This document provides answers to frequently asked questions regarding government services and GST. It explains that not all services provided by the government or local authorities are exempt from GST. It clarifies the meaning of key terms like "government" and "local authority" under the GST Acts. It also discusses the tax treatment and compliance requirements for government departments and authorities in relation to supplying services, deducting tax at source, and obtaining registrations.
This document outlines the provisions of the Central Goods and Services Tax Act (CGST Act), 2017 in India. It provides an overview of key aspects of the Act including levy and collection of tax, input tax credit, registration requirements, tax invoices and credit/debit notes. Specifically, it notes that the CGST Act provides for the levy and collection of tax on intra-state supply of goods or services. It also summarizes some of the major chapters and provisions related to administration, determination of tax liability, registration, returns and payments.
Input tax credit (ITC) is a key feature of GST that aims to avoid cascading of taxes or "tax on tax". Under the current system, taxes paid at each stage of production and distribution cannot be offset, resulting in higher prices for consumers. GST will allow businesses to claim ITC for taxes paid on inputs at each stage of the supply chain. This will ensure that only the value added at each stage is taxed, eliminating cascading of taxes. ITC has to be claimed within time limits and is subject to certain restrictions to prevent misuse or use for non-business purposes. The seamless availability of ITC across India will create a common national market and boost economic growth.
Constitutional Provisions To levy Taxes For G.S.T.RoopamAmbekar
This document discusses the key constitutional provisions related to goods and services tax (GST) in India. It explains that the constitution was amended to introduce GST and place it in the concurrent list, allowing both central and state governments to legislate on it. A GST Council was established under Article 279A to make recommendations on tax rates and dispute resolution. The council is chaired by the Union Finance Minister and includes state finance ministers. Inter-state GST is levied and collected by the central government under Article 269A.
Place of supply in GST- export import ca amit kumarAmit Kumar
The document summarizes key provisions related to place of supply under the IGST Act, 2017. It discusses scenarios for determining place of supply for goods imported/exported from India as well as for domestic and international supply of services. For goods imported into India, place of supply is location of importer. For exported goods, place of supply is location outside India. For domestic service transactions, place of supply rules are based on location of supplier and recipient. For international transactions, general rule is location of recipient, with certain exceptions specified based on nature of service.
Service tax was introduced in India in 1994 on three services - telephone, insurance, and stock broking. Since then, the scope of service tax has gradually expanded to cover more services and increased rates. Currently, service tax of 14% plus cess is levied on a wide range of taxable services defined under negative list approach. The tax is levied under the constitutional authority of the central government and shared with states. Over the years, both the number of taxable services and rates of service tax have risen steadily to widen the tax base and boost government revenue from the growing services sector.
Analysis of Finance Act, 2020 vis-à-vis GST
The Finance Act, 2020 has made several amendments to the CGST Act, 2017 and corresponding amendments to the IGST Act, 2017 and UTGST Act, 2017. We have attempted to analyse the provision wise amendment made by the Finance Act, 2020 to the CGST Act, 2017.
LEVY AND COLLECTION OF GST – Scope of Supply - Schedule I, II & IIISundar B N
Under the old tax regime in India, different taxes like excise, VAT/CST, and service tax had different taxable events. GST unified these various taxes and introduced a single taxable event of "supply". Supply includes all forms of supply of goods or services for a consideration in the course of business. Certain activities specified in Schedules I, II and III of the GST acts are treated as supply. For a transaction to qualify as supply under GST, it must be a supply of goods or services, for a consideration, in the course of business, by a taxable person, and be a taxable supply.
This document outlines the provisions of the Central Goods and Services Tax Act (CGST Act), 2017 in India. It provides an overview of key aspects of the Act including levy and collection of tax, input tax credit, registration requirements, tax invoices and credit/debit notes. Specifically, it notes that the CGST Act provides for the levy and collection of tax on intra-state supply of goods or services. It also summarizes some of the major chapters and provisions related to administration, determination of tax liability, registration, returns and payments.
Input tax credit (ITC) is a key feature of GST that aims to avoid cascading of taxes or "tax on tax". Under the current system, taxes paid at each stage of production and distribution cannot be offset, resulting in higher prices for consumers. GST will allow businesses to claim ITC for taxes paid on inputs at each stage of the supply chain. This will ensure that only the value added at each stage is taxed, eliminating cascading of taxes. ITC has to be claimed within time limits and is subject to certain restrictions to prevent misuse or use for non-business purposes. The seamless availability of ITC across India will create a common national market and boost economic growth.
Constitutional Provisions To levy Taxes For G.S.T.RoopamAmbekar
This document discusses the key constitutional provisions related to goods and services tax (GST) in India. It explains that the constitution was amended to introduce GST and place it in the concurrent list, allowing both central and state governments to legislate on it. A GST Council was established under Article 279A to make recommendations on tax rates and dispute resolution. The council is chaired by the Union Finance Minister and includes state finance ministers. Inter-state GST is levied and collected by the central government under Article 269A.
Place of supply in GST- export import ca amit kumarAmit Kumar
The document summarizes key provisions related to place of supply under the IGST Act, 2017. It discusses scenarios for determining place of supply for goods imported/exported from India as well as for domestic and international supply of services. For goods imported into India, place of supply is location of importer. For exported goods, place of supply is location outside India. For domestic service transactions, place of supply rules are based on location of supplier and recipient. For international transactions, general rule is location of recipient, with certain exceptions specified based on nature of service.
Service tax was introduced in India in 1994 on three services - telephone, insurance, and stock broking. Since then, the scope of service tax has gradually expanded to cover more services and increased rates. Currently, service tax of 14% plus cess is levied on a wide range of taxable services defined under negative list approach. The tax is levied under the constitutional authority of the central government and shared with states. Over the years, both the number of taxable services and rates of service tax have risen steadily to widen the tax base and boost government revenue from the growing services sector.
Analysis of Finance Act, 2020 vis-à-vis GST
The Finance Act, 2020 has made several amendments to the CGST Act, 2017 and corresponding amendments to the IGST Act, 2017 and UTGST Act, 2017. We have attempted to analyse the provision wise amendment made by the Finance Act, 2020 to the CGST Act, 2017.
LEVY AND COLLECTION OF GST – Scope of Supply - Schedule I, II & IIISundar B N
Under the old tax regime in India, different taxes like excise, VAT/CST, and service tax had different taxable events. GST unified these various taxes and introduced a single taxable event of "supply". Supply includes all forms of supply of goods or services for a consideration in the course of business. Certain activities specified in Schedules I, II and III of the GST acts are treated as supply. For a transaction to qualify as supply under GST, it must be a supply of goods or services, for a consideration, in the course of business, by a taxable person, and be a taxable supply.
Find out the detailed explanation of the provisions related to Offences and Penalties under the dual GST Law for the efficient tax administration from the presentation. Give it a read and we would love to know your feedback!
The document summarizes the key provisions around e-way bills under the GST law. It discusses the 5 rules dealing with e-way bills - information to be provided prior to movement of goods, documents/devices to be carried during transit, verification of documents/conveyances during transit, inspection of goods, and facility for uploading detention details. It provides details on when an e-way bill is required, its validity period, documents to be carried, and consequences of acceptance/rejection of details by the recipient. RFID is required to be mapped to the e-way bill number for certain class of transporters.
This document discusses the taxation of composite contracts under the proposed GST bill of 2017 in India. It addresses some key points:
1) Works contracts related to immovable property, including sale of under-construction apartments, will be taxed as services under GST. This aims to avoid double taxation that can currently occur under VAT and service tax.
2) The treatment of composite contracts related to movable property under GST concepts of composite and mixed supplies is unclear and will need further clarification.
3) Once works contracts are defined as services under GST, the distinction between goods and services is only relevant for determining the place of supply and taxation point.
