court or Tribunal established under any law for the time being in force.
3. (a) Functions performed by the Members of Parliament, Members of State Legislature,

Members of Panchayats, Members of Municipalities and Members of other local
authorities;
(b) Duties performed by any person who holds any post in pursuance of the provisions of
the Constitution in that capacity; or
(c ) Duties performed by any person as a Chairperson or a Member or a Director in a body

established by the Central Government or a State Government or local authority and who
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is not deemed as an employee before the commencement of this clause.
4. Services of funeral, burial, crematorium or mortuary including transportation of the

deceased.
5. Sale of land and, subject to paragraph 5(b) of Schedule II, sale of building.
6. Actionable claims, other than lottery, betting and gambling
8. Examine whether the activity of import of service in the following independent cases would
amount to supply under section 7 of the CGST Act, 2017?
i. Miss Shriniti Kaushik received vaastu consultancy services for her residence located at
Bandra, Mumbai from Mr. Racheal of Sydney (Australia). The amount paid for the said
service is 5,000 Australian dollar.
ii. Miss Shriniti Kaushik received vaastu consultancy services for her residence located at
Bandra, Mumbai from her brother, Mr. Varun residing in Sydney (Australia). Further, Miss
Shriniti did not pay any consideration for the said service.
iii. Miss Shriniti Kaushik received vaastu consultancy services for her business premises
located at Bandra, Mumbai from her brother, Mr. Varun residing in Sydney (Australia).
Further, Miss Shriniti did not pay any consideration for the said service.
Solution – 8
i. Supply, under section 7 of the CGST Act, 2017, inter alia,

 includes import of services for a consideration
 even if it is not in the course or furtherance of business.
Thus, although the import of service for consideration by Miss. Shriniti Kaushik is not in
course or furtherance of business, as the vaastu consultancy service has been availed in
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respect of residence, it would amount to supply.
ii. Section 7 of the CGST Act, 2017 read with Schedule I provides that import of services by a
taxable person from a related person located outside India, without consideration is treated
as supply if it is provided in the course or furtherance of business.
In the given case, import of service without consideration by Miss Shriniti from her brother
– Mr. Varun [brother, being member of the same family, is a related person] will not be
treated as supply as it is not in course or furtherance of business.
iii. Section 7 of the CGST Act, 2017 read with Schedule I provides that import of services by a
taxable person from a related person located outside India, without consideration is treated
as supply if it is provided in the course or furtherance of business.
Thus, import of service without consideration by Miss Shriniti from her brother – Mr. Varun
(brother, being member of the same family, is a related person) will be treated as supply as
she receives vaastu consultancy service for her business premises, i.e. in course or
furtherance of business.
9. List the activities to be treated as supply under CGST Act, 2017 even if made without
consideration.
(Source :- May 18 Paper –Old Syllabus)
Solution:- 9
 Activities to be treated as supply even if made without consideration in terms of
section 7 of CGST Act, 2017 read with Schedule I:-
1. Permanent transfer or disposal of business assets where input tax credit has been
availed on such assets.
2. Supply of goods or services or both between related persons or between distinct

persons as specified in section 25 of the CGST Act, 2017, when made in the course
or furtherance of business.
 However, gifts not exceeding Rs. 50,000 in value in a financial year by an employer
to an employee shall not be treated as supply of goods or services or both.
3. Supply of goods —
(a) by a principal to his agent where the agent undertakes to supply such goods on
behalf of the principal; or
(b) by an agent to his principal where the agent undertakes to receive such goods on
behalf of the principal.
4. Import of services by a taxable person from a related person or from any of his other
establishments outside India, in the course or furtherance of business.
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10. Mrs. Pragati received legal advice for her personal problems & paid 1,000 pound as
a legal fees to Miss Unnati of U.K. (London).
(a) Explain whether the above activity of import of service would amount to supply u/s
7 of the CGST Act, 2017 ?
(b) If in above case both of them are real sisters & no consideration is paid then will it
change your answer?
(c) Further in the above case if both of them are real sisters & Mrs. Pragati receives legal
advice for her business & she doesn't pay any consideration then what will be your
answer?
Solution:- 10
 Supply, under section 7 of the CGST Act, 2017, inter alia,
i. includes import of services for a consideration
ii. even if it is not in the course or furtherance of business.
 Thus, although the import of service for consideration by Mrs. Pragati is not in course
or furtherance of business, it would amount to supply.
 Further, import of services by a taxable person from a related person located outside
India, without consideration is treated as supply if it is provided in the course or
furtherance of business.
 In the given case, import of service without consideration by Mrs. Pragati from her
real sister - Miss Unnati [real sister, being member of the same family, is a related
person] will not be treated as supply as it is not in course or furtherance of business.
 However, import of service without consideration by Mrs. Pragati from her sister -
Miss Unnati (related person) will be treated as supply if she receives legal advice for
her business, i.e. in course or furtherance of business.
11.Examine whether the following activities would amount to supply under section 7 of
the CGST Act:
i. Shri Ram Charitable Trust, a trust that gets the neuro treatment of underprivileged
children done free of cost, donates clothes and food to children living in slum area.
ii. Simran is a beauty consultant in Mumbai. Her brother who is settled in Paris is a
well-known lawyer. Simran has taken legal advice from him free of cost with regard
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to her family dispute.

(Source – Mock Test Paper - Old Syllabus – Nov 2018)
Solution:- 11
i. Section 7 of the CGST Act, inter alia, provides that supply must be made for a
consideration except the activities specified in Schedule I and in course or
furtherance of business. Since, both these elements are missing, donation of clothes
and foods to children living in slum area would not amount to supply under section
7 of the CGST Act.
ii. Schedule I of CGST Act, inter alia, stipulates that import of services by a taxable
person from a related person located outside India, without consideration is tre ated
as supply if it is provided in the course or furtherance of business. In the given case,
Simran has received legal services from her brother free of cost in a personal matter
and not in course or furtherance of business. Hence, services provided by Simran’s
brother to her would not be treated as supply under section 7 of the CGST Act.
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Chapter - 3
Charge of GST
1. M/s X & Sons, tax consultant of Zenson Ltd., have advised them that reverse charge
mechanism is applicable only to services. Examine the validity of the advice given by
M/s X & Sons.
Solution:- 1
 The advice given by M/s X & Sons is not valid in law.
 The reverse charge mechanism applies to supplies of both goods and services, as
notified by the Government on the recommendations of the GST Council vide section
9(3)/5(3) of CGST/IGST Act, 2017.
 Reverse charge also applies to supplies received by a registered person from
unregistered persons under section 9(4)/5(4) of CGST/IGST Act, 2017. 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 30.06.2018.
2. Royal Sweet Co., Delhi, a registered supplier, has furnished the details of the
following few transactions which took place in November, 20XX:
S. Date Particulars Date of Amount (Rs.)

No. invoice
(i) 11.11.20XX Payment made to an advocate in Delhi 07.07.20XX 1,25,000
(ii) 20.11.20XX Paid sitting fee to Director from 15.10.20XX 75,000
Haryana for meeting held in Delhi on
15.10.20XX
[Inter-State supply]
Assume the rates of taxes to be as under:-
Particulars Rate
CGST 9%
SGST 9%
IGST 18%
You are required to compute GST [CGST & SGST/IGST, as the case may be] payable for the
month of November, 20XX along with time of supply of the aforementioned activities.
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Solution – 2
Computation of GST payable for the month of November, 20XX
S. Particulars Time of supply of CGST SGST IGST Interest
No. services (Rs.) (Rs.) (Rs.) (Rs.)
(i) Services from an 06.09.20XX 11,250 11,250 - 244
advocate in Delhi [Note-1 & 3] [Note-4]
(ii) Director’s Sitting fee 20.11.20XX - - 13,500

[Note-2 & 3]
 Notes:-
1. Services supplied by an individual advocate to any business entity located in the taxable
territory is a notified service on which tax is payable on reverse charge basis by the
recipient of services.
2. Services supplied by a director of a company to the said company is a notified service on

which tax is payable on reverse charge basis by the recipient of services.
3. As per section 13 of the CGST Act, 2017, the time of supply of services in case of reverse
charge is earliest of the following:-
a. Date of payment as entered in the books of account of the recipient or the date
on which the payment is debited to his bank account, whichever is earlier, or
b. Date immediately following 60 days since the date of issue of invoice.
 Provisions of time of supply as provided under section 13 of the CGST Act are also
applicable for inter-State supply vide section 20 of the IGST Act.
 In view of the aforesaid provisions, the time of supply and due date for payment of
tax in the given cases would be determined as under:
i. Time of supply of the services is the date immediately following 60 days since the date
of issue of invoice, i.e. 06.09.20XX. The due date for payment of tax is 20.10.20XX with
return of September, 20XX.
ii. Time of supply of service is 20.11.20XX and due date for payment of tax is 20.12.20XX
with return of December, 20XX.
4. The due date for payment of tax in case (i) is 20.10.20XX with return of September, 20XX.
However, the payment of tax is actually made on 11.11.20XX. Thus, payment of tax is
delayed by 22 days.
 In case of delayed payment of tax, interest @ 18% per annum is payable for the period
for which the tax remains unpaid starting from the day succeeding the day on which
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such tax was due to be paid [Section 50 of the CGST Act, 2017 read with Notification No.
13/2017 CT dated 28.06.2017]. In view of the same, in the given case, interest payable
would be as follows:
 Amount of interest payable = Rs. 22,500 × 18% × 22/365 = Rs. 244 (rounded off)
3. With reference to the provisions of GST law, briefly answer the following questions:-
a) Income is received by Maharashtra Government from renting of immovable property to
Ganpati Morya Pvt. Ltd., registered in Maharashtra (Turnover of the company was Rs. 18
lakh in the preceding financial year). Is GST payable in the present case? If yes, who is liable
to pay the same?
b) Mr. Vivek Goyal, director of A2Z Pvt. Ltd. Company has received sitting fee amounting to Rs.
1 lakh from A2Z Pvt. Ltd for attending the Board meetings.
Solution – 3(a)
i. Notification No. 12/2017 CT (R) dated 28.06.2017 has inter alia exempted the services
provided by the State Government to a business entity with an aggregate turnover of up to
Rs. 20 lakh (Rs. 10 lakh in case of a Special Category States) in the preceding FY. However,
the same shall not apply to services by way of renting of immovable property.
ii. In the given case, services by way of renting of immovable property is provided by
Maharashtra Government to Ganpati Morya Pvt. Ltd, registered in Maharashtra. Therefore,
the above exemption will not apply in this case even though the turnover of the company
was less than Rs. 20 lakh in the preceding financial year. Thus, GST is payable in the given
case.
iii. Notification No. 13/2017 CT (R) dated 28.06.2017 as amended inter alia provides that
reverse charge is applicable in case of services supplied by the State Government by way of
renting of immovable property to a person registered under the Central Goods and Services
Tax Act, 2017. Thus, GST is payable by Ganpati Morya Pvt. Ltd., being a registered person in
the present case.
Solution – 3(b)
i. Notification No. 13/2017 CT (R) dated 28.06.2017 inter alia provides that GST on supply of
services by director of a company to the said company located in the taxable territory is
payable on reverse charge basis.
ii. Therefore, in the given case, person liable to pay GST is the recipient of services, i.e., A2Z
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4. State, with reason, person liable to pay GST in each of following independent cases.
Assume recipient is located in taxable territory.
i. Rental income received by Tamil Nadu State Government from renting an

immovable property to Mannappa Pvt. Ltd. (Turnover of the company was Rs. 22
lakhs in the preceding F. Y.)
ii. Legal Fees received by Mr. Sushrut, a senior advocate, from M/s. Tatva Trading
Company having turnover of Rs. 50 lakhs in preceding F. Y.
Solution:- 4(i)
i. Notification No. 13/2017 CT (R) dated 28.06.2017 as amended inter alia provides that
reverse charge is applicable in case of services supplied by the State Government by way of
renting of immovable property to a person registered under the Central Goods and Services
Tax Act, 2017. Thus, GST is payable by Mannappa Pvt. Ltd., being a registered person in the
present case.
Solution:- 4(ii)
 GST on legal services supplied by a senior advocate [Mr. Sushrut] to any business
entity [M/s. Tatva Trading Company] located in the taxable territory is payable on
reverse charge basis.
 Therefore, in the given case, person liable to pay GST is the recipient of services, i.e.,
M/s. Tatva Trading Company.
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Chapter - 4
Exemptions from GST
1. Ayushman Medical Centre, a clinical establishment, offers the following services:
S.No. Particulars Rs. *

(i) Reiki healing treatments. Such therapy is not a recognized 10,00,000
system of medicine in terms of section 2(h) of Clinical
Establishments Act, 2010.
(ii) Plastic surgeries. 20,00,000
[One such surgery was conducted to repair cleft lip of a new
born baby.
Consideration of Rs. 1,00,000 was charged for the same.]
(iii) Air ambulance services to transport critically ill patients from 1,00,000
distant locations to Ayushman Medical Centre.
(iv) Alternative medical treatments by way of Ayurveda. Such 2,50,000

therapy is a recognized system of medicine in terms of section
2(h) of Clinical Establishments Act, 2010
*excluding GST
 Ayushman Medical Centre also operates a cord blood bank which provides services in
relation to preservation of stem cells. You are required to compute the value of supply
and GST liability [CGST & SGST or IGST] of Ayushman Medical Centre, if any, in the
light of relevant GST provisions.
 Note – All the services provided by Ayushman Medical Centre are intra -State supplies.
Assume the rates of CGST, SGST and IGST to be 9%, 9% and 18% respectively.
(Source Mock Test Paper -1 May 2018)
Solution:- 1
 Health care services provided by, inter alia, a clinical establishment in India are
exempt from GST vide Notification No. 12/2017 CT (R). dated 28.06.2017.
 The definition of ‘health care services’ stipulates that such services must be provided
in any recognized system of medicines.
 As per section 2(h) of Clinical Establishments Act, 2010, recognised system of

