#GST Made Easy for Freshers# By SN Panigrahi

2
SN Panigrahi is a Versatile Practitioner, Strategist, Energetic Coach, Learning Enabler & Public Speaker.
He is an International-Corporate Trainer, Mentor & Author
He has diverse experience and expertise in Project Management, Contract
Management, Supply Chain Management, Procurement, Strategic
Sourcing, Global Sourcing, Logistics, Exports & Imports, Indirect Taxes –
GST etc.
He had done more than 150 Workshops on above
Published more than 500 Articles; 60 YouTubes & more than
70 SlideShares
He is an Engineer + MBA +PGD ISO 9000 / TQM with around 29 Yrs of
Experience
He is a certified PMP® from PMI (USA) and become PMI India
Champion
Also a Certified Lean Six Sigma Green Belt from Exemplar Global
Trained in COD for 31/2 Yrs. on Strategy & Leadership
GST Certified – MSME – Tech. Dev. Centre (Govt of India)
ZED Consultant – Certified by QCI – MSME (Govt of India)
Member Board of Studies, IIMM
Co-Chairman, Indirect Tax Committee, FTAPCCI
Empanelled Faculty in NI MSME
He has shared his domain expertise in various forums as a speaker & presented a number of papers in various national and
international public forums and received a number of awards for his writings and contribution to business thoughts.
SN Panigrahi
9652571117
snpanigrahi1963@gmail.com
Hyderabad

• Earlier System Drawbacks & Expected Benefits of GST
Why GST
• Understanding the Basic Concepts – GST Act & Rules
What is GST
• Understanding Various Transactional Provisions
How GST Works
• Tax Payment, ITC Utilization, Returns Filling
GST – Tax Collection, Returns Filling
SNPanigrahi

Avoid Double Taxation
Removal of Multiple Taxes /
Cascading Effect –
Seamless Flow of ITC
Nation-Wide Level Plying
Field – Unifying Taxes
Across India
Ease of Doing Business :
Simplified & Unified Tax
System; Reduce Interface
with Different
Departments– Less Legal
Litigations
Total Digitalization
Transparency in Tax
System; Compliance
Easier with Lesser
Litigations
Simplified Tax Collection
System & Expand Tax
Base;
Increase Tax-GDP Ratio
One Nation, One Tax, One
Market: Free Flow of
Supply Enhance India’s
Trade Competitiveness
Improved Efficiency &
Productivity in Supply
Chain Resulting in
Business Growth. Also
Shift of Business from
Un-organized to
Organized
More Efficient
Neutralization of Taxes
Especially for Exports –
Improve Export
Competiveness
Bring about a
Macroeconomic Dividend
– Encourage Investments
/ FDI – Boost Economy -
GDP Growth
SNPanigrahi

SN Panigrahi 5
2000: Prime Minister Atal Bihari Vajpyee introduces the concept, sets up a committee headed by
the then West Bengal Finance Minister Asim Dasgupta to design a GST model.
 2003: The Vajpayee government forms a task force under Vijay Kelkar to recommend tax reforms.
 2004: Vijay Kelkar, then advisor to the Finance Ministry, recommends GST to replace the existing
tax regime. The Task Force strongly recommended fully integrated ‘GST’ on national basis.
 Subsequently, the then Union Finance Minister, Shri P. Chidambaram, while presenting the Central
Budget (2007-2008), announced that GST would be introduced from April 1, 2010. Since then, GST
missed several deadlines and continued to be shrouded by the clouds of uncertainty.
 The talks of ushering in GST, however, gained momentum in the year 2014 when the NDA
Government tabled the Constitution (122nd Amendment) Bill, 2014 on GST in the Parliament on 19th
December, 2014.
 The Lok Sabha passed the Bill on 6th May, 2015 and Rajya Sabha on 3rd August, 2016. Subsequent
to ratification of the Bill by more than 50% of the States, Constitution (122nd Amendment) Bill, 2014
received the assent of the President on 8th September, 2016 and became Constitution (101st
Amendment) Act, 2016, which paved the way for introduction of GST in India.

Announcement of GST for the first time
was made by the then Union Finance
Minister, during budget of 2006-07 that it
would introduced from 1 April 2010
28 th February
2006
First Discussion
Paper was released
by the Empowered
Committee
10th November
2009
Constitution (115thAmendment)
Bill introduced and subsequently
lapsed
22nd March,
2011
The C o n s t i t u t i o n ( 1 2 2 nd
Amendment) Bill was introduced
in the Lok Sabha
19th December, 2014
3rd August,
2016
The Constitution (One
Hundred and First
Amendment) Act was
enacted
4th March
2017
GST Council
Recommends the
CGST, SGST, IGST,
UTGST and
Compensation CessAct
April 2017
CGST, IGST, UTGST
and
Compensation Cess
Acts passedAll S t a t e s
except J&K
passed their
SGSTACT
May 2017
GST Launched
1st July 2017
1st GST Council
Meeting
22—23
Sep 2016
30th June 2017
GST Council
recommends
all the rules
SGST Act passed by J&K; CGST and IGST
Ordinances promulgated to extend GST to
J&K
8th July
2017
True Economic Integration of India
Journey
Continues…
• Notifying and amending
rules
• Dealing with IT related
issues
• Revision of Rates
• Clarification and
communication with
taxpayers
3
29th August,
2018
Amendments to CGST,
IGST, UTGST and
Compensation to State Acts
enacted
R a j y a S a b h a
p a s s e s t h e
C o n s t i t u t i o n
A m e n d m e n t B i l l
8th September, 2016

SN Panigrahi 7
1. Amendments in the Constitution
2. Legislative Framework for GST
3. Goods & Service Tax Council (GSTC)
4. Goods & Service Tax Network (GSTN)

8
Constitution (101st Amendment) Act, 2016 was enacted on 8th September, 2016.
Significant amendments made by Constitution (101st Amendment) Act, 2016 are as
follows:-
1.) In Article 366 of the Constitution,
New clause (12A) has been inserted to provide the definition of GST.
Article – 366(12A):-
“Goods and Services Tax” means any tax on Supply of Goods or Services or both except taxes
on the supply of the alcoholic liquor for human consumption.
2.)The tax shall be levied as dual GST separately by the Union and States. For this, Article-
246A has been inserted.

4
“Goods and services tax” means any tax on supply of goods, or services
or both except taxes on the supply of the alcoholic liquor for human
consumption
Definition of GST
Sl No Definition Article Definition
1. Goods 366(12) Includes all materials, commodities, and articles [Pre Existing Definition]
2. Service 366 (26A) Anything other than goods [Introduced vide 101st Constitutional Amendment
Act]
3. State 366(26B) With reference to articles 246A, 268, 269,269A and Article 279A includes a
Union territory with Legislature. [Introduced vide 101st Constitutional
Amendment Act]
“Goods and Services tax” law while having unique principles, has significant elements of prior Central
and State laws; and is also inspired by VAT/GST legislation of EU, Australia, Malaysia etc. along with
International VAT/GST guidelines of OECD
Constitution (101st Amendment)
Act, 2016 was enacted
Article 366(12A)
has been inserted to provide the
definition of GST

10
Article 265
Article 246
To be read with Schedule 7
ie Three Lists
List -1 : Union List
List – 2 : State List
List 3 : Concurrent List
Article 246A
Inserted by Constitutional
(One Hundred and First)
Amendment Act 2016
No Tax shall be Levied
or Collected Except by
Authority of Law

11
Insertion
of 3 new
Articles
Article 246A: Concurrent
jurisdiction for levy &
collection of GST by the
Centre & the States
Article 269A: Levy and
collection of Goods and
Service tax in the course or
interstate trade and
commerce
Article 279A: Goods and
Service Tax Council
Features of GST Constitution Amendment Act
 Concurrent jurisdiction for levy & collection of GST by the Centre (CGST) and the States (SGST)
 Centre to levy and collect IGST on supplies in the course of inter-State trade or commerce including
imports
 Compensation for loss of revenue to States for five years – Clause 19
 GST on petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas &
aviation turbine fuel to be levied from a later date on recommendations of Council

12
Article
246A
Supersedes Article 246
Concurrent jurisdiction for levy
& collection of GST by the
Centre & the States
Dual GST Framework : Center
Collects CGST &
State Collects SGST
Article
269A
Centre to levy and collect
IGST on supplies in the
course of Inter-State Trade or
commerce including imports
IGST Collected to be
Distributed between Center &
State / UT
Center will Determine Place of
Supply & Time of Supply
Exports & Imports are Treated
as Deemed Inter-State Supply
Article
279A
GST Council Constituted by
President of India
Union Finance Minister Chairs
the Council
Council Members: 1/3 from
Center & 2/3 from States
All the State FMs are Members

13
•As per Article–279A (5), GST Council shall recommend the date on which GST shall be levied on
following Goods which are as follows:-
√ Petroleum Crude,
√ High Speed Diesel,
√ Motor Spirit (Commonly known as Petrol),
√ Natural Gas,
√ Aviation Turbine Oil.
•Taxes on entertainments and amusements to the extent levied and collected by a panchayat or a
municipality or a regional council or district Council shall not be subsumed (included) under GST.

Alcohol for human
consumption
Entertainment tax
levied by local bodies
8
Five petroleum
products – crude oil ,
diesel, petrol, natural
gas and ATF
Tobacco
and
Tobacco
products
Power to tax remains with the State
GST Council to decide the date from which GST
will be applicable
Part of GST but power to levy additional excise duty
with Central Government
Power to tax remains with local bodies

SN Panigrahi 15
Commencement of GST Council
According to Article 279A of the Constitution, the GST Council has to be constituted by the President within 60 days of
the commencement of Article 279A. The notification for bringing into force Article 279A with effect from 12th
September, 2016 was issued on 10th September, 2016.
Members of GST Council
The GST Council is a joint forum of the Centre and the States, and consists of the following members:
1. Chairperson- Union Finance Minister
2. Vice chairperson- to be chosen from amongst the members of Ministers of State government
3. Members-
(a) The Union Minister of State, in-charge of Revenue/Finance
(b) The Minister In-charge of finance or taxation or any other Minister nominated by each State Government

SN Panigrahi 16
Quorum for GST Council Meetings
 • The quorum of GST council is 50% of total members
 • Decision is taken by 3/4th majority (75%), wherein-
(a) the Central Government would have the weightage of 1/3rd of the total vote cast, and
(b) the State Governments would have a weightage of 2/3rd of the total votes cast.
Functions of the GST Council
GST Council is basically entrusted with task to make recommendations on the different aspects of GST to the Union as well as states.
GST Council under the Constitution is required to make recommendations on the following:
(a) the taxes, cesses and surcharges which may be subsumed in the goods and services tax;
(b) the goods and services that may be subjected to, or exempted from the goods and services tax;
(c) model GST Laws, principles of levy, apportionment of IGST and the principles that govern the place of supply;
(d) the threshold limit of turnover below which goods and services may be exempted from goods and services tax;
(e) GST rates including floor rates;
(f) any special rates for a specified period, to raise additional resources during any natural calamity or disaster;
(g) special provision with respect to the States of Arunachal Pradesh, Assam, Jammu and Kashmir, Manipur, Meghalaya,
Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh and Uttarakhand; and
(h) any other matter relating to the GST, as the Council may decide.
The GST Council shall also recommend the date on which GST will be levied on petroleum crude, high speed diesel, motor spirit
(commonly known as petrol), natural gas and aviation turbine fuel.

