GST - Final LAB WORK 1-50

Problems
First 20 written ,
From 21 to 36: (23,24.26,29,35,36,)
Practical problems
Introduction
A “tax” is a compulsory financial charge or some other type of levy imposed on a taxpayer (an
individual or a legal entity) by a governmental organization in order to fund government spending
and various public expenditures (regional, local, or national). Taxation in India is majorly divided
into two types: Direct Taxes and Indirect Taxes. Direct taxes are levied on the earnings, and
indirect taxes are levied on expenses in India. The responsibility to deposit the direct tax liability
lies with the earning party (individual, HUF, or a company). Whereas, indirect taxes are collected
majorly by the corporates and businesses providing services and products; and so the
responsibility to deposit indirect taxes lies with the business entities. Income Tax, Capital Gains
Tax, and Corporate Tax are the direct taxes levied in India. Indirect Taxes in India are Customs
Duty, GST, Excise Duty, VAT, and Sales Tax, many of which were later subsumed in GST.
Goods and Service Tax (GST):-
Goods and Service Tax is an indirect levied on the supply of goods and services. GST is a
consumption based tax ultimately borne by the end consumer of goods or services. France was
the first country to implement GST in 1954 which was known as the Value Added Tax (VAT). Since
then, 160 countries have adopted GST. Further, the GST journey in India began in the year 2000,
when a committee was set up to draft the law. It took 17 years from then for the Law to evolve. In
2017, the GST Bill was passed in the Lok Sabha and Rajya Sabha.
On 1 st July 2017, the GST Law came into force in India.
According to the Article 366 (12A) of the Constitutional (101 st Amendment) Act, 2016, Goods
and Service Tax (GST) is defined as “any tax on supply of goods, or services, or both, except
for taxes on the supply of the alcoholic liquor for human consumption.” GST is of four types:
● Central Goods and Service Tax (CGST)
● State Goods and Service Tax (SGST)
● Integrated Goods and Service Tax (IGST)
● Union Territory Goods and Service Tax (UTGST)
GST has brought in a “one nation, one tax” system, but its effect on various industries are slightly
different. Goods and services are divided into five different tax slabs for collection of tax: 0%, 5%,
12%, 18% and 28%. However, petroleum products, alcoholic drinks, and electricity are not taxed
under GST and instead are taxed separately by the individual state governments,
as per the previous tax system.
The features of GST can be summarized as under:
● Subsuming 17 taxes at Central/State level.
● Consumption based tax.
● One tax rate across the country.
● Taxable event – “Supply of Goods or Services.”
● No differentiation in Goods or Services.
● Comprehensive tax on Goods & Services.
● No tax on tax.
● Free flow of credit.
● Value Added Tax at each stage.
The benefits of GST are as follows:
● For Business & Industry:
⮚ Easy compliance.
⮚ Uniformity in tax rates and structures.
⮚ Development of the Common National Market.
⮚ Removal of cascading effect.
⮚ Competitiveness.
⮚ Boost to exports.
⮚ Can avail Input Tax Credit (ITC).
● For Central & State Governments:
⮚ Simple and easy to administer.
⮚ Better control on tax compliance.
⮚ Higher revenue efficiency.
● For the Consumers:
⮚ Simpler tax system.
⮚ Reduction in prices of goods and services due to
elimination of cascading. ⮚ Uniform prices throughout
the country.
⮚ Transparency in the taxation system.
⮚ Increase in employment opportunities.
GST Council:-
GST Council is the governing body of GST having 33 members, out of which 2 members are of
center and 31 members are from 28 state and 3 Union territories with Legislature. The council
contains the following members:
● Union Finance Minister (as chairperson)
● Union Minister of States in charge of revenue or finance (as member)
● The ministers of states in charge of finance or taxation or other ministers as nominated by
each state's government (as member).
GST Council is an apex member committee to modify, reconcile or to procure any law or regulation
based on the context of goods and services tax in India. The GST council is responsible for any
revision or enactment of rule or any rate changes of the goods and services in India.
Goods and Service Tax Network (GSTN):-

The GSTN software is developed by Infosys Technologies and the Information Technology
network that provides the computing resources is maintained by the National Informatics Centre
(NIC). "Goods and Services Tax Network" (GSTN) is a non-profit organization formed for creating
a sophisticated network, accessible to stakeholders, government and taxpayers to access
information from a single source (portal). The portal is accessible to the Tax authorities for tracking
down every transaction, while taxpayers have the ability to connect for
their tax returns. However, later it was made a wholly owned government company having equal
shares of state and central government.
HSN Code:-
India has been a member of the World Customs Organization (WCO) since 1971. It was originally
using 6-digit HSN codes to classify commodities for Customs andCentral Excise. Later Customs
and Central Excise added two more digits to make the codes more precise, resulting in an 8 digit
classification. The purpose of the HSN code is to make GST systematic and globally accepted.
HSN codes will remove the need to upload the detailed description of the goods. This will save
time and make filing easier since GST returns are automated.
Solutions to the Practical Lab Questions (1 to 20)
1. Draw a chart showing tax structure in India?
2. Draw a chart and write a note on Pre - GST Indirect tax structure in
India?
During the pre - GST period, India had several erstwhile indirect taxes such as service tax, Value
Added Tax (VAT), Central Excise, etc., which used to be levied at multiple supply chain stages.
Some taxes were governed by the State Governments and some by the Centre Government.
There was no unified and centralized tax on both goods and services due to which the cascading
effect of tax occurred because taxes are included in the price of goods and services at each stage
of the supply chain. The above pre - GST Indirect taxes structure was
later subsumed to form GST today.
3. Write any five limitations of Pre - GST Indirect taxes?

ANS: The pre - GST Indirect taxes were interconnecting and often overlapping, which posed
many disadvantages and conflicts for suppliers and manufacturers along with the government
bodies, which are as follows:
a) A complex web of multiple tax points and returns for suppliers.
b) Incidents of double taxation and cascading effect.
c) Difficult web legal conditions for exporters.
d) The difficulty of market entry due to varying rules and regulations.
e) Very high after-tax prices for goods and services.
❖ CENVAT (Excise Duty) was levied on products made in India. However, problems arose with
product ratings. Implementing CENVAT only at the manufacturing level has been a critical
obstacle to an efficient and neutral flow of tax credits. This resulted in the replacement of VAT for
the GST in many countries.
❖ With the boom in the service sector, the central government has the monopoly right to collect
taxes. On the other hand, the state governments lose their income by not imposing taxes on the
service sector.
❖ Given the CST for the interstate sales of goods, offsetting was not allowed, which increased
the cascading effect.
❖ Better control and management of taxes requires significant technological changes that are
costly, time-consuming, and need to be addressed.
4. What was the significance of the introduction of VAT in Indirect taxes ? Prior to
the implementation of GST? Write a short note.
ANS: Every commodity passes through different stages of production and distribution before
finally reaching the consumer. Some value is added at each stage of the production and
distribution chain: for instance, a forged metal tool is more valuable than metal, which was itself
more valuable than the ore that was originally mined. Value Added Tax (VAT) is a tax on this value
addition at each stage.
VAT was introduced as an indirect tax in the Indian taxation system to replace the existing general
sales tax. The Value Added Tax Act (2005) and associated VAT rules came into effect beginning
April 1, 2005 in many Indian states. A few states (Gujarat, Rajasthan, MP, UP, Jharkhand and
Chhattisgarh) excluded themselves from VAT during its initial introduction, but later adopted the
tax. Every state has its own VAT legislation, rates, taxable base, and list of taxable goods. Value
Added Tax (VAT) is a major source of revenue for all Indian states and union territories (except
Andaman and Nicobar Islands and Lakshadweep). Under a VAT system, a dealer collects tax on
his sales, retains the tax paid on his purchase and pays the balance to the government. It is a
consumption tax, because it is borne ultimately by the final consumer. The tax paid by the dealer
is passed on to the buyer. It is not a charge on the dealer. VAT is instead a multipoint tax system
with provision for collection of tax paid on purchases at
each point of sale.The main aim behind the introduction of VAT was to eliminate the presence
of double taxation and the cascading effect from the then existing sales tax structure.
5. Need for GST in India?
ANS: Imposing several taxes on goods and services can lead to high cost and inefficient tax
structure which can be subject to shirking and revenue disclosures. To overcome these issues,
Rajya Sabha introduced the GST bill, to replace the existing multiple tax structures of Centre and
State taxes, bring transparency to taxation and consumers will get to know how much tax amount
they are paying to the government for sales/purchases/manufacturing.
Following are some of the points that can easily explain the need for GST: - ❖ Tax Structure
will be simple: Earlier, there were a huge number of taxes that have to be paid by consumers,
with GST it will be a single tax to pay, which is much easier to understand. For businesses,
accounting complexities will reduce and result in less paperwork, which will save both time and
money. GST will increase economic GDP by 2% - 2.5%. ❖ Tax revenue will increase: Simple
tax structure will bring more tax payers and in return it will bring revenue for the government.
❖ Competitive pricing: GST will eliminate all other indirect taxes and this will effectively mean
that tax amount paid by end users (consumers) will reduce. As in Economics, lower the prices,
more will be demand for that product, resulting in more consumption of goods, which will be
beneficial to the companies.
❖ Boost to exports: If the Indian market will be competitive in pricing, then more and more
foreign players will try to enter the market, which results in more numbers of exporters and benefits
to the Indian Market.
❖ Decrease the cascading effect: GST will take away the cascading effect of various taxes that
are charged on sales/production/purchases. Products reach customers at a very high rate as
compared to manufacturing, so with GST there will be only one tax and it will reduce burden to
pay off.
6. What are the important stages in implementation of GST?
The Finance Minister P. Chidambaram in February 2006 continued work on the same and
proposed a GST rollout by 1 April 2010. The Empowered Committee of State Finance Ministers
(EC) which had formulated the design of State VAT was requested to come up with a roadmap
and structure for GST. Based on discussions within and between it and the Central Government,
the EC released its First Discussion Paper (FDP) on the GST in November, 2009. This spelt out
features of the proposed GST and has formed the basis for discussion between the Centre and
the States so far. However, in 2011, with the Trinamool Congress routing CPI(M) out of power in
West Bengal, Asim Dasgupta resigned as the head of the GST committee. Dasgupta admitted in
an interview that 80% of the task had been done. The United Progressive Alliance (UPA)
introduced the 115th Constitution Amendment Bill on 22 March 2011 in the Lok Sabha to
bring about the GST. It ran into opposition from the Bharatiya Janata Party and other parties and
was referred to a Standing Committee headed by the BJP's former Finance Minister Yashwant
Sinha. The committee submitted its report in August 2013, but in October 2013 Gujarat Chief
Minister Narendra Modi raised objections that led to the bill's indefinite postponement. In the 2014
Lok Sabha election, the Bharatiya Janata Party (BJP)-led National Democratic Alliance
(NDA) government was elected into power. With the consequential dissolution of the 15th Lok
Sabha, the GST Bill – approved by the standing committee for reintroduction – lapsed. Seven
months after the formation of the then Modi government, the new Finance Minister Arun Jaitley
introduced the GST Bill in the Lok Sabha, where the BJP had a majority. In February 2015,
Jaitley set another deadline of 1 April 2017 to implement GST. In May 2016, the Lok Sabha passed
the Constitution Amendment Bill, paving the way for GST.However, the Opposition, led by the
Congress, demanded that the GST Bill be again sent back for review to the Select Committee of
the Rajya Sabha due to disagreements on several statements in the Bill relating to taxation.
Finally, in August 2016, the Amendment Bill was passed. Over the next 15 to 20 days, 18 states
ratified the Constitution amendment Bill and the President Pranab Mukherjee gave his assent to
it. A 21-member selected committee, the GST Council, was formed to look into the proposed GST
laws. After GST Council approved the Central Goods and Services Tax Bill 2017 (The CGST Bill),
the Integrated Goods and Services Tax Bill 2017 (The IGST Bill), the Union Territory Goods and
Services Tax Bill 2017 (The UTGST Bill), the Goods and Services Tax (Compensation to the
States) Bill 2017 (The Compensation Bill), these Bills were passed by the Lok Sabha on 29 March
2017. The GST was launched at midnight on 1 July 2017 by the President of India, and the
Government of India.
7. What were the taxes subsumed in GST?