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medicine means allopathy, yoga, naturopathy, ayurveda, homeopathy, siddha and

unani system of medicines or any other system of medicines as may be recognised
by the Central Government.
 Accordingly, value of supply and GST liability of Ayushman Medical Centre will be
computed as follows
S.No. Particulars Rs.
(i) Reiki healing treatments 10,00,000
[Not a recognized system of medicines]
(ii) Plastic surgeries [ Rs. 20,00,000 – Rs. 1,00,000] 19,00,000
[‘Health care services’ specifically excludes, inter alia, cosmetic or plastic
surgery except when undertaken to restore/reconstruct
anatomy/functions of body affected due to congenital defects,
developmental abnormalities, injury or trauma]
(iii) Air ambulance services to transport critically ill patients from distant Nil
locations to the Medical Centre
[‘Health care services’ specifically includes services by way of
transportation of the patient to and from a clinical establishment ]
(iv) Alternative medical treatments by way of Ayurveda [Being a recognized Nil
system of medicines]
Value of supply 29,00,000
CGST @ 9% 2,61,000
SGST @ 9% 2,61,000
 Note: Services provided by cord blood banks by way of preservation of stem cells or any
other service in relation to such preservation are exempt from GST. Therefore, services
provided in relation to preservation of stem cells by the cord blood bank operated by
Ayushman Medical Centre will be exempt from GST.
2. Kesar Maharaj, a registered supplier, gave a classical dance performance in an

auditorium. The consideration charged for the said performance is Rs. 1,48,500. Is
Kesar Maharaj liable to pay GST on the consideration received for the said
performance if such performance is not for promotion of any product/services? If yes,
determine his GST liability (CGST and SGST or IGST, as the case may be). Will your
answer be different if:
i. Kesar Maharaj is a brand ambassador of a food product and aforesaid performance
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By CA Meeta Mangal
is for the promotion of such food product?

ii. The dance performance given by Kesar Maharaj is not a classical dance performance,
but a contemporary Bollywood style dance performance?
iii. Consideration charged by Kesar Maharaj for the classical dance performance is Rs.
1,60,000?
 Notes:
1. Services provided by Kesar Maharaj are intra-State supplies.
2. Wherever applicable, GST has been charged separately.
3. Rates of CGST, SGST and IGST are 9%, 9% and 18% respectively.
(Source Mock Test Paper -1 May 2018)
Solution:- 2
a) Notification No. 12/2017 CT (R) dated 28.06.2017 exempts services by an artist by
way of a performance in folk or classical art forms of
(i) music, or
(ii) dance, or
(iii) theatre, if the consideration charged for such performance is not more than
Rs. 1,50,000.
 However, exemption will not apply to service provided by such artist as a brand
ambassador.
In view of the aforesaid provisions, services provided by Kesar Maharaj are exempt
from GST as consideration for the classical dance performance has not exceeded Rs.
1,50,000. Therefore, his GST liability is nil.
i. If Kesar Maharaj is a brand ambassador of a food product and aforesaid performance

is for the promotion of such food product, he will be liable to pay GST as aforesaid
exemption is not applicable to service provided by an artist as a brand ambassador.
His CGST and SGST liability would, therefore, be Rs. 13,365 (Rs. 1,48,500 × 9%) and
Rs. 13,365 (Rs. 1,48,500 × 9%) respectively.
ii. If Kesar Maharaj gives a contemporary Bollywood style dance performance, such
performance will not be eligible for aforesaid exemption. The reason for the same is
that although the consideration charged does not exceed Rs. 1,50,000, said
performance is not in folk or classical art forms of dance. Hence, GST would be payable
on the same. His CGST and SGST liability would, therefore, be Rs. 13,365 (Rs. 1,48,500
18
By CA Meeta Mangal
× 9%) and Rs. 13,365 (Rs. 1,48,500 × 9%) respectively.
iii. If the consideration charged for the classical dance performance by Kesar Maharaj is
Rs. 1,60,000, he will be liable to pay GST on the same as although the performance is
by way of classical art form of dance, consideration charged for such performance
has exceeded Rs. 1,50,000. His CGST and SGST liability would, therefore, be Rs. 14,400
(Rs.1,60,000 × 9%) and Rs. 14,400 (Rs. 1,60,000 × 9%) respectively.
3. Examine whether GST is payable in the following independent cases:-

i. Ekta Charitable trust, registered under section 10(23C)(v) of the Income-tax Act manages
a temple in Rohini, Delhi. It has given on rent a community hall, located within temple
premises, to public for celebration of Teej Mela. Rent charged is Rs. 9,500.
ii. Speed post services by Department of Post to Union Territory of Daman & Diu.
iii. ST Ltd. has given on hire 5 trucks to Titu Transporters of Delhi (a goods transport agency)
for transporting goods in Central and West Delhi. The hiring charges for the trucks are Rs.
7,500 per truck per day.
Solution:- 3
i. Renting of community hall by Ekta charitable trust is exempt from GST, as rent is less than
Rs. 10,000 per day. The Exemption Notification No. 12/2017 CT (R) dated 28.06.2017/
Notification No. 9/2017 IT (R) dated 28.06.2017 has exempted the said service wholly from
GST.
Provision:- The said notification provides exemption to services by a person inter alia by
way of renting of precincts of a religious place meant for general public, owned or
managed by an entity registered as a trust or an institution under section 10(23C)(v) of
the Income-tax Act . However, this exemption does not apply where renting charges of
premises, community halls, kalyanmandapam or open area are Rs. 10,000 or more per
day.
ii. GST is not payable in case of speed post services by Department of Post to Union
territory of Daman & Diu. The Exemption Notification No. 12/2017 CT (R) dated
28.06.2017/ Notification No. 9/2017 IT (R) dated 28.06.2017 has exempted the said
service wholly from GST.
Provision:-Exemption Notification inter alia provides exemption to services by the
Department of Posts by way of speed post, express parcel post, life insurance, and
19
By CA Meeta Mangal
agency services provided to the Central Government, State Government, Union

territory. Therefore GST is payable, if such service is provided to a person other than
Central Government/State Government/Union Territory.
iii. GST is not payable in case of hiring of trucks to Titu Transporters. The Exemption
Notification No. 12/2017 CT (R) dated 28.06.2017/ Notification No. 9/2017 IT (R) dated
28.06.2017 provides exemption to services by way of giving on hire inter alia to a goods
transport agency, a means of transportation of goods.
4. Examine whether GST is payable in the following independent supply of services:

i. Indiana Engineering College, a recognized educational institution, has conducted an
entrance test examination for various courses run by it and charged entrance fees from
the applicants.
ii. Ramfal Lalaji, an agriculturist, has stored sugarcane in a warehouse. He has taken
fumigation services in the said warehouse from Gupta Pest Control Co. for which he paid
the consideration of Rs. 6,000.
Solution – 4(i)
 Services provided by an educational institution by way of conduct of entrance examination
against consideration in the form of entrance fee are exempt from GST vide Notification
No. 12/2017 CT (R) dated 28.06.2017 as amended.
 Since in the given case, services provided by Indiana Engineering College, an educational
institution are by way of conduct of entrance examination against entrance fee, the same
is exempt and thus, GST is not payable in this case.
Solution – 4(ii)
 Services by way of fumigation in a warehouse of agricultural produce are exempt from
GST vide Notification No. 12/2017 CT (R) dated 28.06.2017 as amended.
 In the present case, since Gupta Pest Control Co. provides services by way of fumigation
in the warehouse of sugarcane [being an agricultural produce], said services are exempt
and GST is not payable on the same.
20
By CA Meeta Mangal
5. Examine whether GST is exempted on the following independent supply of services:

a) Relax & Co, a tour operator, provides services to a foreign tourist for tour conducted
in Kerala and receives a sum of Rs. 1,50,000.
b) Ms. Sneha acts as a Coach for Indian Sports League (ISL), a recognised sports body,
for a Tennis tournament organised by Superb retail company and received a
remuneration of Rs. 4,00,000.
Solution:- 5
a) Services provided by a tour operator to a foreign tourist are exempt from GST
provided such services are in relation to a tour conducted wholly outside India.
Thus, since in the given case, services provided by Relax & Co. are in relation to a
tour conducted within India, the same are not exempt from GST.
b) Services provided by a coach to a recognised sports body for participation in a

sporting event are exempt from GST provided said sporting event is organised by a
recognized sports body.
Thus, since in the given case, the sporting event is not organised by a recognised
sports body, the services provided by Ms. Sneha are not exempt from GST.
21
By CA Meeta Mangal
SCANNER - CA INTER /IPCC - NOV 2018
Chapter - 5
Time of Supply
1. Mehra Sons, a registered supplier, is a wholesale supplier of ready-made garments
located in Bandra, Mumbai. On 5th September, 20XX, Subhadra, owner of Aura
Boutique located in Dadar, Mumbai, approached Mehra Sons for supply of a
consignment of customised dresses for ladies and kids.
• Mehra Sons gets the consignment ready by 2nd December, 20XX and informs
Subhadra about the same. The invoice for the consignment was issued the next day,
3rd December, 20XX.
• Due to some reasons, Subhadra could not collect the consignment immediately. So,
she collects the consignment from the premises of Mehra Sons on 18th December,
20XX and hands over the cheque for payment on the same date. The said payment is
entered in the accounts on 20th December, 20XX and amount is credited in the bank
account on 21st December, 20XX.
• You are required to determine the time of supply of the readymade garments supplied
by Mehra Sons to Subhadra elaborating the relevant provisions under the GST law.
(Source – Mock Test paper 1 – May 2018)
Solution:- 1
• Section 12 of CGST Act, 2017 read with Notification No. 66/2017 CT dated 15.11.2017
provides that the time of supply for all suppliers of goods (excluding composition
suppliers) is the time of issue of invoice, without any turnover limit.
• Thus, the time of supply will be, when the invoice for the supply is issued i.e. 3 rd
December, 20XX.
2. The time of liability to pay GST is independent of the time of supply of goods/
services. Discuss the correctness of the statement?
Solution – 2
• The said statement is not correct.
• Liability to pay arises at the time of supply of goods as explained in Section 12 and at the
time of supply of services as explained in Section13 of CGST Act.
22
By CA Meeta Mangal
3. Explain the meaning of the term “date of receipt of payment” as per section 13 of the
CGST Act, 2017.
Solution – 3
(i) “Date of receipt of payment” in terms of section 13 of CGST Act, 2017 refers to the:-
a) date on which the payment is recorded in the books of account of the entity (supplier of
service) that receives the payment, or
b) the date on which the payment is credited to the entity’s bank account,
Whichever is earlier.
4. On 4th September, 2017, V.R. Mehman a famous music composer, received Rs.
3 crore of consideration from Zilmil Music Co. Ltd. for sale of copyright of his
original music album. He finished his work & made available the CD to the music
company on 20th July, 2017 & raised the invoice on 24th July, 2017. What will
be the time of supply as per CGST Act, 2017?
Note: Above service is taxable under reverse charge basis
Solution:- 4
• As per section 13 of CGST Act, 2017, the time of supply of service on which GST is
payable on reverse charge basis is earlier of the following:
a) Date of payment (04.09.2017), or
b) Date immediately following 60 days since issue of invoice by the supplier
(23.09.2017)
• Thus, time of supply of services is 04.09.2017
5. Gupta & Sons, a registered supplier, paying tax under normal scheme is a
wholesale supplier of ready-made garments located in Bandra, Mumbai. On 5th
September, 20XX, Mohini, owner of Charming Boutique located in Dadar,
Mumbai, approached Gupta & Sons for supply of a consignment of customised
dresses for ladies and kids.
• Gupta & Sons gets the consignment ready by 2nd December, 20XX and informs
23
By CA Meeta Mangal
Mohini about the same. The invoice for the consignment was issued the next day,
3rd December, 20XX.
• Due to some reasons, Mohini could not collect the consignment immediately. So, she
collects the consignment from the premises of Gupta & Sons on 18th December,
20XX and hands over the cheque for payment on the same date. The said payment
is entered in the accounts on 20th December, 20XX and amount is credited in the
bank account on 21st December, 20XX.
• You are required to determine the time of supply of the readymade garments
supplied by Gupta & Sons to Mohini elaborating the relevant provisions under the
GST law.
Solution:- 5
• As per Notification No. 66/2017 CT dated 15.11.2017, a registered person (excluding
composition supplier) has to pay GST on the outward supply of goods at the time of
supply as specified in section 12(2)(a) of CGST Act, 2017 i.e., date of issue of invoice
or the last date on which invoice ought to have been issued in terms of section 31.
• Therefore, the time of supply of goods is 3rd December which is the date on which
the invoice for the consignment was issued.
6. M/s Mansh & Vansh Trading Company, a registered supplier, is liable to pay GST
under forward charge. Determine the time of supply from the following
information furnished by it:
i. Goods were supplied on 03-10-2017
ii. Invoice was issued on 05-10-2017
iii. Payment received on 09-10-2017
Source:-Exam Paper May 18 – New Syllabus
Solution:- 6
• As per Notification No. 66/2017 CT dated 15.11.2017, a registered person (excluding
composition supplier) has to pay GST on the outward supply of goods at the time of
supply as specified in section 12(2)(a) of CGST Act, 2017 i.e., date of issue of invoice
or the last date on which invoice ought to have been issued in terms of section 31.
• Further, a registered person is required to issue a tax invoice before or at the time of
removal of goods for supply to the recipient. Thus, in the given case, the invoice for
24
By CA Meeta Mangal
supply of goods should have been issued on or before the removal of goods i.e., on
03-10-2017.
• However, since the invoice has not been issued within the prescribed time, the time
of supply will be the last date on which the invoice is required to be issued (03 -10-
2017) .
• Thus, the time of supply of the goods will be 03-10-2017.
25
By CA Meeta Mangal
SCANNER - CA INTER / IPCC – NOV -2018
Chapter - 6
Value of Supply
1. Quantum Plast Private Limited, Delhi supplies plastic granulation machine to
Capscom Ltd., Delhi. It furnishes the following details in respect of such supply:
Particulars Rs.
List price of the machine (exclusive of taxes and discounts) 1,00,000
Corrugated Boxes used for packing the machine (not included in price 1,000
above)
Subsidy received from Delhi Government on sale of such machine 5,000
(considered in price above)
Discount @ 2% is offered on list price of the machine (recorded in the ----
invoice for the machine)
Determine the value of taxable supply made by Quantum Plast Private Limited.
(Source – Mock Test Paper 1 – May 2018)
Solution:- 1
Computation of value of taxable supply
Particulars Rs.
List price of the goods (exclusive of taxes and discounts) 1,00,000
Add: Corrugated Boxes used for packing the machine [Includible in the 1,000
value as per section 15(2)(c)]
Add: Subsidy received from Delhi Government on sale of such machine
[Subsidy received from State Government is not included the value in -
terms of section 15(2)(e)]
Total 1,01,000
Less: Discount @ 2% on Rs. 1,00,000 2,000
[Since discount is known at the time of supply, it is deductible from the
value in terms of section 15(3)(a)]
Value of taxable supply 99,000
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By CA Meeta Mangal
2. Shiv Shankar Ltd., a registered supplier in Mumbai (Maharashtra), has supplied goods
to Narad Traders and Nandi Motors Ltd. located in Ahmedabad (Gujarat) and Pune
(Maharashtra) respectively. Shiv Shankar Ltd. has furnished the following details for
the current month:
S. Particulars Narad Nandi
No. Traders Motors
(Rs.) Ltd. (Rs.)
(i) Price of the goods (excluding GST) 10,000 30,000
(ii) Packing charges 500 ----
(iii) Commission 500 ----