17
CGST
Act
SGST
Act
IGST
Act
UTGST
Act
State
Compensation
Act

How Many Acts?
Central
Government
CGST
1
Apply to Whole of
India
For Intra-State
Transactions
IGST
1
Apply to Whole of
India
For Inter-State
Transactions
UTGST
1
Applies to Union
Territories
Compensation
CESS
1
Apply to Whole of
India
State
Government
SGST
29+2=31
Applies to
Respective States
For Intra-State
Transactions
Total
35
Acts

19
Chapter I
Preliminary
(Sections 1 – 2)
Chapter II
Administration
(Sections 3-6)
Chapter III
Levy & Collection of
Tax
(Sections 7-11)
Chapter IV
Time & Value Of
Supply
(Sections 12-15)
Chapter V
Input Tax Credit
(Sections 16-21)
Chapter VI
Registration
(Sections 22-30)
Chapter VII
Tax Invoice, Credit &
Debit Notes
(Sections 31-34)
Chapter VIII
Accounts And
Records
(Sections 31-34)
Chapter IX
Returns
(Sections 37-48)
Chapter X
Payment of Tax
(Sections 49-53)
Chapter XI Refunds
(Sections 54-58)
Chapter XII
Assessment
(Sections 59-64)
Chapter XIII
Audit
(Sections 65-66)
Chapter XIV
Inspection, Search,
Seizure And Arrest
(Sections 67-72)
Chapter XV
Demands And
Recovery
(Sections 73-84)
Chapter XVI
Liability To Pay In
Certain Cases
(Sections 85-94)
Chapter XVII
Advance Ruling
(Sections 95-106)
Chapter XVIII
Appeals And Revision
(Sections 107-121)
Chapter XIX
Offences And
Penalties
(Sections 122-138)
Chapter XX
Transitional
Provisions
(Sections 139-142)
Chapter XXI
Miscellaneous
(Sections 143-174)

20
Short Title &
Definition
(1 and 2)
Composition
Scheme
(3 to 7)
Registration
(8 to 26)
Valuation
(27 to 35)
ITC
(36 to 45)
Tax invoice,
Debit and credit
Notes
(46 to 55A)
Accounts and
Records
(56 to 58)
Returns
(59 to 84)
Payment of
Tax
(85 to 88)
Refund
(89 to 97A)
Assessment and
Audit
(98 to 102)
Advance Ruling
(103 to 107)
Appeals and
Revision
(108 to 116)
Transitional
Provisions
(117 to 121)
Anti-Profiteering
(122 to 137)
E-way Bills
(138)
Inspection,
Search and
Seizure
(139 to 141)
Demand and
Recovery
(142 to 161)
Offenses and
Penalties
(162)

SN Panigrahi 21
Section 8
(GSTN : a Non-Profit,
Non-Government,
Private Limited
Company)
Supporting
to
Supporting
through
Supporting
in
 Government
 Taxpayers
 Other Stakeholders
 IT Infrastructure
 Systems
 Services
 Implementation
 Administration of GST
The common GST Portal www.gst.gov.in has been developed by GSTN as the front-end of the overall GST IT eco-system.

SN Panigrahi 22
1.
Functions
Relating to
Tax Payers
2.
Functions
relating to
Government
3.
Functions
relating to
Tax Officials

23
GSTN Eco-system
A common GST system will provide linkage to all State/UT Commercial Tax departments, Central Tax authorities,
Taxpayers, Banks and other stakeholders. The eco-system consists of all stakeholders starting from taxpayer to tax
professional to tax officials to GST portal to Banks to accounting authorities. The diagram given below depicts the whole
GST eco-system.

Multiple Taxes to
Single Unified Tax
System
GST is a Multipoint
Levy Tax & is a
Value Added Tax
GST is a
Destination based
Tax
GST is a Dual Levy
Tax - Concurrently
Levied by both
Center & State
Seamless Input Tax
Credit – Payment
Mechanism
Value of Supply
Transaction Value
Place of Supply
To Determine
Nature of Supply
Time of Supply
Point of Taxation
Taxable Person –
Registration Under
GST
Supply is the basis
for Levy & Collection
of GST
GST

CGST / IGST SGST
Earlier 17 Taxes & and 23 Cesses Subsumed

26
GST exclusions …
 Petroleum products i.e. Crude Oil, Natural Gas, Aviation Turbine Fuel (ATF), Diesel and Petrol
Effective date for Petroleum Products will be notified later – Sec 9(2) of CGST Act
 Taxes on Tobacco and Tobacco products imposed by the center shall continue to be levied over and above
GST
 In case of alcoholic liquor for human consumption, states would continue to levy the taxes Earlier being
levied, ie state excise duty and sales tax / VAT
 Basic Customs Duty (BCD) on Imports & Export Duty
 Toll Taxes
 Environment Taxes
 Stamp Duty
 Property Tax
 Tax on Electricity
SNPanigrahi
"However, the exclusion of petroleum products and electricity are particularly problematic.
Diesel accounted for 12 per cent of total indirect tax collections. On an average, indirect taxes
paid on diesel account for 30 per cent of logistics cost, for which no credit will be available to the
consumer. The resulting cascading is significant in case of basic food items and most dry bulk
commodities."

27
‘Destination Principle’ states that the supply of goods and services would be taxed
at the point of consumption. This means that GST replaces source based tax
system with destination based tax regime.
Destination
Principle
‘Value Added Principle’ on the other hand underlines that the tax shall be collected
on value-added to goods or services at each stage of the supply chain. Right from
the original producer or service provider to the ultimate consumer, GST will be
collected on value added at every stage of the supply chain.
Value Added
Principle
According to Multipoint Taxation Principle, Tax shall be Levied at every stage of
the Supply
Multipoint
Taxation
Principle
Seamless Credit is allowed as long as the Value Chain Continues with
Furtherance of Business, subject to Blocked Credits
Seamless
Credit
Event for Taxation is Supply
Event for
Taxation

SN Panigrahi 28
Supplier Recipient
Customer
Basic Supply Value = Rs 100
GST @ 5 = Rs 5
Total Invoice Value = Rs 105
Supplier Pays to the Govt.
GST Collected from
Recipient
Govt.
GST
Rs 5 Paid to
Govt
Inward Inv Value = Rs 105
Less ITC = Rs 5
Total Cost Value = Rs 100
Value Addition = Rs 50
Basic Supply Value=Rs 150
GST @ 5 =Rs 7.5
Total Inv Value =Rs 157.5
GST Paid is
Taken as
Credit
Govt.
GST
Rs 7.5 Paid to
Govt
GST Payable to Govt. = Rs 7.5
Less Credit Taken = Rs 5
Net Tax Payable = Rs 2.5

29
S1
Cotton
Yarn
S2
Fabric S3
Garments
FC
CustomerBasic Supply
Value = Rs 100
GST @ 5 = Rs 5
Total Invoice
Value = Rs 105
Inward Inv Value = Rs 105
Less ITC = Rs 5
GST @ 5 =Rs 7.5
Inward Inv Value = Rs 157.5
Less ITC = Rs 7.5
GST @ 5 =Rs 10.5
Inv Value= Rs 220.5
Less ITC = Rs 0
Total Cost
Value = Rs 220.5
Tax Paid = Rs 7.5
Less ITC = Rs 5
Net Tax Paid = Rs 2.5
GST on VA @5% = Rs 2.5
Net Tax Paid is Tax Paid on Value Addition. Therefore called Value Added Tax
Net Tax Paid = Rs 5 + Net Tax Paid = Rs 2.5 + Net Tax Paid = Rs 3 = Total Tax = 10.5
Tax Paid = Rs 10.5
Less ITC = Rs 7.5
Net Tax Paid = Rs 3
GST on VA @5% = Rs 3
Credit of Tax Paid at Every Stage is Available as Setoff for Payment of Tax at Subsequent Stage
C1
C2
SN Panigrahi
1. GST is a Mutli-Point Taxation
2. GST is a Value Added TAX
3. Seamless Credit is allowed
as long as the Value Chain
Continues with Furtherance of
Business;
4. No Credit is allowed in case
No Furtherance of Business or
Exempted Supply

Indirect taxes can be either origin based or destination based. Origin based tax (also
known as production tax) is levied where goods or services are produced. Destination
based tax (consumption tax) are levied where goods and services are consumed.
GST is a Destination-based or Consumption-based Tax. Hence, the place of
consumption will decide the State that will collect tax. The parody behind destination-
based taxation is, the producing/selling state gets nothing while the consuming states
receive complete share of revenue.
SNPanigrahi
Tax will go to Maharashtra
Maharashtra
30

Dual Levy
Central
Levy
Union Territory
Levy
CGST
UT GST
State
Levy SGST
or
IGST will be leviable on inter-state transactions
31
I GST
Central
Levy

32
Location of
Supplier
INTRA-STATE SUPPLY
Place of Supply
CGST SGSTTax Payable
Warangal
Telangan
Hyderabad
Telangana
INTRA-STATE SUPPLY
Customer
Selling Price 1000
CGST @ 9% 90
SGST @ 9% 90
Total Sale Price 1180
Total tax paid by
Supplier
180
SN Panigrahi

33
Location of
Supplier
INTER-STATE SUPPLY
Place of Supply
Tax Payable
Bengaluru
In Karnataka
Hyderabad
In Telangana
INTER-STATE SUPPLY
IGST
Selling Price 1,000
IGST @ 18% 180
Total Sale Price 1,180
Total tax paid by
Supplier
180
Customer
SN Panigrahi

36
‘Supply’ is a fundamental concept and all the provisions of GST revolves around it. Under Supply, there
are three key elements namely time of supply, place of supply and value of supply.
Customs Duty
Type of Tax Tax Law / Act Taxable Event
Tax Collection
Authority
Central Excise Duty
Central Sales Tax (CST)
Service Tax
VAT
GST
Customs Act, 1962
Central Excise Act 1944
Central Sales Tax Act 1956
Finance Act 1994
State VAT Acts (2005)
CGST / SGST /
UTGST / Com. Cess
Act 2017
Import / Export
Manufacture / Production
Inter-Sate Sales
Taxable Service
Sales within State
Supply
Central Govt.
Central Govt.
State Govt.
Central Govt.
State Govt.
Central Govt. &
State Govt.

Supply Goods Services Both
or or
Sec 2(52) of CGST Act : “goods” means every kind of movable property other than money and
securities but includes actionable claim, growing crops, grass and things attached to or forming
part of the land which are agreed to be severed before supply or under a contract of supply
Sec 2(102) of CGST Act : “services” means anything other than goods, money and securities
but includes activities relating to the use of money or its conversion by cash or by any other mode,
from one form, currency or denomination, to another form, currency or denomination for which a
separate consideration is charged;
Explanation.––For the removal of doubts, it is hereby clarified
that the
expression “services” includes facilitating or arranging
transactions in
securities;

SN Panigrahi 38
Separate
Provisions
have been
Specified
Goods
Sec 2(52) of
CGST Act
Services
Sec 2(102) of
CGST Act
Sec 12 of
CGST Act
Sec 13 of
CGST Act
Time of
Supply
Place of
Supply
GST Rate
Sec 10 & 11
of IGST Act
Sec 12, 13 &
14 of IGST
Act
Section 12 and Section 13 thereof provides for ascertaining time of supply of goods and time
of supply of services respectively; similarly, separate provisions have been specified for
ascertaining place of supply of goods and place of supply of services.
Further, the rate of tax applicable to supply of goods and supply of services are different.
Accordingly, it is important to distinguish whether a particular transaction involves supply of
goods or supply of services.

SNPanigrahi
39
Supply
All form of
Supplies for a
consideration
Section 7(1)(a)
Even Some
Specific
Supplies Without
Consideration
Section 7(1)(c) –
Schedule : I
Clarifying
Certain Activities
Whether Goods
or Services
Section 7(1)(d)
– Schedule : II
Treated Neither
as a Supply of
Goods Nor a
Supply of
Services –
Section 7(2)
Schedule : III
Sec 7 of
CGST Act
In the Course or Furtherance
of Business
Import of
Services for a
Consideration
whether or not in
the course or
furtherance of
business -
Section 7(1)(b)
 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,
Involves
Goods or Services or Both
Supply includes

40
Made by a Taxable
Person
Is in the
Taxable Territory
Is for a consideration
Is in the course
or furtherance
of business.
Supply
Goods Services Both
or orInvolves
Taxable Supply
Sec 7 of CGST Act
Without Consideration
in Some Cases

41
Supply Includes
Sale
Transfer
Barter
Exchange
Rent
License
DisposalSN Panigrahi

4
2
What is Supply in GST
Supply may include these 8 forms as per Sec 7 :
Supply
Sale Property in goods is transferred or agreed to be transferred by seller to buyer.
Transfer
It refers to alienation or conveyance or passing on of the property of a thing form one person to
another
Barter Swapping of goods or services without using a medium of exchange such as money
Exchange Negotiation by which one person transfers to another person funds and this transfer could be
either at a price agreed upon, or which could be fixed by commercial usage
License Permission granted by competent authority to exercise certain privilege which, without such
authorisation, would have constituted as an illegal act.
Lease
A contractual agreement by which one party conveys an estate in property to another party, for a
limited period, subject to various conditions, in exchange for something of value, but still retains
ownership.
Rent Sum or amount agreed in the lease or tenancy agreement to be paid by the tenant to the
landlord for exclusive possession of the property leased for the period of the lease
Disposal In relation to property it refers to the act of transferring or relinquishing of that property to
another’s care or possession usually by deed or will.
Supply is the “taxable event under GST” like manufacture of goods under Excise, rendering of
services under Service Tax and sale of goods under VAT.