ANS: GST is commonly described as an indirect, comprehensive, broad based consumption Tax.
The Dual GST which would be implemented in India will subsume many consumption taxes. The
objective is to remove the multiplicity of tax levies thereby reducing the complexity and remove
the effect of Tax Cascading. The objective is to subsume all those taxes that are currently levied
on the sale of goods or provision of services by either Central or State Government. Subsumption
of large numbers of taxes and other levies will allow free flow of a larger pool of tax credits at both
Central and State level. Principles of Tax Subsumption: The various Central, State and Local
levies were examined to identify their possibility of being subsumed under GST. While identifying,
the following principles were kept in mind, that the taxes or levies subsumed be....
● Taxes and levies should be primarily in the nature of indirect taxes.
● Taxes and levies should be part of the transaction chain.
● Taxes and levies should result in free flow of tax credit.
● The taxes, levies and fees that are not specifically related to supply of goods & services
should not be subsumed under GST.
● Revenue fairness for both the Union and the States individually would need to be
attempted. Central Taxes subsumed under GST:
● Central Excise Duty.
● Additional Excise Duty.
● Service Tax.
● Additional Customs Duty commonly known as Countervailing Duty.
● Special Additional Duty of Customs.
State Taxes subsumed under GST:
● Subsuming State Value Added Tax/Sales Tax.
● Entertainment Tax (other than the tax levied by the local bodies).
● Central Sales Tax (levied by the Centre and collected by the States).
● Octroi and Entry tax.
● Purchase Tax.
● Luxury tax.
● Taxes on lottery, betting and gambling.
8. Visit the CBIC Website and make a note of important contents?
9. What is the major difference in incidence of tax during pre and post
GST implementation with respect to inter-state transfer Explain with
Example?
10.What are the exclusive products not included in the purview of GST?
Why?
ANS: The exclusive products not included under GST are as follows: ● Tax on items
containing alcohol: Alcoholic beverages for human consumption would be kept out of the
purview of GST as an exclusion mandated by constitutional provision. Sales Tax/VAT could be
continued to be levied on alcoholic beverages as per the existing practice. VAT is levied on
alcohol purchases in some states, and there will be no objection to that. Excise duty, which is
presently levied by the states, may also be
unaffected.
● Tax on Petroleum Products: The full range of petroleum products, including crude oil and
motor spirits including Aviation Turbine Fuel (ATF) and High-Speed Diesel (HSD), would be kept
outside GST, as is the prevailing practice in India. Sales tax could continue to be levied by the
states on these products with the prevailing floor rate. Similarly, the Centre could also continue its
levies. A final opinion on whether natural gas should be kept outside the GST will be issued after
further deliberations. As for petroleum products, although the GST constitutional amendment
provides for levying GST on these products, it allows the timeframe for their inclusion to be decided
by the GST Council. Therefore, in the initial years of GST, petroleum products will remain out of
the scope of GST. The existing taxation system under VAT and the Central Excise Act will continue
for both of the commodities listed above.
Why the exclusion of these products?
VAT or sales tax on petroleum products contributes to nearly 33 percent of state revenues, and
the Centre also earns significant excise duty income on the generation of petroleum products from
crude oil. To protect these significant revenue interests, both the Governments want GST to first
stabilize before they allow the GST Council to consider their inclusion. Similarly, for alcohol, states
don’t want to lose the significant revenue currently earned from state excise
duty. In many states, the revenue from state excise taxes imposed on alcohol brings in 25 percent
of total revenue. For this reason, the state excise tax on alcohol has been kept out of the
constitutional mandate for levying GST. This decision was made to provide fiscal security to states
and ensure that there is a minimum guaranteed income under the proposed GST regime.
11.What is the GST council and what is its composition?

ANS: GST Council is an apex member committee to modify, reconcile or to procure any law or
regulation based on the context of goods and services tax in India. The GST council is responsible
for any revision or enactment of rule or any rate changes of the goods and services in India. GST
Council is the governing body of GST having 33 members, out of which 2 members are of center
and 31 members are from 28 state and 3 Union territories with Legislature. The decisions of the
GST Council are made by three-fourth majority of the votes
cast. The center has one-third of the votes cast, and the states together have two-third of the
votes cast. Each state has one vote, irrespective of its size or population. According to Article
279A of the modified Constitution, the Council of GST, which will be a combined forum of the
Center and the States, shall be composed of the following members: the Chairperson; the Union
Finance Minister; and the Union Minister of State responsible for Finance and Revenue; and
Members, any other Minister proposed by each state government, including the Minister in
charge of finance or taxation. Along with this....
● The Secretary (Revenue) will be appointed as the Ex-officio Secretary to the GST Council. ●
The Chairperson, Central Board of Excise and Customs (CBEC), will be included as a
permanent invitee (non-voting) to all proceedings of the GST Council.
● One post of Additional Secretary to the GST Council in the GST Council Secretariat (at the
level of Additional Secretary to the Government of India) will be created.
● Four posts of Commissioner in the GST Council Secretariat (at the level Joint Secretary to the
Government of India) will also be created.
Functions of GST Council: As per Article 279A (4), the Council will make recommendations to
the Union and the States on important issues related to GST, like....
● Taxes, cesses, and surcharges to be subsumed under the GST.
● Goods and services which may be subject to, or exempt from GST.
● The threshold limit of turnover for application of GST.
● Rates of GST.
● Model GST laws, principles of levy, apportionment of IGST and principles related to place of
supply.
● Special provisions with respect to the eight north eastern states, Himachal Pradesh, Jammu
and Kashmir, and Uttarakhand; and
● Other related matters. GST rates will include the floor rates with bands, special rates for
raising additional resources during natural disasters / calamities, special provisions for certain
States, etc.
12.What are the different types of taxes levied under GST?

ANS: There are two main types of GST: Inter-state and Intra-state. Intra-state transactions are
where the supply of goods and services happen within a state, and both CGST and SGST/UTGST
is collected. Whereas, inter-state transactions are where the supply of the goods and services
happen between different states, then only IGST is collected.
The four different types of GST are as follows:
❖ The Central Goods and Services Tax (CGST): CGST is a tax levied on intrastate supplies of
both goods and services by the Central Government and collected by it for its coffers. Accordingly,
the levy and collection of CGST are governed by the provisions of the CGST Act, 2017 as
amended from time to time. If a seller sells a product to a buyer within the same state, say
Telangana, then CGST and SGST will apply. This implies that both the Central and state
governments will agree on combining their levies with an appropriate proportion for revenue
sharing between them. It is clearly mentioned in Section 8 of the CGST Act that the taxes be levied
on all intrastate supplies of goods and/or services but the rate of tax shall not be exceeding 14%,
each. Any tax liability obtained under CGST can be set off against CGST or IGST input tax credit
only and not any SGST.
❖ The State Goods and Services Tax (SGST): SGST is a tax levied on intrastate supplies of
both goods and services by the particular state government where the product sold is consumed.
Therefore, levy and collection of SGST are governed by the respective state’s SGST Act, 2017 as
amended from time to time. After the introduction of the SGST, all the state taxes such as the
value-added tax, entertainment tax, luxury tax, entry tax, etc. were merged under
SGST. As explained above, CGST will also be levied on the same intrastate supply but will be
governed by the Central Government. Any tax liability obtained under SGST can be set off against
SGST or IGST input tax credit only and not CGST.
❖ The Union Territory Goods and Services Tax (UTGST): UTGST refers to the tax levied on
the intra-Union Territory supply of goods and services. It is governed by the UTGST Act, 2017 as
amended from time to time and is levied together with CGST. UTGST is similar to SGST and is
levied in Union Territories which do not have their own legislature. UTGST is applicable to the
supplies that take place in the Union Territories of Jammu & Kashmir, Ladakh, Andaman and
Nicobar Islands, Chandigarh, Dadra & Nagar Haveli and Daman & Diu, and
Lakshadweep. Please note that the Union Territories of Delhi and Puducherry will fall under
SGST law as they have their own legislature. The order of ITC utilization of UTGST is similar to
SGST. The ITC of UTGST should first be set off against UTGST. Any balance remaining may be
used to set off any IGST liability.
❖ The Integrated Goods and Services Tax (IGST): IGST is a tax under GST, levied on all
interstate supplies of goods and/or services or across two or more states/Union Territories.
Further, IGST levy and collection will be governed by the IGST Act, 2017, as amended from time
to time.
IGST will be applicable on any supply of goods and/or services in both cases of import into India
and export from India. Under IGST,
● Exports would be zero-rated.
● Tax will be shared between the Central and State governments.
13.What are the laws supporting the levy of GST. Explain with examples or rules?
ANS: Article 246A of the Constitution, which was introduced by the Constitution (101st
Amendment) Act, 2016 confers concurrent powers to both, Parliament and State Legislatures to
make laws with respect to GST i. e. central tax (CGST) and state tax (SGST) or union territory
tax (UTGST).
14.What is RNR?
ANS: Revenue neutral rate (RNR) is a structure of different rates established in order to match
the current revenue generation with revenue under GST. RNR calculation has to include the
cascading effect on certain goods having no excise or sales tax implications. It is the tax rate that
will allow the Government to receive the same amount of money despite changes in tax laws. In
the GST regime the revenue of the government would not be the same in comparison
with the present tax structure due to tax credit mechanism, removal of cascading effect, or
otherwise. Therefore, an adjustment in tax rate is required to avoid reduction in revenue of the
government. This adjusted Rate is termed as Revenue Neutral Rate (RNR). It is the rate at which
tax revenue remains the same despite giving credit of duty paid on inputs and other factors.
15.What are the categories of Goods and Services for levying GST? ANS: The GST
tax is levied based on Revenue Neutral Rate (RNR). For the purpose of imposing GST tax in
India, the goods and services are categorized into four. The 4 categories of goods and services
are as follows:
● Exempted Categories under GST in India: The GST Council and other GST authorities notify
the list of exempted goods. Such goods do not fall under payment of GST tax. The authorities
may modify or amend the list from time to time by adding or deleting any item if required by
notification to the public.
● Essential Goods and Services of GST in India: Essential categories of goods and services
are charged a very lower GST rate. Essential goods and services are the goods and services for
necessary items and items under basic importance.
● Standard Goods and Services for GST in India: A major share of GST Tax payers fall under
this category of standard goods and services. A standard rate of GST is charged against the
goods and services under this category.
● Special Goods and Services for GST tax levy: Under the special category of goods and
services, GST rates would be high. Precious metals including luxury items of goods and services
fall under special goods and services for GST rate implementation.
16.Briefly explain the important components of Supply?

ANS: Under GST, 3 types of taxes can be charged in the invoice. SGST and CGST in the case
of an intra-state transaction, and IGST in case of an inter-state transaction. But deciding whether
a particular transaction is interstate or intrastate is not an easy task. To help address this issue,
the CGST Act, 2017 lays down certain rules which define whether a transaction is interstate or
intrastate. There are three important components of Supply of Goods and
Services: Time of Supply, Place of Supply, and Value of Supply.
● Time of Supply: Time of supply is a relevant measure under the GST law for every transaction
entered into by the supplier of goods and services. It means the point in time when goods have
been deemed to be supplied or services have been deemed to be provided for determining when
the taxpayer is liable to pay taxes.
● Place of Supply: Under GST, the place of supply is the place of delivery of goods or the place
where service is rendered by the taxpayer. In simple words, the place of supply is nothing but the
registered place of the recipient of goods or/and services. So, the place of supply of goods is the
place where the ownership of goods changes. What if there is no
movement of goods. In this case, the place of supply is the location of goods at the time of
delivery to the recipient.
● Value of Supply: Value of Supply is important to consider as the GST is calculated on the value
of goods or services. If there is any mistake in calculation of the value of goods or services, then
there may be an incorrect amount of GST charged. This value is known as the Transaction value.
Transaction value is the price actually paid (or payable) for the supply of goods/services between
unrelated parties (i.e., price is the sole consideration) The value of supply under GST shall include:
Any taxes, duties, cess, fees, and charges levied under any act, except GST.
17.What activities are included in Supply?

ANS: Under section 2(92) read with section 3, ‘supply’ includes all forms of supply of goods and/or
services such as sale, transfer, barter, exchange, license, rental, lease or disposal made or agreed
to be made for a consideration by a person in
the course or furtherance of business. Schedule I specified the supply.
Activities included in Supply are:
● Supply includes....
a) All forms of supply of goods and/or services such as sale, transfer, barter, exchange, license,
rental, lease or disposal made or agreed to be made for a consideration by a person in the course
or furtherance of business.
b) Importation of service, whether or not for a consideration and whether or not in the course or
furtherance of business, and
c) A supply specified in Schedule I, made or agreed to be made without a consideration. ●
Schedule II, in respect of matters mentioned therein, shall apply for determining what is, or is to
be treated as a supply of goods or a supply of services.
18.Brief registration process of GST?