(iv) Weighment charges ---- 2,000
(v) Discount for prompt payment (recorded in the ---- 1,000
invoice)
 Items given in points (ii) to (v) have not been considered while arriving at price of the
goods given in point (i) above.
 Compute the GST liability [CGST & SGST or IGST, as the case may be] of Shiv Shankar
Ltd. for the given month.
 Make suitable assumptions, wherever necessary.
 The supply made to Narad Traders is an inter-State supply
 Assume the rates of taxes to be as under:
Particulars Rate of tax
Central tax (CGST) 9%

State Tax (SGST) 9%
Integrated tax (IGST) 18%
Solution:- 2
Computation of GST liability
S. Particulars Narad Nandi
No Traders Motors Ltd.
(Rs.) (Rs.)
(i) Price of goods 10,000 30,000
27
By CA Meeta Mangal
(ii) Add: Packing charges (Note-1) 500

(iii) Add: Commission (Note-1) 500
(iv) Add: Weighment charges (Note-1) - 2,000
(v) Less: Discount for prompt payment (Note-2) - 1,000
Value of taxable supply 11,000 31,000
IGST payable @ 18% (Note-3) 1,980
CGST payable @ 9% (Note-4) 2,790
SGST payable @ 9% (Note-4) 2,790
Notes:
1. Incidental expenses, including commission and packing, charged by supplier to recipient
of supply is includible in the value of supply. Weighment charges are also incidental
expenses, hence includible in the value of supply [Section 15 of the CGST Act, 2017].
2. Since discount is known at the time of supply, it is deductible from the value in terms of
section 15 of the CGST Act, 2017.
3. Since supply made to Narad Traders is an inter-State supply, IGST is payable in terms of
section 5 of the IGST Act, 2017.
4. Since supply made to Nandi Motors Ltd. is an intra-State supply, CGST & SGST is payable
on the same.
3. A manufacturer of machinery supplied a special machine to Texco Furnishers.

Following details are provided in relation to amounts charged:
S.No. Particulars Rs.
(i) Price of machinery excluding taxes (before cash discount) 5,00,000
(ii) Packing charges 10,000
(iii) Extra charges for designing the machine 17,000
(iv) Freight 13,000
Charges mentioned in (ii) to (iv) are not included in (i) above. Other information furnished is
-
a) Cash discount @ 2% on price of machinery has been allowed to the customer at the
time of supply and also recorded in invoice.
b) GST rate – 18%.
Calculate value of supply of the special machine.
28
By CA Meeta Mangal
Solution:- 3
Computation of value of special machine
Particulars Rs.
Price of machinery 5,00,000
Add: Packing charges [Note 1] 10,000
Extra design charges [Note 2] 17,000
Freight [Note 2] 13,000
Total 5,40,000
Less: 2% cash discount on price of machinery 10,000
[Rs. 5,00,000 x 2%] [Note 3]
Value of taxable supply 99,000
 Notes:
1. All incidental expenses including packing charged by the supplier to the recipient of a
supply are includible in the value of supply in terms of section 15(2) (c) of CGST Act,
2017.
2. Any amount charged for anything done by the supplier in respect of the supply of
goods at the time of, or before delivery of goods is includible in the value of supply in
terms of section 15(2)(c) of CGST Act, 2017. Thus, extra designing charges are to be
included in the value of supply.
3. Cash discount was given at the time of supply and also recorded in invoice, so the
same is not to be included while computing value of supply in terms of section
15(3)(a) of CGST Act, 2017.
4. Mr. P supplied goods for the value of Rs. 10,000 to its customer Miss Prem on
01.01.20XX on the condition that payment for the same will be made within a
week. However, Miss Prem made payment for the said goods on 02.02.20XX and
thus paid interest amounting to Rs. 500. What is the time of supply with regard
to addition in the value by way of interest in lieu of delayed payment of
consideration?
Solution – 4
 As per section 12(6) of CGST Act, 2017, the time of supply with regard to an addition in
value on account of interest, late fee or penalty or delayed payment of consideration shall
be the date on which the supplier received such additional consideration.
29
By CA Meeta Mangal
 Thus, time of supply in respect of interest would be the date on which the supplier has
received such additional consideration, i.e. 02.02.2018. Further, Mr. P is required to make
payment on or before 20th of March, 2018.
5. There are separate valuation provisions for CGST, SGST and IGST and for Goods
and Services. Examine the correctness of the statement.
Solution – 5
 No, the said statement is not correct.
 Section 15 of CGST Act determines the value of supply of goods or services or both. Further,
section 15 is applicable for determining value of taxable supply under IGST as well vide
section 20 of IGST Act.
 Thus, section 15 is common for all three taxes and also common for goods and services.
6. Whether post-supply discounts or incentives are allowed as admissible

deduction under section 15 of the CGST Act? If yes, what are the necessary
conditions to be complied with for availing such deduction?
Solution – 6
 Yes, post-supply discounts or incentives are allowed as admissible deduction under section
15 of the CGST Act.
 Where the post-supply discount is established:-
1) as per the agreement which is known at or before the time of supply and
2) where such discount specifically linked to the relevant invoice and
3) the recipient has reversed input tax credit attributable to such discount,
 The discount is allowed as admissible deduction under Section 15(3)(b) of the CGST Act.
7. Raman Ltd., a registered supplier in Mumbai (Maharashtra), has supplied goods

to Sahil Traders and Jaggi Motors Ltd. located in Ahmedabad (Gujarat) and Pune
(Maharashtra) respectively. Raman Ltd. has furnished the following details for
the current month:
30
S.No Particulars Sahil Jaggi

By CA Meeta Mangal
Traders Motors Ltd.

(Rs.) (Rs.)
(i) Price of the goods (excluding GST) 20,000 15,000
(ii) Packing charges 600 ----
(iii) Commission 400 ----
(iv) Weighment charges --- 1,000
(v) Discount for prompt payment (recorded in the --- 500
invoice)
 Items given in points (ii) to (v) have not been considered while arriving at price of
the goods given in point (i) above.
 Compute the GST liability [CGST & SGST or IGST, as the case may be] of Raman
Ltd. for the given month. Assume the rates of taxes to be as under:
 Assume the rates of GST, unless otherwise specified, as under:
CGST 9%
SGST 9%
lGST 18%
 Note:-
1. Make suitable assumptions, wherever necessary.
2. The supply made to Sahil Traders is an inter-State supply.
Solution:- 7
S.No Particulars Sahil Traders Jaggi Motors
(Rs.) Ltd.
(Rs.)
(i) Price of goods 20,000 15,000
(ii) Add: Packing charges (Note-1) 600
(iii) Add: Commission (Note-1) 400
(iv) Add: Weighment charges (Note-1) - 1,000
(v) Less: Discount for prompt payment (Note-2)
500
Value of taxable supply 21,000 15,500
IGST payable @ 18% (Note-3) 3,780
CGST payable @ 9% (Note-4) 1,395
SGST payable @ 9% (Note-4) 1,395
Notes:
31
By CA Meeta Mangal
1. Incidental expenses, including commission and packing, charged by supplier to recipient of

supply is includible in the value of supply. Weighment charges are also incidental
expenses, hence includible in the value of supply [Section 15 of the CGST Act, 2017].
2. Since discount is known at the time of supply, it is deductible from the value in terms of
section 15 of the CGST Act, 2017.
3. Since supply made to Sahil Traders is an inter-State supply, IGST is payable in terms of
section 5 of the IGST Act, 2017.
4. Since supply made to Jaggi Motors Ltd. is an intra-State supply, CGST & SGST is payable on
the same.
8. M/s. Shri Durga Corporation Pvt. Ltd. is a supplier of goods and services at
Kolkata. It has furnished the following information for the month of February,
20XX:
S.No Particulars Amount
(i) Intra-State sale of taxable goods including Rs. 1,00,000 received as 4,00,000
advance in January, 20XX, the invoice for the entire sale value is
issued on 15th February, 20XX
(ii) Goods purchased from unregistered dealer on 20th February, 20XX 1,00,000
(Inter-State purchases are worth Rs.30,000 and balance purchases
are intra-State)
(iii) Services provided by way of labour contracts for repairing a single 1,00,000
residential unit otherwise than as a part of residential complex (It is
an intra-State transaction)
(iv) Goods transport services received from a GTA. GTA is paying tax 2,00,000
@12% (It is an inter-State transaction)
 Compute net GST liability (CGST, SGST or IGST, as the case may be) of M/s Shri Durga
Corporation Pvt. Ltd. for the month of February, 20XX.
 Assume the rates of GST, unless otherwise specified, as under:
CGST 9%
SGST 9%
32
By CA Meeta Mangal
IGST 18%
 Note:-
i. The turnover of M/s. Shri Durga Corporation Pvt. Ltd. was Rs. 2.5 Crore in the previous
financial year.
ii. All the amounts given above are exclusive of taxes
Solution:- 8
Computation of GST liability of M/s. Shri Durga Corporation Pvt. Ltd. for the month of February,
20XX
Particulars Value of CGST SGST IGST
Supply (Rs.) (Rs.) (Rs.)
Intra -State sale of taxable 4,00,000 36,000 36,000 Nil
goods [Note-1]
Goods purchased from Nil Nil Nil Nil

unregistered dealer on 20th
February, 20XX [Note-2]
Services rendered by way of 1,00,000 9,000 9,000 Nil

labour contracts for repairing a
single residential unit otherwise
than as a part of residential
complex [Note-3]
Goods transport services 2,00,000 Nil Nil Nil

received from GTA [Note-4]
Total GST liability for the month 45,000 45,000 Nil

of February, 20XX
Less: Input tax credit available 24,000 Nil Nil

[Note-5] (Rs. 2,00,000 x 12%)
Net GST liability for the month of 21,000 45,000 Nil

February, 20XX
33
By CA Meeta Mangal
Notes:
1. Section 12 of CGST Act, 2017 read with Notification No. 66/2017 CT dated 15.11.2017
provides that the time of supply for all suppliers of goods (excluding composition suppliers) is
the time of issue of invoice, without any turnover limit.
Thus, liability to pay tax on the advance received in January, 20XX will also arise in the month of
February, when the invoice for the supply is issued.
2. All intra-State and inter-State procurements made by a registered person from unregistered
person have been exempted from reverse charge liability, without any upper limit for daily
procurements up to 30.06.2018. [Notification No. 8/2017 CT(R) dated 28.06.2017 as amended
and Notification No. 32/2017 IT(R) dated 13.10.2017 as amended]
3. Services by way of pure labour contracts of construction, erection, commissioning, or

installation of original works pertaining to a single residential unit otherwise than as a part of a
residential complex are exempt vide Notification No. 12/2017 CT(R) dated 28.06.2017. Labour
contracts for repairing are thus, taxable.
4. As per Notification No. 13/2017 CT(R) dated 28.06.2017, GST is payable by the recipient on
reverse charge basis on the receipt of services of transportation of goods by road from a goods
transport agency (GTA) provided such GTA has not paid GST @ 12%. Since in the given case,
services have been received from a GTA who has paid GST @ 12%, reverse charge provisions will
not be applicable.
5. Input tax credit is available for the services received from GTA. The input tax credit of IGST
can be used against IGST, CGST and SGST in the respective order vide section 49(5) of CGST Act,
2017.
9. Red Pepper Ltd., Delhi, a registered supplier, is manufacturing taxable goods. It provides
the following details of taxable inter-State supply made by it for the month of March, 20XX.
Particulars Amount in
(Rs.)
List price of goods supplied inter-state (exclusive of taxes) 15,00,000
Subsidy received from Central Government for supply of taxable goods to 2,10,000
Government School.
Subsidy received from a NGO for supply of taxable goods to an old age 50,000
home
Tax levied by Municipal Authority 20,000
Packing charges 15,000
Late fee paid by the recipient of supply for delayed payment of invoice 6,000
34
By CA Meeta Mangal
The list price of the goods takes into account the two subsidies received. However, the other
charges/taxes/fee are charged to the customers over and above the list price. Calculate the value
of taxable supply made by M/s Red Pepper Ltd. for the month of March, 20XX. Rate of IGST is 18%.
Solution:- 9
Computation of value of taxable supply made by Red Pepper Ltd. for the month of March, 20XX
(Rs.)
List price of the goods 15,00,000
Add: Subsidy amounting to Rs.2,10,000 received from Central Government NIL
[Since subsidy is received from Government, the same is not includible in the
value in terms of section 15 of the CGST Act, 2017]
Subsidy received from NGO 50,000
[Since subsidy is received from a non-Government body, the same is includible in

the value in terms of section 15 of the CGST Act, 2017]
Tax levied by the Municipal Authority 20,000
[Includible in the value as per section 15 of the CGST Act, 2017]

