CA NOTES ON GST AND CUSTOMS

Tharun’s BRAINERY © Tharun Raj
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That’s It on GST & Customs
For books & video lectures visit www.tharunraj.com © Tharun Raj
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That’s It
On
GST & Customs
For CA Final July 2020
[Also for CMA Final July 2020]
© Tharun Raj

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PREFACE TO FOURTH EDITION
The CA profession is a dizzy road with thorns for an ultimate bliss in life. The student has to undergo
intensive coaching and learn many new concepts which are of divergent nature say it be accounts,
audit, tax, costing, law etc., and particularly students at Final level feels it difficult to absorb as
they have to undergo practical training and attend classes.
On my interaction with many students at Final level, I came to know that they are very much in need
of a simple indirect tax (GST & Customs) book covering all topics which helps them to revise and
re”Wise” the subject from time to time, during their idle time in travelling, waiting at ITO office etc.,
As a faculty, it is a herculean task for me to make things simple - to the point and at the same time
ensuring that the essence of law in indirect tax (GST & Customs) is not missed.
It took me a considerable amount of time and I sincerely thank the almighty and my family for
enabling me to put enough efforts required to bring this novel concept into your hands.
However, the detailed information may not be available in this book but I ensured that the crux
required for appearing exams is covered. It is always advisable to read the main text and base this
book as a revision exercise.
By the Author
Tharun Raj
This book is designed to cater the above needs of every student.
How to
revise??
I am
afraid of
big
books!!!
I want a
simple
tax
book.

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INDEX
REVISION - 1 ___________________________________________________________________________________ 10
Supply, Composite & Mixed Supply, Liability to pay GST _______________________________________________ 10
Supply [Sec. 7 of CGST Act, 2017] _______________________________________________________________ 10
Composite Supply V. Mixed Supply [Sec. 8 of CGST Act, 2017]: ________________________________________ 15
Liability to pay GST [Sec. 9 of CGST Act, 2017] _____________________________________________________ 16
Summary of important circulars: _______________________________________________________________ 20
REVISION – 2___________________________________________________________________________________ 22
Value of Supply (incl. Rules related to Valuation)_____________________________________________________ 22
Meaning & Inclusions - Value of Supply – Sec. 15(1) and Sec. 15(2) of CGST Act, 2017 ______________________ 22
Exclusions from Value of Supply – Sec. 15(3) of CGST Act, 2017: _______________________________________ 23
Summary on CGST Rules, 2017[Rule 27 to Rule 31]
related to Valuation:______________________________________ 24
GST implications on debit note and credit note:____________________________________________________ 24
CGST Rules, 2017 – Value of Supply in special Situations: ____________________________________________ 25
REVISION – 3___________________________________________________________________________________ 27
Invoice [Sec. 31] & Time of Supply [Sec. 12,13 & 14] __________________________________________________ 27
TOS in case of goods covered under FCM: ________________________________________________________ 27
TOS in case of goods covered under RCM: ________________________________________________________ 27
TOS in case of Services covered under FCM:_______________________________________________________ 28
TOS in case of Services covered under RCM:_______________________________________________________ 29
TOS in special situations:______________________________________________________________________ 29
Various documents involved in GST: _____________________________________________________________ 30
TOS in case of change in Rate – Applicable only in case of services [Sec. 14]: _____________________________ 31
REVISION – 4___________________________________________________________________________________ 32
Input Tax Credit (ITC) __________________________________________________________________________ 32
Manner of Utilization of Credit [Sec. 49(5) of CGST Act, 2017]: ________________________________________ 33
Conditions for availing ITC [Sec. 16 of CGST Act, 2017]: ______________________________________________ 34
Apportionment of Credit [Sec. 17(1), 17(2) and 17(3) of CGST Act, 2017]:________________________________ 35
Rule 42 of CGST Rules, 2018 – Manner of availement of ITC w.r.to Inputs and Input Services: ________________ 36
Rule 43 of CGST Rules, 2018 – Manner of availement of ITC w.r.to capital goods: _________________________ 37
Special provision for availment of ITC by Banking company & FI (incl. NBFC) – Sec. 17(4)____________________ 37
Blocked Credits [Sec. 17(5) of CGST Act, 2017]: ____________________________________________________ 38
ITC in Special Circumstances [Sec. 18 of CGST Act, 2017]: ____________________________________________ 40
Job Work Provisions [Sec. 19 read with Sec. 143 of CGST Act, 2017]:____________________________________ 42
Input Service Distributor [Sec. 20 & 21 of CGST Act, 2017]: ___________________________________________ 43

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REVISION – 5___________________________________________________________________________________ 45
Place of Supply (POS) __________________________________________________________________________ 45
Nature of Supply Inter State or Intra-State [Sec. 7 & Sec. 8 of IGST Act, 2017]: ____________________________ 45
Export of goods Vs. Export of Services: ___________________________________________________________ 46
Deemed inter-state supplies: __________________________________________________________________ 46
Benefits in case of zero-rated supplies:___________________________________________________________ 46
Supplies in territorial waters (i.e. 12 Nautical Miles from base line) – Sec. 9 of IGST Act, 2017: _______________ 46
POS in case of goods [Sec. 10 & Sec. 11 of IGST Act, 2017]: ___________________________________________ 47
POS in case of Services [Sec. 12 & Sec. 13 of IGST Act, 2017]: _________________________________________ 48
REVISION – 6___________________________________________________________________________________ 55
Registration & Composition Scheme_______________________________________________________________ 55
Threshold limits for registration and composition scheme: ___________________________________________ 55
An Overview of registration Provisions: __________________________________________________________ 56
Procedure for obtaining registration [Sec. 25]:_____________________________________________________ 57
Special provisions relating to Casual Taxable Person and Non-resident taxable person [Sec. 27]: _____________ 58
Amendment in registration [Sec. 28]: ____________________________________________________________ 59
Cancellation of registration and revocation of cancellation [Sec. 29] :___________________________________ 60
Revocation of cancellation of registration [Sec. 30]:_________________________________________________ 61
Composition Scheme [Sec. 10 of CGST Act, 2017]: __________________________________________________ 62
Person opting for composition scheme can provide services upto 10% of turnover - Newly inserted from FY 2019-20
onwards __________________________________________________________________________________ 63
Overview of forms involved: ___________________________________________________________________ 65
Procedural compliance:_______________________________________________________________________ 65
Option to pay concessional tax @ 6% (CGST - 3% + SGST - 3%) - Notification No. 2/2019 w.e.f 1/4/2019:_______ 66
REVISION – 7___________________________________________________________________________________ 68
Exemptions in GST_____________________________________________________________________________ 68
Agriculture related Services: ___________________________________________________________________ 68
Banking and other financial services: ____________________________________________________________ 68
Health Care Services:_________________________________________________________________________ 69
Entry tickets: _______________________________________________________________________________ 70
Insurance Services – Following are exempted: _____________________________________________________ 70
Pension services: ____________________________________________________________________________ 70
Services by Specified organizations: _____________________________________________________________ 71
Charitable and religious service – Following services are exempted: ____________________________________ 71
Incubator & Incubatee Services: ________________________________________________________________ 71
Education Services: __________________________________________________________________________ 72