This document provides an analysis and explanation of services covered under the negative list in India's service tax regime. It discusses several services specified in the negative list, including access to roads/bridges on toll payment, betting/gambling, admission to entertainment/amusement facilities, electricity transmission/distribution, and education services. For each service, it analyzes the scope of activities covered versus excluded from the negative list. It also addresses issues like taxability of bundled services and dual qualification courses.
This document summarizes key sections of the GST law regarding input tax credit (ITC). It provides an overview of sections 16-21 which govern ITC eligibility, conditions for claiming ITC, blocked credits, and special circumstances. The summary covers concepts like eligible inputs/capital goods, tax invoices, payment to suppliers, reversals, ITC attribution, and distribution by Input Service Distributors. It also defines important terms and summarizes rules regarding ITC claims, reversals, and transfers.
Analysis of "Supply" in CGST ACT,2017 and taxation of NGO,Government and Clubs.Amit Kumar
Decoding term "supply" define in GST ACT,2017 and other important concept of GST. Whether one person can supply himself. Discuss deemed supply given in schedule I of CGST ACT,2017.Taxation of NGO, Government and club also discussed.
The document discusses the concept of supply under the GST law. It defines supply under Section 7 of the CGST Act to include all forms of supply of goods or services such as sale, transfer, license etc. made for a consideration in the course of business. It also includes import of services for consideration and activities listed in Schedule I without consideration. The key activities that constitute supply are discussed along with relevant definitions.
CASE STUDY PAPER - GST- INTRICATE ISSUES IN ENTERTAINMENT & HOSPITALITY SEC...Ramandeep Bhatia
The document discusses various GST related issues for amusement parks and charity events. For the amusement park case study, it analyzes whether input tax credit will be available for various construction activities and components. It also examines how different ticketing options would be taxed under GST. For the charity marathon event case study, it questions whether donations collected by the trust organizing the event will be exempt from GST. Key discussion points include whether the activities can be considered charitable, and how reducing donation amounts could impact exemptions.
The document provides information on electronic way (e-way) bills under the Goods and Services Tax (GST) regime in India. Some key points:
- E-way bills are required to be generated for the movement of goods of over Rs. 50,000 in value.
- Various notifications provide details on the nationwide implementation of the e-way bill system from January 2018.
- CGST Rules specify the procedures for generating e-way bills, including which parties are responsible for Parts A and B, validity periods, transfer procedures and exemptions.
- Non-compliance can attract penalties, and e-way bills help verify movement of goods and prevent tax evasion.
The document is the Union Territory Goods and Services Tax Bill, 2017 which proposes a law to levy and collect tax on intra-state supply of goods or services within Union Territories in India. Some key points:
- It contains 9 chapters covering preliminary aspects, administration, levy and collection of tax, payment procedures, inspections, demands and recovery, advance rulings and transitional provisions.
- The Commissioner of Union Territory Tax will administer the law along with other officers. Taxes like integrated tax and central tax can also be collected by officers under this law.
- A tax called the Union Territory Tax will be levied on all intra-state supplies of goods/services at rates up to 20%
The document defines key terms from the Model GST Law and CGST Act related to aggregate turnover, adjudicating authority, agent, business, capital goods, casual taxable person, composite supply, exempt supply, goods, input service distributor, input tax, job work, manufacture, mixed supply, non-resident taxable person, outward supply, person, place of business, place of supply, principal supply, reverse charge, supplier, works contract. It provides concise definitions for these important GST concepts in 2-3 sentences each.
The document summarizes key aspects of GST as it relates to imports in India. It states that all imports into India, whether goods or services, are treated as inter-state supplies subject to Integrated GST. IGST on imported goods is levied under the Customs Act, while IGST on imported services is levied under the IGST Act. The importer of goods or services is responsible for paying the applicable IGST and customs duties. Input tax credit for IGST paid on imports can be utilized by the importer against their GST obligations.
This document provides an overview of the negative list of services that are exempted from service tax in India. It discusses the 17 categories of services specified in the negative list, including services provided by the government, Reserve Bank of India, foreign diplomatic missions, agriculture, transportation, education, renting of residential dwellings, financial services, and funeral services. The negative list aims to exempt essential services from taxation while applying service tax to other taxable services.
The key elements necessary to constitute a taxable supply under GST are: 1) the supply must occur within a taxable territory, 2) the supply must be made by a registered taxable person, 3) the supply must involve goods or services, and 4) the supply must be made for consideration in the course or furtherance of business. A taxable supply is defined as a supply of goods or services that is chargeable to GST. For a supply to be considered a taxable supply, it must meet the requirements outlined in the document.
K. Vijaya Kumar, Asst. Commissioner of C.Excise, presents on the determination of value of goods and services under GST law. The key points are:
1. The determination of value is essential for calculating tax liability under GST law. Section 15 of the CGST Act outlines how to determine the transaction value, which is the price actually paid or payable.
2. The valuation rules provide various methods for determining value when the transaction value is not available, such as open market value, value of like goods/services, and cost plus 10% method.
3. Specific rules cover valuation of supplies between related parties, through agents, and supplies where consideration is not wholly monetary
This document discusses various aspects of CGST/SGST levy and collection under Section 9 of the CGST Act, including:
1. Rates not exceeding 20% apply to intra-state supplies except alcoholic liquor for human consumption.
2. Petrol and its by-products shall be levied with effect from the date notified by the government based on council recommendations.
3. For mixed and composite supplies, the highest tax rate among the goods or services in the combination is applied to calculate tax liability for mixed supplies, while the rate applicable to the principal supply is applied for composite supplies.
Issues in Export & Import of Goods & Services vis-a-vis Foreign Trade PolicyGST Law India
The following presentation enumerates various issues related to import and export of goods under GST like modes of exports, zero-rated supply, supplies to SEZ and others, how to claim refund of ITC and IGST by using different forms. Further, it deals with methods to rectify mistakes in the respective refund forms under GST.
The document discusses the powers of inspection, search, seizure, and arrest granted to tax officers under the CGST Act, 2017. It outlines that proper officers have the authority to (1) inspect business premises, warehouses, and means of transporting goods if they suspect tax evasion, (2) search and seize goods, documents, or other items useful for tax proceedings if concealed in any place, and (3) arrest individuals suspected of tax offenses. The powers aim to safeguard tax collection and ensure compliance with tax laws by allowing officers to inspect records, audit businesses, and summon individuals or documents as part of investigations.
The document discusses provisions around place of supply under the Integrated Goods and Services Tax (IGST) Act. It explains that IGST is levied on inter-state supplies of goods or services. It outlines the key provisions to determine whether a supply is inter-state or intra-state, including looking at the location of the supplier and place of supply. It also summarizes the relevant sections that govern place of supply of goods (Section 10), imports/exports of goods (Section 11), and place of supply of services (Section 12).
1. Several amendments to GST rules and notifications were made effective January 1st, 2022 regarding the definition of supply, tax rates for restaurant services supplied through online platforms, availability of input tax credit, and recovery of self-assessed tax without notice.
2. The amendments aim to expand the scope of taxable supplies, increase tax rates for certain services, and streamline input tax credit and tax recovery procedures.
3. The Commissioner is now empowered to provisionally attach property or bank accounts to protect government revenues during tax proceedings.
The document discusses non-supplies under the GST regime in India. It covers three key categories of non-supplies:
1) Activities/transactions specified under Schedule III of the CGST Act which are considered a "negative list" and are neither treated as supply of goods nor services.
2) Activities/transactions notified by the Government via notifications which are also treated as non-supplies.
3) Certain activities/transactions which have been clarified by CBIC to be non-supplies, including the grant of alcoholic liquor licenses, inter-state movement of various modes of conveyance, and inter-state movement of rigs, tools and spares.
Find out the detailed explanation of the provisions related to Offences and Penalties under the dual GST Law for the efficient tax administration from the presentation. Give it a read and we would love to know your feedback!