ANS: GST Registration process is online based and must be carried out on the government
website gst.gov.in. Every dealer whose annual turnover exceeds Rs.20 lakh (Rs.40 lakh or Rs.10
lakh, as may vary depending upon state and kind of supplies) has to register for GST. The GST
registration process is the same for normal taxpayers, composite dealers, CTP, ISD, SEZ
developer, SEZ unit.
Essentials for Registration process of GST:
1. Registration is PAN based.
2. State-wise or UT-wise registration [Section 25 (2)].
3. More than one registration [Section 25 (4)].
4. GST Identification Number [GSTIN].
5. Effective date of registration.
6. Validity of registration: Registration is permanent.
7. Unique Identity Number (UIN) [Section 25 (9) and (10)].
8. Suo motu registration by the proper officer [Section 25 (8) read with Rule 16].
9. Supply from Territorial water.
10.Registration is not tax specific.
11.Deemed registration [Section 26].
There are four main steps for the registration of GST. They are:
Step 1: Application for registration.
Click on the services tab displayed on the top of the GST Portal homepage and in the services
tab, click on the new registration option.
Step 2: Generate Temporary Reference Number (TRN). Fill in the details like PAN of the business,
type of taxpayer, state/union territory, valid email and mobile number, etc. Different OTPs will be
sent to the given mobile number and email address. Enter Captcha and click on proceed. On
clicking proceed, the portal displays all the GSTINs/Provisional IDs/UINs/GSTP IDs mapped to
the same PAN across India. Now click on the proceed button. In the OTP verification page, enter
the OTP received on email and mobile number, and then click proceed. The system will generate
TRN which will be received on both email address and mobile number.
Step 3: Submitting business information.
● Login with TRN and enter the captcha and click proceed.
● Enter the OTP received on email/mobile number (OTP is valid for only 10 minutes and you
can enter either mobile or email OTP).
● My saved application page is displayed by clicking on the edit option (the application for TRN
shall be purged after 15 days if the applicant doesn’t submit the application). ● The registration
application form has 10 tabs as mentioned below, click on each tab to enter the details.
● Enter the information for - Business details, Promoter/Partners, Authorized Signatory,
Authorized Representative, Principal place of business, Additional place of business, Goods and
services, Bank Account, State specific information, Aadhar authentication tab, Verification tab.
Step 4: Do your KYC.
● Click on the authentication link received on GST registered email id and mobile numbers of
promoters/partners.
● Select the consent for authentication and enter the Aadhar number.
● Enter the otp received on mobile number and email id of authorized
signatory registered at UIDAI and click on validate OTP.
● A success message is displayed when Aadhar is successfully verified and
then click on ok.
● Note: the authentication link received shall be valid for only 15 days and
once assessed cannot be reassessed again.
19.Ram Enterprises purchased goods from Shyam Enterprises. The

goods were supplied on 15/01/2018. Ram Enterprises paid an advance
of Rs. 1,00,000 for purchases on 10/01/2018. The invoice was raised
on 30/01/2018. Explain with respect to supply?
ANS: GST is not applicable to advances under GST. GST in Advance is payable at the
time of issue of the invoice.
As per the information given in the question, we can analyze that the -
⮚ Date of issue of invoice = 30 th January, 2018.
⮚ Date of supply = 15 th January, 2018.
⮚ Date of payment of advance = 10 th January, 2018.
Thus, the time of supply is 15 th January, 2018.
20.Mr. Y was travelling from Hyderabad to Bengaluru on a flight.

During his journey, he purchased some books. Determine the
incidence of tax and identify the place of supply?
ANS: The place of supply in case of goods taken on board for consumption in aircraft, is the place
or location at which such goods are taken on board. As per the question, Mr. Y was traveling on
a flight which departed from Hyderabad to Bengaluru. After purchasing and taking on board the
books for consumption at Hyderabad, the place of supply will be Hyderabad.
21. What is Composite supply and Mixed Supply, What is the rate of tax applied?
ANS: Composite Supply under GST:
Composite supply is defined under CGST Act as “composite supply” means a supply made by a taxable
person to a recipient consisting of two or more taxable supplies of goods or services or both, or any
combination thereof, which are NATURALLY BUNDLED and supplied in conjunction with each other
in the ordinary course of business, one of which is a PRINCIPAL SUPPLY; Illustration.— Where goods
are packed and transported with insurance, the supply of goods, packing ,Materials, Transport and
insurance is a composite supply and supply of goods is a principal supply. A composite supply has to
fulfill the following conditions to be called a composite supply.
1. Supply to be made by a Taxable Person : The term “taxable person” is defined as a person who
is registered or liable to be registered under section 22 or section 24. Meaning thereby composite supply
can be affected by a person who is registered or liable to be registered under GST laws. An unregistered a
person cannot affect a composite supply.
2. Two or more taxable supplies: There should be two or more taxable supplies of goods or services
or combination of goods and services. The supplies of goods or services should also be taxable supplies.
Combination of one taxable supply and one exempted supply would not suffice the condition of a composite
supply.
3. Supplies should be naturally bundled: The term “naturally bundled” is not defined in the CGST
Act. However two supplies shall be considered naturally bundled if one is a principal supply and other
supply which is ancillary make the principal supply more effective, more convenient, more comfortable,
more useful and more enjoyable. E.g. Food by railway on board to passengers makes the journey of
passengers more comfortable and enjoyable.
4. In conjunction with each other : The supplies should be provided simultaneously at the same time
or at the time of principal supply being continued or just after the main supply. E.g. Packing material and
disposables with doorstep food delivery. Another is installation of TV Set just after delivery of the same at
the premises of the consumer.
5. In ordinary course of business : The goods or services or both provided as a package or bundle
should be provided in ordinary course of business. Meaning thereby it should be the practice of the majority
of traders/service providers to provide different elements of supplies as a package or bundle. Most of the
consumers/receivers of supply expect to receive those packages/bundles in conjunction. Composite supply
should be advertised as a whole and there should be a single price of the whole package. There should be a
principle supply and other supplies should be ancillary to the main supply and if any one of the supplies is
removed the other supplies lose their usefulness. There is no clear cut formula whether the composite supply
is provided in ordinary course of business. One has to see each and every case of composite supply whether
it is in the ordinary course of business or not on the basis of some of the indicators cited above including
other industry specific requirements. E.g. Breakfast provided by hotels with the service of lodging and
boarding is naturally bundled as it is a frequent practice adopted by the hotel industry and most of the
consumers expect hotels to provide breakfast during the time of check in.
6. Principle Supply : A principle supply is defined in CGST Act as “principal supply” means the
supply of goods or services which constitutes the predominant element of a composite supply and to
which any other supply forming part of that composite supply is ancillary. Meaning Principal supply is
that supply for which supplier and recipient come together and that supply which is the actual intention of
the consumer to get from the supplier. E.g. Mr. ‘A’ go to an auto-mobile shop to purchase an auto part.
However supplier also installed it at the same time and charge a single price for that auto part including
installation. In this case the actual intention of the consumer is to buy the auto part. The installation is
ancillary to principal supply which is purchase of auto parts. Therefore the predominant nature of supply
is purchase of goods. A composite supply has to comply with the above conditions to get a composite
supply character. In short composite supply is the bundle of two or more taxable
supplies which are provided by the traders or service providers to their consumers as a normal trade practice
normally for a single price and consumers also become habitual of getting those multiple supplies together.
7. Rate of Tax on Composite Supply : The rate of tax on composite supply is applicable at the rate
which is applicable to principally supply of the composite supply. Eg. Meal is sold by suppliers with
disposables. In this case meal is the principal supply and disposables are ancillary to meal. Rate of tax
shall be that which is applicable to meals.
2. MixedSupply under GST:

The mixed supply is defined in the Act as “mixed supply” means two or more individual supplies of goods
or services, or any combination thereof, made in conjunction with each other by a taxable person for a single
price where such supply does not constitute a composite supply. A mixed supply has to comply with the
following condition to be called a mixed supply.
1. Two or more individual supplies : There should be two or more individual supplies whether these
are taxable supplies or exempted supplies or any combination thereof. Unlike in case of composite supply
there is no need that all the supplies of the bundle should be a taxable supply. The supplies could be that of
goods or services or both or any combination of these two.
2. Provided in conjunction with each other : Like in case of composite supply, mixed supply
should also be provided at the same time or as a bundle or package of multiple supplies. 3. Single price
: There should be a single price for multiple supplies forming a combination.
4. Does not constitute a composite supply : A supply could only become a mixed supply when it
fails to get the character of a composite supply. All the necessary conditions of a composite supply are not
present in the combination. Meaning thereby the combination offered for a single price should not be
naturally bundled and should not be provided in ordinary course of business. The combination has to fail
these two tests for calling a mixed supply. In short the mixed supply is a combination of multiple supplies
which are independent from each other. The combination is not sold by the trade in normal trade practice.
The constituent supply of the combination can be sold independently. The consumer does not generally
expect the combination to be provided in conjunction with each other. E.g. Toilet cleaner sold with toilet
brush for a single price. Another one is Diwali gift packs containing sweets, chocolates, namkeen and
juices etc.
5. Rate of Tax applicable to Mixed Supply : The rate of tax applicable to mixed
supply is the highest rate applicable to any of the constituent supply of the
combination.
Example-1: Fruits and chocolates are sold as a combination for a single price. Fruits are taxable at Nil rate
while chocolates are taxable at 18%. Whole of the combo shall be taxable at 18% despite fruits being Nil
rated. Example-2: 5 kg pack of Branded Rice and 5 kg pack of washing powder are sold as a combo for a
single price. Branded rice is taxable at 5% while washing powder is taxable at 18%. Whole the combo is
taxable at 18% which is the highest rate. Composition Levy under GSTComposition levy is a kind of GST
for small taxpayers who are not able to do complicated compliances of GST laws as applicable to regular
taxpayers. The compliance level for those small taxpayers is very minimal and the applicable tax rate for
composition levy is uniform across all types of goods or services. Infact composition levy is a scheme
provided by Govt. to small taxpayers at their option. Therefore it is at the option of the small taxpayer
whether he wants to avail the scheme or not. Moreover such taxpayers can avail the scheme for a particular
financial year and also can opt out from the scheme at the beginning of the upcoming financial year.
22. Write a short note on the process of GST?

ANS:The goods and services tax (GST) is a value-added tax (VAT) levied on most goods and services sold
for domestic consumption. The GST is paid by consumers, but it is remitted to the government by the
businesses selling the goods and services. Critics point out, however, that the GST may disproportionately
burden people whose self-reported income are in the lowest and middle income brackets, making it a
regressive tax. These critics argue that GST can therefore exacerbate income inequality and contribute to
social and economic disparities. In order to address these concerns, some countries have introduced GST
exemptions or reduced GST rates on essential goods and services, such as food and healthcare. Others have
implemented GST credits or rebates to help offset the impact of GST on lower-income households. Goods
and services tax should not be confused with the generation-skipping trust, also abbreviated GST (and its
related taxation, GSTT).’
Understanding the Goods and Services Tax (GST) The goods and services tax (GST) is an indirect
federal sales tax that is applied to the cost of certain goods and services. The business adds the GST to the
price of the product, and a customer who buys the product pays the sales price inclusive of the GST. The
GST portion is collected by the business or seller and forwarded to the government. It is also referred to as
Value-Added Tax (VAT) in some countries. Most countries with a GST have a single unified GST system,
which means that a single tax rate is applied throughout the country. A country with a unified GST platform
merges central taxes (e.g., sales tax, excise duty tax, and service tax) with state-level taxes (e.g.,
entertainment tax, entry tax, transfer tax, sin tax, and luxury tax) and collects them as one single tax. These
countries tax virtually everything at a single rate.
23.What are the types a dealer can opt for at registration?
ANS:Difference between Normal Dealer and Composition Dealer are as under
Particulars Normal
Particular Regular dealer Composite dealer
Registration The threshold limit of Rs. 20
Registered person, if his
lakh for all states or10 lakh for
turnover is below to Rs. 1.00
NE and hill states has increased
crore GST council has
to Rs. 40 lakh or Rs. 20 lakh
increased the threshold limit of
in32nd GST Council meeting
annual turnover for
atNew Delhi 10 th January
Composition scheme raised to
2019. registration required.
Rs 1.5 crore from Rs. 1 Crore
w.e.f. 1st April 2019, can opt
for Composition Scheme but in
Applicability case of North-Eastern states
and Himachal Pradesh, the
limit is Rs 75 lakh.
It is applicable for large