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Government Services: ________________________________________________________________________ 73
Renting services: ____________________________________________________________________________ 74
Sports Services: _____________________________________________________________________________ 75
Services of unincorporated association to its members – Following services are exempted:__________________ 75
OIDAR Services:_____________________________________________________________________________ 76
Construction Services (Not applicable to works contract services): _____________________________________ 76
Advocate Services:___________________________________________________________________________ 77
Transportation Services: ______________________________________________________________________ 78
GTA Services:_______________________________________________________________________________ 80
Exemptions under IGST Act: ___________________________________________________________________ 80
Miscellaneous exempted services: ______________________________________________________________ 81
REVISION – 8___________________________________________________________________________________ 83
Payment Process, Returns, Accounts & Records, Miscellaneous Topics ____________________________________ 83
Payment Process – An overview:________________________________________________________________ 83
Returns – An Overview:_______________________________________________________________________ 84
Accounts and Records: _______________________________________________________________________ 86
GST Practitioner [Sec. 48]:_____________________________________________________________________ 87
Tax Deducted at Source (TDS) Vs. Tax Collected at Source (TCS):_______________________________________ 88
Liability to pay in special cases: ________________________________________________________________ 89
Antiprofiteering: ____________________________________________________________________________ 90
E-Way Bill:_________________________________________________________________________________ 91
REVISION - 9 ___________________________________________________________________________________ 93
Assessment & Audit, Offences & Penalties __________________________________________________________ 93
Various interest provisions under GST: ___________________________________________________________ 93
Assessment under GST _______________________________________________________________________ 94
Audit under GST: ____________________________________________________________________________ 96
Seizure and Confiscation under GST:_____________________________________________________________ 97
Offences & Penalties under GST:________________________________________________________________ 98
REVISION - 10 _________________________________________________________________________________ 100
Appeals, Advance Ruling, Demand & Recovery _____________________________________________________ 100
Meaning of various terminologies used:_________________________________________________________ 100
Appeals:__________________________________________________________________________________ 100
Advance Ruling:____________________________________________________________________________ 102
Demand & Recovery under GST: _______________________________________________________________ 102
REVISION - 11 _________________________________________________________________________________ 104

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Refunds, Exports & Deemed Exports under GST _____________________________________________________ 104
Procedural aspects:_________________________________________________________________________ 104
Possible scenarios of refund in case of exports by a registered person: _________________________________ 105
What are the various situations where refund is available to a registered person under GST: _______________ 105
Refund allowed to retail outlets established in the departure area of an international airport - Rule 95A of CGST
Rules read with Circular No. 106/25/2019-GST dated 29/06/2019 (w.e.f 1/07/2019)______________________ 109
Analytical Chart on Exports & Deemed Exports:___________________________________________________ 111
REVISION - 12 _________________________________________________________________________________ 112
Taxable Event under Customs, Types of Customs duty, Valuation under Customs___________________________ 112
Important definitions under Customs Act, 1962: __________________________________________________ 112
Options available to importer for import of goods: ________________________________________________ 113
Various documents involved: _________________________________________________________________ 113
Taxable Event and Relevant date for determining rate of duty:_______________________________________ 114
Normal Customs duties: _____________________________________________________________________ 114
Additional Customs Duties on import – A comparative chart: ________________________________________ 115
Computation of Customs duty in case of import: __________________________________________________ 116
Valuation in case of imports: _________________________________________________________________ 116
Valuation in case of Exports:__________________________________________________________________ 118
REVISION - 13 _________________________________________________________________________________ 119
Customs – Procedures, Exemptions & Misc. topics___________________________________________________ 119
Procedures under customs:___________________________________________________________________ 119
Exemptions under Customs: __________________________________________________________________ 123
Relevant rate of duty in case of goods imported as a set of articles – Sec. 19: ___________________________ 125
REVISION – 14_________________________________________________________________________________ 126
Duty Drawback, Baggage, Assessment & Audit _____________________________________________________ 126
Duty Drawback:____________________________________________________________________________ 126
Baggage:_________________________________________________________________________________ 128
Audit under Customs [Sec. 99A]:_______________________________________________________________ 129
Interest on account of delay in payment of customs duty:___________________________________________ 130
Self-Assessment [Sec. 17 of Customs Act, 1962]: __________________________________________________ 130
Provisional Assessment [Sec. 18 of Customs Act, 1962]:_____________________________________________ 131
REVISION – 15_________________________________________________________________________________ 132
Foreign Trade Policy __________________________________________________________________________ 132
Various Export Promotion Schemes:____________________________________________________________ 134
II. EXPORT PROMOTION CAPITAL GOODS (EPCG) SCHEME: __________________________________________ 134
Merchandise Exports from India (MEIS) V. Service Export From India Scheme (SEIS): ______________________ 135