43
1
• The Activity Involves the Supply of Goods or Services, or Both
2
• Supply is for Consideration unless otherwise expressly provided for
3
• Supply Even without Consideration – Schedule -1
4
• Supply is Made in the Course or Furtherance of Business
5
• Supply is Made in a Taxable Territory (as per section 2(109)
6
• Supply is a Taxable Supply
7
• Made by A Taxable Person (as per section 2 (107)Makes the Supply
To constitute a supply, the following elements must
be satisfied:
SNPanigrahi

SN Panigrahi 44
It makes the
Supply for
Consideration
The supply is
made in the
course or
furtherance
Business of an
enterprise that it
carries on
The Supply is
Made in the
Taxable Territory
The entity is
Either
Registered or
Required to be
Registered for
GST, and
The Supply is not
“non-taxable
supply”
Sec 2(108) of CGST Act
“taxable supply” means a supply of goods or services or both which is leviable to tax
under this Act;
An entity makes a taxable supply if:

SN Panigrahi
45
Consideration
Includes
Payment Made
or To be Made
In Money
or otherwise
In Respect of,
In Response to, or
for the Inducement of
whether by the
Recipient or
by Any Other Person
shall not include any subsidy given
by the Central Government or a State
Government
Monetary Value of any Act or
Forbearance
Sec 2(31)(a)
Sec 2(31)(b)

SN Panigrahi 46
TYPES
OF
CONSIDERATION
Monetary
consideration
Non-
monetary
consideration
 Cash,
 Cheque or Credit Card,
 Bank Transfer and
 Deduction From Bank Account
Compensation in Kind
 Supply of Goods and Services in Exchange
Any Act or Forbearance
 Refraining or Forbearing to Do an Act
 Tolerating an Act or a Situation
 Doing or Agreeing to Do an Act

4
7
Supply Without Consideration : Schedule - 1
SupplywithoutConsideration
1
Permanent
Transfer of
Assets
Permanent transfer / disposal of business assets where input tax credit has
been availed on such assets.
2
Supply
between
related
persons
Supply of goods or services or both between related persons or between
distinct persons as specified in section 25, when made in the course or
furtherance of business: Provided that gifts not exceeding Rs 50,000 in value
in a financial year by an employer to an employee shall not be treated as
supply of goods or services or both.
3
Supply
between
Principal &
Agent
Supply of goods— (a) by a principal to his agent where the agent undertakes
to supply such goods on behalf of the principal; or
(b) by an agent to his principal where the agent undertakes to receive such
goods on behalf of the principal.
4
Import of
Services –
Related
Persons
Import of services by a taxable person from a related person or from any of
his other establishments outside India, in the course or furtherance of
business.
Activities To Be Treated As Supply Even If Made Without Consideration

48
Transaction Goods Service
1. Transfer Any transfer of the title in goods is a supply of
goods
Any transfer of right in goods or of undivided
share in goods without the transfer of title
thereof, is a supply of services
Any transfer of title in goods under an
agreement which stipulates that property in
goods shall pass at a future date upon
payment of full consideration as agreed, is a
supply of goods.
2. Land and Building Any lease, tenancy, easement, licence to occupy
land is a supply of services;
Any lease or letting out of the building including a
commercial, industrial or
residential complex for business or commerce,
either wholly or partly, is a supply of services
3. Treatment or
process
(Job Work)
Treatment or process : Any treatment or process
which is applied to another person's goods is a
supply of services.
Deciding whether Goods or Service : Schedule – 1I
Activities To Be Treated As Supply Of Goods Or Supply Of Services

49
4. Transfer of
Business Assets
Transfer or disposal of
Goods, whether or not for a
consideration – Treated as
Supply of Goods
Goods held or used for the purposes of the
business are put to any private use - other
than a purpose of the business, whether or
not for a consideration - is a supply of
services
Where any person ceases to
be a taxable person, any
goods forming part of the
assets of any business
carried on by him shall be
deemed to be supplied by
him in the course or
furtherance of his business
immediately before he
ceases to be a taxable
person,

50
6. Composite
supply
(a) works contract as defined in clause (119) of
section 2; and
(b) supply, by way of or as part of any service or
in any other manner whatsoever, of goods,
being food or any other article for human
consumption or any drink (other than alcoholic
liquor for human consumption), where such
supply or service is for cash, deferred payment
or other valuable consideration.
7. Supply of
Goods
Supply of goods by any
unincorporated association or
body of persons to a member
thereof for cash, deferred
payment or other valuable
consideration

51
Neither Goods Nor Service : SCHEDULE III [Section 7]
Activities Or Transactions Which Shall Be Treated Neither as a Supply Of Goods Nor a Supply of Services
1. Services by an employee to the employer in the course of or in relation to his
employment.
2. Services by any court or Tribunal established under any law for the time being in force.
3. (a) the functions performed by the Members of Parliament, Members of State
Legislature, Members of Panchayats, Members of Municipalities and Members of other local authorities;
(b) the duties performed by any person who holds any post in pursuance of the provisions of the Constitution
in that capacity; or
(c) the duties performed by any person as a Chairperson or a Member or a Director in a body established by
the Central Government or a State Government or local authority and who is not deemed as an employee
before the commencement of this clause.
4. Services of funeral, burial, crematorium or mortuary including transportation of the deceased.
5. Sale of land and, subject to clause (b) of paragraph 5 of Schedule II, sale of building.
6. Actionable claims, other than lottery, betting and gambling.
Explanation.—For the purposes of paragraph 2, the term "court" includes District Court, High Court and
Supreme Court.

52
One of the significant changes proposed by the GST Council in its recently concluded 28th meeting on
July 21, 2018 is inclusion of following transactions in Schedule III to the CGST Act, 2017 (i.e. activities
or transactions which shall be treated neither as a supply of goods nor a supply of services):
•Merchant trading. supply of goods from a place in the non-taxable territory to another place in the
non-taxable territory without such goods entering into the taxable territory.
•High seas sales. sale carried out by the actual consignee shown in the Bill of Lading to another buyer
while the goods are yet on high seas or after their dispatch from the port of loading and before entering
the customs frontier of India.
•In-bond Sale. Sale of imported goods from customs bonded warehouses
Further, it has been proposed that these transactions shall not be regarded as exempt supply for
reversal of input tax credit.
Indeed, the proposal of keeping the said transactions out of the scope of exempt supply turns
out to be a very beneficial and trade friendly measure for the taxpayer as it will help the
taxpayer to avail input tax credit, which otherwise would have been blocked had it not been kept out
of the scope of exempt supply.
Inclusion of Additional Transactions in Schedule III
Notification No. 03/2019 – Central Tax 29/01/2019

SN Panigrahi 53
An explanation has been inserted to provide that the
‘value of exempt supply’ shall not include the value of
activities or transactions specified in Schedule III (other than
the sale of land and building).
Central Goods and Services Tax (Amendment) Rules, 2019 Notification No. 03/2019 – Central Tax
29/01/2019

54
Types of Supply
Types of
Supply
Taxable Supply
Exempted Supply
Zero Rated Supply
Composite / Mixed Supply
Continuous Supply
Inward / Outward Supply
Inter / Intra State Supply
Deemed Supply

SN Panigrahi 55
“taxable supply” means a supply of goods or services or both which is leviable to tax
under this Act;
An entity makes a taxable supply if:
 it makes the supply for consideration
 the supply is made in the course or furtherance of an enterprise that it
carries on
 the supply is made in the Taxable Territory
 the entity is either registered or required to be registered for GST, and
 the supply is not “non-taxable supply”

SN Panigrahi 56
Sec 2(78) of CGST Act :
“non-taxable supply” means a supply of goods or services or both which is not leviable to tax
under this Act or under the Integrated Goods and Services Tax Act;
A transaction must be a 'supply' as defined under the GST law (Section 7 of the CGST Act) to
qualify as a non-taxable supply under the GST.
If an activity or transaction falls outside the scope of supply then it cannot be said as a non taxable
supply.
The activities and transactions specified in Schedule III are not supply. As it is not supply so it cannot
be said as non taxable supply but can be said as Non-GST Supply
Non-taxable
Supply
Non-GST
Supply
Sec 2(78) of
CGST Act
No where
Defined in
GST Act
There Should be
a Supply as per
Sec 7 of CGST
Act
It is Not a
Supply as per
Schedule III
Alcoholic Liquor for Human
Consumption, Petroleum Crude,
Petrol, Diesel, Natural Gases
and Aviation Turbine Fuel
Activities and Transaction
Specified in
Schedule III

57
Note: Only those supplies that are excluded from the scope of taxation under GST are
covered by this definition – i.e., Alcoholic Liquor for Human Consumption, articles listed in
section 9(2) or in schedule III.
Sec 9(2) The central tax on the supply of
 petroleum crude,
 high speed diesel,
 motor spirit (commonly known as petrol),
 natural gas and
 aviation turbine fuel
shall be levied with effect from such date as may be notified by the Government on the
recommendations of the Council.
It must also be noted that these items are not out of scope of GST. That means GST Rate
has not yet been announced or notified for them .

SN Panigrahi
58
Sec 2(47) of CGST Act :
“Exempt Supply” means supply of any goods or services or both which attracts nil rate of tax or
which may be wholly exempt from tax under Section 11, or under section 6 of the Integrated
Goods and Services Tax Act, and includes non-taxable supply;
Wholly Exempt
From Tax
Nil Rate of
Supply
Non-Taxable
Supply
Exempt
Supply
Exempted
through a
Notification
Tariff @ Nil
Rate
Supply
But
Not Taxable

59
Nil Rate of
Supply
Wholly Exempt
From Tax
Non-Taxable
Supply
Nil Rated supply is nowhere
defined in GST Law. The Tariff is
at NIL rate.
The rates of goods are notified
under section 9(1)
vide Notification No. 01/2017-
Central Tax (Rate) which
contains six schedules specifying
tax rates at 2.5%, 6%, 9%, 14%,
1.5% and 0.125%. There is no
schedule levying tax at 0% i.e.
NIL rated.
In case of services, there is only
one service which is notified as
Nil rated in Notification No.
11/2017- Central Tax (Rate) at
S.No. 24 i.e Support services to
agriculture, forestry, fishing and
animal husbandry.
Notification No. 02/2017-
Central Tax (Rate) for
Goods
and Notification No.
12/2017- Central Tax
(Rate) for Services have
been issued by using power
given under Section 11 of
CGST ACT.
So goods and services
mentioned in these two
notifications (amended from
time to time) are exempted
goods as per definition of
exempt supply.
Sec (78) of CGST Act :
“non-taxable supply” means
a supply of goods or services
or both which is not leviable
to tax under this Act or under
the Integrated Goods and
Services Tax Act;
Alcoholic liquor for human
consumption, petroleum crude,
high speed diesel, motor spirit,
natural gases and aviation turbine
fuel are non taxable supply.
Activities and Transactions
specified in Schedule III are
not supply. As it is not
supply so it cannot be said as
non taxable supply but can be
said as Non-GST Supply