It is applicable for small
assesses having turnover
assesses having turnover up to
&Rs. 1.50 crore.
Rs. 1.50 crore.
Sales/Transfer They can sales/transfer

They can sales/transfer
goods/services in one state
goods/services only within the
to another state or within
same state cannot make
the same state.
interstate sale
Rate of Tax The rate of tax is higher. The rate of tax is lower.
Input Credit They can avail Input tax

availed They cannot take Input tax
credit paid on purchase of
credit.
goods.
Period of They have to file 3

Returns They have to file 1 quarterly
monthly returns and 1
return and 1 annual
annual return. return. Businesses whose under GST
Composition Scheme
from April 1st 2019, has to file
just one annual return, but pay
taxes once every quarter.
Form of Monthly 3 returns, “Form

Returns Quarterly return in “Form
GSTR-1”, “GSTR
GSTR-4” & Annual Return
2” and “GSTR-3”
in
& Annual Return in “Form
“Form GSTR-9A”.
GSTR-9”.
E-commerce There is no restriction on

Not allowed such sale of goods
sale of goods through E
through E-commerce.
commerce.
Casual Taxable
Person
Casual Taxable person
Casual Taxable person cannot
should be compulsory
opt composition taxable
Invoice registered.
scheme.
They have to issue a Tax

They have to issue bill of
Invoice.
supply instead of tax invoice.
Restriction on some There is no such

manufacturing Manufacturer of ice cream, pan
units restriction.
masala, or tobacco cannot opt
composition scheme.
Restriction on There is no such
operation of Under this scheme, if an
other units restriction.
establishment have in more
than one state, all such units
are required to opt composition
scheme or normal tax payer
scheme.
Maintenance of Mandatory to maintain Not mandatory to maintain
Tax Records detailed records. detailed records.
24. What is the threshold limit for composite dealers & Registered
dealers?
ANS: GST Composition Scheme:
Composition Scheme is a simple and easy scheme under GST for taxpayers. Small taxpayers can get rid
of tedious GST formalities and pay GST at a fixed rate of turnover. This scheme can be opted by any
taxpayer whose turnover is less than Rs. 1.5 crore*. *CBIC has notified the increase to the threshold limit
from Rs 1.0 Crore to Rs. 1.5 Crores.
1.Who can opt for Composition Scheme:
A taxpayer whose turnover is below Rs 1.5 crore* can opt for a Composition Scheme. In case of North-
Eastern states and Himachal Pradesh, the limit is now Rs 75* lakh. As per the CGST (Amendment) Act,
2018, a composition dealer can also supply services to an extent of ten percent of turnover, or Rs.5 lakhs,
whichever is higher. This amendment will be applicable from the 1st of Feb, 2019. Further, GST Council
in its 32nd meeting proposed an increase to this limit for service providers on 10th Jan2019 Turnover of all
businesses registered with the same PAN should be taken into consideration to calculate
turnover. *CBIC has notified the increase to the threshold limit from Rs 1.0 Crore to Rs. 1.5
Crores. 2.Who cannot opt for Composition Scheme:
The following people cannot opt for the scheme-
● Manufacturer of ice cream, pan masala, or tobacco
● A person making inter-state supplies
● A casual taxable person or a non-resident taxable person
● Businesses which supply goods through an e-commerce operator
3.What are the conditions for availing Composition Scheme?
The following conditions must be satisfied in order to opt for composition
scheme:
● No Input Tax Credit can be claimed by a dealer opting for composition
scheme ● The dealer cannot supply goods not taxable under GST such as
alcohol.
● The taxpayer has to pay tax at normal rates for transactions under the Reverse Charge Mechanism ● If a
taxable person has different segments of businesses (such as textile, electronic accessories, groceries, etc.)
under the same PAN, they must register all such businesses under the scheme collectively or opt out of the
scheme.
● The taxpayer has to mention the words ‘composition taxable person’ on every notice or signboard
displayed prominently at their place of business.
● The taxpayer has to mention the words ‘composition taxable person’ on every bill of supply issued by
him.
● As per the CGST (Amendment) Act, 2018, a manufacturer or trader can now also supply services to an
extent of ten percent of turnover, or Rs.5 lakhs, whichever is higher. This amendment will be applicable
from the 1st of Feb, 2019. Not mandatory to maintain detailed records.
4. How can a taxpayer file the GSTR?
To opt for the composition scheme a taxpayer has to file GST CMP-02 with the government. This can be
done online by logging into the GST Portal. This intimation should be given at the beginning of every
Financial Year by a dealer wanting to opt for a Composition Scheme. Here is a step by step Guide to File
CMP-02 on GST Portal.
25.List out five examples of B2C transactions?

ANS : Business to Consumer (B2C) Meaning:
B2C Definition: A business-to-consumer, or B2C, business model is one in which a company sells a service
or product directly to a consumer. Familiar examples of B2C companies include Amazon, Walmart, and
other companies where individual customers are the end-users of a product or service.B2C is the alternative
of the business-to-business model (B2B) in which a company sells their products first
to another business, which will then sell the product to another business or customer with a mark-up.
Companies can either be B2C, B2B, or a hybrid of both.B2C as a business model typically involves a higher
volume of clients, but a proportionally lower revenue.B2B businesses deal with a smaller number of clients
that make larger transactions. Examples of the hybrid model are SaaS companies (Software as a Service),
which often have many different tiers of service, tailored to companies or individuals, depending on the
service.
Examples of B2C companies include:
● Amazon
● Google
● Facebook
● Dmart
● Walmart
26.Draw a specimen of Invoice, Tax Invoice and Bill of Supply?

ANS:There is “NO FORMAT PRESCRIBED”by the Government. Only a “FEW PARTICULARS”have
been mandated in the format which is listed herein below – Serial number of tax invoice (serial number
should not exceed 16 character and it should be consecutive serial number containing alphabets or numbers
or special characters or any combination thereof, unique for a financial year); Name, address and GSTIN of
the supplier; Date of issue of tax invoice; Name, address and GSTIN or UIN, if registered, of the recipient;
Name and address of the recipient and the delivery address of the consignment, along with name of the State
and State code, in case the recipient is unregistered person and the value of goods exceeds INR 50,000;
Description of goods or services; HSN code of goods or Accounting code of services; Quantity of goods
and units or unique quantity code needs to be mentioned correctly; Total value of supply of goods or
services; Taxable value of supply of goods or services taking into account discount or abatement; Rate of
tax i.e. central tax, state tax, integrated tax or union territory tax or cess; Amount of tax charged in respect
of taxable goods or services (central tax, state tax, integrated tax or union territory tax or cess); In case of
supply in the course of inter-state trade or commerce, place of supply along with name of the State and State
Code has to be mentioned; In case delivery place is
different from place of supply, address of the delivery needs to be mentioned; Whether tax is payable on
reverse charge basis, has to be mentioned; Signature or Digital Signature of the supplier or the authorized
representative. 2. There are mainly 3 types of Invoices under GST as: TAX INVOICE– For taxable supplies
either within state or outside state and the person is required to collect and pay the tax on such supplies.
BILL OF SUPPLY– The supplies on which the person is not required to collect and pay the tax. These
mainly comprise of ‘registered person supplying exempted goods or service or both’, ‘Composition Dealers’
and ‘Exporters’. Bill of Supply Format is given below. PAYMENT VOUCHER– This voucher is required
to be issued when the tax is payable by the receiver of goods or services or both. It covers ‘Importers’ and
‘Reverse Charge Mechanism’ of paying taxes.
27.What is a Supplementary invoice?

ANS: A supplementary invoice is issued when the particulars given in the original invoice are changed. In
exercise a supplementary tax invoice is generally issued when the rate or quantity have upward revision.
When to issue a supplementary invoice or debit note in GST: In GST Clause 3 of section 31 provide for the
debit note. Before we explain how a debit note is defined in GST. Let us make it clear that explanation to
clause 3 of section 31 provides that the debit note includes the supplementary invoice. Thus we can say that
for the purpose of GST Supplementary tax invoice = Debit note. Now we will discuss what is defined as a
debit note in GST. Clause 3 of section 31 provide that debit note will be issued:
● Where a tax invoice has been issued for supply of any goods and/or services
● The taxable value and/or
● tax charged in that tax invoice is found to be less than the taxable value.
28.What is the eligibility for availing Input Tax Credit?

ANS:According to Section 16 (4) of the CGST Act, 2017, a registered person is eligible to take input tax
credit with respect to the invoice or debit note for inward supply of goods and/ or services, earlier of the
due date for filing of Form GSTR 3B for the month of September for subsequent year or filing of annual
return for the period to which such invoice or debit note pertains to.
29.With the help of a diagram showing Input Credit Mechanism?
30. List out masters to be created to effect GST in tally?
ANS: All necessary ledger accounts
✔ CGST
✔ SGST
✔ LGST
✔ Purchase ledger
✔ Sales Ledger
✔ Debtors
✔ Creditors
35. What is Reverse Charge Mechanism?
ANS: Generally, the supplier of goods or services is liable to pay GST. However, in specified
cases like imports and other notified supplies, the liability may be cast on the recipient under the
reverse charge mechanism. Reverse Charge means the liability to pay tax is on the recipient of
supply of goods or services instead of the supplier of such goods or services in respect of notified
categories of supply. There are two types of reverse charge scenarios provided in law. .First is
dependent on the nature of supply and/or nature of supplier. This scenario is covered by section
9 (3) of the CGST/SGST(UTGST) Act and section 5 (3) of the IGST Act.
.Second scenario is covered by section 9 (4) of the CGST/SGST (UTGST) Act and section 5 (4)
of the IGST Act where taxable supplies by any unregistered person to a registered person is
covered.
As per the provisions of section 9(3) of CGST / SGST (UTGST) Act, 2017 / section 5(3)of IGST
Act, 2017, the Government may, on the recommendations of the Council, by notification, specify
categories of supply of goods or services or both,the tax on which shall be paid on reverse 86
GST FLYERS charge basis by the recipient of such goods or services or both and all the provisions
of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to
the supply of such goods or services or both.
36. What are the activities specified as a Negative List According to

Schedule –III ?
ANS: NEGATIVE LIST – DEFINITION :
Negative List is defined under Section 65B(34) of the Finance Act, 1994. The services covered
under the list are enumerated under Section 66D of the Finance Act, 1994. Services which fall
under the list of services covered under the negative list are not subjected to service tax. Only
the parliament can make changes in the negative list through the Union Budget. Pranab
Mukherjee, while introducing the negative list in his Budget speech of 2012-13 said that the
introduction was a step in the direction of the eventual transition to Goods and Services Tax
(GST).
NEGATIVE LIST UNDER SECTION 66D :
There are in total 17 services falling under this category which remain non-taxable and they are
as under:
1) Services provided by Government or Local authority
2) Services provided by Reserve Bank of IndiaREPORT THIS AD
3) Services by a Foreign Diplomatic Mission Located in India
4) Services relating to agriculture
5) Trading of Goods
Transfer of title of goods is one of the essential conditions for a transaction to come under the
ambit of trading of goods. However, the services supporting or ancillary to the trading of goods
would not come under the above item of Negative List.
6) Processes amounting to Manufacture or Production of Goods.
7) Selling of Space or Time Slots for Advertisements other than Advertisements Broadcast by
Radio or Television.
8) Access to a Road or a Bridge on Payment of Toll Charges
9) Betting, Gambling or Lottery
10) Entry to Entertainment Events and access to Amusement Facilities
11) Transmission or Distribution of Electricity
12) Specified services relating to Education
13) Services by way of Renting of residential dwelling for use as residence : ‘Renting’ has been
defined in section 65B as “allowing, permitting or granting access, entry, occupation, usage or any
such facility, wholly or partly, in an immovable property, with or without the transfer of possession
or control of the said immovable property and includes letting, leasing, licensing or other similar
arrangements in respect of immovable property‘.
14) Financial Sector
15) Service relating to Transportation of Passengers
16) Service relating to Transportation of Goods:
The following services provided in relation to transportation of goods are specified in the
negative list: a) By road except the services of (i) a goods transportation agency; or (ii) a courier
agency.
b) By aircraft or vessel from a place outside India up to the customs station of
clearance in India;
c) By inland waterways. (Services provided as agents for inland waterways are not
covered in the negative list.).
17) Funeral, Burial, Crematorium or M47ortuary services including transportation of the
deceased .This entry exempts services in relation to cremation, etc. of dead.
PRACTICAL PROBLEMS
37.Mr. Ankur purchased goods for Rs. 8,00,000 and paid tax @ 5% from a
dealer in the same locality. He sold Rs. 4,00,000 worth goods to Raj and
collected tax from him. Record the following transaction with the help of
accounting Software ?
SOLUTION:
Step 1: Creation of company:
From Gateway of tally - the alt+f3- then select create company and then create a company. Fill
the below particulars :
Name: Ankur Financial Year : 1-4-2023
Address : Hyderabad Books Beginning from : 1-4-2023. Country : India
State: Telangana After creation of company press ctrl +A to accept the company. And then a
new company is formed .
Step 2: Configuration of GST in Tally From Gateway of tally -F11 features- from there F3
(statutory and Taxation) select that and the pages open to enable GST.
Enable Goods and Services Tax (GST) ? YES