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IV. EXPORT PROMOTION ZONES SCHEME: _______________________________________________________ 136
V. DEEMED EXPORTS: _______________________________________________________________________ 138
Appendix – A__________________________________________________________________________________ 141
Ready Reckoner on time limits under GST _________________________________________________________ 141
Appendix – B __________________________________________________________________________________ 151
Ready Reckoner of Monetary Limits under GST _____________________________________________________ 151
This material is subject to copyright and strict action shall be taken on any person reproducing the contents of the book
without any written permission.
All disputes are subject to Chennai Jurisdiction

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9

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REVISION - 1
Supply, Composite & Mixed Supply, Liability to pay GST
Supply [Sec. 7 of CGST Act, 2017]
Supply - Sec. 7
7(1) - Includes
7(1)(a) - Any activity
for consideration in
the course or
furtherance of
business
7(1)(b) - Import of
services for
consideration,
whether or not in
the course or
furtherance of
business
7(1)(c) - Activities in
Schedule I even though
not for consideraton but
in the course of
furtherance of business
D - Disposal or business
assets on which ITC has
been availed
R - Related party
transactions (incl.
transaction between
distinct persons)
I - Import of services by a
person from related
persons or establishment
outside India
P - Principal Agent
transactions, when agent
is acting on behalf of
principal
7(1A) - Classification
of supply as goods
and services (Read
with Schedule II)
Supply of goods:
1. Transfer of title in
goods (Present or at
future date)
2. Disposal of
business assets
without
consideration
3. Supply of goods
by an
unincorporated
association or body
to its members
Supply of Services:
1. Transfer of right
to use goods
2. Doing an act, Not
doing an act or
Tolerating an act
3. Temporary
transfer of IPR
4. Information
Technology
Software Services
5. Works Contract
Services
6. Job Work
7. Supply of food -
Restaurant or
outdoor catering
8. Facilitating or
arranging
transactions in
securities.
7(2) - Excludes (Read
with Schedule III)
S - Soverign Functions
of Govt
P - Posts (Govt,
Constitutional and
Nominated)
A - Actionable Claims
other than lottery,
betting and gambling
L - Legal Fees collected
by Court or Tribunal
L - Land Sale (incl. Sale
of immovable property,
where entire
consideration is
recevied after
obtaining completion
certificate)
E - Employee to
Employer in the course
of employment
D - Death related
(Fuenral, Burial,
Mortury etc.,)
S - Sale in High Seas
O - Outside the coutry
movement of goods
W - Warehoused goods
sale
7(3) - CG on the
recommendations
of GST council* is
empowered to
notify Supply of
goods as supply of
services and
viceversa
Gifts by employer to employee not
exceeding `50,000 p.a per employee is
excluded from supply. Also, any benefit
covered under salary offer document forms
part of salary and is excluded from supply
*GST Council:-
1. Article 279A of
constitution
2.Constituted by
President of India
3.Union FM is its
Chairman
4.State FM & MP of
state affairs in
charge of revenue
are its members.
5.Decision making
for GST.
M 20

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Summary of Sec. 7(1):
Section reference Nature of Supply Whether
Consideration is
essential?
Whether it should be in the
course (or) in furtherance of
business?
Point of View
Section 7(1)(a) Any Activity Yes Yes Supplier
Section 7(1)(b) Import of services Yes Yes (or) No Recipient
Section 7(1)(c)
read with
Schedule I
D R I P
(Discussed above)
No D – No
R I P - Yes
D R P – Supplier
I - Receipient
Important Definitions/Points:
1. Meaning of goods & Services:
“Goods” are defined under section 2(52) of CGST Act, 2017 “Services” are defined under section 2(102) of CGST Act,
2017
“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.
“Services” MEANS anything other than goods, money and
securities but includes activities relating to 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 separate
consideration is charged.
Explanation: Activities in relation to transaction in
securities is included in services
2. Meaning of Consideration:
Ü Consideration can be received from recipient or any other person (Presence of Consideration is relevant)
Ü Consideration should be in respect of, in response to, or for the inducement of supply of goods or services
Ü Activity without consideration (or) Consideration without activity; is not a supply u/s 7(1)(a)
Consideration
Includes
Monetary -Payment
received or receivable
Non Monetary - Goods
or Services
Excludes
Subsidy from CG/SG Refundable Security
Deposit
Donations
Conditional - Obligation on supplier
to do something
Supply u/s 7(1)(a)
Unconditional - No obligation on
supplier to do anything
Not a supply
If Donor name displayed
anywhere in the premises
against donation:
Individual Name displayed –
Not a supply
Business Name displayed –
Supply u/s 7(1)(a)
M 20