The document summarizes the key provisions around e-way bills under the GST law. It discusses the 5 rules dealing with e-way bills - information to be provided prior to movement of goods, documents/devices to be carried during transit, verification of documents/conveyances during transit, inspection of goods, and facility for uploading detention details. It provides details on when an e-way bill is required, its validity period, documents to be carried, and consequences of acceptance/rejection of details by the recipient. RFID is required to be mapped to the e-way bill number for certain class of transporters.
This document discusses the taxation of composite contracts under the proposed GST bill of 2017 in India. It addresses some key points:
1) Works contracts related to immovable property, including sale of under-construction apartments, will be taxed as services under GST. This aims to avoid double taxation that can currently occur under VAT and service tax.
2) The treatment of composite contracts related to movable property under GST concepts of composite and mixed supplies is unclear and will need further clarification.
3) Once works contracts are defined as services under GST, the distinction between goods and services is only relevant for determining the place of supply and taxation point.
This document provides an analysis and explanation of services covered under the negative list in India's service tax regime. It discusses several services specified in the negative list, including access to roads/bridges on toll payment, betting/gambling, admission to entertainment/amusement facilities, electricity transmission/distribution, and education services. For each service, it analyzes the scope of activities covered versus excluded from the negative list. It also addresses issues like taxability of bundled services and dual qualification courses.
This document summarizes key sections of the GST law regarding input tax credit (ITC). It provides an overview of sections 16-21 which govern ITC eligibility, conditions for claiming ITC, blocked credits, and special circumstances. The summary covers concepts like eligible inputs/capital goods, tax invoices, payment to suppliers, reversals, ITC attribution, and distribution by Input Service Distributors. It also defines important terms and summarizes rules regarding ITC claims, reversals, and transfers.
Analysis of "Supply" in CGST ACT,2017 and taxation of NGO,Government and Clubs.Amit Kumar
Decoding term "supply" define in GST ACT,2017 and other important concept of GST. Whether one person can supply himself. Discuss deemed supply given in schedule I of CGST ACT,2017.Taxation of NGO, Government and club also discussed.
The document discusses the concept of supply under the GST law. It defines supply under Section 7 of the CGST Act to include all forms of supply of goods or services such as sale, transfer, license etc. made for a consideration in the course of business. It also includes import of services for consideration and activities listed in Schedule I without consideration. The key activities that constitute supply are discussed along with relevant definitions.
CASE STUDY PAPER - GST- INTRICATE ISSUES IN ENTERTAINMENT & HOSPITALITY SEC...Ramandeep Bhatia
The document discusses various GST related issues for amusement parks and charity events. For the amusement park case study, it analyzes whether input tax credit will be available for various construction activities and components. It also examines how different ticketing options would be taxed under GST. For the charity marathon event case study, it questions whether donations collected by the trust organizing the event will be exempt from GST. Key discussion points include whether the activities can be considered charitable, and how reducing donation amounts could impact exemptions.
The document provides information on electronic way (e-way) bills under the Goods and Services Tax (GST) regime in India. Some key points:
- E-way bills are required to be generated for the movement of goods of over Rs. 50,000 in value.
- Various notifications provide details on the nationwide implementation of the e-way bill system from January 2018.
- CGST Rules specify the procedures for generating e-way bills, including which parties are responsible for Parts A and B, validity periods, transfer procedures and exemptions.
- Non-compliance can attract penalties, and e-way bills help verify movement of goods and prevent tax evasion.
The document is the Union Territory Goods and Services Tax Bill, 2017 which proposes a law to levy and collect tax on intra-state supply of goods or services within Union Territories in India. Some key points:
- It contains 9 chapters covering preliminary aspects, administration, levy and collection of tax, payment procedures, inspections, demands and recovery, advance rulings and transitional provisions.
- The Commissioner of Union Territory Tax will administer the law along with other officers. Taxes like integrated tax and central tax can also be collected by officers under this law.
- A tax called the Union Territory Tax will be levied on all intra-state supplies of goods/services at rates up to 20%
The document defines key terms from the Model GST Law and CGST Act related to aggregate turnover, adjudicating authority, agent, business, capital goods, casual taxable person, composite supply, exempt supply, goods, input service distributor, input tax, job work, manufacture, mixed supply, non-resident taxable person, outward supply, person, place of business, place of supply, principal supply, reverse charge, supplier, works contract. It provides concise definitions for these important GST concepts in 2-3 sentences each.
The document summarizes key aspects of GST as it relates to imports in India. It states that all imports into India, whether goods or services, are treated as inter-state supplies subject to Integrated GST. IGST on imported goods is levied under the Customs Act, while IGST on imported services is levied under the IGST Act. The importer of goods or services is responsible for paying the applicable IGST and customs duties. Input tax credit for IGST paid on imports can be utilized by the importer against their GST obligations.
This document provides an overview of the negative list of services that are exempted from service tax in India. It discusses the 17 categories of services specified in the negative list, including services provided by the government, Reserve Bank of India, foreign diplomatic missions, agriculture, transportation, education, renting of residential dwellings, financial services, and funeral services. The negative list aims to exempt essential services from taxation while applying service tax to other taxable services.
The key elements necessary to constitute a taxable supply under GST are: 1) the supply must occur within a taxable territory, 2) the supply must be made by a registered taxable person, 3) the supply must involve goods or services, and 4) the supply must be made for consideration in the course or furtherance of business. A taxable supply is defined as a supply of goods or services that is chargeable to GST. For a supply to be considered a taxable supply, it must meet the requirements outlined in the document.
K. Vijaya Kumar, Asst. Commissioner of C.Excise, presents on the determination of value of goods and services under GST law. The key points are:
1. The determination of value is essential for calculating tax liability under GST law. Section 15 of the CGST Act outlines how to determine the transaction value, which is the price actually paid or payable.
2. The valuation rules provide various methods for determining value when the transaction value is not available, such as open market value, value of like goods/services, and cost plus 10% method.
3. Specific rules cover valuation of supplies between related parties, through agents, and supplies where consideration is not wholly monetary
This document discusses various aspects of CGST/SGST levy and collection under Section 9 of the CGST Act, including:
1. Rates not exceeding 20% apply to intra-state supplies except alcoholic liquor for human consumption.
2. Petrol and its by-products shall be levied with effect from the date notified by the government based on council recommendations.
3. For mixed and composite supplies, the highest tax rate among the goods or services in the combination is applied to calculate tax liability for mixed supplies, while the rate applicable to the principal supply is applied for composite supplies.
Issues in Export & Import of Goods & Services vis-a-vis Foreign Trade PolicyGST Law India
The following presentation enumerates various issues related to import and export of goods under GST like modes of exports, zero-rated supply, supplies to SEZ and others, how to claim refund of ITC and IGST by using different forms. Further, it deals with methods to rectify mistakes in the respective refund forms under GST.
The document discusses the powers of inspection, search, seizure, and arrest granted to tax officers under the CGST Act, 2017. It outlines that proper officers have the authority to (1) inspect business premises, warehouses, and means of transporting goods if they suspect tax evasion, (2) search and seize goods, documents, or other items useful for tax proceedings if concealed in any place, and (3) arrest individuals suspected of tax offenses. The powers aim to safeguard tax collection and ensure compliance with tax laws by allowing officers to inspect records, audit businesses, and summon individuals or documents as part of investigations.
The document discusses provisions around place of supply under the Integrated Goods and Services Tax (IGST) Act. It explains that IGST is levied on inter-state supplies of goods or services. It outlines the key provisions to determine whether a supply is inter-state or intra-state, including looking at the location of the supplier and place of supply. It also summarizes the relevant sections that govern place of supply of goods (Section 10), imports/exports of goods (Section 11), and place of supply of services (Section 12).
1. Several amendments to GST rules and notifications were made effective January 1st, 2022 regarding the definition of supply, tax rates for restaurant services supplied through online platforms, availability of input tax credit, and recovery of self-assessed tax without notice.
2. The amendments aim to expand the scope of taxable supplies, increase tax rates for certain services, and streamline input tax credit and tax recovery procedures.
3. The Commissioner is now empowered to provisionally attach property or bank accounts to protect government revenues during tax proceedings.