Set / alter GST details ? Yes
After the GST details are set as yes a new page opens to enter the following details:
State:
● TelanganaRegistration type : Regular
● Assessee of Other Territory : No
● GSTIN / UIN : 36AJCPS0057J1Z5
● Applicable form : 1-4-2023.
● Periodicity of GSTR-1 : Monthly
● Press Ctrl A to Save.
NOTE: Only after the GST details are enabled you are able to give the tax rates.
Step 3 : After enabling GST our next step is to create stock item:
From Gateway of Tally- inventory info - then select stock items and
create: ● Name : Goods
● Under: Not applicable
● Units: Not applicable
● GST: Applicable
● set/alter GST details : yes , after u enable it as yes a new page is open to enable
the tax rates 1). Nature of transaction: Taxable
2.) Integrated Tax : 5%
3.) Central Tax: 2.5%
4.) State Tax : 2.5%
5.) Cess : 0%
After enabling the tax rates ‘Accept it as YES and press ESC button to go back to the main
screen.
Step4: Creation of ledger accounts :
From Gateway of Tally -Accounting info- ledgers- Single Ledger- Create
1st LEDGER:
Name : Purchase
Under : Purchase Account
Is GST Applicable ? Applicable
Set / alter GST details ? No
After entering all the details accept it as YES. Then the particular ledges get saved.
2nd LEDGER:
Name : Sales
Under : Sales Account
Set / alter GST details ? No After creation of this ledger accept it as YES.
3RD LEDGER:
Name : Sundry Creditor
Under : Sundry Creditor
State: Telangana
Registration type : Regular
GSTIN/UIN : 36AADCR6508A1ZQ After entering the details accept it as YES.
4TH LEDGER:
Name : Raj
Under : Sundry Debtor
State: Telangana
GSTIN/UIN :36AABFJ9848C2Z8 After entering the details accept it as YES.
5TH LEDGER:
Name : CGST
Under : Duties & Taxes
Type of Duty /Tax : GST
Tax Type : Central Tax After entering the details accept it as YES.
6TH LEDGER:
Name : SGST
Tax Type : State Tax After entering the details accept it as YES.
After creation of ledgers go back to the main screen .

Note: The TAX rates should not be enabled at ledger levels.
Step 4 :Voucher Entry

From Gateway of Tally - Accounting Voucher- then click F9 ( purchase
voucher). Press Alt + I to convert into Accounting Invoice. And give the below
particulars 1ST VOUCHER:
Under purchase voucher(F9)
Supplier Invoice No:25 Date:1-4-2022
Party Name: Ankur
Particulars Amount
Purchase 800000
CGST 20000
SGST 20000
Total 840000
After entering the details, accept it as YES.
2ND VOUCHER:
Click on F8 Sales on right side button bar or press F8
Press Alt + I to convert into Accounting Invoice. And give the below particulars
Reference No:1
Party Name: Raj
Particulars Amount
Sales 400000
CGST 10000
SGST 10000
Total 420000
After entering the details, accept it as YES. And press ESC button to view the GST reports {THE
OUTPUT}
Step 5 :Reports From Gateway of Tally- Display -Statutory Reports- GST - GSTR 3B
38. Mahesh Enterprises of Hyderabad purchased goods from Ashish Enterprises

of Chennai, He paid GST @ 28%. Record the transaction in accounting software?
SOLUTION: I
Step 1: Create company in the name of Mahesh Enterprises
From Gateway of Tally- ;Press Alt+F3- Create Company- ; fill the below
particulars Name: Mahesh Enterprises Financial Year: 1-4-2023
Address : Hyderabad Books Beginning from : 1-4-2023.
Country : India
State: Telangana
Press Ctrl + A to Save the company
Step 2: Configuration of GST in Tally (Enabling GST)

Gateway of Tally- Press F11 then press F3 Statutory & Taxation give the following particulars
Set / alter GST details ? Yes After you enable GST details a page opens to enter the other
details.
● State:Telangana
● Registration type : Regular
After entering all the details, accept it as YES only then we can enable the GST rates.
Step 3 : After enabling GST our next step is to create stock item:
From Gateway of Tally- inventory info - then select stock items and
create: ● Name : Goods
● Under: Not applicable
● Units: Not applicable
● GST: Applicable
● set/alter GST details : yes , after u enable it as yes a new page is open to enable
the tax rates 1). Nature of transaction: Taxable
2.) Integrated Tax : 28%
3.) Central Tax: 14%
4.) State Tax : 14%
5.) Cess : 0%
Step 4: : Creation of Ledger Accounts.

From Gateway of Tally- Accounting info -ledger- Single Ledger- Create
1ST LEDGER:
Name : Purchase
Set / alter GST details ? Yes After enabling it as yes a page opens to enter GST
rates: ● Description : Goods
● HSN / SAC : 1234
● Nature of Transaction : Interstate Purchase Taxable
● Type of Supply : Goods
After entering the details accept it as YES
2ND LEDGER:
Name : Ashish Enterprises
State: Tamil Nadu
GSTIN/UIN :33AAACC6106G5Z4 After entering the details accept it as YES.
3RD LEDGER:
Name : IGST
Tax Type :Integrated Tax After the creation of ledger accept it as YES and press ESC button to
go back to main screen to create vouchers.
Step 5: Voucher Entry

From Gateway of Tally - Accounting Voucher -
Click on F9 Purchase on right side button bar or press F9
Party Name: Ashish Enterprises
Particulars Amount
Purchase 100000
IGST 28000
Total 128000
This is the last step and after entering accept it as YES. Now to Display the GST reports.
Step 6: Reports Gateway of Tally - Display- Statutory Reports- GST- GSTR 3B

Here is the output:
39.Create 3 stock items named milk, bread and Ice creams. Opening balances of
these 3 stock items would be milk – 10 liters, Bread– 20 Pkts and Ice creams – 25
numbers.Create 1 sundry debtor and 1 sundry creditors within state. Record a
purchase entry of 5 liters of milk at 5% GST rate for 80 per liter, 10 Pkt of Bread for
Rs.25 per pkt 5% GST rate and 30 numbers of Ice creams for 30 per Ice cream at
18% GST rate. A sale entry 10 liters of milk Rs.90 per liter, 15Pkts of Bread for Rs.40
per pkt and 35 numbers of Ice creams for 50 per Ice cream?
SOLUTION:
Step 1. Create company in the name of Mahesh Enterprises
From Gateway of Tally- Press Alt+F3- Create Company - fill the below
particulars Name: Kiran Dairy Products Financial Year: 1-4-2022
Address : Hyderabad Books Beginning from : 1-4-2022. Country : India
State: Telangana
After the Creation of the company Accept it as YES.
Step 2. Configuration of GST in Tally ( enabling GST )

From Gateway of Tally- ; Press F11-Company Features- F3 Statutory & Taxation give the
following particulars
● State: :Telangana
● Periodicity of GSTR-1 : Monthly After this Accept it as YES. Press the ESC button and go
back to the main screen to create a stock group, units of measure, and stock item.
Step 3. Creation of Units of Measures (UOM)

From Gateway of Tally -Inventory info - Units of Measure- ; Create
1.Type : Simple
Symbol :Nos
Formal name : Numbers
Unit Quantity Code (UQC) : No-Numbers
Number of decimal places : 0
2.Type : Simple
Symbol :Pkt
Formal name : Packet
Unit Quantity Code (UQC) : PAC- Packs
3.Type : Simple
Symbol :Ltr
Formal name :Litres
Unit Quantity Code (UQC) : Ltr-Litres
Number of decimal places : 2 After the creation of each unit of measure accept it as YES.
Step 4. Creation of Stock item:
Gateway of Tally - Inventory info- Stock Items - Create
1. Name: Milk
Under : Primary
Units :Ltr
GST Applicable : Applicable
Set/alter GST Details ? Yes
● Description : Milk
● HSN Code: 2524
● Calculation type : On Value
● Taxability : Taxable
● Integrated Tax : 5%
● Central Tax : 2.5%
● State Tax : 2.5%
● Cess : 0%
● Type of Supply : Goods After this creation accept it as YES
● Opening Balance Qty : 10 Ltr Rate 80 Per Ltr Value : 800
2. Name: Bread
Under : Primary
Units :Pkt
● Description : Bread
● HSN Code: 5252
● Opening Balance Qty : 20 Nos Rate 25 Per Nos Value : 500
3. Name: Ice Cream

Under : Primary
Units :Nos
● Description : Ice Cream
● HSN Code: 5252
● Central Tax : 9%
● State Tax : 9%
● Cess : 0%
● Opening Balance Qty : 25Nos Rate 30 Per Nos Value : 750
After the creation of all the stock items press ESC button to go back to the main screen to create
ledger Accounts.
Step 5: Creation of Ledger Accounts.
From Gateway of Tally - Accounting info- ledgers- Single Ledger - Create
1ST LEDGER:
Name : Purchase
Set / alter GST details ? NO
Type of Supply : Goods After entering the details save the ledger.
2nd LEDGER:
Name : Sales
Type of Supply : Goods After entering the details save the ledger.
3rd LEDGER:
Name : Sunday creditor
State: Telangana
GSTIN/UIN : 36AADCR6508A1ZQ After entering the details save the ledger.
4th LEDGER:
Name : Customer( sundry Debtor)
State: Telangana
GSTIN/UIN :36AABFJ9848C2Z8 After entering the details save the ledger.
5TH LEDGER:
Name : CGST
Tax Type : Central Tax After entering accept it as yes
6th LEDGER:
Name : SGST
Tax Type : State Tax After entering accept it as YES and then press ESC button to go back to
the main screen
Step 6 : Creation of voucher: 1st voucher:

From Gateway of Tally - Accounting Voucher -Press F9 for Purchase and
Press Alt + I to convert into Item invoice give the below particulars
Supplier Invoice No .50 Date: 1-4-2023
Purchase ledger: GST- Purchase
Name of Item Quantity Rate per Amount
Milk 5 Ltr 80.00 Ltr 400.00
Bread 10 Pkt 25.00 Pkt 250.00
Ice Cream 30 Nos 30.00 Nos 900.00
Total (before GST) 1550.00 CGST 97.25 SGST 97.25 Total (After tax) 1744.50
After this details accept it as yes and move to the second voucher to create (sales).
2nd voucher:
Press F8 for Sale and Press Alt + I to convert into Item invoice give the below particulars
Reference No .1 Date: 1-4-2023
Sales ledger: GST-Sales
Milk 10 Ltr 90.00 Ltr 900.00
Bread 15 Pkt 40.00 Pkt 600.00
Ice Cream 35 Nos 50.00 Nos 1750.00
Total( Before tax) 3250.00 CGST 195.00 SGST 195.00
Total(after tax) 3640.00
After the creation of this voucher accept it as YES. And then Press Alt+ A for Tax Analysis and
press Alt F1 for detailed information. After this the voucher is saved.
Step 7: The last step is to view the reports of this respective problem:
From Gateway of Tally- Display -Statutory Report - GST- GSTR 3B
Here is the output:
40. What is the value in GST invoices when Rs. 10000 worth of goods are
purchased, GST tax rate @ 5%. In the second invoice two purchases of Rs
5000 worth goods GST rate @ 5% and another Rs 5000 GST @ 18%. Both the
transactions are intra state and show the GST Tax ledgers?
SOLUTION:
Step 1: Creation of company
From Gateway of Tally - Press Alt+F3- Create Company -fill the below
particulars Name:XYZcompany Financial Year : 1-4-2023
Address : Hyderabad Books Beginning from : 1-4-2023 Country : India
State: Telangana
After the creation of the company, accept it as YES.
Step 2: Configuration of GST in Tally( enabling GST)
From Gateway of Tally- Press F11-Company Features - F3 Statutory & Taxation give the
● Applicable form : 1-4-2023
After entering the details, accept it as YES.
Step 3: Creation of Stock items
1. Name: Goods at 5%
Under : Primary
Units :Not applicable
● Description : Goods at 5%
● HSN Code: -
● Type of Supply : Goods After creation accept it as YES.
2. Name: Goods at 18%

Under : Primary
● Description : Goods at 18%
● HSN Code: -
● State Tax : 9 %
● Type of Supply : Goods After creation accept it as YES.