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3. Meaning of Person:
4. Meaning of Business:
Sec. 2(17) of CGST Act, 2017
a) Any trade, commerce, manufacture, profession, vocation, adventure, wager or any other similar activity, whether
or not it is for a pecuniary benefit;
b) Any activity or transaction in connection with or incidental or ancillary to sub clause (a)
c) Any activity or transaction in the nature of sub clause (a), whether or not there is volume, frequency, continuity
or regularity of such transaction;
d) Supply or acquisition of goods including capital goods and services in connection with commencement or closure
of business.
e) Provision by a club, association, society, or any such body (for a subscription or any other consideration) of the
facilities or benefits to its members;
f) Admission, for a consideration, of persons to any premises;
g) Services supplied by a person as the holder of an office which has been accepted by him in the course or
furtherance of his trade, profession or vocation;
h) activities of a race club including by way of totalisator or a license to book maker or activities of a licensed book
maker in such club; and
i) Any activity or transaction undertaken by the central government, a state government or any local authority in
which they are engaged as public authorities;
5. Meaning of Related: [Transaction value u/s 15 not applicable and value determined in terms of Rules]
As per Explanation to Section 15, persons shall be deemed to be related if –
1. such persons are officers or directors of one another’s businesses; - Mr. X is appointed as officer of Mr. Y’s business
and Mr. Y is appointed as officer of Mr. X’s business. Now Mr. X and Mr. Y are related
2. such persons are legally recognised partners in business; - Partners in a firm are related
3. such persons are employer and employee1
;
4. any person directly or indirectly owns, controls or holds twenty-five per cent. or more of the outstanding voting
stock or shares of both of them; - Mr. A invests ≥ 25% in X Ltd. and ≥ 25% in Y Ltd. Now X ltd. and Y Ltd. are related
5. one of them directly or indirectly controls the other; - Meaning of control – Investment > 50%, (or) Majority
common BOD, (or) Controlling operations.
6. both of them are directly or indirectly controlled by a third person; - X Ltd. is controlled by A Ltd. and Y Ltd.
controlled by A Ltd., Now X Ltd. and Y Ltd. are related.
7. together they directly or indirectly control a third person; - X Ltd. invested 28% in A Ltd. and Y Ltd. invested 30% in
A Ltd. As both X Ltd. and Y Ltd. together control A Ltd., X Ltd. and Y Ltd. are related
8. they are members of the same family; (Family MEANS the spouse and children of the person, whether or not
dependent and the parents, grandparents, brothers and sisters of the person if they are wholly and mainly
dependent on the said person)
9. Also, persons who are associated in the business of one another in that one is the sole agent or sole distributor or
sole concessionaire, howsoever described, of the other, shall be deemed to be related.
1
However, services by employee to employer in the course of employment is not treated as supply as per schedule III of CGST Act,
2017.
"Person"
under
Income Tax
Act, 1961
Central
Govt. or
State Govt.
"Person"
under GST
Person under IT Act, 1961:- An individual, a HUF, a Company, A Firm, an AOP, local authority, Artificial Juridical
person & other body corporate.

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6. Meaning of various supplies:
Taxable Supply Exempted Supply Non-taxable supply Zero rated supply
Section 2(108) of CGST Act,
2017
2(47) of CGST Act, 2017 2(78) of CGST Act,
2017
16 of IGST Act, 2017
Meaning G/S/GS, which is
leviable to tax
G/S/GS, which attracts nil
rate of tax (or) Wholly
exempt from tax and
includes non- taxable
supply
G/S/GS, which is
not liable to tax
Following supplies of
G/S/GS:
a) Export
b) Supply to SEZ
unit/Developer
Goods not liable to tax – 1) Alcoholic Liquor for Human Consumption & 2) Petroleum products – Crude Oil, Petrol,
Diesel, Aviation Turbine Fuel and Natural Gas
8. Meaning of Aggregate turnover:
As per Sec. 2(6) of CGST Act, 2017 AGGREGATE TURNOVER MEANS aggregate value of
Ü Taxable supplies
Ü Exempt supplies2
Ü Exports
Ü Interstate supplies3
Of persons having same PAN, to be computed on all India basis.
BUT EXCLUDES
Ü Inward supplies on which tax is payable by a person on reverse charge basis
Ü CGST/SGST/UTGST/IGST
9. GST on Sale of Flats/Buildings:
S.No. Before obtaining
completion certificate
(or) First Occupation,
whichever is Earlier
After obtaining
completion certificate
(or) First occupation,
whichever is Earlier
GST Implications Nature of transaction
(a) Consideration Received - Payable (i.e. Not
excluded from supply)
Works Contract Service
(b) - Consideration received Not payable (i.e.
Excluded from supply)
Sale of immovable
property
(c) Part Consideration
received
Remaining consideration
received
Payable on entire
consideration (i.e. Not
excluded from supply)
Works Contract Service
10. Meaning of Works Contract:
“Works Contract” – A Contract involving transfer of property in goods as well as supply of services, in relation to
immovable property against a single consideration. [In earlier indirect tax regime, the same was classified under both
goods and services, and in GST it is classified completely as service]
11. Meaning of Job Work:
“Job Work” – Carrying out any process on the goods belonging to other registered person & the words job worker shall
be construed accordingly
2
Includes Non-taxable supplies or nil rated supplies
3
Includes supplies to SEZ unit/Developer (Even though it is zero rated, it is included in aggregate turnover)

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12. Meaning of Distinct Persons:
Every registration of a person to their another registration is a distinct person
When a person is required to obtain more than one registration?
13. Meaning of actionable claim:
Ü Right to receive a benefit or recover a debt
Ü Which is legally enforceable
Ü Can be transferred from one person to another
Ü Holder of such right is entitled to receive benefit or recover debt
7. Position of goods under GST [After implementation of GST] in comparison to earlier system:
Particulars Excise Duty CST VAT GST
Centre Excise State Excise
1. Alcohol for human
consumption*
X ü ü ü X
(Permanent)
2. Petroleum
products (5)*
ü X ü ü X
(Temporary)
3. Tobacco & Tobacco
products
ü X X X ü
4. Other Goods X X X X ü
* Non-taxable supplies under GST
Actionable Claims
Covered under the definition of
"MONEY" i.e. Bill of exchange,
Promissory Note, Bearer Cheque
Not Goods
Others - Considered as "GOODS"
Lottery, Betting, Gambling
Supply
Others
Not a Supply