SN Panigrahi 60
Sec 2(23) of IGST Act
“zero-rated supply” shall have the meaning assigned to it in section 16;
Sec 16. (1) of IGST Act
“zero rated supply” means any of the following supplies of goods or services or both, namely:––
(a) export of goods or services or both; or
(b) supply of goods or services or both to a Special Economic Zone developer
or a Special Economic Zone unit.
Zero Rated
Supply Supply of Goods or Services
To SEZ / SEZ Dev.
Export of Goods or Services

61
Important Notifications Issued for Exemption
from Payment of GST:
Notification No. Particulars
For Goods
02/2017
Central Tax
(Rate) dated
28.06.2017
Exempted supplies of around 149 items of goods in terms of
Section
11(1) of the CGST Act, 2017. Ex. Electricity, Salt, fresh fruits,
plastic bangles, passenger baggage etc.
Amended vide Notification No.28/2017, 35/2017,42/2017, 7/2018,
19/2018 – Central Tax (Rate)
For Services
12/2017
Central Tax
(Rate) dated
28.06.2017
Exemption to supply specified services under the CGST Act. More
or less, all the exemptions were available earlier under the
erstwhile service tax law
Amended vide Notification No.21/2017, 25/2017, 32/2017 and
47/2017, 2/2018 – Central Tax (Rate)

SN Panigrahi 62
Types of Exemptions:
Absolute exemption: Exemption without any conditions.
Ex: Transmission or distribution of electricity by an electricity transmission or
distribution utility, Services by Reserve Bank of India.
Conditional Exemption: Exemption subject to certain conditions.
Ex: Services by a hotel, inn, guest house, club or campsite, by whatever
name called, for residential or lodging purposes, having declared tariff of a
unit of accommodation less than ` 1000/- per day”.
Conditional or Partial Exemption:
Intra-State supplies of goods and/or services received from an unregistered
person by a registered person is exempted from payment of tax under
reverse charge provided the aggregate value of such supplies received by a
registered person from all or any of the suppliers does not exceed Rs 5000/-
in a day. (Now this Condition is not Applicable – Notification Repealed)

66
Combination of
Supply
Mixed Supply
(Sec 2(74) of CGST Act)
Composite Supply
(Section 2(30) of CGST Act)
Naturally Bundled ?
& Made in Conjunction
with One Another
Yes No
Rate Rate
Rate Applicable on Principal
Supply
(Section 8(a) of CGST Act)
Highest Rate Among All
(Section 8(b) of CGST Act)
SNPanigrahi
Naturally Bundled and Supplied in
Conjunction with each other
Supply does not Constitute a
'Composite Supply'.
Multiple
Supplies
Single
Price

67
Classification
Goods Services
HSN
Code
SAC
Code
GST Rates for Goods
SCHEDULE I: LIST OF GOODS AT NIL RATE
SCHEDULE II: LIST OF GOODS AT 0.25% RATE
SCHEDULE III: LIST OF GOODS AT 3% RATE
SCHEDULE IV: LIST OF GOODS AT 5% RATE
SCHEDULE V: LIST OF GOODS AT 12% RATE
SCHEDULE VI: LIST OF GOODS AT 18% RATE
SCHEDULE VII: LIST OF GOODS AT 28% RATE
Compensation Cess applicable on Luxury & Demerit Items
GST Rates for Services
LIST OF SERVICES AT NIL RATE
LIST OF SERVICES AT 5% RATE
Compensation Cess applicable on Luxury
& Demerit Items

68
For Goods
GSTN portal has issued a comprehensive list of Harmonized System of Nomenclature (HSN) codes
for classification of the goods under proposed GST legislation.
Notification No. 12/2017 – Central Tax, 28th June, 2017
Notification No. 5/2017 – Integrated Tax, 28th June, 2017
Turnover up to Rs 1.5 crore : No HSN code is required
Turnover between Rs 1.5 Crores and Rs 5 Crores : 2-digit Chapter Level
Turnover Exceeding Rs 5 crore : HSN code of 4 digits
Export and Imports : 8 digits Level – Mandatory
For Services
For Services, Service Tax Accounting Codes (‘SAC’) shall be used.
SNPanigrahi

SN Panigrahi 69
Description HSN No.
BASMATI Rice 10063020
BROWN RAJMA 0713.33 00
URAD DAL 0713.31 00
CLOVES 9071010
CASHEW 0801.32.10
JAGGERY BLOCKS 1701.13.10
MULTIGRAIN ATTA 1102.90.90
Soya Bean 1201 10 00
STEAM STERILIZED CHILLY POWDER 0904.22.11

70
Item HSN Code GST
Rate
Cotton and Cotton waste 5201 to
5203
5%
Cotton yarn [other than khadi yarn] 5205 to
5207
5%
Woven Fabrics of Cotton 5208 to
5212
5%
Activity SAC
Code
GST
Rate
Job Work - Textile 998821 5%
Management consulting and management services
including financial, strategic, human resources,
marketing, operations and supply chain management.
998311 18%
Manpower Supply - Other employment & labour supply
services n.e.c
998519 18%

71
Chapter 1 Live Animals, Bovine & Poultry Chapter 21 Tea & Coffee Extract & Essence
Chapter 2 Meat & Edible Offal of Animals Chapter 22 Water – Mineral & Aerated
Chapter 3 Fish Meat & Fillets Chapter 23 Flours, Meals & Pellets
Chapter 4 Eggs, Honey & Milk Products Chapter 24 Tobacco, Stemmed & Stripped
Chapter 5 Non Edible Animal Products Chapter 25 Salts & Sands
Chapter 6 Live Trees & Plants Chapter 26 Mineral Ores & Slags
Chapter 7 Vegetables Chapter 27 Fossil Fuels – Coal & Petroleum
Chapter 8 Fruits & Dry Fruits Chapter 28 Gases & Non Metals
Chapter 9 Tea, Coffee & Spices Chapter 29 Hydrocarbons – Cyclic & Acyclic
Chapter 10 Edible Grains Chapter 30 Drugs & Pharmaceuticals
Chapter 11 Milling Industry Products Chapter 31 Fertilisers
Chapter 12 Oil Seeds, Fruit & Part of Plants Chapter 32 Tanning & Colouring Products
Chapter 13 Gums, Resins, Vegetable SAP &
Extracts
Chapter 33 Essential Oils, Beauty Products
Chapter 14 Vegetable Material & Products Chapter 34 Soaps, Waxes, Polish products
Chapter 15 Fats, Oils & Waxes their Fractions Chapter 35 Casein, Albumin, Gelatin, Enzymes
Chapter 16 Preserved/Prepared Food Items Chapter 36 Propellants, Explosives, Fuses,
Fireworks
Chapter 17 Sugar, Jaggery, Honey & bubble
Gums
Chapter 37 Photographic & Cinematographic
Films
Chapter 18 Chocolate & Cocoa Products Chapter 38 Insecticides, Artificial Carbon &
Graphite
Chapter 19 Pizza, Cake, Bread, Pasta & Waffles Chapter 39 Polymers, Polyethylene, Cellulose
Chapter 20 Edible Plants – Fruits, Nuts & Juices Chapter 40 Rubber, Plates, Belt, Condesnsed
Milk
HSN Chapters
Harmonized System means the nomenclature which makes up the Harmonized Commodity escription and Coding
System including the chapters and the corresponding number codes, section notes and Chapter notes, as well as the
General Rules for their interpretation

72
Chapter 41 Raw hides & Skins, Leather Chapter 61 Men & Women Clothing
Chapter 42 Trunks, Suit-cases, Vanity cases Chapter 62 Men & Women Jackets, Coats &
Garments
Chapter 43 Raw Fur Skins, Articles of apparel Chapter 63 Blankets & Bedsheets
Chapter 44 Fuel wood, Wood Charcoal Chapter 64 Shoes & Footwear Products
Chapter 45 Natural Cork, Shuttlecock Cork Chapter 65 Hats & Accessories
Chapter 46 Plaiting Materials, Basketwork Chapter 66 Umbrellas & Accessories
Chapter 47 Mechanical & Chemical woodpulp Chapter 67 Artificial flowers, Wigs & False Beards
Chapter 48 Newsprint, Uncoated paper & paperboard Chapter 68 Monumental & Building Stones
Chapter 49 Printed Books, Brochures, Newspapers Chapter 69 Bricks, Blocks & Ceramics
Chapter 50 Silk Worm Coccon, Yarn, Waste & Woven
Fabrics
Chapter 70 Glasses, Mirrors, Flasks
Chapter 51 Wool materials & Waste, Animal Hairs Chapter 71 Pearls, Diamonds, Gold, Platinum
Chapter 52 Cotton materials, Synthetics & Woven
fabrics
Chapter 72 Iron, Alloys, Scrap & Granules
Chapter 53 Flex raw, Vegetable materials & Paper yarn Chapter 73 Iron tube, piles & Sheets
Chapter 54 Synthetic felaments, Woven fabrics &
Rayons
Chapter 74 Copper Mattes, Rods, Bars, Wires.
Plates
Chapter 55 Synthetic felament tows & Polyster staple
fiber
Chapter 75 Nickel Mattes & Unwrought Nickel
Chapter 56 Towels, Napkins, ropes & Netting materials Chapter 76 Unwrought Aluminium- Rods, Sheets &
Profiles
Chapter 57 Carpets & Floor coverings textile
Handlooms
Chapter 77
Reserved for Possible Future Use
Chapter 58 Labels, Bades, Woven pile & Chennile,
Terry towelings
Chapter 78 Unwrought Lead – Rods, Sheets &
Profiles
Chapter 59 Rubberised textile fabrics, Convayer belts Chapter 79 Unwrought Zinc – Rods, Sheets &
Profiles
Chapter 60 Pile,Wrap Knit,Tarry & Croched fabrics Chapter 80 Unwrought Tin – Rods, Sheets &
Profiles
HSN Chapters

73
Chapter 81 Magnesium, Cobalt, Tungsten Articles
Chapter 82 Hand Tools & Cutlery
Chapter 83 Locks, Metal Mountings & Fittings
Chapter 84 Industrial Machinery
Chapter 85 Electrical Parts & Electronics
Chapter 86 Railway Locomotives & Parts
Chapter 87 Tractors & Motor Vehicles
Chapter 88 Balloons, Parachutes & Airlift Gear
Chapter 89 Cruise Ships & Boats
Chapter 90 Medical, Chemical & Astronomy
Chapter 91 Watches & Clocks
Chapter 92 Musical Instruments
Chapter 93 Military Weapons & firearms
Chapter 94 Furniture, Bedding & lighting
Chapter 95 Children Toys, Table & Board Games &
Sports Goods
Chapter 96 Pencil Lighter Toiletries
Chapter 97 Paintings Decoratives Sculptures
Chapter 98 Machinery Lab Chemicals Drugs
Medicines
HSN Chapters