The document discusses non-supplies under the GST regime in India. It covers three key categories of non-supplies:
1) Activities/transactions specified under Schedule III of the CGST Act which are considered a "negative list" and are neither treated as supply of goods nor services.
2) Activities/transactions notified by the Government via notifications which are also treated as non-supplies.
3) Certain activities/transactions which have been clarified by CBIC to be non-supplies, including the grant of alcoholic liquor licenses, inter-state movement of various modes of conveyance, and inter-state movement of rigs, tools and spares.
The document provides an overview of the framework of GST laws in India. It discusses key concepts such as the types of GST (CGST, SGST, IGST), taxes subsumed under GST, exclusions from GST, laws governing GST, and the GST council. It also explains important aspects like the administration of GST, levy and collection of tax, the concept of supply which is the taxable event, and import of services under GST.
Under GST, provisions for tax deduction at source (TDS) and tax collection at source (TCS) have been introduced.
For TDS, certain category of persons are required to deduct 2% tax at source from payments made to suppliers of goods or services exceeding Rs. 2.5 lakhs. TCS is required to be collected at 1% of the net value of taxable supplies made through electronic commerce operators (ECOs) by other registered suppliers.
ECOs are required to register under GST and file statements containing details of outward supplies made through them along with tax collected. Tax deducted/collected must be deposited within 10 days. Rectification of mistakes is allowed by
Taxation of-cooperative-societies-ca krishan-dev_sindhuKrishan Dev
The document discusses various tax compliance requirements for cooperative housing societies under the Income Tax Act and GST laws in India. Some key points:
1) A cooperative housing society is treated as an Association of Persons (AOP) for tax purposes. It is required to file tax returns and may be liable for tax audit if gross receipts exceed Rs. 1 crore.
2) The society needs to comply with TDS provisions like depositing TDS, issuing Form 16A, and filing returns. Failure to comply can attract penalties.
3) Under GST, transactions between a society and its members are taxable. The society needs to register if aggregate turnover exceeds Rs. 20 lakhs
This document summarizes key aspects of GST registration in India based on draft rules released by the government. It notes that registration will be required if annual aggregate turnover exceeds Rs. 9 lakhs (Rs. 4 lakhs in North Eastern states). It outlines the registration procedure and discusses provisions for migrating existing taxpayers. It also discusses the impact of GST on the manufacturing sector, including opportunities for improved sourcing and credit availability, as well as challenges related to multiple proposed GST rates and potential differences in rates between goods and services.
DECODING GST- INPUT TAX CREDIT OF CGST, SGST AND IGSTCa Ashish Garg
Basic Concepts of Input Tax Credit, availment, utilization and reversal of input tax credit.
In every value added taxation structure, Input tax credit remains the backbone of such tax structures as it removes the cascading effect of taxes. In GST also being a value added tax, it is the intention of the lawmakers to allow seamless flow of credit in the supply chain and remove cascading effect of taxes.
As the Empowered Committee of Finance Ministers granted in-principle nod to the draft of Model GST Law, it was placed in the
public domain on 14th June, 2016, with the government seeking feedback and comments from trade and industry. It is a laudable
way forward with optimism to see it implemented in full swing by April 2017.
GST is a destination based value added tax which will remove trade barriers and create one common Indian market. By providing
seamless credit of input tax across entire supply chain, it will remove the cascading effects of tax, thereby reducing the cost of
indigenous goods and services and making them more competitive in the international market.
This document provides an overview of the proposed Goods and Services Tax (GST) in India. Some key points:
- GST would replace many existing indirect taxes and be levied on most goods and services at both central and state levels.
- It aims to create a unified national market, reduce the cascading effect of taxes, and simplify compliance.
- GST would have three components - CGST levied by the central government, SGST levied by state governments, and IGST on inter-state trade.
- Input tax credit allows taxes paid at earlier stages to be deducted from taxes owed at later stages, reducing the overall tax burden.
- Registration, returns,
A GOOD TUTORIAL TO UNDERSTAND GOODS AND SEERVICEVijayakumarA35
This document provides information about GST registration requirements in India. It defines key terms related to registration such as aggregate turnover, casual taxable person, etc. It explains that registration is required if aggregate turnover exceeds Rs. 20 lakhs. It also discusses the process of applying for registration online, details required, registration number format, display of registration certificate, amendment and cancellation procedures.
This document provides an overview of the Goods and Services Tax (GST) in India. It defines GST as a comprehensive tax on the manufacture, sale, and consumption of goods and services applied at the national level. The document discusses the need for GST to replace existing multiple tax structures and integrate various taxes to allow for full input tax credits. It outlines the justification for GST at both the central and state levels. The document also covers the key features and benefits of GST, including the types of taxes subsumed under GST, registration requirements, taxable supplies, input tax credits, and returns.
The Undisclosed Foreign Income and Assets (Imposition of Tax) Bill, 2015 - An...D Murali ☆
The Undisclosed Foreign Income and Assets (Imposition of Tax) Bill, 2015 aims to tax undisclosed foreign income and assets and prosecute related violations. The bill applies to Indian residents and companies holding foreign assets or income not previously disclosed. Undisclosed foreign assets and income will be taxed at 30% plus penalties, with imprisonment of up to 10 years for willful evasion. The bill provides a one-time compliance window to disclose foreign assets and income in tax returns for assessment year 2016-17 at a tax rate of 30% plus penalty, without reopening past assessments. However, disclosures may still lead to proceedings under other laws and do not conflict with double taxation avoidance agreements. The bill grants tax authorities significant
This document provides an overview of the Goods and Services Tax (GST) in India. It discusses the problems with the current indirect tax structure, the key features of GST, and how GST aims to be a "game changer" by replacing multiple taxes with a single tax and reducing economic distortions. The document outlines the proposed GST model and rates, input tax credit provisions, registration requirements, and transition provisions. It also summarizes the statutory scheme for levying GST on intra-state and inter-state supplies.
This document provides an introduction and overview of the Goods and Services Tax (GST) implemented in India. It begins by explaining that GST consolidates several indirect taxes into a single tax applied to the supply of goods and services. It highlights that GST eliminates the cascading effect of taxation. The document then outlines some of the key features of GST, including that it is a consumption-based tax applied at the location where goods or services are consumed. It also describes some of the major taxes subsumed under GST and compares the previous tax regime to GST. Finally, it discusses important aspects of GST such as taxable events, tax rates, input tax credit, and the treatment of inter-state transactions
GST is an indirect tax levied on the supply of goods and services. It has replaced multiple indirect taxes and aimed to simplify the indirect tax system in India. GST is charged on the final consumer but collected at each stage of supply. Supply includes sale, transfer, exchange and other transactions done in the course of business for consideration. Certain activities such as permanent transfer of business assets and supplies between related parties are treated as supply even if made without consideration under GST.
The document discusses key aspects of the Goods and Services Tax (GST) in India, including:
1. It defines the scope of supply under GST to include all forms of supply of goods and services for consideration in the course of business. It also covers import of certain services.
2. It outlines various types of supplies - taxable supplies, exempt supplies, non-taxable supplies, deemed exports and import of goods/services.
3. It provides details around composition scheme under GST for small businesses with turnover up to Rs. 50 lakhs, including lower tax rates, exemption from maintaining detailed records and paying tax under reverse charge.
The document discusses key aspects of the Goods and Services Tax (GST) in India, including:
1. It defines the scope of supply under GST to include all forms of supply of goods and services for consideration in the course of business. It also covers import of certain services.
2. It outlines various taxable, exempt and non-taxable supplies. Exempt supplies include basic food items and petroleum products.
3. It provides details around composition scheme for small businesses with turnover up to Rs. 50 lakhs, which allows payment of tax at concessional rates and simplified compliance.