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Composite Supply V. Mixed Supply [Sec. 8 of CGST Act, 2017]:
COMPOSITE SUPPLY MIXED SUPPLY
Meaning? Two or more supplies naturally bundled
in the ordinary course of business of
supplier
Two or more supplies not naturally
bundled in the ordinary course of business
of supplier
Type of supplies
involved?
Taxable supplies Taxable supplies (or) exempted supplies
(or) non-taxable supplies
How the price
should be?
Single Price (or) Separate Price Single Price
Principal supply? Yes, one of the supplies should be
principal supply
Principal supply is not relevant
Rate of GST? Rate of principal supply is applicable on
all supplies
Highest rate out of supplies is applicable
on all supplies
Examples? 1. AC + Installation
2. Transportation + Insurance
3. Replacement of parts during servicing
of vehicles + Labour Charges
1. Inverter + Battery
2. Renting of building + Renting of
Furniture
3. Popcorn + Coke in a Theatre
two or more taxable
supplies of goods or
services or both or any
combinatin thereof
are naturally bundled and
supplied in conjuction with
each other, in the ordinary
course of business, one of
which is a principal supply
Composite
Supply -
Sec. 2(30)
two or more individual
supplies of goods or
services, any combination
thereof, made in
conjunction with each
other
for a single price where
such supply does not
constitute composite
supply
Mixed
Supply -
Sec. 2(74)
Rate of tax applicable
Such supply is treated as
Whether it is naturally
bundled i.e one cannot be
supplied witthout other
Whether there involves more
than one supply
Supply of goods (or) Services (or)
both
Yes
Yes
Composite
supply
GST rate of principal
supply involved
No
Mixed supply
GST rate of supply having
highest rate
No
Question of
composite or mixed
supply shall not arise

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Liability to pay GST [Sec. 9 of CGST Act, 2017]
Note: Sec. 9(4) is now applicable only for notified class of registered
recipient and in case of notified goods or services
Sec. 9(3) – Notified Services for RCM – SIR CG GOT SALAD
S Security Lending as per SEBI – Borrower of securities is liable to pay GST
I Import of services by a person other than non-taxable recipient (NTR = Unregistered individual, Govt. or Trust
importing for other than using it for further supply in the business)
R Renting of motor vehicles by a person other than body corporate to a Body Corporate (Rate of GST opted
should be 5% by the supplier)
C Copyright – Temporary transfer of Copyright relating to original literary, Dramatic, Musical or artisitic works
to a publisher, Music Company, producer or the like. In case of literary works, the supplier (i.e. Author) has
option to pay GST under FCM and if it is opted, for 1 year such option cannot be withdrawn
G GTA Services to person other than Unregistered Individual, HUF or AJP. (Such individual, HUF, AJP should not
have factory)
G Government or Local Authority Services to business entities (Wherever it is taxable)
O Overseeing Committee services to RBI in relation to restructuring NPA’s
T Transfer of right to use by any person to promoter in relation to
• Development rights or floor space index, for construction of a project
• Long term lease of land (30 years or more)
S Sponsorship services by Organizer of event to Firm or Body Corporate (If recipient is other than body corporate
or firm, it is covered under FCM)
A Agent Services
1. Insurance Agent to person carrying insurance business
2. Recovery Agent to Banking company/FI/NBFC
3. Direct Selling Agent (other than body corporate/Firm/LLP) to Banking company/NBFC
4. Business Facilitator to Banking Company
5. Agent of Business Correspondent to Business Correspondent
M 20
M 20
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17
L Legal Services – By Individual Advocate or Firm of advocates to Business entity, whose turnover during
previous year exceeds `20 lakhs/`10 lakhs
A Arbitrator Services to Business entity, whose turnover during previous year exceeds `20 lakhs/`10 lakhs
D Director’s services to Company or Body Corporate
S Security services by any person other than body corporate to any registered person other than Govt/Local
authority/Govt. agencies who got registered only to deduct TDS; or person opting for compositions scheme
Supplier Recipient Charge
Body Corporate (BC) Any Person FCM
Other than BC Unregistered Person FCM
Other than BC Registered - Composition Scheme FCM
Other than BC Registered - CG/SG/LA/GA only to deduct TDS FCM
Other than BC Registered - Other than above RCM
Sec. 9(4) – Purchases by registered person from unregistered persons:
Sec. 9(5) – Liability to pay GST on E Commerce Operator (ECO) in case of notified services:
In case of following categories of services, GST on Intra and interstate supplies shall be paid by ECO:
1. Services by way of transportation of passengers by Radio Taxi, Motor Cab, Maxi Cab and Motor Cycle (Eg: OLA,
UBER)
2. Services by way of providing accommodation in hotels, inns, guesthouses, clubs, campsites or other commercial
places meant for residential or lodging purposes (Eg: Goibibo, Make my Trip)
3. Services by way of housekeeping such as plumbing, carpentry etc., (Eg: Urban Clap, Quikr Services)
Note: In case of (2) and (3) above, if supplier is registered, liability to pay GST is on supplier but not on E
Commerce Operator

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Important points:
1. When ECO is liable to pay GST, they are not required to deduct TCS [Tax Collected at Source under Sec. 52 -
Provisions of TCS Discussed below]
2. Only in case of notified services [Sec. 9(5)], ECO is liable to pay GST. In other cases, Supplier shall pay GST.
3. Every ECO who is liable to pay GST (or) who is liable to deduct TCS is compulsorily required to get registered
4. Also, every supplier of goods through ECO is compulsorily required to get registered under GST irrespective
of their aggregate turnover
5. Supplier of notified services [Sec. 9(5)] is not required to get registered, if they are supplying only through
ECO. Otherwise, they should register when their aggregate turnover exceeds `20 lakhs (`10 lakhs in case of
special category states i.e. Manipur, Mizoram, Tripura & Nagaland)
6. Supplier of other than notified services [Sec. 9(5)] through ECO is required to get registered only when their
aggregate turnover exceeds ` 20 lakhs (` 10 lakhs in case of special category states)
Tax Collected at Source (TCS) [Sec. 52]
Important points on TCS:
1. ECO is liable to deduct TCS on behalf of supplier, only when the following conditions are satisfied
a. Supplier should be registered
b. Payment from buyer should be collected by ECO
c. Such supplies should not be notified services under sec. 9(5)
d. Such supplies should be taxable supplies
2. TCS shall be deducted @ 1% (0.5% CGST & 0.5% SGST) on the value of taxable supplies (Excl. GST) and any sales
returns made during the period should be deducted
3. GSTR-8 to be furnished by 10th
of the following month along with payment of TCS.
4. Details furnished by ECO in GSTR – 8 should be matched with corresponding details furnished by the supplier in
GSTR – 1, only then TCS shall be made available as credit to supplier in their Electronic Cash Ledger
Supplier ECO Buyer
1. Contract to sell mobile with a
commission of ` 1,000 plus GST @ 18%
2. Order for mobile
3. Mobile with an invoice of `10,000
plus GST @ 28% i.e. ` 12,800
4. Delivery of Mobile
5. Payment of ` 12,800
Govt.
6. GST Payable on Commission
= ` 1,000 X 18% = ` 180
7. TCS Deducted and payable =
` 10,000 X 1% = ` 100
8. Amount remitted = Price –
Commission with GST – TCS = `
12,800 - ` 1,180 - ` 100 = ` 11,520
9. GST payable on
mobile = ` 2,800
10. ITC on
Commission
paid = ` 180 &
TCS Credit = `
100
M 20