74
9954 CONSTRUCTION SERVICES
9961 SERVICES IN WHOLE SALE TRADE
9962 SERVICES IN RETAIL TRADE
9963 ACCOMMODATION , FOOD AND BEVERAGE SERVICES
9964 PASSENGER TRANSPORT SERVICES
9965 GOODS TRANSPORT SERVICES
9966 RENTAL SERVICES OF TRANSPORT VEHICLES WITH OR WITHOUT OPERATORS
9967 SUPPORTING SERVICES IN TRANSPORT
9968 POSTALAND COURIER SERVICES
9969 ELECTRICAL , GAS, WATER AND OTHER DISTRIBUTION SERVICES
9971 FINANCIAL AND RELATED SERVICES
9972 REAL ESTATE SERVICES
9973 LEASING OR RENTAL SERVICES WITH OR WITHOUT OPERATOR
9981 RESARCH & DEVELOPMENT SERVICES
9982 LEGALAND ACCOUNTING SERVICES
9983 OTHER PROFESSIONAL , TECHNICALAND BUSINESS SERVICES
9984 TELECOMMUNICATIONS, BROADCASTING AND INFORATION SUPPLY SERVICES
9985 SUPPORT SERVICES
9986 SUPPORT SERVICES TOAGRICULTURAL HUNTING,FORESTRY, FISHING, MINING AND UTILITIES
9987 MAINTENANCE , REPAIR AD INSTALLATION ( EXCEEPT CONSTRUCTION ) SERVICES
9988 MANUFCTURING SERVICES ON PHYSICAL INPUTS (GOODS) OWNED BY OTHERS
9989 OTHER MANNUFACTURING SERVICES, PUBLISHING PRINTING AND REPRODUCTION SERVICES, MATERIAL RECOVERY SERVICES
9991 PUBLIC ADMINISTRATION AND OTHER SERVICES PROVIDED TO THE COMMUNITY ASA WHOLE , COMPULSORY SOCIAL SECURITY SERVICES
9992 EDUCATION SERVICES
9993 HUMAN HEALTH AND SOCIAL CARE SERVICES
9994 SEWGE AND WASTE COLLECTION , TREATMENT AND DISPOSALAND OTHER ENVIRONMENTAL PROTECTION SERVICES
9995 SERVICES OF MEMBERSHIP ORGANISATION SERVICES
9996 RECREATIONAL, CULTRAL AND SPORTING SERVICES
9997 OTHER SERVICES
9998 DOMESTIC SERVICES
9999 SERVICES PROVIDED BY EXTRATERRITORIAL ORGANIZATIONS AND BODIES
SERVICE ACCOUNT CODE (S A C) UNDER GST LAW

75
Worldwide GST
France was the first country to introduce GST in 1954. Worldwide, Almost 150 countries
have introduced GST in one or the other form since then.
Most of the countries have a unified GST system.
Brazil and Canada follow a dual system vis-à-vis India is now adopted the same.
In China, GST applies only to goods and the provision of repairs, replacement and processing
services. GST rates of some countries are given below:-
Country
Rate of
GST
Country
Rate of
GST
Australia 10% Singapore 7%
France 19.6% Denmark 25%
China 17% Taiwan 5%
UK 17.5%
New
Zealand
15%
Canada 5% Philippines 10%
Germany 19% Indonesia 10%
Japan 5%

77
Supplier Recipient
Makes Supply – Tax Invoice
Forward Charge – Collects GST
Makes / Promises to Make Payment
Supply Value + GST
Govt.
Deposits GST
with Govt.
Supplier Recipient
Makes Supply – No Tax Invoice – Charges No Tax
Tax to be Paid by Recipient on Reverse Charge
Makes / Promises to Make Payment
Supply Value only
Govt.
Pays GST
On
Basis
Supplier Liable to Pay GST
Recipient Liable to Pay GST
Forward Charge Mechanism
Reverse Charge Mechanism

Sec 2(98) of CGST Act : “reverse charge” means the liability to pay tax by the recipient of supply of goods or services
or both instead of the supplier of such goods or services or both under sub-section (3) or sub-section (4) of section 9, or
under sub-section (3) or subsection (4) of section 5 of the Integrated Goods and Services Tax Act;
Sec 9(3) of CGST Act : 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 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.
Sec 9(4) of CGST Act : The central tax in respect of the supply of taxable goods or services or both by a supplier, who is
not registered, to a registered person shall be paid by such person on reverse charge basis as the recipient 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.
Amended Section 9(4) effective from 01-02-2019 read as follows:
“Section 9(4). The Government may, on the recommendations of the Council, by notification, specify a class of registered
persons who shall, in respect of supply of specified categories of goods or services or both received from an unregistered
supplier, pay the tax on reverse charge basis as the recipient of such supply of 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 such supply of
goods or services or both”
Reverse Charge
In GST, Reverse Charge is applicable both on Goods & Services. There was No Reverse Charge
Mechanisms in Supply of Goods. However, some States were Collecting in the name of Purchase
Tax on Certain Goods from Recipient

79
Supply
Notified
Goods &
ServicesSupplier
Recipient
Registered
Issue Self Invoice
Issue Payment Voucher
Pay GST on RCM
Supply
Supplier
Un-Registered
Recipient
Registered
Various Changes are
made from
time to
time
Continued to be Applicable
Issue Self Invoice
Issue Payment Voucher
Pay GST on RCM

Reverse Charge Mechanism (RCM)
Notified Goods
& Services
Or
Or
Deferred
w.e.f. 13-10-2017 till 30.09.2019
Notification No. 38/2017 – Central Tax (Rate); 13th Oct, 2017
& Notification No. 10/2018 – Central Tax (Rate); 23rd March, 2018
Notification No.12/2018 – Central Tax (Rate); 29th June, 2018
Notification No. 22/2018 – Central Tax (Rate); 6th August, 2018
Relaxed
w.e.f. 1-07-2017 till 13-10-2017
Notification No. 08/2017 – Central Tax (Rate) dated 28-06-2017
No RCM on Intra-State Supplies Received from Un-Registered
Supplier(s) for value not exceeding five thousand rupees in a day.
No such exemption was granted under IGST act.
Central Goods &
Services Tax
(Amendment) Act,
2018 (No 31 of 2018)
-30th August 2018
Effective from 01-02-
2019
Notification No.
02/2019 – Central
Tax dated 29-01-2019
Reverse
Charge
Supply from
Un-registered
Person
Up to 30-01-2019
w..e.f 1-02-2019
Certain specified
Categories of Goods or
Services or both by
Notified Classes of
Registered Persons
from Unregistered
Suppliers
vide Notification No. 01/2019 – Central Tax (Rate) dated 29-01-2019, Central Government rescinds principle Notification No.
08/2017 – Central Tax (Rate) dated 28-06-2017 and consequently exemption provided till 30th September 2019 stands
withdrawn.

SN Panigrahi 81
As per section 9(4) of CGST Act 2017, RCM will be applicable to all the registered persons on all type
of supplies of goods or services from an unregistered person
As per Notification No. 8/2017 CGST(Rate) dated 28.06.17 RCM will be applicable only when the aggregate value of supplies
received by a registered person from unregistered person in the Intra-
State Transaction Exceeds Rs. 5000 per day.
As per Notification
No. 38/2017 CGST(Rate) dated 13.10.17
Provisions of RCM u/s 9(4) were suspended Efective from 13th
Oct’2017 up to 31.03.18.
As per Notification
Provisions of RCM u/s 9(4) were suspended up to 30.06.18.
As per Notification
As per Notification
Notification No. 22/2018 – Central Tax (Rate); 6th August, 2018
As per Notification
Provisions of RCM u/s 9(4) will be applicable from 01.02.19
As per Notification
No. 2/2019 CGST dated 29.01.19
CGST (Amendment) Act, 2018 will be applicable which has made
changes in the provision of section 9(4)
As per section 9(4) of
CGST(Amendment) Act 2018
RCM will be applicable to the specific class of registered
persons on the specific category of supplies of goods or
services from an unregistered person.
Conclusion: Provisions of RCM u/s 9(4) will be applicable ONLY after the Government will notify
 The specific category of registered persons on whom it will be applicable;
 The specific category of supply of goods or services on which it intends to make it applicable.
Series of Changes in Section 9(4) Notified from Time to Time by Government

82
Reverse Charge : Notified
Goods & Services : Sec 9(3)
Notified Goods
Notification No. 04/2017- Central Tax
(Rate) dated 28th June, 2017
(Rate) dated 13th October, 2017
(Rate) dated 14th November 2017
(Rate) dated 28th May, 2018
Notified Services
Notification No. 13/2017- Central
Tax (Rate) dated 28th June, 2017
Tax (Rate) dated 13th October,
2017
Tax (Rate) dated 25th January,
2018
Tax (Rate) dated 26th July, 2018
Sec 9(3) of CGST Act : Reverse charge may be applicable in case of supply
of notified goods or services or both.
SN Panigrahi

83
S.
No
Tariff item,
sub-heading,
heading or
Chapter
Description of supply of
Goods
Supplier of goods Recipient of supply
1 0801 Cashew nuts, not shelled or
peeled
Agriculturist Any registered person
2 1404 90 10 Bidi wrapper leaves (tendu) Agriculturist Any registered person
3 2401 Tobacco leaves Agriculturist Any registered person
4 5004 to 5006 Silk yarn Any person who manufactures silk
yarn from raw silk or silk worm
cocoons for supply of silk yarn
Any registered person
4A 5201 Raw cotton Agriculturist Any registered person”
5 Supply of lottery. State Government, Union Territory or
any local authority
Lottery distributor or selling agent. Explanation.- For
the purposes of this entry, lottery distributor or selling
agent has the same meaning as assigned to it in
clause (c) of Rule 2 of the Lotteries (Regulation)
Rules, 2010, made under the 2 provisions of sub
section 1 of section 11 of the Lotteries (Regulations)
Act, 1998 (17 of 1998).
6. Any Chapter Used vehicles, seized and
confiscated goods, old and
used goods, waste and scrap
Central Government, State
Government, Union territory or a local
authority
Any registered person
7 Any Chapter Priority Sector Lending
Certificate
Any registered person Any registered person
Reverse Charge : Notified Goods
Notification No.4/2017-Central Tax (Rate), Dt : 28th June, 2017
Amended (by adding Sr No 6) vide Notification No. 36/2017-Central Tax (Rate), 13th October, 2017
Amendment (by adding Sr 4A) vide Notification No : Notification No. 43/2017-Central Tax (Rate), 14th November, 2017
Amended vide Notification No. 11/2018-Central Tax (Rate) dated 28th May, 2018

RCM for Services
 Goods Transport Agency (GTA)
 Services supplied by an individual advocate including a senior advocate by way of
Representational services
 Services supplied by an Arbitral Tribunal to a business entity
 Services provided by way of Sponsorship to any body corporate or partnership firm.
 Government or Local authority
 Services supplied by the Central Government, State Government, Union territory or local
authority by way of renting of immovable property to a person registered under the Central
Goods and Services Tax Act, 2017 (12 of 2017)
 Services supplied by a Director of a Company or a body corporate to the said company or the
body corporate
Reverse Charge : Notified Services
Notification No. 13/2017- Central Tax (Rates) DT:28.06.2017
As Amended vide Notification no 03/2018 Central tax (Rate) dated 25th January 2018 & 15/2018-
Central Tax (Rate) ,dt. 26-07-2018; Notification No. 29/2018- Central Tax (Rate) Dated 31.12.2018.