#Comprehensive Guide on TDS Under GST# By SN PanigrahiSN Panigrahi, PMP
#Comprehensive Guide on TDS Under GST# By SN Panigrahi,
Essenpee Business Solutions,
Tax Deducted at Source, GST,
Government or Local Authorities,
PSU Contracts,
An attempt to compile relevance of contractual clauses, technique of claiming back lost exemptions through doctrine of promissory estoppel, effect of repeals and omission and related judgments, is made. An overview of legal aspects for ongoing contracts is included.
Summary of special economic package for self-reliant India (Atma-Nirbhar Bharat Abhiyan) to reduce the economic strain on the country due to the pandemic by the Hon’ble Prime Minister, Mr. Narendra Modi on May 12, 2020.
Due dates extension, waiver in late fee & interestDeepak Kumar Jain
This document provides an overview of due date extensions for filing various tax returns and compliance requirements in India due to the COVID-19 pandemic. Key highlights include:
- The due dates for filing GSTR-3B and GSTR-1 returns have been extended for several months. Lower interest rates and late fees have also been waived for some periods.
- Income tax return filing deadlines have been extended until July/October 2020 for individuals and companies. Several audit and compliance deadlines have also been extended.
- The government has provided broad relief by extending all tax notice and appeal periods falling between March-June 2020 to August 30, 2020. This applies to refunds, returns, and other compliance requirements.
This document discusses measures taken by the Indian government to mitigate the economic impact of Covid-19. It summarizes projected declines in GDP and GST revenue. The government introduced measures like extending tax filing deadlines and relaxing penalties. It also allowed more input tax credits to be claimed and extended timelines for composition schemes. Industry requested additional measures to boost consumption and investment like lowering tax rates and interest penalties.
The document provides information about e-way bills under the Goods and Services Tax (GST) system in India. It discusses the requirement for e-way bills when transporting goods over a certain value, the documentation and information needed to generate e-way bills, who is responsible for filling out the various parts of the e-way bill form, validity periods, exemptions, penalties for non-compliance, blocking of e-way bills, and integration with vehicle registration databases. It also summarizes some case laws related to e-way bills and discusses some practical issues that commonly arise.
The document discusses factors that determine whether the price paid for a supply can be considered the "sole consideration", including whether the price is influenced by the relationship between supplier and recipient, if there are additional benefits provided, or if the price is set below cost for market penetration. It also outlines valuation rules for situations where the price is influenced, such as using open market value, cost of production, or reasonable means consistent with valuation principles.
The document discusses the definition and meaning of an "intermediary" under GST/Service Tax law. It provides the statutory definition, examines what is meant by a "broker, agent or other person" and "arranges or facilitates." It also discusses relevant case laws and provides a practical perspective on determining whether a party is an intermediary based on their role and activities. The key points are that an intermediary must actively participate to facilitate or arrange a supply between two other parties, cannot be the main supplier, and their services should be identifiable from the main supply.
The document discusses exemptions and zero-rated supplies under GST. It defines exempt supplies as those taxed at a nil rate or exempt by law. Zero-rated supplies include exports and supplies to special economic zones, which are taxed at 0% to promote these activities. The document also discusses non-taxable supplies not covered by GST and transactions that are neither goods nor services. It provides examples and addresses related questions on these topics.
This document provides answers to various questions regarding exports under the GST regime in India. It explains that exports are treated as inter-state supplies under IGST and are zero-rated, meaning taxes paid on inputs can be refunded. Procedures for exports have been simplified, removing paperwork. While some export incentives like MEIS and SEIS scrips can no longer be used to pay GST, exports will remain competitive. EOU and SEZ units pay GST but have simplified procedures for imports and refunds. Drawback rates have changed and applications are now filed with customs authorities.
This document provides answers to questions about the Goods and Services Tax (GST) for textile suppliers and manufacturers. Key points addressed include: raw jute and raw silk suppliers are not required to register for GST; cotton farmers are not required to register but buyers of raw cotton must pay GST on a reverse charge basis; the rates for bags made of jute is 18%; and a saree manufacturer is provided guidance on issues like treatment of returns, opening stock, invoices for composition scheme buyers, and input tax credit eligibility.
This document provides answers to frequently asked questions regarding food processing and GST. Some key points addressed include:
- Manufacturing units in a state can take a single registration or separate registrations for business verticals.
- Transporting semi-cooked food between branches in different states is an inter-state supply subject to IGST.
- Transportation charges paid by the recipient are considered part of the supply value.
- Rental costs for a factory premises can be claimed as input tax credit.
- Tax rates for food supplied in air conditioned vs. non-air conditioned restaurants and composition scheme eligibility.
- Input tax credit eligibility and registration requirements for a rice wholesaler with branded and un
This document provides answers to frequently asked questions about electronic commerce and the Goods and Services Tax (GST) in India. It defines key terms like electronic commerce, e-commerce operator, and tax collection at source (TCS). Some of the main points covered include: e-commerce operators and suppliers making supplies through e-commerce operators are not eligible for GST registration thresholds; e-commerce operators may need to pay GST on notified services supplied through their platforms; and e-commerce operators are required to collect TCS on the net value of supplies made by other registered suppliers through their platform.
This document contains answers to frequently asked questions regarding goods and services tax (GST) for drugs and pharmaceuticals.
It addresses questions about how formulations will be assessed under GST, requirements for clearance of free physician samples, procedures for movement of expired medicines, treatment of supplies to special economic zones, and whether separate registrations are required for input service distributors and units located in SEZs.
It also provides details on transitional credit that can be availed for existing stock, treatment of purchases from unregistered persons, and the effect of non-payment of consideration for supplies received.
This document contains answers to frequently asked questions about applying GST to the mining sector in India. Some key points addressed include:
- Small mining leaseholders with turnover under Rs. 75 lakhs can operate under the composition scheme.
- The GST rates for minerals and ores under composition scheme are 1% CGST/SGST for manufacturing processes and 0.5% CGST/SGST otherwise.
- Buyers cannot claim input tax credit for purchases from suppliers under the composition scheme.
- Inter-state supplies are not allowed for those availing the composition scheme.
This document contains questions and answers about how imports, exports, and other cross-border transactions will be treated under the Goods and Services Tax (GST) regime in India. Some key points addressed include:
- Imports will be subject to IGST in addition to other import duties, and full input tax credit will be available on the IGST paid.
- Exports will be treated as zero-rated supplies, and exporters can claim refunds on taxes paid or export without payment under bond.
- Refunds to exporters for taxes paid on inputs/services for exports must be sanctioned within 60 days.
This document contains answers to frequently asked questions regarding the application of GST to banks and the gems and jewellery industry. It addresses questions about whether providing advertising materials to distributors constitutes a supply, how import of precious metals by banks will be treated under GST, the GST treatment of gold and silver imported and held in stock by banks on consignment, and clarifies the methodology for payment of provisional GST by banks on gold loans and setting off excess payments.
This document contains answers to frequently asked questions regarding GST treatment of IT/ITES services. Some key points addressed include:
- Software is treated as goods if pre-developed and supplied in a medium, otherwise development of software is treated as a service.
- Development of software being treated as a service means place of supply rules for services apply and the supplier is not eligible for the composition scheme.
- A dealer with annual turnover of Rs. 8 lakh is not required to register under GST.
- A registered person integrating small software codes from unregistered individuals must pay GST on the services under reverse charge.
- The rate of GST on IT services is 18%. Exports of software services are
The document is a set of answers to frequently asked questions regarding transport and logistics services under GST regulations. It addresses questions about registration requirements for truck owners, brokers, and goods transport agents. It clarifies that intermediary services provided along with transportation are part of a composite supply. It also discusses record keeping requirements, input tax credit eligibility, and tax treatment of international journeys. Electronic ticket receipts are acceptable as tax invoices without a signature requirement.
The document contains frequently asked questions and answers regarding banking, insurance, and stock brokers in relation to GST.
Some key points addressed are:
- Banks are not required to provide ATM details in their GST registration as ATMs alone do not constitute a place of business.
- Third party places like ATMs, business correspondents, or warehouses used by banks are not required to be included in their GST registration.