[Being incidental expenses, the same are includible in the value as per section 15
of the CGST Act, 2017]
Late fees paid by recipient of supply for delayed payment
[Includible in the value as per section 15 of the CGST Act, 2017] (assumed to be 5085
inclusive of taxes) [Rs. 6,000 x 100/118] rounded off.
Value of taxable supply 15,90,085
10. Shri Krishna Pvt. Ltd., a registered dealer, furnishes the following information
relating to goods sold by it to Shri Balram Pvt. Ltd. in the course of Intra State.
S.No. Particulars Amount (Rs.)
(i) Price of the goods 1,00,000
35
By CA Meeta Mangal
(ii) Municipal Tax 2,000

(iii) Inspection charges 15,000
(iv) Subsidies received from Shri Ram Trust 50,000
(As the products is going to be used by blind association)
(v) Late fees for delayed payment.
(Though Shri Balram Pvt. Ltd. made late payment but these 1,000
charges are waived by Shri Krishna Pvt. Ltd.)
(vi) Shri Balram Pvt. Ltd. paid to Radhe Pvt. Ltd. (on behalf of Shri
Krishna Pvt. Ltd.) weightment charges. 2,000
According to GST Law, determine the value of taxable supply made by Shri Krishna Pvt. Ltd..
Items given in Point (ii) to (vi) are not considered while arriving at the price of the goods
given in point no. (i).
Solution:- 10
Computation of value of taxable supply made by Shri Krishna Pvt. Ltd.
Particulars Rs.
Price of the goods 1,00,000
Municipal tax 2,000
Inspection charges 15,000
[Being incidental expenses, the same are includible in the value as per
section 15 of the CGST Act, 2017]
Subsidy received from Shri Ram Trust 50,000
[Since subsidy is received from a non-Government body, the same is
includible in the value in terms of section 15 of the CGST Act, 2017]
Late fees for delayed payment [Not includible since waived off] Nil
Weighment charges paid to Radhe Pvt. Ltd. by Shri Balram Pvt. Ltd. on 2,000
behalf of Shri Krishna Pvt. Ltd.
[Liability of the supplier being discharged by the recipient, is includible
in the value in terms of section 15 of the CGST Act, 2017]
11. M/s. Pradyumn Corporation Pvt. Ltd., a registered dealer of Mumbai furnishes
you following information for the month of October, 2017.
S.No. Particulars Amount
(Rs.)
36
By CA Meeta Mangal
(i) Intra state sale of Taxable goods (out of above Rs. 50,000 was 2,00,000
received as advance in September, 2017)
(ii) Goods purchased from unregistered dealer (purchase on 50,000
20th October, 2017)
(10,000 in case of Inter State & Balance Intra-State)
(iii) Received for services by way of labour contracts for repairing 50,000
a single residential unit otherwise than as a part of residential
complex (It is Intra-State transaction)
(iv) Professional fees paid to Ms. Udadhi located in a non-taxable 50,000
territory (It amounts to Inter State transaction)
 Compute GST liability (CGST, SGST or IGST, as the case may be) of M/s Pradyumn
Corporation Pvt. Ltd. for the month of October, 2017.
 Assume the rates of GST as under:
(a) CGST 9%
(b) SGST 9%
(c) lGST 18%
 Note: Turnover of M/s. Pradyumn Corporation Pvt. Ltd. was Rs. 2 crore in the
previous financial year.
Solution:- 11
Computation of GST liability of M/s. Pradyumn Corporation Pvt. Ltd. for the month of
October, 2017
Particulars Value of CGST SGST IGST
Supply (Rs.) (Rs.) (Rs.)
Intra State sale of taxable goods [Note-1] 2,00,000 18,000 18,000 ---
Goods purchased from unregistered dealer Nil Nil Nil ---

on 20th October, 2017 [Note-2]
Receipt for services rendered by way of 50,000 4,500 4,500 ---

labour contracts for repairing a single
residential unit otherwise than as a part of
residential complex [Note-3]
Professional fees paid to Ms. Udadhi located 50,000 --- --- 9,000
in a non-taxable territory [Note-4]
Total GST liability for the month of October, 2017. 22,500 22,500 9,000
37
By CA Meeta Mangal
Notes:
1. Section 12 of CGST Act, 2017 read with Notification No. 66/2017 CT dated
15.11.2017 provides that the time of supply for all suppliers of goods (excluding
composition suppliers) is the time of issue of invoice, without any turnover limit.
 Thus, liability to pay tax on the advance received in September, 20XX will also arise
in the month of October, when the invoice for the supply is issued.
2. All intra-State and inter-State procurements made by a registered person from

unregistered person have been exempted from reverse charge liability, without any
upper limit for daily procurements.
3. Services by way of pure labour contracts of construction,erection, commissioning, or

installation of original works pertaining to a single residential unit otherwise than as
a part of a residential complex are exempt. Labour contracts for repairing are thus,
taxable.
4. In case of service supplied by a person located in a non -taxable territory to a person

other than non-taxable online recipient, GST is payable under reverse charge by such
recipient.
12.A manufacturer of machinery supplied a special machine to Modern Furnishers.

Following details are provided in relation to amounts charged:
S. No. Particulars Rs.
(i) Price of machinery excluding taxes (before cash discount) 5,00,000
Additional charges not included above:-
(ii) Freight 13,000
(iii) Packing charges 10,000
(iv) Charges for designing the machine 17,000
 Other information furnished is -
1. Cash discount @ 2% on price of machinery has been allowed to the customer at the
time of supply and also recorded in invoice.
2. GST rate – 18%.
3. Calculate value of supply of the special machine.
Solution:- 12
Computation of value of special machine
38
Particulars Rs.
By CA Meeta Mangal
Price of machinery 5,00,000

Add: Freight [Note 1] 13,000
Packing charges [Note 2] 10,000
Designing charges [Note 3] 17,000
Total 5,40,000
Less: 2% cash discount on price of machinery [Rs. 5,00,000 x 2%] [Note 10,000
4]
 Notes:
1. Supply of machinery (goods) with supply of ancillary services like freight is a
composite supply, the principle supply of which is the supply of machinery. Thus,
value of such ancillary supply is includible in the value of composite supply.
2. All incidental expenses including packing charged by the supplier to the recipient
of a supply are includible in the value of supply in terms of section 15(2)(c) of
CGST Act, 2017.
3. Designing charges are includible in the value of supply as any amount charged
for anything done by the supplier in respect of the supply of goods at the time
of, or before delivery of goods is so includible in terms of section 15(2)(c) of CGST
Act, 2017.
4. Cash discount was given at the time of supply and also recorded in invoice, so
the same is not to be included while computing value of supply in terms of
section 15(3)(a) of CGST Act, 2017.
13. Candy Blue Ltd., Mumbai, a registered supplier, is manufacturing Chocolates

and Biscuits. It provides the following details of taxable inter-state supply made
by it for the month of October, 2017.
(Rs.)
List price of goods supplied inter-state 12,40,000
Items already adjusted in the price given in (i) above:
1. Subsidy from Central Government for supply of biscuits to 1,20,000
Government School.
2. Subsidy from Trade Association for supply of quality biscuits. 30,000
Items not adjusted in the price given in (i) above:
3. Tax levied by Municipal Authority 24,000
4. Packing Charges 12,000
39
By CA Meeta Mangal
5. Late fee paid by the recipient of supply for delayed payment of 5,000
invoice
 Calculate the value of taxable supply made by M/s Candy Blue Ltd. for the month of
October, 2017.
Solution 13
 Computation of value of taxable supply made by Candy Blue Ltd. for the month of
October, 2017
Particulars Rs.
List Price of the goods 12,40,000
Add: Subsidy amounting to Rs. 1,20,000 received from Central Government NIL
[Since subsidy is received from Government, the same is not includible in
the value in terms of section 15 of the CGST Act, 2017.]
Subsidy received from Trade Association 30,000

[Since subsidy is received from a non-Government body, the same is
includible in the value in terms of section 15 of the CGST Act, 2017.]
Tax levied by the Municipal Authority 24,000


[Being incidental expenses, the same are includible in the value as per
section 15 of the CGST Act, 2017]
Late fees paid by recipient of supply for delayed payment [Includible in the
value as per section 15 of the CGST Act, 2017] 5,000
(See Note Below)
Note: In the above solution, list price of the goods and late fee for delayed payment of
invoice have been assumed to be exclusive of taxes.
40
By CA Meeta Mangal
SCANNER – CA INTER / IPCC – NOV 2018
Chapter – 7
Input Tax Credit
1. Ramoplast Soap Factory, a registered supplier, is engaged in manufacturing beauty
soaps – ‘Forever Glow’ in Mumbai. It has provided the following information
pertaining to purchases made/services availed in the month of January, 20XX
Particulars GST paid (Rs.)
Soap making machine 50,000
Motor vehicles for transportation of inputs 70,000
Membership of ‘Fit and Fine’ health and fitness centre for its employees 25,000
Inputs purchased, but stolen from the factory 40,000
 You are required to compute the input tax credit (ITC) available with Ramoplast
Soap Factory for the month of January, 20XX assuming that all the other conditions
for availing ITC, wherever applicable, have been fulfilled.
Solution:- 1
Computation of ITC available with Ramoplast Soap Factory
Particulars Amount
(Rs.)
Soap making machine 50,000
[ITC in respect of goods used in course/furtherance of business is available
in terms of section 16 of the CGST Act]
Motor vehicles for transportation of inputs 70,000
[ITC in respect of motor vehicles and conveyances is blocked, except when
used, inter alia, for transportation of goods, in terms of section 17(5) of the
CGST Act]
Membership of ‘Fit and Fine’ health and fitness centre for its employees Nil
[ITC in respect of membership of a club, health and fitness centre is blocked
in terms of section 17(5) of the CGST Act]
Inputs stolen from the factory Nil
[ITC in respect of goods stolen is blocked in terms of section 17(5) of the
CGST Act]
Total ITC available 1,20,000
41
By CA Meeta Mangal
2. Classic Textiles Ltd. purchased a needle detecting machine on 6th July, 2017 from Balaji
Engineering Works Ltd. for Rs. 10,00,000 (excluding GST) paying GST @ 18% on the
same. It availed the input tax credit of the GST paid on the machine and started using it
for manufacture of goods. The machine was sold on 18th October, 2018 for Rs. 6,00,000
(excluding GST), as second hand machine to AB. Pvt. Ltd. The GST rate on supply of
machine is 18%.
 Compute the amount payable by Classic Textiles Ltd. in accordance with the
statutory GST provisions on the sale of the second-hand machine
Solution:- 2
 Section 18 of the CGST Act, 2017 read with the CGST Rules, 2017 provides that if
capital goods or plant and machinery on which input tax credit has been taken are
supplied outward by the registered person, he must pay an amount that is the higher
of the following:
i. input tax credit taken on such goods reduced by 5% per quarter of a year or part
thereof from the date of issue of invoice for such goods (i.e., input tax credit
pertaining to remaining useful life of the capital goods), or
ii. Tax on transaction value.
 Accordingly, the amount payable on supply of needle detecting machine shall be
computed as follows:
Particulars Rs. Rs.
Input tax credit taken on the machine (Rs. 10,00,000 × 1,80,000
18%)
Less: Input tax credit to be reversed @ 5% per quarter for
the period of use of machine
(i) For the year 2017-18 = (Rs. 1,80,000 × 5%) × 3 27,000
quarters
(ii) For the year 2018-19 = (Rs.1,80,000 × 5%) × 3 27,000 54,000
quarters
Amount required to be paid (A) 1,26,000
Duty leviable on transaction value (Rs.6,00,000 × 18%) (B) 1,08,00
0
Amount payable towards disposal of machine is higher of (A) 1,26,000
42
and (B)
By CA Meeta Mangal
3. Explain the conditions necessary for obtaining input tax credit?