19
Flow chart determining ECO liability:
Sec. 9(5) CGST
Sec. 5(5) IGST
Is the
person ECO?
Is supply made
through ECO?
Is supply of
service
notified?
All the provisions of this Act shall apply to ECO as if he is the supplier liable for paying the tax in
relation to the supply of such services
Does ECO has a
physical presence in
India (taxable
territory)
Any of your
representatives
located in taxable
territory?
No
Stop
Yes
No
Yes
Yes
ECO will be liable to pay Tax
Yes
No
ECO is not liable to pay GST
Such representative shall be liable to pay tax
Yes
No
Such electronic commerce operator shall appoint a person in the taxable territory for the purpose of
paying tax and such person shall be liable to pay tax.
No

20
Summary of important circulars:
Circular No. Issue involved? Clarification
Vide Circular No.
1/1/2017 (Dt:
7.7.17),
Vide Circular No.
21/21/2017,
Whether inter-state movement of
various modes of conveyance
carrying goods or passengers or
both, or for repairs and
maintenance, between distinct
persons as specified in section 25(4)
of the CGST Act [except in cases
where such movement is for further
supply of the same conveyance], is
leviable to IGST?
it is clarified that such interstate movement of Trains,
buses, trucks, tankers, trailers, vessels, containers,
aircrafts
- Carrying goods or passengers or both, or
- For repairs and maintenance, shall not constitute supply
and not chargeable to GST.
However, applicable CGST/ SGST/ IGST, as the case may
be shall be leviable on repairs and maintenance done for
such conveyance.
Also, the above circular is extended to interstate
movement of rigs, tools and spares, and all goods on
wheels (like Cranes) and except in case where movement
of such goods is for further supply of the same.
Note: This circular can be applied even in case of intra
state, if there are multiple registrations in the state.
Circular No.
57/31/2018
When an agent is termed as “Acting
on behalf of principal”?
An agent should:
1. Represent principal in all aspects
2. raise invoice in their name (or) accept invoice in
their name i.e in Agent’s name
Circular No.
11/11/2017 (Dt:
20.10.17)
Whether supply of books,
pamphlets, brochures, envelopes,
annual reports, leaflets, cartons,
boxes etc., printed with design,
logo, name, address or other
contents supplied by the recipient of
such supplies, would constitute
supply of goods or supply of
services?
printing of books, pamphlets, brochures, annual reports,
and the like, where only content is supplied by the
publisher – Supply of Service
printed envelopes, letter cards, printed boxes, tissues,
napkins, wall paper etc., printed with design, logo etc.
supplied by the recipient – Supply of goods
Circular No.
34/8/2018 (Dt:
1.3.2018)
Whether activity of bus body
building, is a supply of goods or
services?
Determined on the basis of principal supply involved in
the transaction
Circular No.
34/8/2018 (Dt:
1.3.2018)
Whether rethreading of tyres is a
supply of goods or services?
Supply of rethreaded tyres, where the old tyres belong to
the supplier of rethreaded tyres, is a supply of goods. If
the old tyres belongs to recipient, then it is treated as
supply of service.
Circular No.
34/8/2018 (Dt:
1.3.2018)
Whether Priority Sector Lending
Certificates (PSLCs) are outside the
purview of GST and therefore not
taxable?
In GST, there is no exemption to trading in PSLCs. Thus,
PSLCs are taxable as goods (Always, chargeable to IGST
under RCM)
Circular No.
22/22/2017 GST
dated 21.12.2017
Whether art works sent by artists to
galleries for exhibition not being a
supply ?
It is only when the buyer selects a particular art work
displayed at the gallery, that the actual supply takes
place and applicable GST would be payable at the time
of such supply
Whether tenancy rights or pagadi
system is chargeable to GST?
In relation to residential property à Exempted
In relation to commercial property à Taxable

21
Circular No. 73/47/2018 (Dt: 05.11.2018) has clarified the scope and ambit of principal agent relationship in the context
of a del-credere Agent (DCA)
Who is a DCA? - In commercial trade parlance, a DCA is a selling agent who is engaged by a principal to assist in supply of
goods or services by contacting potential buyers on behalf of the principal. The factor that differentiates a DCA from other
agents is that the DCA guarantees the payment to the supplier. In such scenarios where the buyer fails to make payment
to the principal by the due date, DCA makes the payment to the principal on behalf of the buyer (effectively providing an
insurance against default by the buyer), and for this reason the commission paid to the DCA may be relatively higher than
that paid to a normal agent.
Whether the temporary short-term transaction-based loan extended by the DCA to the recipient (buyer), for which interest
is charged by the DCA, is to be included in the value of goods being supplied by the supplier
Scenario – 1: DCA not making supply on behalf of principal
The interest collected by the agent is not with respect of supply of goods by him and the said interest is for extending loans
or advance and the said interest is EXEMPTED
Scenario – 2: DCA making supply on behalf of principal
The interest collected by the agent is with respect of supply of goods by him and the said interest is for delay in payment
of consideration by recipient and therefore should be included in the value of supply of goods made by him and TAXABLE