- For services provided up to June 30, 2017, the applicable tax (GST or prior tax) depends on whether the invoice was issued or payment was made before or after July 1, 2017.
- Banks/insurers must report exempt, non-GST and invoice
The document discusses factors that determine whether the price paid for a supply can be considered the "sole consideration", including whether the price is influenced by the relationship between supplier and recipient, if there are additional benefits provided, or if the price is set below cost for market penetration. It also outlines valuation rules for situations where the price is influenced, including using open market value, cost of production, or reasonable means consistent with valuation principles.
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Law Number 13 of 2003 on Manpower has been partially revoked and amended several times, with the latest amendment made through Law Number 6 of 2023. Attention is drawn to a specific part of the Manpower Law concerning severance pay. This aspect is undoubtedly one of the most crucial parts regulated by the Manpower Law. It is essential for both employers and employees to abide by the law, fulfill their obligations, and retain their rights regarding this matter.
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Question 1: Are all services provided by the Government or
local authority exempted from payment of tax ?
Answer: No, all services provided by the Government or
a local authority are not exempt from tax. As for instance,
services, namely, (i) services by the Department of Posts by
way of speed post, express parcel post, life insurance, and
agency services provided to a person other than Government;
(ii) services in relation to an aircraft or a vessel, inside or
outside the precincts of an airport or a port; (iii) transport of
goods or passengers; or (iv) any service, other than services
covered under (i) to (iii) above, provided to business entities
are not exempt and that these services are liable to tax.
That said, most of the services provided by the Central
Government, State Government, Union Territory or local
authority are exempt from tax. These include services
provided by government or a local authority or governmental
authority by way of any activity in relation to any function
entrusted to a municipality under Article 243W of the
Constitution and services by a governmental authority by
way of any activity in relation to any function entrusted to a
Panchayat under article 243G of the Constitution.
Question 2: Are Government or local authority or
governmental authority liable to pay tax?
Answer: Yes. The Government or a local authority or a
governmental authority is liable to pay tax on supply of
services other than the services notified as exempt or
notified as neither a supply of goods nor a supply of services
under clause (b) of sub-section (2) of section 7 of the CGST
Act, 2017. In respect of services other than – (i) renting of
immovable property; (ii) services by the Department of Posts
by way of speed post, express parcel post, life insurance, and
agency services provided to a person other than Government;
and (iii) services in relation to an aircraft or a vessel, inside
or outside the precincts of anairport or a port, the service
recipients are required to pay the tax under reverse charge
mechanism.
FAQ:
Government Services
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Question 3: What is the meaning of ‘Government’ ?
Answer: As per section 2(53) of the CGST Act, 2017,
‘Government’ means the Central Government. As per
clause (23) of section 3 of the General Clauses Act, 1897 the
‘Government’ includes both the Central Government and any
State Government. As per clause (8) of section 3 of the said
Act, the ‘Central Government’, in relation to anything done
or to be done after the commencement of the Constitution,
means the President. As per Article 53 of the Constitution,
the executive power of the Union shall be vested in the
President and shall be exercised by him either directly or
indirectly through officers subordinate to him in accordance
with the Constitution. Further, in terms of Article 77 of the
Constitution, all executive actions of the Government of India
shall be expressed to be taken in the name of the President.
Therefore, the Central Government means the President and
the officers subordinate to him while exercising the executive
powers of the Union vested in the President and in the name
of the President. Similarly, as per clause (60) of section 3
of the General Clauses Act,1897, the ‘State Government’,
as respects anything done after the commencement of
the Constitution, shall be in a State the Governor, and in an
Union Territory the Central Government. As per Article 154 of
the Constitution, the executive power of the State shall be
vested in the Governor and shall be exercised by him either
directly or indirectly through officers subordinate to him in
accordance with the Constitution. Further, as per article 166
of the Constitution, all executive actions of the Government
of State shall be expressed to be taken in the name of
Governor. Therefore, State Government means the Governor
or the officers subordinate to him who exercise the executive
powers of the State vested in the Governor and in the name
of the Governor.
Question 29: Whether the deductee can claim the input tax
credit on the deduction of tax at source amount?
Answer: No. The tax deducted at source is not input tax
credit. However, the amount deducted shall be credited
to the electronic cash ledger (upon being accepted by the
deducteein his Form GSTR-2A) of the deductee and can be
utilized for payment of output tax.
Question 30: Whether an amount in the form of royalty or
any other form paid/payable to the Government for assigning
the rights to use of natural resources is taxable?
Answer: The Government provides license to various
companies including Public Sector Undertakings for
exploration of natural resources like oil, hydrocarbons, iron
ore, manganese, etc. For having assigned the rights to use
the natural resources, the licensee companies are required
to pay consideration in the form of annual license fee, lease
charges, royalty, etc to the Government. The activity of
assignment of rights to use natural resources is treated as
supply of services and the licensee is required to pay tax on
the amount of consideration paid in the form of royalty or
any other form under reverse charge mechanism.
Question 31: Whether a Government Department, required
to deduct tax at source, is liable to take registration as a
normal taxpayer?
Answer: The Government Departmentis required to
take registration as a normal taxpayer only if it makes a
taxable supply of goods and/or services and in such cases,
theregistration shall be obtained on the basis of PAN but
Bank account is not mandatory. However, if it is not making
any taxable supply of goods and/or services, it is required to
register only as a deductorof tax at source on the basis of
TAN/PAN.
Note: Reference to CGST Act, 2017 includes reference to
SGST Act, 2017 and UTGST Act, 2017 also.
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Question 4: Who is a local authority?
Answer: Local authority is defined in clause (69) of section 2
of the CGST Act, 2017 and means the following:
• a “Panchayat” as defined in clause (d) of article 243 of the
Constitution;
• a “Municipality” as defined in clause (e) of article 243P of
the Constitution;
• a Municipal Committee, a ZillaParishad, a District Board,
and any other authority legally entitled to, or entrusted
by the Central Government or any State Government with
the control or management of a municipal or local fund;
• a Cantonment Board as defined in section 3 of the
Cantonments Act, 2006;
• a Regional Council or a District Council constituted under
the Sixth Schedule to the Constitution;
• a Development Board constituted under article 371 of the
Constitution; or
• a Regional Council constituted under article 371A of the
Constitution;
Question 5: Are all local bodies constituted by a State or
Central Law regarded as local authorities for the purposes of
the GST Acts?
Answer: No. The definition of ‘local authority’ is very specific
and means only those bodies which are mentioned as ‘local
authorities’ in clause (69) of section 2 of the CGST Act, 2017.
It would not include other bodies which are merely described
as a ‘local body’ by virtue of a local law.
For example, State Governments have setup local
developmental authorities to undertake developmental
works like infrastructure, housing, residential & commercial
development, construction of houses, etc. The Governments
setup these authorities under the Town and Planning
Act. Examples of such developmental authorities are
Delhi Development Authority, Ahmedabad Development
Authority, Bangalore Development Authority, Chennai
Metropolitan Development Authority, Bihar Industrial Area
Development Authority, etc. Such developmental authorities
formed under the Town and Planning Act are not qualified as
local authorities for the purposes of the GST Acts.
Question 27: Can the supplier of services claim the tax paid
under reverse charger mechanism as input tax credit?
Answer: Yes. The supplier of services may claim the input
tax credit on the amount of tax paid under reverse charge
mechanism subject to the provisions of Chapter V of CGST
Act, 2017 read with Chapter V of the CGST Rules, 2017.
Question 28: What is the concept called ‘tax deduction at
source’?
Answer: As per section 51 of the CGST Act, 2017, the
Government may mandate (a) a department or establishment
of the Central Government or State Government; or (b) local
authority; or (c) Governmental agencies; or (d) such persons
or category of persons as may be notified by the Government
on the recommendations of the Council, to deduct tax at the
rate of one per cent on account of CGST and one percent on
account of SGST from the payment made or credited to the
supplier where the total value of the supply under a contract
exceeds two lakh and fifty thousand rupees (excluding tax
payable under the GST Acts). The deductor shall remit the
deducted amount to the Government and is also required to
furnish a certificate to the deductee by mentioning the details
of the amount deducted and payment of such deducted
amount.