Solution:- 3
 The following four conditions are to be satisfied by the registered taxable person for
obtaining input tax credit :-
1. He* is in possession of tax invoice or debit note or such other tax paying documents
as may be prescribed;
2. He* has received the goods or services or both;
3. the supplier has actually paid the tax charged in respect of the supply to the
Government; and
4. he* has furnished the return under section 39.
 (*He means the registered taxable person availing input tax credit.)
4. LMN & Co, an unregistered supplier under GST wants to claim input tax credit and
collect tax. Can it do so?
Solution:- 4
 No, LMN & Co. cannot claim input tax credit and collect tax.
 A person without GST registration can neither collect GST from his customers nor
can claim any input tax credit of GST paid by him.
 However, if LMN & Co. nevertheless wants to claim input tax credit and collect tax,
it can apply for voluntary registration under section 25(3) of CGST Act, 2017.
5. Tirupati Traders, a registered supplier of goods, pays GST [CGST & SGST or IGST,
as the case may be] under regular scheme. It has furnished the following particulars
for a tax period:-
Particulars Rs.
Value of intra-State supply of goods 12,000
Value of intra-State purchase of goods 10,000
Note:
i. Rates of CGST, SGST and IGST are 9%, 9% and 18% respectively.
43
By CA Meeta Mangal
ii. Both inward and outward supplies are exclusive of taxes, wherever applicable.
iii. All the conditions necessary for availing the input tax credit have been fulfilled.
 Compute the net GST payable by Tirupati Traders during the given tax period
assuming that there is no opening balance of input tax credit (ITC). Make suitable
assumptions wherever required.
Solution:- 5
Computation of net GST payable
Particulars CGST (Rs.) SGST (Rs.)
GST payable on intra-State supply of goods 1,080 1,080
[Being an intra-State supply, CGST and SGST (Rs.12,000 × 9%) (Rs.12,000 × 9%)
is payable on the same]
Less: Input tax credit (ITC) on intra-State 900 900
purchase of goods (Rs.10,000 × 9%) (Rs.10,000 × 9%)
[CGST and SGST paid on the intra-State
purchases of goods]
Net GST payable 180 180
6. Govind, a registered supplier, is engaged in providing services in the neighbouring

States from his registered office located in Mumbai. He has furnished the following
details in respect of the inward and outward supplies made during a tax period:-
Particulars (Rs.)
Inter-State supply of services 1,80,000
Receipt of goods and services within the State 1,00,000
Assume the rates of taxes to be as under:-

Particulars Rate
CGST 9%
SGST 9%
IGST 18%
Note:
44
1. Both inward and outward supplies are exclusive of taxes, wherever applicable.
By CA Meeta Mangal
2. All the conditions necessary for availing the input tax credit have been fulfilled.
3. Compute the net GST payable by Govind during the given tax period.
4. Make suitable assumptions if required.
Solution:- 6
Computation of net GST payable by Govind
Particulars Rs.
IGST @ 18% payable on inter-State supply of services [Being an 32,400
inter-State supply, IGST is payable on the same in terms of section [1,80,000 × 18%]
5 of the IGST Act, 2017]
Less: ITC of CGST @ 9% paid on intra-State receipt of goods and 9,000
services [1,00,000 × 9%]
[Cross utilisation of CGST towards IGST]
Less: ITC of SGST @ 9% paid on intra-State receipt of goods and 9,000
services [1,00,000 × 9%]
[Cross utilisation of SGST towards IGST]
Net GST payable in cash 14,400
 Note:
1. CGST shall first be utilised towards payment of CGST and the amount remaining, if
any, be utilised towards the payment of IGST [Section 49 of the CGST Act, 2017].
2. SGST shall first be utilised towards payment of SGST and the amount remaining, if
any, may be utilised towards the payment of IGST [Section 49 of the CGST Act, 2017].
7. Shipra Traders is a registered supplier of goods in Assam. It purchased goods

valued at Rs. 10,000 from Kartik Suppliers located within the same State. Kartik
Suppliers charged CGST & SGST separately in its invoice. Subsequently, Shipra
Traders sold goods valuing Rs. 9,500 to Rabina Manufacturers located in Assam.
20% of the inputs purchased are still lying in stock and there was no opening stock
of goods. Rate of CGST and SGST on supply and purchase of goods is 9% each.
Calculate the net GST payable by Shipra Traders and input tax credit (ITC) to be
carried forward, if any.
45
By CA Meeta Mangal
Solution:- 7
Computation of net GST payable by Shipra Traders
Particulars CGST @ 9% SGST @ 9%
(Rs.) (Rs.)
GST payable on intra-State supply of goods 855 855
[Being an intra-State supply, CGST and CGST is [9,500 × 9%] [9,500 × 9%]
payable on the same]
Less: ITC on intra-State purchase of goods 900 900

[ITC of CGST and SGST paid on intra-State [10,000 × 9%] [10,000 × 9%]
purchase is available in full, even if some inputs
are lying in stock]
Net GST payable Nil Nil

Input tax credit carried forward in Electronic
Credit Ledger 45 45
8. Granites Textiles Ltd. purchased a needle detecting machine on 8th July, 2017 from
Makhija Engineering Works Ltd. for Rs. 10,00,000 (excluding GST) paying GST @
18% on the same. It availed the ITC of the GST paid on the machine and started
using it for manufacture of goods. The machine was sold on 22nd October, 2018
for Rs. 7,50,000 (excluding GST), as second hand machine to LT. Pvt. Ltd. The GST
rate on supply of machine is 18%.
 State the action which Granites Textiles Ltd. is required to take, if any, in
accordance with the statutory GST provisions on the sale of the second-hand
machine.
Solution:- 8
 Section 18 of the CGST Act, 2017 read with the CGST Rules, 2017 provides that
if capital goods or plant and machinery on which input tax credit has been taken
46
By CA Meeta Mangal
are supplied outward by the registered person, he must pay an amount that is
the higher of the following:
a) input tax credit taken on such goods reduced by 5% per quarter of a year or part
thereof from the date of issue of invoice for such goods (i.e., input tax credit
pertaining to remaining useful life of the capital goods), or
b) Tax on transaction value.
 Accordingly, the amount payable on supply of needle detecting machine shall be

computed as follows:
Particulars Rs. Rs.
Input tax credit taken on the machine (Rs.10,00,000 × 18%) 1,80,000
Less: Input tax credit to be reversed @ 5% per quarter for 27,000
the period of use of machine 27,000
(i) For the year 2017-18 = (Rs. 1,80,000 × 5%) × 3 quarters
(ii) For the year 2018-19 = (Rs. 1,80,000 × 5%) × 3 quarters 54,000
Amount required to be paid (A) 1,26,000
Duty leviable on transaction value (Rs.7,50,000 × 18%) (B) 1,35,000
Amount payable towards disposal of machine is higher of 1,35,000
(A) and (B)
9. Cloud Seven Private Limited, a registered supplier, is engaged in the manufacture

of taxable goods. The company provides the following information pertaining to
GST paid on the purchases made/input services availed by it during the month of
February, 20XX :
Particulars GST paid (Rs.)

(i) Trucks used for the transport of raw material. 1,20,000
(ii) Foods and beverages for consumption of employees 40,000
working in the factory.
(iii) Inputs are to be received in five lots, out of which third 80,000
lot was received during the month.
(iv) Membership of a club availed for employees working in 1,50,000
the factory.
(v) Capital goods (out of five items, invoice for one item was 4,00,000
missing and GST paid on that item was Rs. 50,000).
(vi) Raw material (to be received in March, 20XX). 1,50,000
 Determine the amount of input tax credit available with Cloud Seven Private
47
Limited for the month of February, 20XX by giving necessary explanations for
By CA Meeta Mangal
treatment of various items. All the conditions necessary for availing the input tax
credit have been fulfilled.
Solution:- 9
Computation of input tax credit (ITC) available with Cloud Seven Private Limited for the month of
February, 20XX
Particulars GST paid
(Rs.)
(i) Trucks used for the transport of raw material [Note-1] 1,20,000
(ii) Foods and beverages for consumption of employees working in the Nil
factory [Note-2]
(iii Inputs are to be received in five lots, out of which third lot was Nil
) received during the month [Note-3]
(iv) Membership of a club availed for employees working in the factory Nil
[Note-4]
(v) Capital goods (out of five items, invoice for one item was missing and 3,50,000
GST paid on that item was Rs. 50,000) [Note-5]
(vi) Raw material to be received in March, 20XX [Note-6] Nil
Total ITC 4,70,000
Notes:-
1. ITC on motor vehicles is disallowed in terms of section 17(5) of the CGST Act, 2017,
except when they are used inter alia, for transportation of goods.
2. ITC on food or beverages is specifically disallowed unless the same is used for making
outward taxable supply of the same category or as an element of the taxable composite
or mixed supply- [Section 17(5)].
3. When inputs are received in instalments, ITC can be availed only on receipt of last
instalment- [Section 16(2)].
4. Membership of a club is specifically disallowed under section 17(5) of the CGST Act,
2017.
5. ITC cannot be taken on missing invoice. The registered person should have the invoice
in its possession to claim ITC [Section 16(2) of CGST Act, 2017].
6. Input tax credit is available only upon the receipt of goods in terms of section 16(2) of
CGST Act, 2017
10. Explain the meaning of the term “input tax” under section 2(62) of CGST Act, 2017.
48
By CA Meeta Mangal
Solution – 10
11. Mr. Nimit, a supplier of goods, pays GST under regular scheme. He is not eligible
for any threshold exemption. He has made the following outward taxable supplies
in the month of August, 2017 :-
Particulars (Rs.)
Intra state supplies of goods 6,00,000
Interstate supplies of goods 2,00,000
He has also furnished following information in respect of purchases made by him from
registered dealers during August, 2017 :-
Particulars (Rs.)
Intra state purchase of goods 4,00,000
Interstate purchase of goods 50,000
Balance of ITC available at the beginning of the August 2017 :-
Particulars (Rs.)
CGST 15,000
SGST 35,000
IGST 20,000
49
By CA Meeta Mangal
Note:
i. Rate of CGST, SGST and IGST to be 9 %, 9% and 18% respectively, on both inward
and outward supplies.
ii. Both inward and outward supplies given above are exclusive of taxes, wherever
applicable.
iii. All the conditions necessary for availing the ITC have been fulfilled.
 Compute the net GST payable by Mr. Nimit for the month of August, 2017.
Solution:- 11
(a) Computation of net GST payable by Mr. Nimit for the month of August, 2017
S.No. Particulars (Rs.) GST (Rs.)

(i) Intra-State supply of goods
CGST @ 9% on Rs. 6,00,000 54,000
SGST @ 9% on Rs. 6,00,000 54,000 1,08,000
(ii) Inter-State supply of goods
IGST @ 18% on Rs. 2,00,000 36,000
Computation of total ITC
Particulars CGST @ 9% SGST @ 9% IGST @ 18%

(Rs.) (Rs.) (Rs.)
Opening ITC 15,000 35,000 20,000
Add: ITC on Intra-State purchases of goods 36,000 36,000
valuing Rs. 4,00,000
Add: ITC on Inter-State purchases of goods 9,000
valuing Rs. 50,000
Total ITC 51,000 71,000 29,000
Computation of GST payable from cash ledger
Particulars CGST @ 9% SGST @ 9% (Rs.) IGST @ 18%

(Rs.) (Rs.)
GST payable 54,000 54,000 36,000
Less: ITC (51,000)- CGST (54,000)-SGST (29,000)-IGST
(7,000)-SGST
50
By CA Meeta Mangal
Net GST payable 3,000 Nil Nil
12.Bharat Associates Pvt. Ltd. purchased machinery worth Rs. 9,00,000 (excluding
GST) on 20-07-2017 on which it paid GST @ 18% and availed the ITC. On 05-03-
2018, it sold the machinery for Rs. 7,00,000 (excluding GST) to Hindustan
Associates Pvt. Ltd. The GST rate on sale is 18%. What will be the course of action
for Bharat Associates Pvt. Ltd. to follow under CGST Act, 2017 ?
Solution:- 12
 If capital goods or plant and machinery on which input tax credit (ITC) has been
taken are supplied outward by a registered person, he must pay an amount that
is higher of the following:
a) ITC taken on such goods reduced by 5% per quarter of a year or part thereof from
the date of issue of invoice for such goods or
b) tax on transaction value.
 Accordingly, the amount payable on supply of machinery by Bharat Associates Pvt.

Ltd. shall be computed as follows:
Particulars Rs.
ITC taken on the machinery (Rs. 9,00,000 × 18%) 1,62,000
Less: ITC pertaining to the period of usage of the capital goods 24,300
= (Rs. 1,62,000 × 5%) × 3 quarters
Amount of reduced ITC based on percentage points (A) ** 1,37,700
Duty leviable on transaction value (Rs. 7,00,000 × 18%) (B) 1,26,000
Amount payable towards disposal of machinery is higher of (A) and 1,37,700
(B)
**Note: In the above solution, amount of ITC to be paid (amount of reduced ITC based on
percentage points) has been computed on the basis of provisions of rule 40(2) of the CGST
Rules, 2017 [ITC reduced by 5% for every quarter or part thereof from the date of the
issue of invoice]. However, the said amount can also be computed on the basis of
provisions of rule 44(6) of the CGST Rules, 2017 [ITC of remaining useful life in months
computed on pro rata basis, taking the useful life as 5 years].
13. Mr. Bholenath, a registered supplier of goods, pays GST under regular scheme and
51
provides the following information for the month of January, 20XX:
By CA Meeta Mangal
S.No Particulars (Rs.)

(i) Inter-state taxable supply of goods 10,00,000
(ii) Intra state taxable supply of goods 2,00,000
(iii) Intra state purchase of taxable goods 5,00,000
He has the following input tax credit at the beginning of January 20XX:
Nature ITC Amount in (Rs.)

CGST 20,000
SGST 30,000
lGST 25,000
 Rate of CGST, SGST and IGST are 9%, 9% and 18% respectively.
 Both inward and outward supplies are exclusive of taxes wherever applicable.
 All the conditions necessary for availing the ITC have been fulfilled. Compute the
net GST payable by Mr. Bholenath for the month of January, 20XX.
Solution:- 13
 Computation of net GST payable by Mr. Bholenath for the month of January,
20XX
Working of GST payable on Outward supplies
S.No. Particulars (Rs.) GST (Rs.)