22
REVISION – 2
Value of Supply (incl. Rules related to Valuation)
Meaning & Inclusions - Value of Supply – Sec. 15(1) and Sec. 15(2) of CGST Act, 2017
Conditions for pure agent:
• Supplier should enter into an agreement with recipient to act as pure agent w.r.to an expenditure
• Supplier should recover only the actual amount incurred
• Supplier should not hold title to the goods or services so procured
• Supplier should not use the said goods or services so procured for his personal purpose
Note: Passenger Service Fee (PSF) and User Development Fee (UDF) collected by airline operators from passengers
are to be remitted to airport operator and falls under expenditure incurred as a pure agent
Subsidy received by supplier
From CG/SG
Such subsidy shall be
excluded from value
From Others (i.e.
recipient or third party)
Directly linked to price
Such Subsidy shall be
included in Value
General Subsidy
Such subsidy shall be
excluded from value
M 20

23
Exclusions from Value of Supply – Sec. 15(3) of CGST Act, 2017:
Issue: Whether GST is applicable on additional / penal interest on the overdue loan? Whether such penal interest would
be exempt under Entry 27 of exemption notification or it would be taxable treating it as consideration for liquidated
damages?
Clarification: There are two transaction options involving EMI that are prevalent in the trade. In view of the provisions of
law discussed above, these two options, along with the GST applicability are as follows-
Relevant date for determining exchange rate for the purpose of valuation and computation of GST [Rule 34
of GST Rules, 2017]
Note: Exchange gain/loss shall be ignored for the purpose of GST
Discount
Before Supply
At the time of
Supply
Discount is allowed
as deduction and
such discount
should be recorded
in invoice
Eg: Trade Discount
After Supply
Discount is known
before (or) at the
time of supply
Discount is allowed as
deduction, provided ITC to such
extent has been reversed by
recipient and supplier has issued
a credit note Eg: Cash Discount
Discount is known
after supply
Discount is not
allowed as
deduction
Eg: End of Season
Sale Discount
Relevant Exchange rate
In Case of goods
Rate notified by CBIC
prevailing on time of supply
determined under sec. 12
In Case of Services
Rate determined as per GAAP
prevailing on time of supply
determined under sec. 13
M 20

24
Summary on CGST Rules, 2017[Rule 27 to Rule 31]
related to Valuation:
Assessable Value = Transaction Value determined in terms of Sec. 15, if the following conditions are satisfied
1. Price must be the sole consideration for sale
2. Supplier and Recipient are not related
If any or both the conditions are not satisfied, then Assessable Value shall be determined in terms of CGST Rules, 2017 as
follows:
Situation 1 2 3 4
(i) Price is not sole
consideration – Rule
27
Open Market Value
(OMV)
Monetary
Consideration (+)
Money value of non-
monetary
consideration
Like Kind &
Quality
2
Cost (+) 10%
(ii) Transactions
between related
persons including
distinct persons –
Rule 28
Recipient eligible for
100% ITC
OMV = TV (Deemed)3
Recipient not eligible for
100% ITC
OMV
Like Kind & Quality 2
Cost (+) 10% -
Alternatively (at the option of the supplier for each supply),
90% of the price at which recipient supplies like kind and quality to unrelated buyer on
the same day (Recipient should not process those goods but should have been sold as
such)
(iii) Principal and Agent
transactions
between u/s 7(1)(c) –
Rule 29
(at the option of the
supplier for each supply)
OMV (or) 90% of the price
at which recipient
supplies like kind and
quality to unrelated buyer
on the same day
(Recipient should not
process those goods but
should have been sold as
such)
2
Cost (+) 10%
- -
Notes:
1. If above is not possible, then value shall be determined as per Rule 31 by GST officer.
2. Rule 30: For Cost (+) 10%, Cost shall be Cost of production (In case of manufacturer); Cost of acquisition (In case
of trader) and Cost of providing service (In case of service provider)
3. In such case, invoice can be generated for any value (even ` 1 can be considered as value)
4. In case of services, Rule 30 can be skipped and proceeded to Rule 31, as determining cost of providing service is
difficult
GST implications on debit note and credit note:
Nature of
document
When? Who? Consequence to
supplier
Consequence to recipient
Debit
Note
Recipient has to pay an
amount beyond invoice
price
Supplier to
Recipient
INCREASE in Output tax
liability
INCREASE in ITC
Credit
Note
Recipient has to pay an
amount less than the
invoice price
Supplier to
Recipient
DECREASE in Output
tax liability
REVERSAL of ITC (or) INCREASE
in Output tax liability

25
CGST Rules, 2017 – Value of Supply in special Situations:
Rule Situation Value of Supply =
Rule
32(2)
Foreign Exchange
transactions (incl.
Money changing)
Option to be
decided in the
beginning of the
financial year,
which shall be
applicable
throughout the
financial year
Rule
32(3)
Air travel Agent
Services
5% of basic fare in case of domestic bookings and 10% of basic fare in case of
international bookings
Rule
32(4)
Life insurance
business
• Risk Cover Policies à Entire premium
• Single premium annuity policy à 10% of single premium
• Reinvestment policy (Where amount allocated for investment is intimated to policy
holder) à Gross premium (-) Amount allocated for investment [If amount allocated
for investment is not communicated to policy holders, then it is treated as other
policies]
• Other policies à 25% of premium in 1st
year and 12.5% of premium in subsequent
years
Rule
32(5)
Buying and selling
of second hand
goods
• Value = Selling price (-) purchase price i.e., margin scheme
• ITC should not be availed on purchase (i.e. purchase from a unregistered
person)
• In case of repossession à Purchase price = Original purchase price (-) 5% for
every quarter or part thereof from the date of purchase till the date of disposal
of repossessed asset.
Rule
32(6)
In case of coupon/
Voucher
Money value of supplies redeemable against such voucher/coupon
Rule
32(7)
Notified services
between distinct
persons without
consideration
Nil (If ITC available on purchase)
Option (i)
When one of the
currency exchanged
in a transaction
involves `
When RBI
reference rate is
available for
that currency on
that date
(Buying
rate/Selling rate
- RBI Ref. rate)
X Units of
currency
When RBI
reference rate is
not available for
that currency on
that date
Gross amount of
INR involved X
1%
When both the
currencies
exchanged in a
transaction are
Foreign currency
Least of the
following:
(a) Purchased
currency
converted into `
using RBI ref.
rate X 1%
(b) Sold
currency
converted into `
using RBI ref.
rate X 1%
Option (ii)
Gross amount
involved is £ `
1,00,000
1% of gross
amount (or) `250,
whichever is
HIGHER
Gross amount
involved is > `
1,00,000 and £ `
10,00,000
`1,000 (+) 0.5% of
gross amount
exceeding `1,00,000
Gross amount
involved >
`10,00,000
`5,500 (+) 0.1% of gross
amount exceeding
`10,00,000 (or) `60,000,
whichever is LOWER
Rule 32(2)(b)
Rule 32(2)(a)