RCM for Services
 An insurance agent
 Services supplied by a Recovery Agent to a banking company or a financial institution or a non-
banking financial company.
 Supply of services by Author or music composer, photographer, artist, etc
 Taxi driver or Rent a cab operator
 Supply of services by the members of Overseeing Committee to Reserve Bank of India
 Services supplied by individual Direct Selling Agents (DSAs) other than a body corporate,
partnership or limited liability partnership firm to bank or non-banking financial company (NBFCs).
 Services provided by business facilitator (BF) to a banking company
 Services provided by an agent of business correspondent (BC) to business correspondent (BC).
 Security services (services provided by way of supply of security personnel) by Any person other
than a body corporate to a registered person, located in the taxable territory
Reverse Charge : Notified Services
Notification No. 13/2017- Central Tax (Rates) DT:28.06.2017
As Amended vide Notification no 03/2018 Central tax (Rate) dated 25th January 2018 & 15/2018-
Central Tax (Rate) ,dt. 26-07-2018; Notification No. 29/2018- Central Tax (Rate) Dated 31.12.2018.
Cont,,,,,,

86
GST on Import of Services Notification no 10/2017 Integrated Tax (Rate) dated 28th June
2017 u/s 5(3) of IGST Act, requires payment under RCM for:
i) Any service supplied by any person who is located in a non-taxable territory to any
person other than nontaxable online recipient.
Thus, the import of services will fall under this category as supply of any service where the
supplier is located outside India and the recipient is located in India, the place of supply
of service will be in India.
It may be noted that, Import of services by an Indian branch from their overseas branch, in
the course or furtherance of business, even if without consideration, will be a supply due
to provision contained in Schedule I of the CGST Act, 2017.
RCM – Import Services

SN Panigrahi 87
Sr.
No
Services Provider of
service
Recipient of Service
1 Taxable services provided or
agreed to be provided by
any person who is located in
a non-taxable territory and
received by any person
located in the taxable
territory other than non-
assessees online recipient
(OIDAR)
#
Any person
who is located
in a non-
taxable
territory
Any person located in the
taxable territory other than
non-assessee online
recipient (Business
Recipient)
RCM – Import Services

SN Panigrahi 88
Newly Notified Service Under Notification No. 05/2019
dated 29th March,2019 on which RCM Applicable from 1st April 2019.
Sr.
No
service
1 Services supplied by any person
by way of Transfer Of
Development Rights or Floor
Space Index (FSI) (including
additional FSI) for construction of
a project by a promoter.
Any person Promoter
2 Long Term Lease of Land (30
years or more) by any person
against consideration in the form
of upfront amount (called as
premium, salami, cost, price,
development charges or by any
other name) and/or periodic rent
for construction of a project by a
promoter.
Any person Promoter

SN Panigrahi 89
Sr.
No
service
Services by way of
transportation of goods by
a vessel from a place
outside India up to the
customs station of
clearance in India
A person
located in
non-taxable
territory to a
person
located in
non-taxable
territory
Importer as defined under
clause (26) of section 2 of
the Customs Act, 1962.
RCM – Import of Goods – Freight
Paid by Overseas Supplier
INCOTERM : CNF & CIF

SN Panigrahi 90
 Tax under Reverse Charge can be Paid through Cash only – Rule 85(4) of
CGST Rules
 ITC can’t be utilized for Payment of Tax under GST
 The supplier must mention in his Invoice stating “the tax is payable on
reverse charge”.
Availing Input
Tax Credit (ITC)
on Reverse Charge by
Recipient
 Self Invoice shall be created by Recipient, showing Tax Rate & Amount and
Other details as per Rule 46 CGST Rules
Manner of
Payment
of GST under Reverse
Charge
 Credit is allowed to be claimed on Self Assessment basis by Filling GSTR 3B
 The Recipient is entitled to avail ITC subject to Eligibility Conditions
Stipulated Sec 16 of CGST Act
 Further availing ITC is subject to Blocked Credit as per Sec 17(5) of CGST
Act

SN Panigrahi 91
 Even though the Recipient is Registered under Composition Scheme, Tax is
Payable on Reverse Charge” wherever appillcable.
Reverse Charge
Miscellaneous
Aspects
 Composition Scheme Recipient is Not Entitled for ITC
Reverse Charge
Applicability for
Composition
Scheme
 The Recipient of Supplies attracting RCM, must be Registered
 An ISD cannot make purchases liable to Reverse Charge
 Reverse Charge is Applicable in case of Advance Payments also
 The Rate Applicable to the supplies is the rate at which GST has to be
paid. This means that rate under composition scheme should not be used
for Reverse Charge purposes.

92
The Time of Supply (TOS) in case of RCM:
In case of GOODS In case of Services
The TOS would be Earliest of the
following:
 the date of Receipt of goods
 the date of Payment*
 the date
immediately after 30 days from the
date of issue of an invoice by the
supplier {not from Self Invoicing}
If it is not possible to determine the TOS
by the above, the time of supply shall be
the date of entry in the books of account
of the recipient.
*This point is no more applicable based
this Notification No. 66/2017 – Central
Tax issued on 15.11.2017
The TOS shall be the earliest of the
following dates:
 The date of Payment
 The date
immediately after 60 days from the
date of issue of an invoice by the
supplier {not from Self Invoicing}
If it is not possible to determine the TOS
by the above, the time of supply shall be
the date of entry in the books of account
of the recipient.

SN Panigrahi 93
Four Pillars of
GST
When?
Time of Supply
To Determine the Rate of Tax &
To Determine Due Dates
for Payment of Taxes.
What is Taxable Event?
Supply
All forms of Supply for a
Consideration +
Even though without Consideration
as per Schedule -1
Where?
Place of Supply
To Determine Nature of Supply
ie whether Intra-State or Inter-State
& Export or Import
On What Value?
Value of Supply
Transaction Value

94
Se 2(107) of CGST Act : “taxable person” means a person who is Registered or Liable to be Registered
under section 22 or section 24.
Sec 22. (1) of CGST Act : Every supplier shall be liable to be registered under this Act in the State or Union
territory, other than special category States, from where he makes a taxable supply of goods or services or
both, if his aggregate turnover in a financial year exceeds twenty lakh rupees:
Provided that where such person makes taxable supplies of goods or services or both from any of the special
category States, he shall be liable to be registered if his aggregate turnover in a financial year exceeds ten
lakh rupees.
Sec 2(108) of CGST Act : “taxable supply” means a supply of goods or services or both which is leviable to tax
under this Act.
Sec(78) of CGST Act : “non-taxable supply” means a supply of goods or services or both which is not leviable
to tax under this Act or under the Integrated Goods and Services Tax Act.
Sec 24. of CGST Act : Compulsory Registration in certain cases
Special Category States (as mentioned in Art.279A(4)(g) of the Constitution of India) comprise of Arunachal
Pradesh, Assam, Jammu and Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal
Pradesh and Uttarakhand.

SN Panigrahi 95
Threshold Limit Crosses Rs 20 Lakhs
for Other than Special Category States
under Sec 22 of CGST Act
Threshold Limit Crosses Rs 10 Lakhs
for Special Category States
Compulsory Registration Irrespective
of Threshold Limit
Exempt from Register in Certain Cases
Sec 23 of CGST Act
When
Gross
Turnover
Notification No. 06/2019 – Central
Tax 29/01/2019
Prior 01/02/2019 W.e.f 01/02/2019
Special Category States
Threshold Limit Rs 10 L
Arunachal Pradesh
Assam
Jammu & Kashmir
Manipur
Meghalaya
Mizoram
Nagaland
Sikkim
Tripura
Himachal Pradesh
Uttarakhand
Special Category States
Threshold Limit Rs 10 L
Jammu & Kashmir
Manipur
Mizoram
Nagaland
Tripura
The threshold limit for
registration has been
increased from INR 10 lakh
to INR 20 lakh in states of
Assam,
Arunachal Pradesh,
Himachal Pradesh,
Meghalaya,
Sikkim and
Uttarakhand

96
Person
Engaged in
Exclusive
Supply of
Goods
(Not Services)
Aggregate
Turnover in the
Financial Year
< Rs 40 Lakhs
Except
Persons Required to
take Compulsory
Registration under
Section 24 of CGST
Act
Persons Engaged in
Making Supplies of the
Following Goods:
 1. Ice Cream and
other Edible Ice,
whether or not
containing Cocoa
 2. Pan Masala
 3. Tobacco and
Manufactured
Tobacco Substitutes
Persons Engaged in
Making Intra-State
supplies in the States of
 Arunachal Pradesh,
 Manipur,
 Meghalaya,
 Mizoram,
 Nagaland,
 Puducherry,
 Sikkim,
 Telangana,
 Tripura,
 Uttarakhand
Persons Exercising
Option under the
provisions of sub-section
(3) of section 25
(Voluntary Registration),
or
such registered persons
who intend to continue
with their registration
under the said Act
Exempt from Obtaining
Registration
(Sec 23(2))
w.e.f.
1st
April,
2019

SN Panigrahi 97
The above limit of Rs 40 Lakhs does not apply to following:
(a) persons required to take compulsory registration under section 24 of the said Act;
(b) persons engaged in making supplies of Demerit goods, namely – Ice cream and other edible ice,
whether or not containing cocoa, Pan Masala and Tobacco and manufactured tobacco substitutes
(c) persons engaged in making intra-State supplies in the States of Arunachal Pradesh, Manipur,
Meghalaya, Mizoram, Nagaland, Puducherry, Sikkim, Telangana, Tripura, Uttarakhand
(d) persons exercising option under the provisions of sub-section (3) of section 25, i.e. who
have voluntarily obtained GST registration or such registered persons who intend to continue with
their registration under the said Act

SN Panigrahi 98
Important Points to be noted
1. The new registration limit is only for goods and not for services
2. Inter-state supply of goods shall not be covered, since persons making inter-state supplies
are mandatorily required to get registered as per Section 24
3. If the person has obtained registration because of Section 24, the new limit of Rs. 40 Lakhs
shall not apply then.
4. The new limit is applicable from 1st April 2019, i.e. Financial Year 2019-20.

Aggregate
Turnover
Turnover of All Units Computed On All India Basis having
Same Permanent Account Number (PAN)
Taxable
supplies
Exempt
Supplies
Export
Turnover
Inter-State Supplies
Of Distinct Persons
Includes
Excludes
Value of Inward Supplies on which Tax is Payable by a Person on Reverse Charge Basis
Central Tax, State Tax, Union Territory Tax, Integrated Tax and Compensation Cess
Sec 2(6) of CGST Act : “aggregate turnover” means the aggregate value of all taxable supplies
(excluding the value of inward supplies on which tax is payable by a person on reverse charge basis),
exempt supplies, exports of goods or services or both and inter-State supplies of persons having the
same Permanent Account Number, to be computed on all India basis but excludes central tax, State
tax, Union territory tax, integrated tax and cess;
Aggregate Turnover

Wholly Exempt
From Tax
Nil Rate of
Supply
Non-Taxable
Supply
Sec 2(47) of CGST Act: “exempt supply” means supply of any goods or services or both which
attracts nil rate of tax or which may be wholly exempt from tax under section 11, or under section 6
of the Integrated Goods and Services Tax Act, and includes non-taxable supply;
Exempt Supply
Exempt
Supply

101
Sec 22. (1) of CGST Act : Every supplier who makes a taxable supply and whose
aggregate turnover in a financial year exceeds twenty lakh rupees need to be
Registered under GST.
SNPanigrahi
Structure of Registration Number
State
Code
PAN
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Entity Code
Blank
Check Digit (Logical Code)
Each taxpayer will be allotted a state wise PAN-based 15-digit Goods and Services Taxpayer
Identification Number (GSTIN)
Various digits in GSTIN will denote the following :
State Code
as defined under the
Indian Census - 2011
Multiple Places of business
Alpha-numeric (1-9 and then A-Z) and
would be assigned depending on the
number of registrations a legal entity
(having the same PAN) has within
one state.
For Future
Use
10 Digit PAN

SN Panigrahi 102
PAN
1 2 3 4 5 6 7 8 9 10
First three Characters
Alphabetic series running
from AAA to ZZZ
Fourth character of PAN represents the
status of the PAN holder.
Fifth character Represents first character
a) of the PAN holder's Last Name / Surname in
case of Individual.
b) of the name of the Entity, Trust, society, or
organisation in the case of Company/ HUF/
Firm/ AOP/ Trust/ BOI/ Local Authority/ Artificial
Judicial Person/ Govt, where the fourth
character is "C","H","F","A","T","B","L","J","G".
Next four characters are
Sequential Number Running
from 0001 to 9999.
The last (10th)
character is an
alphabetic digit
used as a
check-sum to
verify the
validity of that
current code.
A — Association of Persons (AOP)
B — Body of Individuals (BOI)
C — Company
F — Firm
G — Government
H — HUF (Hindu Undivided Family)
L — Local Authority
J — Artificial Juridical Person
P — Individual (PROPRIETOR)
T — Trust (AOP)
E – LLP (Limited Liability Partnership)
It is a unique, 10-character alpha-numeric identifier, issued under Section 139A of the Income Tax Act, 1961 – Valid for Life Time. The PAN is
mandatory for a majority of financial transactions such as opening a bank account, receiving taxable salary or professional fees, sale or
purchase of assets above specified limits etc.; especially high-value transactions. It also serves as an important proof of identification.

103
Sec 2(18) of CGST Act : “business vertical” means a distinguishable component of an
enterprise that is engaged in the supply of individual goods or services or a group of related
goods or services which is subject to risks and returns that are different from those of the
other business verticals.
Explanation.––For the purposes of this clause, factors that should be considered in
determining whether goods or services are related include––
(a) the nature of the goods or services;
(b) the nature of the production processes;
(c) the type or class of customers for the goods or services;
(d) the methods used to distribute the goods or supply of services; and
(e) the nature of regulatory environment (wherever applicable), including
banking, insurance, or public utilities;
w.e.f 1-02-2019
The term ‘multiple business verticals’ has been removed from the provisions of registration and has
been substituted by the term ‘multiple places of business’, and separate registration for each such
place of business within the state or union territory shall be granted subject to the fulfilment of
conditions specified therein.