(i) Inter-State taxable supply of goods
IGST @ 18% on Rs. 10,00,000 1,80,000
(ii) Intra-State taxable supply of goods
CGST @ 9% on Rs. 2,00,000 18,000
SGST @ 9% on Rs. 2,00,000 18,000 36,000
Computation of total ITC

Particulars CGST @ 9% (Rs.) SGST @ 9% (Rs.) IGST @ 18% (Rs.)
Opening ITC 20,000 30,000 25,000
Add: ITC on Intra-State
purchases of taxable goods 45,000 45,000
valuing Rs. 5,00,000
Total ITC 65,000 75,000 25,000
Computation of GST payable from cash ledger

52
Particulars CGST @ 9% (Rs.) SGST @ 9% (Rs.) IGST @ 18% (Rs.)
By CA Meeta Mangal
GST payable 18,000 18,000 1,80,000

Less: ITC (18,000)-CGST (18,000)-SGST (25,000)-IGST
(47,000)-CGST
(57,000)-SGST
Net GST payable Nil Nil 51,000
Note: ITC of IGST, CGST & SGST have been used to pay IGST in that order.
14. Shridhar Co. Ltd., a registered supplier, is engaged in the manufacture of heavy
machinery. It procured the following items during the month of March.
S. No. Items GST paid
(Rs.)
(i) Sweets for consumption of employees working in the factory 50,000
(ii) Raw material 1,00,000
(iii) Trucks used for the transport of raw material 2,00,000
(iv) Electrical transformers to be used in the manufacturing 4,00,000
process
 Determine the amount of input tax credit available with Shridhar Co. Ltd., for the
month of March by giving necessary explanations for treatment of various items.
 Note: All the conditions necessary for availing the input tax credit have been
fulfilled.
Solution:- 14
Computation of ITC available with Shridhar Co. Ltd. for the month of March
S. No. Items ITC (Rs.)
(i) Sweets for consumption of employees working in the factory Nil
[Note-1]
(ii) Raw material [Note-2] 1,00,000
(iii) Trucks used for the transport of raw material [Note-3] 2,00,000
(iv) Electrical transformers [Note-4] 4,00,000
Total ITC 7,00,000
 Notes:-
1. ITC on food or beverages is specifically disallowed unless the same is used for
making outward taxable supply of the same category or as an element of the
taxable composite or mixed supply-Section 17(5)(b)(i).
2. Being goods used in the course or furtherance of business, ITC thereon is available
in terms of section 16(1).
3. Though ITC on motor vehicles has been specifically disallowed under section
53
17(5)(a), ITC on motor vehicles used for transportation of goods is allowed under
By CA Meeta Mangal
section 17(5)(a)(ii).
4. Being goods used in the course or furtherance of business, ITC thereon is available
in terms of section 16(1).
15. Fun Pharma Private Limited, a registered supplier is engaged in the manufacture
of taxable goods. The company provides the following information of GST paid on
the purchases made/input services availed by it during the month of September
2017 :
S.No. Particulars GST paid (Rs.)

(i) Purchase of cabs used for the transportation of its 3,30,000
employees
(ii) Inputs consisting of three lots, out of which first lot was 1,25,000
received during the month
(iii) Capital Goods (out of three items, invoice for one item was 2,50,000
missing and GST paid on that item was Rs. 25,000)
(iv) Outdoor catering service availed on Women's day 72,000
 Determine the amount of input tax credit available with M/s Fun Pharma Private
Limited for the month of September, 2017 by giving necessary explanations for
treatment of various items.
 All the conditions necessary for availing the input tax credit have been fulfilled.
(Source:- Exam Paper May 18 – New Syllabus)
Solution 15
 Computation of input tax credit (ITC) available with Fun Pharma Private Limited for
the month of September, 2018
Particulars Rs.
Purchase of cabs used for the transportation of its employees [Note-1] Nil
Inputs consisting of three lots, out of which first lot was received during the Nil
month [Note-2]
Capital goods [Note-3] 2,25,000
Outdoor catering service availed on Women’s day [Note-4] Nil
Total ITC 2,25,000
 Notes:-
1. Section 17 of CGST Act, 2017 provides that ITC on motor vehicles can be availed,
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By CA Meeta Mangal
passengers i.e., if the taxable person is in the business of transport of passengers.

In the given case, since the supplier is a manufacturer, it cannot avail credit on cabs
used for transportation of its employees.
2. When inputs are received in instalments, ITC can be availed only on receipt of last
instalment in terms of section 16 of CGST Act, 2017.
3. ITC cannot be taken on missing invoice. The registered person should have the
invoice in its possession to claim ITC vide section 16 of CGST Act, 2017 .
4. ITC on outdoor catering is specifically disallowed unless the same is used for
making outward taxable supply of the same category or as an element of the
taxable composite or mixed supply in terms of section 17 of CGST Act, 2017.
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By CA Meeta Mangal
Chapter – 8
Registration
1. Tirupati Box Manufacturing Co. started manufacturing corrugated boxes in Andhra
Pradesh on 25.01.20XX. On 06.05.20XX, its aggregate turnover exceeded Rs. 10 lakh
and on 01.11.20XX, its aggregate turnover exceeded Rs. 20 lakh. It applied for
registration on 28.11.20XX and is granted registration certificate on 05.12.20XX.
Determine the effective date of registration elaborating the relevant provisions.
Solution – 1
 As per section 22 of the CGST Act, a supplier is liable to be registered in the State/ Union
territory from where he makes a taxable supply of goods or services or both, if his
aggregate turnover in a financial year exceeds Rs. 20 lakh [Rs. 10 lakh in case of special
category States except Jammu and Kashmir], within 30 days from the date on which it
becomes so liable to registration.
 Where an applicant submits application for registration within 30 days from the date he
becomes liable to registration, effective date of registration is the date on which he
becomes liable to registration otherwise it is the date of grant of registration.
 In the given case, threshold limit of registration for Tirupati Box Manufacturing Co. is Rs.
20 lakh as it is engaged in making taxable supplies from Andhra Pradesh.
 The aggregate turnover of Tirupati Box Manufacturing Co. exceeded Rs. 20 lakh on
01.11.20XX. Thus, it is liable to get registered by 01.12.20XX [30 days] in the State of
Andhra Pradesh.
 Since Tirupati Box Manufacturing Co. applied for registration on 28.11.20XX i.e. before
the expiry of 30 days from the date on which it becomes so liable to registration, the
effective date of registration in its case is 01.11.20XX.
2. Explain whether the Department, through the proper officer, suo-moto proceed to
register of a person?
Solution – 2
 Yes. In terms of sub-section (8) of section 25, where a person who is liable to be registered
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By CA Meeta Mangal
under GST law fails to obtain registration, the proper officer may, proceed to register
such person in the manner as is prescribed in the CGST Rules, 2017.
3. Explain how long will the registration certificate issued to a casual taxable person
and non- resident taxable person be valid?
Solution – 3
 The certificate of registration issued to a “casual taxable person” or a “non-5 resident
taxable person” shall be valid for a period
i. specified in the application for registration or
ii. 90 days from the effective date of registration,
 Whichever is earlier.
 However, the proper officer, at the request of the said taxable person, may extend the
validity of the aforesaid period of 90 days by a further period not exceeding 90 days.
4. State the time-period within which registration needs to be obtained in each of the
following independent cases:
a) Casual taxable person
b) Person making inter-State taxable supply
Solution – 4
 Section 25(1) of the CGST Act stipulates the time-period within which registration needs
to be obtained in various cases.
 It provides the following time-limits:-
In case of registration needs to be obtained
a) a person who is liable to be registered within 30 days from the date on which
under section 22 or section 24. he becomes liable to registration.
b) a casual taxable person or a non- at least 5 days prior to the
resident taxable person commencement of business
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By CA Meeta Mangal
5. Blue Moon Ltd., obtains registration for paying taxes under section 9 of CGST Act. He
asked his tax manager to pay taxes on quarterly basis. However, Blue Moon Ltd.’s tax
manager advised the Co.to pay taxes on monthly basis. You are required to examine the
validity of the advice given by tax manager?
Solution – 5
 The advice given by tax manager is valid in law.
 Payment of taxes by the normal tax payer is to be done on monthly basis by 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.
 However, payment can also be debited from the Credit Ledger.
 Composition tax payers will need to pay tax on quarterly basis.
6. Mr. Neerav Kothari of Jaipur often participates in the jewellery exhibition at Trade Fair
in Delhi, which is organised every year in the month of February. Mr. Neerav Kothari
applied for registration in January. The proper officer demanded an advance deposit of
tax in an amount equivalent to the estimated tax liability of Mr. Neerav Kothari. You are
required to examine whether any advance tax is to be paid by Mr. Neerav Kothari at the
time of obtaining registration?
Solution – 6
 Yes, advance tax is to be paid by Mr. Neerav Kothari at the time of obtaining registration.
 Since Mr. Neerav Kothari occasionally undertakes supply of goods in the course or
furtherance of business in a State where he has no fixed place of business, thus he
qualifies as casual taxable person in terms of section 2(20) of CGST Act, 2017.
 While a normal taxable person does not have to make any advance deposit of tax to
obtain registration, a casual taxable person shall, at the time of submission of
application for registration is required, in terms of section 27(2) read with proviso
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By CA Meeta Mangal
thereto, to make an advance deposit of tax in an amount equivalent 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 90 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 90 days is being sought.
7. What is the difference between casual and non- resident taxable persons?
Solution:- 7
Basis Casual Taxable Person Non-resident Taxable Person
Fixed place of Occasionally undertakes Occasionally undertakes transactions
business transactions involving supply of involving supply of goods or services or
goods or services or both in a both, but has no fixed place of business
State or Union territory where he or residence in India.
has no fixed place of business.
PAN Number Has a PAN Number. Do not have a PAN Number; A non-
resident person, if having PAN number
may take registration as a casual
taxable person.
Application Form Same application form for Separate application form for
registration as for normal taxable registration by non- resident taxable
persons. person.
Business Test. Has to undertake transactions in Business test is absent in the definition.
the course or furtherance of
business.
Input tax Can claim input tax credit of all Can get input tax credit only in respect
credit. inward supplies. of import of goods and /or services.
8. Pure Oils, Delhi has started the supply of machine oils and high speed diesel in
the month of April, 20XX. The following details have been furnished by it for the
said month:-
Sl. Particulars Rs. *
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By CA Meeta Mangal
No.
(i) Supply of machine oils in Delhi 2,00,000
(ii) Supply of high speed diesel in Delhi 4,00,000
(iii) Supply made through Fortis Lubricants - an agent of Pure Oils in Delhi 1,75,000
(iv) Supply made by Pure Oils from its branch located in Punjab 1,80,000
*excluding GST.
Determine whether Pure Oils is liable for registration. Will your answer change, if Pure Oils
supplies machine oils amounting to Rs. 2,50,000 from its branch located in Himachal Pradesh
in addition to the above-mentioned supplies?
Solution – 8
 As per section 22 of the CGST Act, 2017, a supplier is liable to be registered in the
State/Union territory from where he makes a taxable supply of goods or services or
both, if his aggregate turnover in a financial year exceed Rs. 20 lakh.
 However, if such taxable supplies are made from any of the specified special category
States, namely, States of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram,
Nagaland, Sikkim, Tripura, Himachal Pradesh and Uttarakhand, he shall be liable to be
registered if his aggregate turnover in a financial year exceeds Rs. 10 lakh.
 As per section 2(6) of the CGST Act, 2017, aggregate turnover includes the aggregate
value of:
a) all taxable supplies
b) all exempt supplies,
c) exports of goods and/or services and
d) all inter-State supplies of persons having the same PAN.
 The above is computed on all India basis.
 Further, the aggregate turnover excludes central tax, State tax, Union territory tax,
integrated tax and cess.
 Moreover, the value of inward supplies on which tax is payable under reverse charge is
not taken into account for calculation of ‘aggregate turnover’.
 Section 9 of the CGST Act, 2017 provides that CGST is not leviable on five petroleum
products i.e. petroleum crude, motor spirit (petrol), high speed diesel, natural gas and
aviation turbine fuel. As per section 2(47) of the CGST Act, 2017, exempt supply
includes non-taxable supply. Thus, supply of high speed diesel in Delhi, being a non-
taxable supply, is an exempt supply and is, therefore, includible while computing the
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By CA Meeta Mangal
aggregate turnover.
 In the backdrop of the above-mentioned discussion, the aggregate turnover for the
month of April, 20XX is computed as under:
S. Particulars Amount
No. (in Rs.)
(i) Supply of machine oils in Delhi 2,00,000
(ii) Add: Supply of high speed diesel in Delhi 4,00,000
(iii) Add: Supply made through Fortis Lubricants - an agent of Pure Oils 1,75,000
in Delhi
(iv) Add: Supply made by Pure Oils from its branch located in Punjab 1,80,000
Aggregate Turnover 9,55,000
 Since the aggregate turnover does not exceed Rs. 20 lakh, Pure Oils is not liable to be
registered.
 If Pure Oils made supply of machine oils amounting to Rs.2,50,000 from its branch in
Himachal Pradesh in addition to the above supply, then threshold limit of registration
will be reduced to Rs. 10 lakh as Himachal Pradesh is one of the specified Special
Category States.
 Aggregate Turnover in that case would be Rs. 9,55,000 + Rs. 2,50,000 = Rs. 12,05,000.
So, if Pure Oils supplies machine oils amounting to Rs. 2,50,000 from its branch in
Himachal Pradesh, then it is liable to be registered.
9. Discuss the circumstances where registration is liable to be cancelled.