From Gateway of Tally- Accounting info - Single Ledger- Create
1ST LEDGER:
Name : Purchase @ 5%
Set / alter GST details ?No Ctrl +A to save the ledger
2nd LEDGER:
Name : Purchase @ 18%
Set / alter GST details ? No Ctrl +A to save the particular voucher.
3rd LEDGER:
Name : Supplier (sundry cr)
State: Telangana
GSTIN/UIN : 36AADCR6508A1ZQ Ctrl + A to save the particular voucher.
4th LEDGER:
Name : CGST
Tax Type : Central Tax Ctrl + A to save this particular voucher.
5th LEDGER:
Name : SGST
Tax Type : State Tax Ctrl + A to save this particular voucher. After creating all the
ledgers press the ESC button to go back to the main screen.
Step 4 : Voucher Entry

FromGateway of Tally - Accounting Voucher -
1. Party Name: Supplier
Particulars Amount
Purchase @ 5% 10000
CGST 250
SGST 250
Total 10500 Ctrl+A to save this voucher.
2. Click on F9 Purchase on right side button bar or press F9

Party Name: Supplier
Particulars Amount
Purchase @ 5% 5000
Purchase @ 18% 5000
CGST 575
SGST 575
Total 11150
Press Ctrl + A for Tax Analysis and you will get a detailed picture about this particular problem.
Step 5 : To view the GST reports

From Gateway of Tally- Display- Statutory reports- GST- GSTR 3B
Here is the output:
41. Mr. A sold goods to Mr. B for Rs. 20,000. Mr. A is charging packing
charges of Rs. 800 and also paying freight of Rs. 2800 from Mr. A’s premises
to Mr. B’s premises. Mr. A also charged interest of Rs. 750 for delay in
payment. Determine the taxable value for levy of GST.Whether packing
charges or freight, Interstate required including in the invoice to determine
taxable value? Show Tax Invoice GST@ 12% (intra state supply)? Solution:
As per GST law any additional expenses are charged in the invoice along with the stock items
the additional expenses are included in calculation of taxable value.
Step 1: Creation of the company

From Gateway of Tally -Press Alt+F3- Create Company - fill the below
particulars Name: ABC Company Financial Year : 1-4-2023 Address :
Hyderabad Books Beginning from : 1-4-2023 Country : India
State: Telangana
Press Ctrl + A to Save the company or accept it as YES.
Step 2. Configuration of GST in Tally (enabling GST)

From Gateway of Tally - Press F11-Company Features- F3 Statutory & Taxation give the
NOTE:After entering the details as per required and accept it as YES, only then we can enter
the GST rates.
Step 3: Creation of stock item.

1. Name: Goods
Under : Primary
● Description : goods
● HSN Code: -
● State Tax : 6 %
● Type of Supply : Goods After creation accept it as YES. After that press the ESC button to
go back to the main screen for creation of the accounting ledger.
STEP 4:Creation of Ledger Accounts.

From Gateway of Tally- Accounting info- Ledger- Single Ledger- Create
1st LEDGER:
Name : sales
Set / alter GST details ?No Ctrl +A to save this ledger
2nd LEDGER:
Name : CGST
Tax Type : Central Tax Ctrl +A to save this ledger
3rd LEDGER:
Name : SGST
Tax Type : State Tax Ctrl +A to save this ledger
4th LEDGER:
Name : Customer
State: Telangana
GSTIN/UIN :36AABFJ9848C2Z8
5th LEDGER:
Name : Packing charges
Under : Indirect Expenses
Is GST Applicable ? Not Applicable
Include in assessable value calculation for : GST
Appropriate to : Both
Method of calculation : Based on Value
Ctrl + A to save
6th LEDGER:
Name : Freight Charges
Ctrl + A to save
7th LEDGER:
Name : Interest
Under : Indirect Income
Ctrl + A to save
NOTE: In this problem while creating the ledgers of packing, freight, and interest be
careful with the adjustments.

FromGateway of Tally- Accounting Voucher
1.Click on F8 Sales on right side button bar or press F8
Reference No:65 Date:1-4-2023
Party Name: Customer
Particulars Amount
Sales @ 12% 20000
Packing Charges 800
Freight Charges 2800
Interest on delay payment 750
CGST 1461.00
SGST 1461. 00
Total 27,272
Press Alt + A for tax analysis and press Alt + F1 for detail you will get the following screen
STEP 5: Here is the output: 1st one is voucher:
And the second output is the TAX ANALYSIS:
42.Mr. X sold 1000 units of goods to Mr. Y for Rs. 20,000 and total unit sold
during the year to Mr. Y after including these units is 2500 unit.As per terms
of the agreement if Mr. Y is purchasing more than 2000 unit of goods in a
year then Mr. X is allowing a 10% discount in all the supplies. Assuming IGST
rate is 18%. How will the discount be recorded?
SOLUTION:Here in the given problem it is understand that there are some terms and conditions
between Mr X and Mr Y. as per terms if Mr Y is purchasing more than 2000 No’s in the financial
year then he will be getting the 10% discount on all the purchases made in the whole financial
year.
The calculation of discount is below
Total discount = number of units purchase in financial year * Rate per No’s *10%
Number of units purchased = 2500
Rate per unit = 20000/1000 = 20
Total discount = 2500*20*10%
Total discount = 5000
GST is levied on Discounts also. In tally discount should be posted in Debit Note
Let we see how to post the transactions in tally
Step 1. Creation of company

From Gateway of Tally - Press Alt+F3 - Create Company- fill the below
particulars Name:pcv company Financial Year : 1-4-2023
State: Telangana
Press Ctrl + A to Save the company or Accept it as YES.
Step 2: Configuration of GST in Tally (Enabling GST)

From Gateway of Tally- Press F11-Company Features- F3 Statutory & Taxation give the
Press Ctrl A to Save.
Step 3: Creation of stock item:
1. Name: Goods
Under : Primary
● Description : goods
● HSN Code: -
● State Tax : 9 %
● Type of Supply : Goods After creation accept it as YES. After that press the ESC button to
go back to the main screen for creation of the accounting ledger.
STEP 4:Creation of Ledger Accounts

1ST LEDGER:
From Gateway of Tally- Accounting info - Single Ledger- Create
Name : Discount Allowed
Set / alter GST details ? Yes press F12 and make Yes to All columns
● Description : Discount (here also u need to enable the gst rates)
● HSN / SAC : 1234
● Nature of Transaction : Inter State Purchase Taxable
● State Tax : 9%
● Cess : 0%
2nd LEDGER:
Name : IGST
Type of duty/tax : GST
Tax type : Integrated Tax
Ctrl + A Save
3rdLEDGER:
Name : Mr B
Under : Sundry debtors
Country : India
State : Delhi Note( Here the state should be changed Because it is interstate supply )
GSTIN /UIN : 07AAJ PK8851A1ZR
Ctrl + A Save
4th LEDGER:
Name : sales
Under :sales
Set / alter GST details ?No Ctrl +A to save the ledger
After the creation of all the ledgers, press the ESC button and go back to the main screen to
create vouchers.
Step 5: Activation of Credit note NOTE( When the customer is a debtor we issue a credit
note and when the customer is a creditor we issue a debit note it is vice versa case) From
Gateway of Tally- F11- features- from there on the right hand side we will find Invoicing under
that enable the changes of debit and credit note:
● Use debit and credit notes : Yes
● Record credit notes in invoice mode : Yes
● Record debit notes in invoice mode : Yes
Step 6: Creation of Accounting voucher

Press F8 for Sale and Press Alt + I to convert into Item invoice give the below particulars
Reference No .1 Date: 1-4-2023
1.Sales ledger: -Sales
Goods 20000
Igst 3600
TOTAL 23600
2.From Gateway of Tally- Accounting Vouchers - press ctrl +F8 for Credit note and enter the
below particulars
Original Invoice No. 1 Date : 1-4-2023
Party Name : Mr Y
Particulars Amount
Discount 5000
IGST 900
Total 5900 Ctrl + A Save the particular voucher .
STEP 7 : Viewing the outputs (Reports)
From Gateway of tally- Display - Statutory reports - GST- GSTR-3B Here is the
Output 1st (Voucher) 1. First is ledger of Mr y and then credit note (2
outputs)
43. Create 5 stock items with GST @ zero tax rates, @ 5%, @12%, and @18%, 28%
record interstate purchase and sale transactions. Show the details of input tax credit?
SOLUTION:
Goods purchased from Adish Enterprises GST No.07AAJPK8851A1ZR Delhi
paint 100 Ltr
Stock Qty
item
TOTAL
Jute 100kg
Tea 50kg Rate GST rate

powder
125 0%
Books 100 Nos
180 5%
Biscuits 50 pkt
125 12% 20 18%
225 28%
Goods sales to Aditya Enterprises GST No.37AHLPK3851D1ZC Andhra pradesh

Stock item Qty Rate GST rate
jute 75kg 150 0%

Tea 45kgs 250 5%
powder
Books 90 nos 150 12%
Biscuits 45 pkt 25 18%
paint 85 Ltr 300 28%
TOTAL
Step 1: Creation of company:

FromGateway of Tally - Press Alt+F3- Create Company - fill the below
particulars Name: XYZ company Financial Year: 1-4-2023 Address : Hyderabad
Books Beginning from : 1-4-2023 Country : India
State: Telangana
Press Ctrl + A to Save the company or Accept it as YES.
Step 2: Configuration of GST in Tally( enabling GST)

From Gateway of Tally- Press F11-Company Features - F3 Statutory & Taxation give the
● Press Ctrl + A to Save.
Step 3: Creation of Units of Measures (UOM)

From Gateway of Tally - Inventory info- Units of Measures - Create
1.Type : Simple
Symbol :Nos
Unit Quantity Code (UQC) : No-Numbers
2.Type : Simple
Symbol :Pkt
Formal name : Packet
Unit Quantity Code (UQC) : PAC- Packs
3.Type : Simple
Symbol :Ltr
Formal name :Liters
Unit Quantity Code (UQC) : OTH _Others
4.Type : Simple
Symbol : Kg
Formal name : Kilograms
Unit Quantity Code (UQC) :KGS-Kilograms
Step 4: Creation of stock items: (NOTE: We will alter the GST details in the stock
items and even the Qty, Rate, Amt are entered here.)
From Gateway of Tally - Inventory info - Stock Items - Create
1.Name: Jute
Under : Primary
Units : Kg
Description : Jute
HSN Code: 2524
Calculation type : On Value
Taxability :Nil Rated (Because on jute it is 0% so we select as nil rates instead of
TAXABLE)
Type of Supply : Goods
QTY RATE AMT
100kg 125 12500
2.Name: Tea Powder

Under : Primary
Units :Kgs
● Description :Tea Powder
● HSN Code: 4152
● Cess : 0%
QTY RATE AMT
50kg 180 9000
3.Name: Books
Under : Primary
Units :Nos
● Description :Colour Books
● HSN Code: 4178
● State Tax : 6%
● Cess : 0%
QTY RATE AMT
100 Nos 125 12500
4.Name: Biscuits
Under : Primary
Units :Pkt
● Description :Biscuits
● HSN Code: 1010
● State Tax : 9%
● Cess : 0%
QTY RATE AMT
50 pkt 20 1000
5.Name: Paint
Under : Primary
Units :Ltr
● Description :Paint
● HSN Code: 4530
● State Tax : 14%
● Cess : 0%
QTY RATE AMT
100 Ltr 225 22500
Step 5: Creation of Ledgers accounts NOTE: (WHILE CREATING MAKE SURE YOU CREATE
ONE SUNDRY DR AND SUNDRY CR WITH DIFFERENT STATES BECAUSE IT IS
INTERSTATE SUPPLY)
From Gateway of Tally- Accounting info- Single Ledger- Create
1st LEDGER:
Name : Purchase
Ctrl +A to save
2nd LEDGER:
Name : Sales
Ctrl +A to save
3rd LEDGER:
Name : Adish Enterprises
State: Delhi
GSTIN/UIN : 07AAJ PK8851A1ZR
Ctrl + A to save
4th LEDGER:
Name : Aditya Enterprises
State: Andhra Pradesh
GSTIN/UIN :37AHLPK3851D1ZC
Ctrl + A to save
5th LEDGER:
Name : IGST
Tax Type :Integrated Tax
Ctrl + A to save
Step6 : Creation of voucher entry;