Illustration: ABC Ltd supplies the service valued at Rs.
3,00,000/- excluding tax to Government department. The
department while making the payment of Rs. 3,00,000/-
should deduct Rs. 3000/- on account of CGST and Rs. 3000/-
on account of SGST and make a net payment of Rs. 2,94, 000/-
to ABC Ltd. Thereafter, the department shall pay the amount
of Rs. 3,000/- to the Central Government andRs. 3,000/- to the
State Government and furnish a certificate to the deductee,
containing the details of such deduction including the details
of such deductee.
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Question 6: Would a statutory body, corporation or an
authority constituted under an Act passed by the Parliament or
any of the State Legislatures be regarded as ‘Government’ or
“local authority” for the purposes of the GST Acts?
Answer: A statutory body, corporation or an authority created
by the Parliament or a State Legislature is neither ‘Government’
nor a ‘local authority’. Such statutory bodies, corporations or
authorities are normally created by the Parliament or a State
Legislature in exercise of the powers conferred under article
53(3)(b) and article 154(2)(b) of the Constitution respectively.
It is a settled position of law (Agarwal Vs. Hindustan Steel AIR
1970 Supreme Court 1150) that the manpower of such statutory
authorities or bodies do not become officers subordinate to the
President under article 53(1) of the Constitution and similarly
to the Governor under article 154(1). Such a statutory body,
corporation or an authority as a juridical entity is separate
from the State and cannot be regarded as the Central or a
State Government and also do not fall in the definition of ‘local
authority’. Thus, regulatory bodies and other autonomous
entities would not be regarded as the government or local
authorities for the purposes of the GST Acts.
Question 7: Would services provided by one department of
the Government to another Department of the Government
be taxable?
Answer: Services provided by one department of the Central
Government/StateGovernment to another department of the
Central Government/ State Government are exempt under
notification No. 12/2017-Central Tax (Rate), dated28.06.2017 [S
No 8 of the Table].
However, this exemption is not applicable to:
(a) services provided by the Department of Posts by way of
speed post, express parcel post, life insurance, and agency
services provided to a person other than the Central
Government, the State Government and Union Territory;
(b) services in relation to a vessel or an aircraft inside or
outside the precincts of a port or an airport;
(c) services of transport of goods and/or passengers.
Question 25: What is the scope of ‘pure services’ mentioned
in the exemption notification No. 12/2017-Central Tax (Rate),
dated 28.06.2017?
Answer: Inthecontextofthelanguageusedinthenotification,
supply of services without involving any supply of goods would
be treated as supply of ‘pure services’. For example, supply
of man power for cleanliness of roads, public places, architect
services, consulting engineer services, advisory services, and
like services provided by business entities not involving any
supply of goods would be treated as supply of pure services.
On the other hand, let us take the example of a governmental
authority awarding the work of maintenance of street lights
in a Municipal area to an agency which involves apart from
maintenance, replacement of defunct lights and other spares.
In this case, the scope of the service involves maintenance
work and supply of goods, which falls under the works contract
services. The exemption is provided to services involves only
supply of services and not for works contract services.
Question 26: Would services in relation to supply of motor
vehicles to Government be taxable?
Answer: Supply of a motor vehicle meant to carry more than
twelve passengers by way of giving on hire to a state transport
undertaking is exempted from tax. The exemption is applicable
to services provided to state transport undertaking and not to
other departments of Government or local authority. Generally,
suchStatetransportundertakings/corporationsareestablished
by law with a view to providing public transport facility to
the commuters. In some cases, transport undertakings hire
the buses on lease basis from private persons on payment of
consideration. The services by way of supply of motor vehicles
to such state transport undertaking are exempt from payment
of tax. However, supplies of motor vehicles to Government
Departments other than the state transport undertakings are
taxable.
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Question 8: What are the transport services provided by the
Government or local authorities exempt from tax?
Answer: Transport services provided by the Government to
passengers by — (i) railways in a class other than— (a) first
class; or (b) an air-conditioned coach; (ii) metro, monorail
or tramway; (iii) inland waterways; (iv) public transport,
other than predominantly for tourism purpose, in a vessel
between places located in India; and (v) metered cabs or auto
rickshaws (including E-rickshaws) are exempt from tax.
Question 9: Are various corporations formed under
the Central Acts or State Acts or various government
companies registered under the Companies Act, 1956/2013 or
autonomous institutions set up by special Acts covered under
the definition of ‘Government’?
Answer: No. The corporations formed under the Central
or a State Act or various companies registered under the
Companies Act, 1956/2013 or autonomous institutions set up
by the State Acts will not be covered under the definition of
‘Government’ and therefore, services provided by them will
be taxable unless exempted by a notification.
Question 10: Are various regulatory bodies formed by the
Government covered under the definition of ‘Government’?
Answer: No.Aregulatorybody,alsocalledregulatoryagency,
is a public authority or a governmental body which exercises
functions assigned to them in a regulatory or supervisory
capacity. These bodies do not fall under the definition of
Government.
Examples of regulatory bodies are - Competition Commission
of India, Press Council of India, Directorate General of Civil
Aviation, Forward Market Commission, Inland Water Supply
Authority of India, Central Pollution Control Board, Securities
and Exchange Board of India.
Question 22: A small business entity is carrying on a business
relating to consulting engineer services in Delhi. Does it need
to pay tax on the services received from Government or a
local authority?
Answer: If turnover of the entity is less than the limit of
Rs. 20 lakhs in a financial year, no tax would be payable.
The exemption from payment of tax is applicable to
services provided to a business entity having a turnover
up to Rs. 20 lakh rupees. However, this exemption is not
applicable to (i) services by the Department of Posts by
way of speed post, express parcel post, life insurance,
and agency services provided to a person other than
Government; (ii) services in relation to an aircraft or a
vessel, inside or outside the precincts of anairport or a
port; (iii) services of transport of goods or passengers and
(iv) services by way of renting of immovable property.
Question 23: What is reverse charge in GST?
Answer: As per 2(98) of the CGST Act, 2017, ‘’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 of the CGST Act, 2017, or under sub-
section (3) or subsection (4) of section 5 of the IGST Act, 2017.
Question 24: Whether reverse charge is applicable to
services provided by Government or local authorities?
Answer: Yes, reverse charge is applicable in respect of
services provided by Government or local authorities to any
person whose turnover exceeds Rs.20 lakhs (Rs.10 lakhs for
Special Category States) excluding the following services:
(i) renting of immovable property;
(ii) services by the Department of Posts by way of speed
post, express parcel post, life insurance, and agency
services provided to a person other than Government;
(iii) services in relation to an aircraft or a vessel, inside or
outside the precincts of anairport or a port;
(iv) transport of goods or passengers.
Thus, the recipient of supply of goods or services is liable
to pay the entire amount of tax involved in such supply of
services or goods or both.
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Question 11: Will the services provided by Police or security
agencies of Government to PSUs or corporate entities or
sports events held by private entities be taxable?
Answer: Yes. Services provided by Police or security agencies
of Government to PSU/private business entities are not exempt
from GST. Such services are taxable supplies and the recipients
are required to pay the tax under reverse charge mechanism
on the amount of consideration paid to Government for such
supply of services.
Illustration: The Karnataka Cricket Association, Bangalore
requests the Commissioner of Police, Bangalore to provide
security in and around the Cricket Stadium for the purpose
of conducting the cricket match. The Commissioner of Police
arranges the required security for a consideration. In this case,
services of providing security by the police personnel are not
exempt.AstheservicesareprovidedbyGovernment,Karnataka
Cricket Association is liable to pay the tax on the amount of
consideration paid under reverse charge mechanism.