Solution – 9
a) Cancellation of registration (Sections 29)and
b) Revocation of cancellation (Sections 30)
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By CA Meeta Mangal
 Voluntary Cancellation of Registration:-
 Suo-motu Cancellation of Registration

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By CA Meeta Mangal
10. Determine the effective date of registration under CGST Act, 2017 in respect of the
following cases with explanation:
i. The aggregate turnover of Varun Industries of Mumbai has exceeded Rs. 20 lakhs
on 1st August, 2017. It submits the application for registration on 20th August,
2017. Registration certificate granted on 25th August, 2017.
ii. Sweta InfoTech Services are the provider of internet services in Pune. The
aggregate turnover of them exceeds Rs. 20 lakhs on 25th September, 2017. It
submits the application for registration on 27th October, 2017. Registration
certificate is granted on 5th November, 2017.
Solution:- 10 (i) and 10(ii)

 A supplier whose aggregate turnover in a financial year exceeds Rs. 20 lakh in a
State/UT [Rs. 10 lakh in Special Category States except Jammu and Kashmir] is
liable to apply for registration within 30 days from the date of becoming liable to
registration (i.e. ., the date of crossing the threshold limit of Rs. 20 lakh/Rs. 10 lakh)
vide section 22 of CGST Act, 2017.
 Where the application is submitted within said period, the effective date of
registration is the date on which the person becomes liable to registration;
otherwise it is the date of grant of registration.
 In the given cases, the applicable turnover limit for registration will be Rs. 20 lakh
as Maharashtra (Mumbai and Pune) is not a Special Category State.
i. Since Varun Industries applied for registration within 30 days of becoming liable to
registration, the effective date of registration is 1st August, 2017.
ii. Since Sweta InfoTech Services applied for registration after the expiry of 30 days
from the date of becoming liable to registration, the effective date of registration
is 5 th November, 2017.
11.State with reason whether following statement is true or false:
"When the change in constitution of business results in change in PAN, the business
entity can apply for amendment of registration in prescribed manner within 15
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By CA Meeta Mangal
days."
Solution:- 11
 The said statement is FALSE.
 When a change in constitution of a business results in change of PAN of the

registered person, the said person shall apply for fresh registration. The reason for
the same is that GSTIN is PAN based. Any change in PAN would warrant a new
registration.
12.Does cancellation of registration impose any tax obligations on the person whose
registration is so cancelled? Discuss.
Solution:- 12
 Yes, as per section 29(5) of the CGST Act, every registered person whose
registration is cancelled shall pay an amount, by way of debit in the electronic cash
ledger, equivalent to
i. the credit of input tax 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
ii. the output tax payable on such goods,
 whichever is higher.
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By CA Meeta Mangal
Chapter – 9
Tax Invoice, Debit Note and Credit Note
1. Discuss the time-limit for issuance of invoice in case of taxable supply of goods.
Solution – 1
• In case of taxable supply of goods, invoice shall be issued before or at the time of—
a) removal of goods for supply to the recipient, where the supply involves movement
of goods; or
b) Delivery of goods or making available thereof to the recipient, in any other case.
• In case of continuous supply of goods, where successive statements of accounts/
successive payments are involved, the invoice shall be issued before/at the time each
such statement is issued or each such payment is received [Section 31 of the CGST
Act].
2. Royal Fashions, a registered supplier of designer outfits in Delhi, decides to exhibit

its products in a Fashion Show being organized at Hotel Park Royal, Delhi on 4th
January, 20XX. For the occasion, it gets the makeover of its models done by Aura
Beauty Services Ltd., Ashok Vihar, for which a consideration is Rs. 5,00,000
(excluding GST) has been charged. Aura Beauty Services Ltd. issued a duly signed
tax invoice on 10th February, 20XX showing the lumpsum amount of Rs. 5,90,000
inclusive of CGST and SGST @ 9% each. Royal Fashions made the payment the
very next day. Answer the following questions:
i. Examine whether the tax invoice has been issued within the time limit prescribed
under law?
ii. Tax consultant of Royal Fashions objected to the invoice raised suggesting that
the amount of tax charged in respect of the taxable supply should be shown
separately in the invoice raised by Aura Beauty Services Ltd. However, Aura
Beauty Services Ltd. contended that there is no mandatory requirement of
showing tax component separately in the invoice. You are required to examine the
validity of the objection raised by tax consultant of Royal Fashions?
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By CA Meeta Mangal
Solution – 2(i)
• As per section 31 of the CGST Act, 2017 read with the CGST Rules, 2017, in case of
taxable supply of services, invoices should be issued before or after the provision of
service, but within a period of 30 days [45 days in case of insurer/ banking company
or financial institutions including NBFCs] from the date of supply of service.
• In view of said provisions, in the present case, the tax invoice should have been issued
in the prescribed time limit of 30 days from the date of supply of service i.e. upto
03.02.20XX. However, the invoice has been issued on 10.02.20XX.
• In such a case, the time of supply as per section 13 of the CGST Act, 2017 would be
04.01.20XX i.e. earliest of the following:
• Date of provision of service (04.01.20XX)
• Date of receipt of payment (11.02.20XX)
Solution – 2(ii)
• Section 31 of the CGST Act, 2017 read with the CGST Rules, 2017, inter alia,
• provides that tax invoice shall contain the following particulars-
a) Total value of supply of goods or services or both;
b) Rate of tax (central tax, State tax, integrated tax, Union territory tax or cess);
c) Amount of tax charged in respect of taxable goods or services (central tax, State
tax, integrated tax, Union territory tax or cess);
• The objection raised by the tax consultant of Royal Fashions suggesting that the
amount of tax charged in respect of the taxable supply should be shown separately
in the invoice raised by Aura Beauty Services Ltd., is valid in law. In the present case,
the tax amount has not been shown separately in the invoice.
3. Luv & Kush Pvt. Ltd. of Srinagar, Jammu & Kashmir engaged in the supply of gifts items
provides you the following details:-
S.No. Particulars Date

1. Commencement of the business of supplying goods 01.08.20XX
2. Turnover exceeds Rs. 10,00,000 on 15.08.20XX
3. Turnover exceeds Rs. 20,00,000 on 05.09.20XX
4. Application for registration made on 28.09.20XX
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By CA Meeta Mangal
5. Registration certificate granted on 06.10.20XX

• The company seeks your advice as to how it should raise revised tax invoices for supplies
made. Is there any specific provision for issuance of revised tax invoices to unregistered
customers? Explain.
Solution:- 3
• A supplier whose aggregate turnover in a financial year exceeds Rs. 20 lakh in a State/UT [ Rs. 10
lakh in special category states except Jammu & Kashmir and Uttarakhand] is liable to apply for
registration within 30 days from the date of becoming liable to registration (i.e., the date of
crossing the threshold limit of Rs. 20 lakh/ Rs. 10 lakh) vide section 22 of CGST Act, 2017.
• Where the application is submitted within said period, the effective date of registration is the date
on which the person becomes liable to registration; otherwise it is the date of grant of
registration.
• Every registered person who has been granted registration with effect from a date earlier than
the date of issuance of registration certificate to him, may issue revised tax invoices in respect of
taxable supplies effected during this period within 1 month from the date of issuance of
registration certificate.
• In the given case, Luv & Kush Pvt. Ltd is located in Jammu & Kashmir, a special category state.
Though the turnover limit for special category states is Rs. 10 lakh, Jammu & Kashmir has opted
for turnover limit of ` 20 lakh for the purpose of registration. Thus, since Luv & Kush Pvt. Ltd. has
made the application for registration within 30 days of becoming liable for registration, the
effective date of registration becomes the date on which the company becomes liable to
registration i.e. 05.09.20XX.
• Thus, Luv & Kush Pvt. Ltd. may issue revised tax invoices against the invoices already issued during
the period between effective date of registration (05.09.20XX) and the date of issuance of
registration certificate (06.10.20XX), within 1 month from 06.10.20XX.
• Further, Luv & Kush Pvt. Ltd may issue a consolidated revised tax invoice in respect of all taxable
supplies made to unregistered dealers during such period.
• However, in case of inter-State supplies made to unregistered dealers, a consolidated revised tax
invoice cannot be issued if the value of a supply exceeds Rs. 2, 50,000.
4. Under what circumstances does the need of issuance of debit note and credit note
arise under section 34 of CGST Act, 2017 ?

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By CA Meeta Mangal
Solution:- 4
Debit Note is issued:-
Credit Note is issued:-

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By CA Meeta Mangal
5. Chidanand Products Pvt. Ltd. started its business of supply of goods on 1st August,
2017. It's turnover exceeds Rs. 20,00,000 on 5th September, 2017. It applied for
registration on 28th September, 2017 & granted registration certificate on 6th
October, 2017. Guide the company regarding invoices to be issued between 5th
September, 2017 to 6th October, 2017 to registered dealers. Further it had also
made supplies to unregistered dealers in that period. How it can raise invoices?
Solution:- 5
• A supplier whose aggregate turnover in a financial year exceeds Rs. 20 lakh in a
State/UT is liable to apply for registration within 30 days from the date of becoming
liable to registration (i.e, the date of crossing the threshold limit of Rs. 20 lakh) vide
section 22 of CGST Act, 2017.
• Where the application is submitted within the said period, the effective date of
registration is the date on which the person becomes liable to registration;
otherwise it is the date of grant of registration.
• Every registered person who has been granted registration with effect from a date
earlier than the date of issuance of registration certificate to him, may issue
revised tax invoices in respect of taxable supplies effected during this period within
1 month from the date of issuance of registration certificate.
• In view of the aforesaid provisions, Chidanand Products Pvt. Ltd may issue revised
tax invoices against the invoices already issued during the period between effective
date of registration (5th September, 2017) and the date of issuance of registration
certificate (6th October, 2017), within 1 month from 6th October, 2017.
• Further, Chidanand Products Pvt. Ltd may issue a consolidated revised tax invoice
in respect of all taxable supplies made to unregistered dealers during such period.
However, in case of inter-State supplies made to unregistered dealers, a
consolidated revised tax invoice cannot be issued if the value of a supply exceeds
Rs. 2,50,000.
6. Determine with reason whether the following statements are true or false:
i. A registered person shall issue separate invoices for taxable and exempted goods
when supplying both taxable as well as exempted goods to an unregistered
person.
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By CA Meeta Mangal
ii. A Non-banking financial institution can issue a consolidated tax invoice at the end
of every month for the supply made during that month.
Source:- Exam Paper May 18 – New Syllabus
Solution:- 6
i. The given statement is false.
• Where a registered person is supplying taxable as well as exempted goods or
services or both to an unregistered person, a single “invoice -cum-bill of supply”
may be issued for all such supplies.
ii. The given statement is True.

• By virtue of an amendment, a non-banking financial company has been allowed
to issue a consolidated tax invoice or any other document in lieu thereof for the
supply of services made during a month at the end of the month.
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By CA Meeta Mangal
SCANNER - CA INTER / IPCC – NOV 2018
Chapter – 10
Payment of Tax
1. What is an electronic cash ledger? Enumerate the modes of making deposit in the
electronic cash ledger.
(Source Mock Test Paper 1- May 2018)
Solution – 1
• Electronic cash ledger is maintained in prescribed form for each person, liable to pay
tax, interest, penalty, late fee or any other amount, on the common portal for
crediting the amount deposited and debiting the payment therefrom towards tax,
interest, penalty, fee or any other amount.
2. Explain the provisions relating to interest on delayed payment of tax as prescribed

under section 50 of CGST Act, 2017?
Solution – 2
• Rate Of Interest in case of delayed payment of self-assessed tax : - Every person who is
liable to pay tax in accordance with the provisions of this Act or the rules made
thereunder, but fails to pay the tax or any part thereof to the Government within the
prescribed period, shall for the period for which the tax or any part thereof remains
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By CA Meeta Mangal
unpaid, pay, on his own, interest at such rate, not exceeding 18% as may be notified by
the Government on the recommendations of the Council. Notification No. 13/2017 CT
dated 28.06.2017 has notified the rate of interest as 18% per annum.
• Period of Interest:- The period of interest will be from the date following the due date of
payment to the actual date of payment of tax.
• In case of Undue or Excess claim of Input tax credit or undue or excess reduction in output
tax liability:- A taxable person who makes an undue or excess claim of input tax credit
under section 42(10) or undue or excess reduction in output tax liability under section
43(10), shall pay interest on such undue or excess claim or on such undue or excess
reduction, as the case may be, at such rate not exceeding 24% as may be notified by the
Government on the recommendations of the Council. Notification No. 13/2017 CT dated
28.06.2017 has notified the rate of interest as 24% per annum.
3. LP Ltd., obtains registration for paying taxes under section 9 of CGST Act. He
asked his tax manager to pay taxes on quarterly basis. However, LP Ltd.’s tax
manager advised the Co.to pay taxes on monthly basis. You are required to
examine the validity of the advice given by tax manager?
Solution – 3
• The advice given by tax manager is valid in law.
• Payment of taxes by the normal tax payer is to be done on monthly basis by the 20th of
the succeeding month.
• Composition tax payers will need to pay tax on quarterly basis.
4. Explain the order in which liability of taxable person has to be discharged under GST laws.
Solution – 4
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By CA Meeta Mangal
i. Section 49(8) of CGST Act, 2017 prescribes the chronological order in which the liability of
a taxable person has to be discharged:
a) Self -assessed tax and other dues for the previous tax periods have to be discharged first.
b) Self -assessed tax and other dues for the current tax period have to be discharged next.
c) Once these two steps are exhausted, thereafter any other amount payable including
demand determined under section 73 or section 74 is to be discharged.
In other words, the liability if any, arising out of demand notice and adjudication
proceedings comes last.
ii. This sequence has to be mandatorily followed.
iii. The expression “other dues” referred above mean interest, penalty, fee or any other
amount payable under the Act or the rules made thereunder.
5. What is CIN?
Solution:- 5
• CIN is Challan Identification Number. It is generated by the banks indicating that
the payment has been realized and credited to the appropriate government
account against a generated challan.
6. When is interest payable under GST Laws?