SN Panigrahi 104
A separate registration shall be required by a person having a special economic zone (SEZ) unit
or being an SEZ developer from his/her other units located outside the SEZ in the same state or
union territory.

105
Sec 25(4) of CGST Act : A person who has obtained or is required to obtain more than one
registration, whether in one State or Union territory or more than one State or Union territory
shall, in respect of each such registration, be treated as distinct persons for the purposes
of this Act.
Sec 25(5) of CGST Act : Where a person who has obtained or is required to obtain registration in a
State or Union territory in respect of an establishment, has an establishment in another State or
Union territory, then such establishments shall be treated as establishments of distinct persons for the
purposes of this Act.
Sec 2(50) of CGST Act : “fixed establishment” means a place (other than the registered place of
business) which is characterized by a sufficient degree of permanence and suitable structure in terms
of human and technical resources to supply services, or to receive and use services for its own needs;
Same Legal Entity – Same PAN
Distinct Persons
Registered
Dealer
State - A
Registered
Dealer
State - B
Registered
Dealer
Same State - A
Separate
GST Registration
Separate
GST Registration
Separate
GST Registration
Registered
Dealer
State - C
Separate
GST Registration

106
GST is State Specific – That means if a business has operations in different
States then in each of such States Separate Registration is Required
• Display of Registration Certificate

Central / State Government may be regarded as a taxable person in respect of activities
engaged as public authorities except otherwise specified
Every Registered Person become Taxable Person would be required to pay GST and
threshold of INR 20 lakhs / Rs 10 Lakhs will not be available to such registered person.
A person having multiple business places in a State may obtain (optional) separate
registrations for each such place in that State.
Place of registration is the state from where taxable goods and / or services are supplied by
a supplier.
Persons making inter-State taxable supply irrespective of threshold; Persons liable to pay
GST under reverse charge; Input Service Distributor; E-Commerce Operator need to obtain
registration.
An agriculturist, to the extent of supply of produce out of cultivation of land, would not be liable
to take registration in the GST regime.
Some categories of persons shall be required to be Registered Compulsorily - Sec 24 of
CGST Act
SNPanigrahi

Registration
Normal Registration
(Upto 20 Lakhs / 10 Lakhs – Sec 22(1))
Registration Under Composition
(Upto 1.5 Cr – Sec 10)
Registration as Casual Taxable Person
(Valid for 90 Days – Sec 24 & 27)
Compulsory Registration
(Sec 24)
Registration in every
such State or Union
territory in which he is
so liable – Sec 25(1)
Deemed Registration
(Sec 26)
Not Liable for Registration
(Sec 23)
Voluntary Registration
(No threshold Limit – Sec 25(3))
ISD Registration
(Sec 24)
w.e.f 1st Apr’19:
Exclusive Supply of Goods
(Upto 40 Lakhs – Sec 23(2))
w.e.f 1st Apr’19
For suppliers of Services or Mix
Suppliers
(Upto 50 Lakhs)

Persons making any
Inter-State Taxable
Supply
Casual Taxable Persons
making Taxable Supply
Persons who are required
to Pay Tax under Reverse
Charge
Person who are required to
pay tax under sub-section
(5) of section 9 (e-
Commerce Services)
Non-resident Taxable
Persons making taxable
supply
Persons who are required
to deduct tax under
section 51, whether or not
separately registered under
this Act
Persons who make taxable
supply of goods or services
or both on behalf of other
taxable persons whether
as an Agent or otherwise
Input Service Distributor,
whether or not separately
registered under this Act
Persons who supply
through electronic
commerce operator who
is required to collect tax at
source under section 52
Every electronic
commerce operator
Every person supplying
online information and
data base access or
retrieval services from a
place outside India to a
person in India, other than
a registered person
Such other person or class
of persons as may be
notified by the Government
on the recommendations of
the Council
Compulsory Registration : Sec 24

110
Persons Not Liable to Registration
Section 23 of CGST Act
Not Liable
to Registration
Supplies
Not Liable to Tax
or Wholly Exempted
An Agriculturist for
Produce out of
Cultivation of Land
By notification
Specify the Category
of Persons
Sec 2(7) of CGST Act “agriculturist” means an individual or a Hindu Undivided Family who
undertakes cultivation of land—
(a) by own labour, or
(b) by the labour of family, or
(c) by servants on wages payable in cash or kind or by hired labour under
personal supervision or the personal supervision of any member of the family
Sec 23(1)(b)

111
Supplier
Inter-State
Supply
Casual Taxable Persons – Supplying
Handicraft Goods – Aggregate Turnover < Rs
20 L
– Notf: 32/2017, 15th Sep’17
Supplier
Need
Not
Register
Inter-State Supply Handicraft Goods
– Aggregate Turnover < Rs 20 L
– Notf No. 8/2017 – Integrated Tax, dt. 14th
Sep’17,
Job-workers making Inter-State supply of
Services to a Registered Person
Exemption will not be available to job work in
relation to jewellery, goldsmiths’ and
silversmiths’ wares as covered under Chapter
71 which do not require e-way bill.
Notf : No. 07/2017-Integrated Tax, dt. 14th
Sep’17
Inter-State Supply by Service Providers
Decision Taken in 22nd meeting of the
Council
Notification No. 10/2017 – Integrated Tax; 13th October,
Supplier Need Not Register

 Notification No. 10/2017 – Integrated Tax; 13th October, 2017
Inter-State Supply by Service Providers
 Notification No. 65/2017 – Central Tax, the 15th November, 2017
Supplies of Services through E-Commerce Operator : Turnover < Rs 20 L - whether
supplying intra-State, inter-State or through e-commerce operator
 Notification No. 65/2017 – Central Tax; 15th Nov’ 2017 (Except Supply through e-
Commerce
Person having an Aggregate Turnover of Less than INR 20 Lakhs (INR 10 Lakhs)
 Notification No. 5/2017- Central Tax dated 19/06/2017
All the Supplies Under RCM
Supplier Exempted from Registration

113
 Notification No. 32/2017 Integrated Tax, 15th Sep’17
Casual Taxable Persons – Supplying Handicraft Goods – Aggregate Turnover < Rs 20
L
 Notification No. 8/2017 – Integrated Tax, dt. 14th Sep’17
Inter-State Supply Handicraft Goods
- Aggregate Turnover < Rs 20 L
 Notification No. No. 07/2017-Integrated Tax, dt. 14th Sep’17 (Exemption will not be available to
jewellery, goldsmiths’ and silversmiths’ wares as covered under Chapter 71 which do not require
e-way bill).
Job-workers making Inter-State supply of Services to a Registered Person -
Aggregate Turnover < Rs 20 L
Supplier Exempted from Registration

SN Panigrahi 116
Sec
16
Sec
18
Sec
19
Sec
20
Sec
21
Sec
17
Eligibility & Conditions for Taking Credit
Apportionment of Credit & Blocked Credit
Availability of Credit in Special Circumstances
Taking Input Tax Credit in Respect of Inputs & Capital
Goods Sent for Job Work
Manner of Distribution of Credit by ISD
Manner of Recovery of Credit Distributed in Excess

ITC allowed only to a Registered Taxable
Person
Which are used or intended to be used in
the course or furtherance of his business
Possession of Tax Invoice / Tax Document
Goods or Services Received
Documentary Evidence of Tax Paid by the
Supplier
Payment Made to Supplier within 180 Days
Tax Documents must contain GSTIN of both
Supplier and Recipient & other Particulars
Documentary Evidence of Returns Filled
Taxable Outward Supply
(Not Exempted)
ITC allowed against Tax Invoice; Self
Invoice (RCM); Debit Note; B/E; ISD Invoice
Recipient has Not Claimed Depreciation on
the tax component
No ITC shall be allowed after GST return has been
filed for September or filing of relevant annual
return which ever is earlier

Registered
Business
Inward Supply
Outward Supply
IGST
Exports / SEZ
Input Tax Credit
CGST
SGST / UT GST
IGST
Compensation Cess
Output Tax Liability
CGST
SGST / UT GST
IGST
Compensation Cess
IGST
SNPanigrahi
Can be Used
to offset
Outward Tax
Liability

SNPanigrahi
119
IGST
Liability
IGST
ITC
CGST
Liability
SGST / UT GST
Liability
CGST
ITC
SGST
ITC
IGST
ITC
CGST
ITC
IGST
ITC
SGST /
UT GST
ITC
Compensation Cess
Liability
Compensati
on Cess
ITC
OutwardTax
LiabilityUtilizationofITConPriority
2
1
2
2
1
2
1
Utilization of ITC
In any Order

ITC credit of CGST is not available for SGST or vice-a-versa
CGST
Input Credit
SGST/UTGST
Input Credit
CGST
Output
SGST/UTGST
Output
Sec 49 (5)(e)
Sec 49 (5)(f)
SNPanigrahi

121
Section 49 of CGST Act, 2017; read with Rules 85 to 88 of CGST Rules, 2017 deals with payment of
tax, interest, penalty and other amounts. Focus on e-payments for the liabilities arising under GST rather
than over the counter payments. Simultaneously, for the small assessee, over the counter payment by
cash / cheque/ DD is permissible up to the limit of Rs. 10,000/- per challan per tax period.
Types of Registers /
Ledgers
Electronic Cash
Ledger
Electronic Credit
Ledger
Electronic Liability
Register
Payments
Through
Internet Banking/
credit or debit cards /
NEFT / RTGS
Through Counter
Sec 49(1)
Used for any
payments
Tax, Interest,
Penalty. Fees or
any other Payment
Sec 49(3)
Input tax
credit
shall be
credited
Sec 49(2)
Used for
making
payments
of Taxes only
Sec 49(4)
All the tax
liabilities
Are
Recorded
Sec 49(7)
Can be
viewed
Section 49 of
CGST Act, 2017
SN Panigrahi
FORM GST PMT-01FORM GST PMT-05 FORM GST PMT-02

SN Panigrahi 122
Sec 17 of CGST Act Apportionment of
credit and blocked credits.

123
Use of Input Tax
Credit
For Business
Purpose
Other
Purposes
ITC Allowed
ITC Not
Allowed
Sec 17. (1) of CGST Act :
Where the goods or services or both are used by the registered person partly for the purpose of any
business and partly for other purposes, the amount of credit shall be restricted to so much of the input tax
as is attributable to the purposes of his business.
Reverse the
Credit if
Taken

124
Use of Input Tax
Credit
Taxable Supply
Including
Zero Rated
(Exports & SEZs)
Exempted
Supplies
ITC Allowed
ITC Not
Allowed
Sec 17. (2) of CGST Act :
Where the goods or services or both are used by the registered person partly for effecting taxable supplies
including zero-rated supplies under this Act or under the Integrated Goods and Services Tax Act and partly
for effecting exempt supplies under the said Acts, the amount of credit shall be restricted to so much of the
input tax as is attributable to the said taxable supplies including zero-rated supplies.
Reverse the
Credit if
Taken

125
Notwithstanding anything contained in sub-section (1) of section 16 and sub-section (1) of section 18, input
tax credit shall not be available in respect of the following, namely:-
(a) Motor Vehicles for transportation of persons having approved seating capacity of not more than
thirteen persons (including the driver), except when they are used for making the following taxable
supplies, namely:––
(i) for making the following taxable supplies, namely:-
A. Motor Vehicles for transportation of persons –
•No ITC allowed if seating capacity is upto 13 persons (including Driver)
• Exceptions : (ie ITC allowed even less than 13 Seater)
• used for further supply of Motor Vehicles (e.g. for car dealers)
• used for transportation of passengers which are taxable (e.g. travels agency, airlines
agency etc.)
• used for imparting taxable training (e.g. motor driving schools)
Input Tax Credit Central Goods and Services Tax (Amendment) Rules, 2019 Notification No. 03/2019 –
Central Tax 29/01/2019

126
Sec 17(5)(b) the following supply of goods or services or both—
i. Food and Beverages, outdoor catering,
Beauty Treatment, health services, cosmetic and plastic surgery,
Leasing, Renting or Hiring of Motor Vehicles, vessels or aircraft
referred to in clause (a) or clause (aa) except when used for the
purposes specified therein,
Life Insurance and Health Insurance:
Provided that the input tax credit in respect of such goods or services or both shall
be available where an inward supply of such goods or services or both is used by a
registered person for making an outward taxable supply of the same category of
goods or services or both or as an element of a taxable composite or mixed supply;

127
Sec 17(5)(b)
ii. membership of a club, health and fitness centre; and
iii. travel benefits extended to employees on vacation such as
leave or home travel concession:
Provided that the input tax credit in respect of such goods or
services or both shall be available, where it is obligatory for an
employer to provide the same to its employees under any law for the
time being in force.