Question 12: The Department of Posts provides a number of
services. What is the status of those services for the purpose
of levy of tax?
Answer: The services by way of speed post, express parcel
post, life insurance, and agency services provided to a person
other than the Government or Union territory are not exempt.
In respect of these services the Department of Posts is liable to
pay tax without application of reverse charge.
However, the following services provided by the Department
of Posts are not liable to tax.
(a) Basic mail services known as postal services such as post
card, inland letter, book post, registered post provided
exclusively by the Department of Posts to meet the
universal postal obligations.
(b) Transfer of money through money orders, operation of
savings accounts, issue of postal orders, pension payments
and other such services.
Question 19: Whether services in the nature of change of land
use, commercial building approval, utility services provided by
a governmental authority are taxable?
Answer: Regulation of land-use, construction of buildings and
other services listed in the Twelfth Schedule to the Constitution
which have been entrusted to Municipalities under Article
243W of the Constitution, when provided by governmental
authority are exempt from payment of tax.
Question 20: Whether fines and penalty imposed by
Government or a local authority for violation of a statute, bye-
laws, rules or regulations liable to tax?
Answer: No. This gets covered under the exemption by
way of tolerating non-performance of a contract for which
consideration in the form of fines or liquidated damages is
payable to the Government or the local authority.
Question 21: Whether services provided by Government or a
local authority to a business entity located in a special category
State are subject to tax?
Answer: The expression “special category States” provided
in Explanation (iii) to section 22 of the CGST Act, shall mean
the States as specified in sub-clause (g) of clause (4) of Article
279A of the Constitution. As per the said clause, the States
of Arunachal Pradesh, Assam, Jammu and Kashmir, Manipur,
Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal
Pradesh and Uttarakhand have been given the status of special
category States for the purpose of GST Acts. Notification
No. 12/2017-Central Tax(Rate), dated 28.06.2017 (Sl. No. 7 of
the Table) provides for exemption from payment of tax in
respect of services provided to a business entity located in a
special category State with a turnover up to Rs. 10 lakh rupees.
However, this exemption is not be applicable to (a) services -
(i) by the Department of Posts by way of speed post, express
parcel post, life insurance, and agency services provided to a
person other than Government; (ii) in relation to an aircraft or a
vessel, inside or outside the precincts of anairport or a port; (iii)
of transport of goods or passengers and (iv) services by way of
renting of immovable property.
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Question 13: What is the scope of agency services provided
by the Department of Posts mentioned in the Notification
No. 12/2017-Central Tax(Rate) dated 28.06.2017?
Answer: The Department of Posts also provides services like
distribution of mutual funds, bonds, passport applications,
collection of telephone and electricity bills on commission
basis. These services are in the nature of intermediary
and generally called agency services. In these cases, the
Department of Posts is liable to pay tax without application
of reverse charge.
Question 14: Would services received by Government, a
local authority, a governmental authority from a provider of
service located outside India be taxable?
Answer: No tax is payable on the services received by the
Government / local authority/ governmental authority from
a provider of service located outside India. However, the
exemption is applicable to only those services which are
received for the purpose other than commerce, industry
or any other business or profession. In other words, if the
Government receives such services for the purpose of
business or commerce, then tax would apply on the same.
Question 15: Whether the exemption is applicable to online
information and database access or retrieval services
received by Government or local authorities from provider of
service located in non taxable territory?
Answer: No. Online information and database access or
retrieval services received by Government or local authorities
from non taxable territory for any purpose including
furtherance of business or commerce are liable to tax.
Question 18: What is the significance of services provided
by Government or a local authority by way of tolerating
non-performance of a contract for which consideration in
the form of fines or liquidated damages is payable to the
Government or the local authority ?
Answer: Non-performance of a contract or breach of
contract is one of the conditions normally stipulated in the
Government contracts for supply of goods or services. The
agreement entered into between the parties stipulates that
both the service provider and service recipient abide by the
terms and conditions of the contract. In case any of the
parties breach the contract for any reason including non-
performance of the contract, then such person is liable to pay
damages in the form of fines or penalty to the other party.
Non-performance of a contract is an activity or transaction
which is treated as a supply of service and the person is
deemed to have received the consideration in the form of
fines or penalty and is, accordingly, required to pay tax on
such amount.
However non performance of contract by the supplier of
service in case of supplies to Government is covered under
the exemption from payment of tax. Thus any consideration
received by the Government from any person or supplier for
non performance of contract is exempted from tax.
Illustration: Public Works Department of Karnataka entered
into an agreement with M/s. ABC, a construction company
for construction of office complex for certain amount of
consideration. In the agreement dated 10.7.2017, it was
agreed by both the parties that M/s. ABC shall complete the
construction work and handover the project on or before
31.12.2017. It was further agreed that any breach of the terms
of contract by either party would give right to the other
party to claim for damages or penalty. Assuming that M/s.
ABC does not complete the construction and handover the
project by the specified date i.e., on or before 31.12.2017. As
per the contract, the department asks for damages/penalty
from M/s. ABC and threatened to go to the court if not paid.
Assuming that M/s ABC has paid an amount of Rs. 10,00,000/-
to the department for non performance of contract. Such
amount paid to department is exempted from payment of
tax.
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Question 16: Whatarethefunctionsentrustedtoamunicipality
under Article 243W of the Constitution
Answer: The functions entrusted to a municipality under the
Twelfth Schedule to Article 243W of the Constitution are as
under:
(a) Urban planning including town planning.
(b) Regulation of land-use and construction of buildings.
(c) Planning for economic and social development.
(d) Roads and bridges.
(e) Water supply for domestic, industrial and commercial
purposes.
(f) Public health, sanitation conservancy and solid waste
management.
(g) Fire services.
(h) Urban forestry, protection of the environment and
promotion of ecological aspects.
(i) Safeguarding the interests of weaker sections of society,
including the handicapped and mentally retarded.
(j) Slum improvement and upgradation.
(k) Urban poverty alleviation.
(l) Provision of urban amenities and facilities such as parks,
gardens, playgrounds.
(m) Promotion of cultural, educational and aesthetic aspects.
(n) Burials and burial grounds; cremations, cremation
grounds; and electric crematoriums.
(o) Cattle pounds; prevention of cruelty to animals.
(p) Vital statistics including registration of births and deaths.
(q) Public amenities including street lighting, parking lots, bus
stops and public conveniences.
(r) Regulation of slaughter houses and tanneries.
Question 17: What are the functions entrusted to a
Panchayat under Article 243G of the Constitution?
Answer: The functions entrusted to a Panchayat under the
Eleventh Schedule to Article 243G of the Constitution are as
under:
(i) Agriculture, including agricultural extension. (ii) Land
improvement, implementation of land reforms, land
consolidation and soil conservation. (iii) Minor irrigation,
water management and watershed development. (iv)
Animal husbandry, dairying and poultry. (v) Fisheries. (vi)
Social forestry and farm forestry. (vii) Minor forest produce.
(viii) Small scale industries, including food processing
industries. (ix)Khadi, village and cottage industries. (x)
Rural housing. (xi) Drinking water. (xii) Fuel and fodder.
(xiii) Roads, culverts, bridges, ferries, waterways and
other means of communication. (xiv) Rural electrification,
including distribution of electricity. (xv) Non-conventional
energy sources. (xvi) Poverty alleviation programme. (xvii)
Education, including primary and secondary schools. (xviii)
Technical training and vocational education. (xix) Adult and
non-formal education. (xx) Libraries. (xxi) Cultural activities.
(xxii) Markets and fairs. (xxiii) Health and sanitation, including
hospitals, primary health centres and dispensaries. (xxiv)
Family welfare. (xxv) Women and child development. (xxvi)
Social welfare, including welfare of the handicapped and
mentally retarded. (xxvii) Welfare of the weaker sections,
and in particular, of the Scheduled Castes and the Scheduled
Tribes. (xxviii) Public distribution system. (xxix) Maintenance
of community assets.
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