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By CA Meeta Mangal
Solution:- 6
• Interest is payable in the following cases in terms of section 50 of CGST Act, 2017:-
a) Delay / failure to pay tax, in full or in part within the prescribed period
b) undue or excess claim of input tax credit
c) undue or excess reduction in output tax liability.
7. How does the new payment system benefit the taxpayer & the Commercial Tax
Department?
Solution:- 7
• The new payment system benefits the taxpayer and the commercial tax
department in the following ways:-
• Benefits to Taxpayer: -
i. No more queues and waiting for making payments as payments can be made
online 24 X 7.
ii. Electronically generated challan from GSTN common portal in all modes of
payment and no use of manually prepared challan. Paperless transactions.
iii. Instant online receipts for payments made online.
iv. Tax consultants can make payments on behalf of the clients.
v. Single challan form to be created online, replacing the three or four copy Challan.
vi. Greater transparency.
vii. Online payments made after 8 pm will be credited to the taxpayer’s account on the
same day.
• Benefits to the Commercial Tax Department:-
i. Revenue will come earlier into the Government Treasury as compared to the old
system.
ii. Logical tax collection data in electronic format.
iii. Speedy accounting and reporting.
iv. Electronic reconciliation of all receipts.
v. Warehousing of digital challan
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By CA Meeta Mangal
Chapter – 11
Return
1. Explain the provision relating to filing of Annual Return under section 44 of CGST
Act, 2017 and Rules there under.
Solution:- 1
• Every registered person, other than
i. an Input Service Distributor,
ii. a person deducting/collecting tax at source,
iii. a casual taxable person and
iv. a non-resident taxable person,
• shall furnish an annual return for every financial year electronically in prescribed
form on or before 31st December following the end of such financial year.
2. Who is required to furnish Final Return under CGST Act, 2017 and what is the time
limit for the same? Discuss.
Solution:- 2
• Every registered person who is required to furnish a return under section 39(1) of
the CGST Act, 2017 and whose registration has been surrendered or cancelled shall
file a Final Return electronically in the prescribed form through the common portal.
• Final Return has to be filed within 3 months of the:
i. date of cancellation or
ii. date of order of cancellation whichever is later
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By CA Meeta Mangal
Chapter – 12
Composition scheme
1. Explain the term ‘aggregate turnover’.
Solution – 1
• While computing the threshold limit of Rs. 1 crore or 75 lacs for special category
states, inclusion in and exclusion from “aggregate turnover” are as follows:-
2. Examiner whether the following statements are true or false giving brief reasons:
a) It is mandatory to issue a tax invoice in case a registered person has opted for
composition levy scheme.
b) A composition tax payer, who has not rendered any taxable supply during a quarter,
is not required to file any return.

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By CA Meeta Mangal
Solution – 2(a)
• The given statement is false. A registered person paying tax under the provisions of
section 10 [composition levy] is required to issue, instead of a tax invoice, a bill of
supply containing the specified particulars in the prescribed manner [Section
31(3)(c) read with rule 49 of the CGST Rules].
Solution – 2(b)
• The given statement is false. Composition tax payer is required to furnish return
under section 39 for every quarter even if no supplies have been effected during such
period. In other words, filing of Nil return is also mandatory.
3. Pepper & Salt Ltd., registered in Madhya Pradesh has the turnover amounting
to Rs. 80 lakh in the financial year 2017-18. It wants to avail the benefit of
composition scheme in the year 2018-19. You are required to advise Pepper
and Salt Ltd. regarding the availability of composition scheme in the year 2018-
19.
• Will your answer change, if Pepper & Salt Ltd. is registered in Arunachal Pradesh?
Solution:- 3
• Pepper & Salt Ltd. can avail the benefit of the composition scheme in the year 2018-
19 as the threshold for composition scheme is Rs.1 Crore of aggregate turnover in
the preceding financial year* under section 10(1) of CGST Act, 2017.
• The benefit of composition scheme can be availed up to the turnover of Rs. 1 Crore
in current financial year*.
• However, it has to be ensured that Pepper & Salt Ltd. fulfills the following
conditions as given under section 10(2) of CGST Act, 2017:-
a) Pepper & Salt Ltd. is not engaged in the supply of services other than supplies of
food articles (restaurant service).
b) It is not engaged in making any supply of goods which are not taxable under the
CGST Act/SGST Act/ UTGST Act.
c) Pepper & Salt Ltd. do not make any inter-State outward supplies of goods.
d) It does not supply goods through an electronic commerce operator.
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By CA Meeta Mangal
e) It does not manufacture ice cream, pan masala and tobacco etc.
• *Rs. 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.
• If Pepper & Salt Ltd. is registered in Arunachal Pradesh, it can not avail the benefit
of composition in the year 2018-19 as its turnover in the preceding financial year
(Rs. 80 lakhs) exceeds the threshold limit (Rs.75 lakhs).
4. Mr. X availing composition scheme during a financial year crosses the turnover
of Rs.1 crore during the course of the year i.e. say he crosses the turnover of
Rs.1 Crore in December? Will he be allowed to pay tax under composition
scheme for the remainder of the year i.e. till 31st March?
Solution:- 4
• No. The option availed shall lapse from the day on which his aggregate turnover
during the financial year exceeds Rs. 1 Crore vide section 10(3) of CGST Act, 2017.
5. M/s. Handsome and Likemi Company, a partnership firm at Mumbai is running a mobile
phone showroom. Along with mobile phone showroom, it is also engaged in providing
health and fitness services.
Turnover of the mobile phone showroom was Rs. 78 lakh and receipts of the health and
fitness service was RS. 26 lakh in the preceding financial year.
i. With reference to the provisions of the CGST Act, 2017, examine whether the
firm can opt for the composition scheme,
78
ii. Will your answer change, if the turnover of the mobile phone showroom was
By CA Meeta Mangal
Rs.74 lakh and receipts of the health and fitness service was Rs.18 lakh in the
preceding financial year?
iii. If M/s. Handsome and Likemi Company obtain separate registration for their
mobile phone showroom & for health fitness centre, can it opt for composition
scheme only for mobile phone showroom?
Solution:- 5
• A registered person, whose aggregate turnover in the preceding financial year did not
exceed Rs. 1 crore [Rs. 75 lakh in case of special category States except Jammu and
Kashmir and Uttarakhand], may opt for composition scheme vide section 10 of CGST
Act, 2017.
• However, he shall not be eligible to opt for composition scheme if, inter alia, he is
engaged in the supply of services other than restaurant services.
i. In the given case, since M/s Handsome and Likemi Company is engaged in supply of
health and fitness service, it is not eligible to opt for composition scheme irrespective
of its turnover in the preceding financial year.
ii. The answer will remain the same i.e., M/s. Handsome & Likemi Company will not be
eligible to opt for composition scheme even with the change in the turnovers.
iii. Where more than one registered persons are having the same Permanent Account
Number, the registered person shall not be eligible to opt for composition scheme unless
all such registered persons opt to pay tax under composition scheme.
• Therefore, M/s. Handsome and Likemi Company will not be able to opt for composition
scheme only for mobile phone showroom as all the registrations under the same PAN
have to opt for composition scheme and since the supply of health and fitness service is
ineligible for composition scheme, supply of mobile phones too becomes ineligible for
composition scheme.
6. M/s. Ginny and John Company is a partnership firm of interior decorators and
also running a readymade garment showroom. Turnover of the showroom was
Rs. 80 lakh and receipts of the interior decorators service was Rs. 22 Lakh in
the preceding financial year.
• With reference to the provisions of the CGST Act, 2017, examine whether the firm
can opt for the composition scheme?
79
By CA Meeta Mangal
• Will your answer change, if the turnover of the showroom was Rs. 70 lakh and
receipts of the interior decorators service was Rs. 22 Lakh in the preceding financial
year ?
• Also discuss whether it is possible for M/s. Ginny and John Company to opt for
composition scheme only for showroom ?
Solution:- 6
• A registered person, whose aggregate turnover in the preceding financial year did
not exceed Rs. 1 crore [Rs. 75 lakh in case of special category States except Jammu
and Kashmir and Uttrakhand], may opt for composition scheme vide section 10 of
CGST Act, 2017.
• However, he shall not be eligible to opt for composition scheme if, inter alia, he is
engaged in the supply of services other than restaurant services.
• In the given case, since M/s Ginny and John Company is engaged in supply of
interior decorator’s service, it is not eligible to opt for composition scheme
irrespective of its turnover in the preceding financial year.
• Therefore, the answer will remain the same i.e., the company will not be eligible to
opt for composition scheme even with the change in the turnovers as given in the
second case.
• Further, where more than one registered persons are having the same Permanent
Account Number, the registered person shall not be eligible to opt for composition
scheme unless all such registered persons opt to pay tax under composition
scheme.
• Therefore, the answer will not change in the third case also as all the registrations
under the same PAN are required to opt for composition scheme and since the
supply of interior decorator service is ineligible for composition scheme, supply of
readymade garments too becomes ineligible for composition scheme.
7. Examiner whether the following statements are true or false giving brief
reasons:
i. A composition tax payer, who has not rendered any taxable supply during a
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By CA Meeta Mangal
quarter, is not required to file any return.

ii. It is mandatory to issue a tax invoice in case a registered person has opted for
composition levy scheme.
Solution:- 7
i. The given statement is false. Composition tax payer is required to furnish return
under section 39 for every quarter even if no supplies have been effected during
such period. In other words, filing of Nil return is also mandatory.
ii. The given statement is false. A registered person paying tax under the provisions
of section 10 [composition levy] is required to issue, instead of a tax invoice, a bill
of supply containing the specified particulars in the prescribed manner [Section
31(3)(c) read with rule 49 of the CGST Rules].
8. M/s Sai Trading Company, an eligible registered dealer in goods making intra
-state supplies within the state of Andhra Pradesh, has reported an aggregate
turnover of Rs.78 Lakhs in the preceding financial year.
i. Determine whether Sai Trading Company will be eligible for composition levy, as
on 31-10-2017.
ii. Will your answer be different, if in the above scenario, M/s Sai Trading Company is
making intra state supply within the State of Jammu and Kashmir
Source:- Exam Paper May 18 – New Syllabus
Solution:- 8
i. Section 10 of CGST Act, 2017 provides that a registered person, whose aggregate
turnover in the preceding financial year did not exceed Rs. 1 crore may opt for
composition scheme.
• The turnover limit is Rs. 75 lakh in case of Special Category States.
• However, for Jammu and Kashmir and Uttarakhand, the turnover limit is Rs. 1 crore
only.
• In the given case, the applicable turnover limit for composition scheme will be Rs.
1 crore as Andhra Pradesh is not a Special Category State.
• Further, since the aggregate turnover of the registered person in the given case
does not exceed Rs. 1 crore and it satisfies other conditions of composition scheme
namely, not making inter-State supplies of goods, it is eligible for composition levy.
ii. Since the turnover limit for determining the eligibility for composition scheme in
81
By CA Meeta Mangal
the State of Jammu and Kashmir is also Rs. 1 crore, Sai Trading Company will be
eligible for composition levy with other condition of not making inter-State supplies
of goods being fulfilled.
82
By CA Meeta Mangal

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GST SCANNER

Compiled by:- Meeta Mangal

1. GST in India – Introduction 1–3

2. Supply Under GST 4 – 11

4. Exemptions from GST 16 – 21

7. Input Tax Credit 41 – 55

12. Composition scheme 76 – 82

(c) Service Tax

4. List any six state levies, which are subsumed in GST.

v. VAT/ Sales tax

2. Determine whether the following supplies amount to composite supplies:

3. “State Government has exclusive power to notify a transaction to be supply of goods

(Source – Practice Paper 1:- May 2018)

4. State the necessary elements for a supply to be chargeable to GST.

5) the supply is made by a taxable person.

5. Modest Ltd., registered in Delhi dealing in supply of electronic items transferred

6. Sahab Sales, an air-conditioner dealer in Janakpuri, Delhi, needs 4 air-conditioners

1. Services by an employee to the employer in the course of or in relation to his employment.

3. (a) Functions performed by the Members of Parliament, Members of State Legislature,

(c ) Duties performed by any person as a Chairperson or a Member or a Director in a body

is not deemed as an employee before the commencement of this clause.

4. Services of funeral, burial, crematorium or mortuary including transportation of the

6. Actionable claims, other than lottery, betting and gambling

i. Supply, under section 7 of the CGST Act, 2017, inter alia,

respect of residence, it would amount to supply.

2. Supply of goods or services or both between related persons or between distinct

(Source :- May 18 Paper –Old Syllabus)

to her family dispute.

S. Date Particulars Date of Amount (Rs.)

(ii) Director’s Sitting fee 20.11.20XX - - 13,500

2. Services supplied by a director of a company to the said company is a notified service on

Pvt. Ltd. Company.

i. Rental income received by Tamil Nadu State Government from renting an

(Source :- May 18 Paper –Old Syllabus)

S.No. Particulars Rs. *

(iv) Alternative medical treatments by way of Ayurveda. Such 2,50,000

 As per section 2(h) of Clinical Establishments Act, 2010, recognised system of

medicine means allopathy, yoga, naturopathy, ayurveda, homeopathy, siddha and

2. Kesar Maharaj, a registered supplier, gave a classical dance performance in an

is for the promotion of such food product?

i. If Kesar Maharaj is a brand ambassador of a food product and aforesaid performance

× 9%) and Rs. 13,365 (Rs. 1,48,500 × 9%) respectively.

3. Examine whether GST is payable in the following independent cases:-

agency services provided to the Central Government, State Government, Union

4. Examine whether GST is payable in the following independent supply of services:

5. Examine whether GST is exempted on the following independent supply of services:

b) Services provided by a coach to a recognised sports body for participation in a

(Source :- May 18 Paper –Old Syllabus)

• Thus, the time of supply of the goods will be 03-10-2017.

(iii) Commission 500 ----

Central tax (CGST) 9%

(ii) Add: Packing charges (Note-1) 500

3. A manufacturer of machinery supplied a special machine to Texco Furnishers.

(Source – Mock Test Paper 2:- May 2018)

6. Whether post-supply discounts or incentives are allowed as admissible

7. Raman Ltd., a registered supplier in Mumbai (Maharashtra), has supplied goods

S.No Particulars Sahil Jaggi

Traders Motors Ltd.

1. Incidental expenses, including commission and packing, charged by supplier to recipient of