128
Sec 17(5)(c) Works contract services for construction of immovable property except when
•It is input service for further supply of works contract service e.g. Subcontract
•Immovable property is plant and machinery i.e. ITC on works contract services used for
construction of immovable plant and machinery is available.
Sec 17(5)(d) Inward supply received by a taxable person for the construction of an immovable
property (other than plant and machinery) on his own account even when such supplies are used
in the course of or furtherance of business.
Explanation.––For the purposes of clauses (c) and (d), the expression
“construction” includes re-construction, renovation, additions or alterations or repairs, to the extent of
capitalisation, to the said immovable property;
•e.g. when a company purchases material to construct a house for his use on his own account, ITC
on material purchased is not allowed as credit. But when a company purchases material to construct
a house for someone other’s use,(construction business), ITC on material purchased is allowed as
credit.

129
Sec 17(5)
(e) Inward supplies on which tax has been paid under under section 10
(Composition scheme).
(f) Inward supplies received by Non Resident taxable person except
goods imported by him.
•e.g. Goods imported by Non resident taxable person is chargeable
under customs which includes IGST paid by him, credit of which is
available to Non resident taxable person.
(g) Goods or services used for personal consumption.
(h) Goods that are lost, stolen, destroyed, written off, or disposed of by way
of free samples or gift.
(i) Tax paid u/s. 74(Fraud), 129(Seize), 130(Confiscation).

13
S
No
Return / Section Nature Last date of Filing Who Should File
1 GSTR – 1*
Section 37
Outward Supplies made by the
Taxpayer
(other than compounding taxpayer
and ISD)
Turnover Above Rs 1.5 cr
11th of the Next Month
Notification No. 32 /2018 – Central Tax,
10th August, 2018
Normal Registered Person
Exclusions
•Input service distributor (“ISD”);”
•Non-resident taxable person.(“NRI”)
•Person paying tax under section 10, 51 or 52 [i.e.,
Composition tax payer, tax deductor, tax collector-
(here e.commerce Operator)]
•Supplier of Online information and database access
or retrieval services (“OIDAR”)
Turnover upto Rs 1.5 cr
Quarterly by end of the month following
the Quarter
Notification No. 32 /2018 – Central Tax,
10th August, 2018
2 GSTR – 2
Section 38
Inward Supplies made by the
Taxpayer
(other than compounding taxpayer
and ISD)
Suspended Till Further Notice
3 GSTR – 3
Section 39(1)
Monthly Return (other than
compounding taxpayer and ISD)
Suspended Till Further Notice
3 A GSTR – 3 B
Section 39(1)
Monthly Return for Claiming Credit
& Paying Tax
20th / 22nd / 24th of the Next Month
• Notification : 07/2020; 3/02/2020
4 GSTR - 4
Section 39(2)
Quarterly return for compounding
taxpayer
18th of the month next to quarter. Registered under Composition Scheme
5 GSTR – 5
Section 39(5)
Periodic return by Non-Resident
Foreign taxpayer
20th of the month succeeding tax period
& within 7 days after expiry
Non-Resident Foreign Tax Payer
Registered NRI
SNPanigrahi

133
S
No
Return /
Section
Nature Last date of Filing Who Should File
6 GSTR – 5A
Rule : 64
Online Information and
Database Access or Retrieval
(OIDAR) services Provider to
un-registered person
20th of the month
succeeding the Tax period
OIDAR services provider
7 GSTR – 6
Section 39(4)
Monthly Return of Input
Service Distributor (ISD)
13th of the Next Month Input Service Distributer (ISD)
8 GSTR – 7
Section 39 (3)
Monthly Return of Tax
Deducted at Source
10th of the Next Month TDS Deductor
9 GSTR – 8
Section 52(4)
Monthly Return of Tax
Collection at Source
10th of the Next Month E- Commerce Operator
10 GSTR – 9
Section 44;
Rule 80(1)
Annual Return 31st Dec of subsequent year All registered persons
Except : ISD; Person paying tax under
section 51 or 52; Casual taxable person;
NRI
11 GSTR – 9A
Section 44;
Proviso to
Rule 80(1)
Annual Return for Composition
Scheme
31st Dec of subsequent year Composition Tax Payer

134
S.
No
Return /
Ledger
Nature Last date of Filing Who Should File
12 GSTR-9B
Section 52(5)-
Rule 80(2)
Annual Statement by
e.commerce Operator
31st Dec of the succeeding financial year (i.e.,
for financial year ending March)
e.commerce Operator
13 GSTR – 9C
Section 44;
Rule 80(3)
Audited annual accounts and a
reconciliation statement, duly
certified
31st Dec of subsequent year Normal Tax Payer having turnover more
than “2 crore (Registered person who get
his A/cs audited)
14 GSTR – 10
Section 45
Final Return Within 3 months from date of cancellation or
date of order of cancellation of registration,
whichever is later
All registered persons for Cancellation of
Registration
Except : ISD; NRI Person paying tax under
section 10, 51 or 52 (i.e., Composition tax
payer, tax deductor, tax collector- here
e.commerce Operator) OIDAR
15 GSTR - 11 Details of inward supplies
to be furnished by a
person having UIN and
claiming refund
Monthly 28th of the month following the
month for which statement is filed

Tax Invoice (Sec 31 (1) & (2)) – Rule 46 : Taxable Supply
Bill of Supply Sec 31(3)(c)’) – Rule – 49 - Exempt Supplies or in case of Composition Dealer
Debit / Credit Note – Sec 34; Rule 53 - For Adjusting Price
Revised Invoice Sec 31(3)(a) – Rule 53 - For Newly Registered
ISD Invoice – Sec 31; Rule 54 - For Distribution of Credit
Self Invoice (RCM) (Sec 31(3) (f) – Rule 46 - Under RCM for Tax Payment
Receipt Voucher (Sec 31(3)(d) – Rule 50 - In case of receipt of Advance Money
Delivery Challan - Rule 55 - For supply of liquid gas; sending to the Job Worker
Refund Voucher (Sec 31(3)(e) – Rule 51 - Advance Money Received, but no supply is made
Payment Voucher (RCM) (Sec 31(3) (g) – Rule 52 - Under RCM for Payment to the Supplier
Consolidated Tax Invoice - Rule 46 -In case recipient is not a registered person; or the recipient does not require
Invoice – Issues Consolidated Invoice at the close of each day & RCM Value > Rs 5,000 in day Consolidated Monthly Invoice
Export Invoice (Sec 31 (1) & (2)) – Rule 46 - Zero Rated Supply
Tax Invoice Cum Bill of Supply – Rule 46A - Taxable + Exempted Supply
Act : CGST Act, 2017
Rules : CGST Rules, 2017
Invoice Under
GST
& Other
Documents

SN Panigrahi 137
In case of supply of Goods:
As per sec 31 of CGST Act 2017, a registered person supplying taxable goods shall, before or at
the time of —
1. Removal of goods for supply to the recipient, where the supply involves movement of
goods; or
2. Delivery of goods or making available thereof to the recipient, in any other case, issue a
tax invoice showing the description, quantity and value of goods, the tax charged thereon and
such other particulars as may be prescribed.
3. Issue of account statement/payment, where there is continuous supply
In case of supply of Services:
As per sec 31 of CGST Act 2017, a registered person supplying taxable services shall, before or
after the provision of service but within a prescribed period issue a tax invoice, showing the
description, value, tax charged thereon and such other particulars as may be prescribed:
Thus tax invoice must be issued within –
 30 days from the date of supply of the service
 45 days from the date of supply of the service, where the supplier is an insurer or banking
company or a financial institution

SN Panigrahi 138
Minimum amount for raising a GST Invoice:
As per Sec 31(3) (b) a registered person may not issue a tax invoice, if the
value of the goods or services or both supplied is less than two hundred
rupees subject to such conditions and in such manner as may be prescribed.
Though it is always a good practise to issue GST invoice for any amount, as
per GST Act read with rules, a tax invoice need not be issued when the value
of the goods or services supplied is less than INR 200, if –
 The recipient is unregistered and
 The recipient does not require an invoice, in case if the recipient
demands for the invoice, should be issued

139
TAX INVOICE
(See Section 31 of CGST Act,2017 read with Rule 46 of CGST Rules, 2017)
Name of Supplier:
Address:
Contact Details : Email ID & Mobile
GSTIN:
Invoice Number :
Date:
Reverse Charge : (Yes / No)
Place of Supply
Bill to: Ship to:
Name:
Address:
State:
State Code:
GSTIN:
Name:
Address:
State:
State Code:
GSTIN:
Sr.
No.
Description of
Goods/Service
HSN/
SAC
Qty Unit Rate Total Taxable
value(Rs.)
CGST SGST IGST Total
Rate Rs. Rate Rs. Rate Rs.
Total
Value in Words:
Terms & Condition:
1.
2.
3.
4.
For M/s __________________________
Authourized Signatory

140
Invoice under Reverse Charge
(As per Sec 31(3) (f) of the CGST Act, 2017 read with Rule 46 of the CGST Rules, 2017)
Name of Supplier:
Address:
Contact Details : Email ID & Mobile
Invoice Number :
Date:
Reverse Charge : (Yes / No)
Place of Supply
Bill to: Ship to:
Name:
Address:
State:
State Code:
GSTIN:
Name:
Address:
State:
State Code:
GSTIN:
Sr.
No.
Description of
Goods/Service
HSN/
SAC
Qty Unit Rate Total Taxable
value(Rs.)
CGST SGST IGST Total
Rate Rs. Rate Rs. Rate Rs.
Total
Value in Words:
Terms & Condition:
1.
2.
3.
4.
For M/s __________________________
Authourized Signatory

142
Debit Note
The supplier has Erroneously Declared a Value which is
less than the actual value of the goods or services or both
provided
The Quantity Received by the Recipient is More than
what has been declared in the tax invoice
The supplier has Erroneously Declared a Lower Tax Rate
than what is applicable for the kind of the goods or services
or both supplied
Any other Similar Reasons
Debit Note
A supplier of goods or services or both is mandatorily required to issue a tax
invoice. However, during the course of trade or commerce, after the invoice has
been issued there could be situations like:
In order to regularize these kinds of situations the supplier is allowed to issue what
is called as debit note to the recipient. The debit note also includes supplementary
invoice.

143
Credit
Note
Supplies are Returned or Found to be Deficient by the
Recipient
Charged Excess in GST
Required to Decrease in GST Charged in Invoice
Charged Excess in Invoice Value
Required to Decrease in Value
Credit Note
A credit note in GST, is a document issued by the supplier in
the following cases:

#GST Made Easy for Freshers# By SN Panigrahi

#GST Made Easy for Freshers# By SN Panigrahi

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Similar to #GST Made Easy for Freshers# By SN Panigrahi

Similar to #GST Made Easy for Freshers# By SN Panigrahi (20)

More from SN Panigrahi, PMP

More from SN Panigrahi, PMP (20)

Recently uploaded

Recently uploaded (20)

#GST Made Easy for Freshers# By SN Panigrahi