From Gateway of Tally- Accounting Voucher- press F9 for purchases and press alt+I to convert
into Item invoice mode. And give the below particulars
Supplier invoice no. 254 Date: 1-4-2023
1. Party Name: Adish Enterprises
Purchase ledger : GST – Purchase:
Stock Item Quantity Rate Amount
Jute 100 Kg 125 12,500
Tea Powder 50 Kg 180 9,000
Books 100 Nos 125 12,500
Biscuits 50 Pkt 20 1,000
Paint 100 Ltr 225 22,500
TOTAL 57500
IGST 8340
TOTAL 65930
Ctrl + A to save
FromGateway of Tally- Accounting Voucher- press F8 for sales and press Alt+I to convert into
Item invoice mode. And give the below particulars
Ref No . 254 Date: 1-4-2023
2.Party Name: Adithya Enterprises
Sales Ledger : GST Sales
Purchase ledger : GST – Purchase:
Stock Item Quantity Rate Amount
Jute 75 Kg 150 11250
Tea Powder 45 Kg 250 11250
Books 90 Nos 150 13500

Biscuits 45 Pkt 25 1,125
Paint 85 Ltr 300 25500
TOTAL 62625
IGST 9525
TOTAL 72750
Step 7: Report
From Gateway of Tally- Display - Statutory Report - GST- GSTR 3B
Here is the output:
44. What are the conditions for E –Way Bill .What are the options available in Tally
An e-Way bill is an electronic way bill that is made effective from 1st April 2018 for person who
is in charge of the
conveyance carrying any consignment of goods exceeding Rs.50,000. This rule is mandated by
Government in terms
of section 68 of the Goods and Services Tax Act read with rule 138 of the rules framed there
under.
An e-Way bill generation has become mandatory for an inter-state transport of goods within
India where the value
consignment is above Rs.50,000. The e-Way bill should be generated not only for the
movement of goods but also
other reasons like purchase from an unregistered person, inter-branch transfer, sales return and
transfer because of
job work.
Tally.ERP 9 supports the latest e-Way bill JSON Preparation Tool, as per version 1.0.0219. In
Tally.ERP 9 you can
enter the e-Way Bill details only when transactions are related with Goods . The provision to
enter e-Way Bill details
is not available in accounting invoice mode and in companies enabled to Maintain only
accounts. In Tally.ERP 9 you
can set up a company, record transactions with e-Way Bill details and create JSON file in tally
for uploading it on
portal.
Following are steps to generate and export e-Way bill details from Tally in a JSON file format
: STEP 1: Step up for e-Way Bill
Open the company and press F11 > F3. Enable Goods and Service Tax(GST) - Yes &
Set / Alter GST
Details - Yes.
In Company GST Details , e-Way Bill applicable option,one needs to provide the applicable date
&and
the value to be considered for the threshold limit.
The value selected for the threshold limit is based on your business requirement. You can also
enable the option for e-Way Bill applicable for intrastate option and enter the threshold
limit for the e-Way bill as applicable for your state. The threshold limit will be applied for the
transactions recorded form release 6.4.6
STEP 2: Select the registration type

Regular or Composition: The GSTIN/UIN is considered as the transporter
ID. Unknown or Unregistered: Enter the 15-digit Transporter ID.
If the transporter ID is incorrect, the message appears as shown:
45. Mr. Ajay (Hyderabad) provides consultancy services to Mr. Vijay (unregistered,
address on record shows Tamil Nadu) and charges Rs.10000, levied GST @18%.
Even provided consultancy services to Mr. Anand (unregistered and address is
not available) Rs.15000, GST @ 12%. Show the transactions in Tally.
SOLUTION:
According to GST Law if there is any sale of services to an unregistered place In such a case we
have to see the address of the service receiver. If the address is provided or available in the
records then the place of supply of services will be the place of residence of the unregistered
place.. If the address is not available in records the place of supply will be location of supply
of service.In the given problem services rendered to Mr. Vijay will be the interstate sale transaction
because the place of supply and receiver of service are different states and to Mr. Anand will be
intrastate sale because place of supply and receiver of supplier are same because the address is
not in the record
Step 1: CreatIon of company

From Gateway of Tally - Press Alt+F3- Create Company - fill the below particulars
Name: Ajay Enterprises Financial Year : 1-4-2023 Address : Hyderabad Books
Beginning from : 1-4-2023 Country : India
State: Telangana
Step 2 : Configuration of GST in Tally

From Gateway of Tally- Press F11-Company Features- F3 Statutory & Taxation give the
Press Ctrl + A to Save

From Gateway of Tally - Accounting info- Single Ledger - Create
1st LEDGER:
Name : Consultancy services @18%
Under : Sales
Set / alter GST details ? Yes and press F12 and make Yes to All columns Note : ( enabling of
GST rates are been done at ledger levels)
● Description : Consultancy service
● HSN / SAC : 1234
● Nature of Transaction :Not applicable
● State Tax : 9%
● Cess : 0%
● Type of Supply : Services
● Ctrl +A to save
2nd LEDGER:
Name : Consultancy services @12%
Under : Sales
Is GST Applicable ? Applicableancy service
Set / alter GST details ? Yes and press F12 and make Yes to All
columns ● Description : consult
● HSN / SAC : 1234
● Nature of Transaction :Not applicable
● State Tax : 6%
● Cess : 0%
● Type of Supply : Services
● Ctrl +A to save this ledger.
3rd LEDGER:
Name : Mr. Vijay
State: Tamil Nadu
Registration type :registered
Ctrl + A to save
4th LEDGER:
Name : Mr. Anand
Registration type :registered
State: telangana
Ctrl + A to save
5th LEDGER:
Name : CGST
Tax Type : Central Tax
Ctrl + A to save
6th LEDGER:
Name : SGST
Tax Type : State Tax
Ctrl + A to save
7th LEDGER:
Name : IGST
Tax Type : Integrated Tax
Ctrl + A to save
Step 4 : Creation of Voucher Entry

From Gate of Tally - Accounting Voucher
reference No:01 Date:1-4-2022
1. Party Name: Mr. Vijay
Particulars Amount
Consultancy services@18% 10000
IGST 1800
Total 11800
Ctrl+A to save this particular voucher. Note: ( both the vouchers are of sales 1st one is with
IGST.)(select interstate supply under description)
In the same sales voucher post another entry of Mr. Anand
2.Party Name: Mr. Anand
Particulars Amount
Consultancy services@12% 15000
CGST 900
SGST 900
Total 16800
(select sales taxable under description)
Ctrl +A to save this voucher.
Step 5: To view the GSTR reports:

From Gateway of tally- display- statutory reports- GST- GSTR 3B
Here is the output:
46. Mrs Rani, resident of Hyderabad has a Bank account and withdraw money
from an ATM in Hyderabad. She went on tour and withdrawn Rs50000 from ATM in
Kerala. Identify place of service, type of taxes levied in both the cases. ANS: In the
situation 1: Mrs Rani has withdraws money from ATM in Hyderabad the place of
service is Hyderabad as the place of service is in Hyderabad and The location of
service is also Hyderabad in the same state so the charge of tax will be CGST and
SGST.
In situation 2: Mrs Rani has withdrawn Rs. 50000 from an ATM in Kerala. The
place of service is Kerala.
ANS: In the situation 1: Mrs Rani withdraws the money from the same place
(hyderabad) so the place of supply and services so CGST and SGST is been charged
Whereas in situation 2: Mrs Rani withdraws the money of 50000 from an ATM in Kerala
in this is the place of supply and service given are of same place (kerala) but having a
bank account in Hyderabad on this service IGST is charged because of interstate supply
Below is the example to understand it in better way :
47. M/s Pooja sold 250 laptops to M/s.Raj for Rs. 50,000 each.Tax Invoice was
raised. They were given a discount of Rs.5000. M/s Raj returned 250 laptops
Assuming GST rate is 18%. Show discount and GST ledger.
SOLUTION: In the given problem it is assumed that discount will not have any effect of GST
discount
Step 1: Create company in the name of M/s Pooja

Gateway of Tally -Press Alt+F3- Create Company - fill the below particulars
Name: M/s Pooja Financial Year : 1-4-2023
Address : Hyderabad Books Beginning from : 1-4-2023
Country : India
State: Telangana
Step 2. Configuration of GST in Tally

Gateway of Tally - Press F11-Company Features -Statutory &-Taxation give the following
particulars
● Press Ctrl + A to Save
After creating units of measure the next step is to create stock items
Step 3: Creation of Stock Items

Gateway of tally - Inventory Info- Units of Measure-Create
Symbol: Nos
FormalName : Numbers
Unit quantity code (UQC) :Nos-Numbers
.
Step 4: Gateway of tally -Inventory Info -stock items-; Create

Name: Laptop
Under : Primary
Units :Nos
● Set/alter GST Details ? Yes
● Description :Laptop
● HSN Code: 7510
● State Tax : 9%
● Cess : 0%
● Type of Supply : Goods After creation of stock items the next step is to create ledgers.

From Gateway of Tally -Accounting info -Single Ledger- Create
1st LEDGER:
Name : Sales
Ctrl +A to save
2nd LEDGER:
Name : M/s Raj
State: Telangana
GSTIN/UIN :36AABFJ9848C2Z8
Ctrl + A to save
3rd LEDGER:
Name: Discount
Type of ledger : Discount
Ctrl + A to save
4thLEDGER:
Name : CGST
Ctrl + A to save
5th LEDGER:
Name: SGST
Under: Duties &; Taxes
Type of Duty /Tax: GST
Tax Type: State Tax
Ctrl + A to save

From Gateway of Tally- Accounting Voucher -
Press Alt + I to convert into Item Invoice. And give the below particulars
Party Name: Raj
1.Sales ledger: -Sales
laptops 250 50000 12500000
Discount 5000
cgst 1125000
Sgst 1125000
TOTAL: 1,47,55000
Step 6 : Activation of Debit and Credit note

From Gateway of Tally - F11 & inventory features
Use Debit and Credit Note: yes
Record credit note in invoice mode: yes
Record debit notes in invoice mode: yes
Enable Credit Note by F8
Particulars : Sales Returns ( credit note) ( Because Mr Raj is sundry dr and we will issue a
credit note)
1.Sales ledger: -Sales Returns
laptops 250 50000 12500000
Discount 5000
cgst 1125000
Sgst 1125000
TOTAL: 1,47,55000
STEP 8: Check the output

48. Assume five intra state purchase and sale transactions and show Input tax
credit in Tally.
SOLUTION:
PURCHASE: ( This are just the examples u can make ur own party name , Qty ,
rate)
SALES:
Step 1: Create a company in the name of ABCComputers Solutions Pvt. Ltd. From
Gateway of Tally -Press Alt+F3-;Create Company- fill the below particulars Name: ABC
Computers Solutions Pvt. Ltd. Financial Year : 1-4-2023 Address : Hyderabad Books
Beginning from : 1-4-2023 Country : India
State: Telangana
Step 2: Configuration of GST in Tally

Gateway of Tally -Press F11-Company Features -Statutory & Taxation give the following
particulars
Step 3: Creation of units of measure:
From Gateway of tally -Inventory Info- Units of Measure -Create
Symbol: Nos
Unit quantity code (UQC) :Nos-Numbers
After creation of units of measure then the next step is to create the stock item.
Step 4:Creation of Stock items:

From Gateway of tally -Inventory Info- stock items- Create
Name: Computer
Under : Primary
Units :Nos
● Description: Computer
● HSN Code: 8471
● Calculation type: On Value
● Taxability: Taxable
● State Tax : 9%
● Cess : 0%

From Gateway of Tally- Accounting info- Single Ledger-Create
1st LEDGER:
Name : Sales
Ctrl +A to save
2nd LEDGER:
Name : Purchase
Under : purchase Account Is
GST Applicable ? Applicable
Ctrl +A to save
3rd LEDGER:
Name : Primordia
State: Telangana
GSTIN/UIN :36AAACC6106G2Z6
Ctrl + A to save
4th LEDGER:
Name : Vijay Textiles
State: Telangana
GSTIN/UIN :36AAACC6106G4ZY
Ctrl + A to save
5th LEDGER:
Name : Deltra Global
State:Telangana
GSTIN/UIN :36AAACC6106G1ZX
Ctrl + A to save
6th LEDGER:
Name : LalluPvt. Ltd
State: Telangana
Ctrl + A to save
7th LEDGER:
Name : Bheema & Co
State: Telangana
Ctrl + A to save ( Till here all the purchase ledger are done and all the party’s are sundry cr)
8th LEDGER:
Name : Kiran Kumar
State: Telangana
Ctrl + A to save
Name : Kishore
State: Telangana
Ctrl + A to save
9th LEDGER:
Name : Reeha Enterprises
State: Telangana
GSTIN/UIN :36AAACC6106G1ZX
Ctrl + A to save
10th LEDGER:
Name : Anviksha Co
State: Telangana
Ctrl + A to save
11th LEDGER:
Name : Kumar & Co
State: Telangana
Ctrl + A to save
12th LEDGER:
Name : CGST
Tax Type :central tax
Ctrl + A to save
13th LEDGER:
Name : SGST
Under : Duties Taxes
Tax Type :state tax
Ctrl + A to save
14th LEDGER:
Name : Kishore
State: Telangana
Ctrl + A to save
Step 6 :Voucher Entry

From Gate of Tally -Accounting Voucher
Press Alt + I to convert into Item Invoice. And give the particulars as below
1.Supplier Invoice No. : 252 Date: 1-4-2023
Party name :Primordia
purchase:
Name of the item Quantity Rate Amount
Computer 5nos 30000 150000
CGST 13500 SGST 13500
Total 177000
Ctrl + A Save
2 Supplier Invoice No. : 022 Date: 1-4-2023

Party name : Vijay Textiles
Purchase Ledger : GST – Purchase
purchase:
CGST 8100
SGST 8100
Total 106200
Ctrl + A Save

Party name :Deltra Global
purchase:
CGST 21600
SGST 21600
Total 283200
Ctrl + A Save

Party name :Lallu Pvt Ltd
Computer 10 nos 30000 300000
CGST 27000
SGST 27000
Total 354000
Ctrl + A Save

Party name :Bheema & Co
Computer 15 nos 30000 450000
CGST 40500
SGST 40500
Total 531000
Ctrl + A Save
NOTE:( ALL THIS TRANSACTIONS ARE BEEN DONE UNDER SAME VOUCHER i.e.
PURCHASE VOUCHER)

Press Alt + I to convert into Item Invoice. And give the particulars as below
Ref No. : 01 Date: 1-4-2023
1.Party name :Kiran Kumar
sales Ledger : GST – Sales

CGST 13500
SGST 13500
Total 177000
Ctrl + A Save
2.Ref No. : 01 Date: 1-4-2023

Party Name :Kishore
Sales Ledger : GST – Sales
CGST 8100
SGST 8100
Total 106200
Ctrl + A Save
3.Ref No. : 03 Date: 1-4-2023

Party Name :Reeha Enterprises
CGST 21600
SGST 21600
Total 283200
Ctrl + A Save
4.Ref No. : 04 Date: 1-4-2023
Party Name :Anviksha & Co
Computer 10 nos 30000 300000
CGST 27000
SGST 27000
Total 354000
Ctrl + A Save
5.Ref No. : 05 Date: 1-4-2023

Party Name :Kumar & co
Computer 15 nos 30000 450000
CGST 40500
SGST 40500
Total 531000
Ctrl + A Save
Step 7: Reports
From Gateway of Tally -Display -Statutory Reports -GST -GSTR3B
49. Outward supplies, B2B, Goods sold to R dealer Rs. 120000, Goods sold to
Customer (B2C) Rs.15000, Goods sold to Interstate dealer Y Rs. 150000. Assuming
GST @ 18% show the effect of outward supplies in GST Return.
SOLUTION:
Step 1: Create a company in the name of P.U Solutions Pvt. Ltd.
From Gateway of Tally- Press Alt+F3- Create Company -fill the below
particulars Name: P.U Solutions Pvt. Ltd. Financial Year : 1-4-2023
State: Telangana

Gateway of Tally -Press F11-Company Features- F3 Statutory & Taxation give the following
particulars
Step 3: Creation of Stock items:

Name: Goods
Under : Primary
Units :Nos
● HSN Code: 8471
● State Tax : 9%
● Cess : 0%
Step 4 : Creation of Ledger Accounts.

From Gateway of Tally - Accounting info - Single Ledger- Create
NOTE( Here R dealer is same state, customer is also same state but Y dealer is of other
state ( interstate) read the problem before u do)
1st LEDGER:
Name : R Dealer
Under : sundry debtor
State: Telangana
Ctrl + A to save
2nd LEDGER:
Name : Y Dealer
Under : sundry debtor
State: Tamil Nadu
GSTIN/UIN :36AJCPS0057SJ1Z5
Ctrl + A to save
3rd LEDGER:
Name : IGST
Ctrl + A to save
4th LEDGER:
Name : CGST
Ctrl + A to save
5th LEDGER:
Name: SGST
Under: Duties & Taxes
Tax Type: State Tax
Ctrl + A to save
6th LEDGER:
Name : Sales
Is GST Applicable ? not Applicable
Set / alter GST details ? no
HSN / SAC : 1234
Nature of Transaction : not applicable
Step 5 :Voucher Entry ( All these vouchers are to entered in sales voucher)
From Gateway of Tally- Accounting Voucher
Press Alt + I to convert into Accounting Invoice. And give the particulars as below
1.Ref No. 1
Party Name : R Dealer
Particulars QTY Rate Amount
Sales 120000
CGST 10800
SGST 10800
Total 141600
Ctrl + A Save
2.Ref No. 2
Party Name : Cash
Select GST registration type as consumer in dispatch detail
Particulars Qty Rate Amount
Sales 15000
CGST 1350
SGST 1350
Total 17700
Ctrl + A Save
3.Ref No. 3
Party Name : Y Dealer
Particulars Qty Rate Amount
Sales 150000
IGST 27000
Total 177000
Ctrl + A Save
Step 5 : Reports
From Gateway of Tally -Display- Statutory Report- GST- GSTR 3B
50. Purchased goods from registered dealer M/s Modern, Rs. 50000 and Rs. 5000
was paid as advance, Purchased goods from unregistered dealer M/s. Ram Rs.
40000. Purchased goods from interstate dealer M/s Jyothi. Rs. 75000. Goods
returned to M/s Jyothi Rs.5000, after raising the tax invoice. Record Inward supplies
in Tally?
SOLUTION:
Step 1: Create a company in the name of X Enterprises.
From Gateway of Tally - Press Alt+F3- Create Company - fill the below
particulars Name: X Enterprises. Financial Year : 1-4-2022
State: Telangana

From Gateway of Tally - Press F11-Company Features- Statutory & Taxation give the following
particulars
● Enable tax liability on advance receipts: YES
Step 3: Creation of Stock items:

Name: Goods
Under : Primary
Units :Nos
● HSN Code: 8471
● State Tax : 9%
● Cess : 0%

From Gateway of Tally - Accounting info - Single Ledge- Create
1st LEDGER:
Name : M/s Modern
State: Telangana
Registration Type : Regular
GSTIN/UIN :36AJCPS0057J1Z5
Ctrl + A to save
2nd LEDGER:
Name : Ram
State: Telangana
Registration type : Unregistered
Ctrl + A to save
3rd LEDGER:
Name : M/s Jyothi
State: Maharashtra
4th LEDGER:
Name : IGST
Ctrl + A to save
5th LEDGER:
Name : CGST
Ctrl + A to save
6 th LEDGER:
Name: SGST
Under: Duties & Taxes
Tax Type: State Tax
Ctrl + A to save
7th LEDGER:( Here only u have to enter the GST rate)

Name : Purchase
Set / alter GST details ? Yes and press F12 and make Yes to All
columns ● Description : Goods
● HSN / SAC : 1234
● Nature of Transaction : Purchase Taxable
● State Tax : 9%
● Cess : 0%
● Ctrl + A Save
Step 4 : Voucher Entry

From Gateway of Tally - Accounting Voucher
Ref No. 52
1.Party Name : M/s Modern
Particulars Amount
Purchase 50000
CGST 4500
SGST 4500
Total 59000
Ctrl + A Save
The next step is M/s Modern gave a advance so that should be recorded under f5 payment
voucher:
Select payment voucher or press F5
Account : Cash
Particulars Amount
M/s Modern 5000
Select the method of adjustment as Advance and then enter

Ctrl + A save
2.Click on F9 Purchase on right side button bar or press F9
Press F12 configuration (Allow modification of tax details for GST – Yes)
Ref No. 25
Party Name : Mr.Ram ( he will be an unregistered dealer while creating his voucher select him
as unregistered dealer refer the ledger accounts)
Particulars Amount
Purchase 40000
Total 40000
NOTE( Here we will not get any CGST and SGST because he is unregistered
dealer so no tax is charged)
Ctrl + A Save
3. Ref No. 255

Party Name : M/s Jyothi ( Here it is interstate supply so IGST is been charged)
Particulars Amount
Purchase 75000
IGST 13500
Total 88500
Ctrl + A Save
After this M/s jyothi has returned goods because she is a creditor and to record this returns we
issue a DEBIT NOTE:

GST - Final LAB WORK 1-50

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GST - Final LAB WORK 1-50

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Problems

Goods and Service Tax Network (GSTN):-

Solutions to the Practical Lab Questions (1 to 20)

1. Draw a chart showing tax structure in India?

3. Write any five limitations of Pre - GST Indirect taxes?

6. What are the important stages in implementation of GST?

7. What were the taxes subsumed in GST?

8. Visit the CBIC Website and make a note of important contents?

11.What is the GST council and what is its composition?

12.What are the different types of taxes levied under GST?

16.Briefly explain the important components of Supply?

17.What activities are included in Supply?

18.Brief registration process of GST?

19.Ram Enterprises purchased goods from Shyam Enterprises. The

20.Mr. Y was travelling from Hyderabad to Bengaluru on a flight.

2. MixedSupply under GST:

22. Write a short note on the process of GST?

It is applicable for large

Sales/Transfer They can sales/transfer

Input Credit They can avail Input tax

Period of They have to file 3

Form of Monthly 3 returns, “Form

E-commerce There is no restriction on

They have to issue a Tax

Restriction on some There is no such

Maintenance of Mandatory to maintain Not mandatory to maintain

Tax Records detailed records. detailed records.

25.List out five examples of B2C transactions?

26.Draw a specimen of Invoice, Tax Invoice and Bill of Supply?

27.What is a Supplementary invoice?

28.What is the eligibility for availing Input Tax Credit?

36. What are the activities specified as a Negative List According to

Enable Goods and Services Tax (GST) ? YES

After creation of ledgers go back to the main screen .

Step 4 :Voucher Entry

38. Mahesh Enterprises of Hyderabad purchased goods from Ashish Enterprises

Step 2: Configuration of GST in Tally (Enabling GST)

Step 4: : Creation of Ledger Accounts.

Step 5: Voucher Entry

Step 6: Reports Gateway of Tally - Display- Statutory Reports- GST- GSTR 3B

Step 2. Configuration of GST in Tally ( enabling GST )

Step 3. Creation of Units of Measures (UOM)

3. Name: Ice Cream

Step 6 : Creation of voucher: 1st voucher:

Total(after tax) 3640.00

2. Name: Goods at 18%

Step 3: Creation of Ledger Accounts.

Step 4 : Voucher Entry

2. Click on F9 Purchase on right side button bar or press F9

Step 5 : To view the GST reports

Step 1: Creation of the company

Step 2. Configuration of GST in Tally (enabling GST)

Step 3: Creation of stock item.

STEP 4:Creation of Ledger Accounts.

Step 4: Voucher Entry

STEP 5: Here is the output: 1st one is voucher:

And the second output is the TAX ANALYSIS:

Step 1. Creation of company

Step 2: Configuration of GST in Tally (Enabling GST)