26
Value of Supply in case of lottery, betting, gambling and horse racing [Rule 31A of CGST Rules, 2017) -
Inserted Vide Notification No. 03/2018 (Dt: 23/01/2018)]:
Particulars VALUE
1. Supply of lottery run by State Government
(organiser of lottery = SG) – This lottery is sold in
the same state
[Face Value of the ticket (or) Price as notified by organising state,
WHICHEVER IS HIGHER] X 100/112 (i.e. Rate of GST is 12%)
2. Supply of lottery authorised by State
Government (Organiser of lottery = Person
authorised by SG) – This lottery can be sold in
other states
[Face Value of the ticket (or) Price as notified by organising state,
WHICHEVER IS HIGHER] X 100/128 (i.e. Rate of GST is 28%)
3. Supply of actionable claim in the form of
Chance to win in betting, gambling or horse
racing in a race club
100% of the face value of bet or the amount paid into the
totalisator [Not on the commission earned by the totalisator]
U/s 15(2) of CGST Act any taxes, cess, duties shall be included in the value of supply but TCS is not includable in the value
as it is interim levy but not having character of tax – Circular No. 76/50/2018 GST Dt.31.12.2108
value to be adopted for computing GST on services of Business Facilitator (BF) or a Business Correspondent (BC) to Banking
Company - Circular No. 86/05/2019 GST dated 01.01.2019
Payable by banking
company under RCM

27
REVISION – 3
Invoice [Sec. 31] & Time of Supply [Sec. 12,13 & 14]
TOS in case of goods covered under FCM:
TOS in case of goods covered under RCM:
Note: GST payable on advances in case of goods covered under RCM
Sec. 12(2) - Time of supply of goods shall be EARLIEST of the following
Actual Date of
issue of tax
invoice
Due date for issue of
tax invoice as per Sec.
31
General Rule -
Sec. 31(1)
Supply involves
movement of
goods
Invoice shall be
issued before or
at the time of
removal of
goods for supply
to the recipient
Supply does not
involve
movement of
goods
Inovice shall be
issued at the
time of delivery
of goods or
making available
goods to the
recipient
Specific Rule
Continous supply
of goods
involving issue of
successive
statement of
accounts or
successive
payments
Inovice shall be
issued before or
at the time each
statement is
issued or each
payment is
received - Sec.
31(4)
Goods sent or
taken on
approval for sale
or return are
removed before
the supply takes
place
Invoice shall be issued
i.e., as & when
customer approved
a) Before or at the time
of supply
b) 6 months from the
date of removal,
whichever is EARLIER -
Sec. 31(7)
Date of receipt
of payment
a) Date of entry
in books of
accounts
b) Date of credit
in bank account,
Whichever is
EARLIER
Time of supply of goods (in case of Reverse charge) shall be
EARLIEST of the following - Sec. 12(3)
Date of receipt of
goods
Date immediately following
30 days from the date of
issuance of inovice by the
supplier i.e. 31st day from
the date of invoice
Date of receipt of
payment i.e. Entry
(or) Debit, whichever
is EARLIER

28
TOS in case of Services covered under FCM:
Time of supply of service - Sec. 13(2)
If invoice is issued within the Due
date
Time of supply shall be EARLIER
of the following 2 dates
Actual Date of
issuance of
invoice
What is the due
date of invoice?
General Rule -
Sec. 31(2)
(a) Before
provision of
service, or
(b) after the
provision of
service but within
30/45 days from
the provision of
service
Specific Rule
Continuous
supply of services
- Sec. 31(5)
Time of supply
depends on the 3
different
scenarios
Due date
ascertainable
from the Contract
Invoice shall be
issued on or
before the due
date of payment
Due date not
ascertainable from
the Contract
Invoice shall be
issued before or
at the time
supplier receives
the payment
Payment linked to
completion of
event
Invoice shall be
issued on or
before the
completion of the
event
Cessation of
services - Sec.
31(6)
Invoice shall be
issued when the
supply ceases
w.r.to
propoctionate
Amount
Date of receipt of
payment
Date of entry in books
(or) Date of credit in
bank account, whichever
is EARLIER
If invoice is not issued within the
due date
Time of supply shall be EARLIER of the
following 2 dates
Date of provision
of service
Date of receipt of
payment
Date of entry on
books (or) Date of
credit in bank
account, whichever is
EARLIER
Note:
• Invoice to be issued
within 45 Days for
Banking &
Insurance, 30 Days
for Others from the
date of completion
• Continuous Supply
of service: A service
which takes more
than 3 months to
complete

29
TOS in case of Services covered under RCM:
TOS in special situations:
Section Situation TOS
12(4) and
13(4)
In case of Vouchers Identifiable Voucher à At the time of issuance of voucher
Non-Identifiable Voucher à At the time of redemption of
voucher
12(5) and
13(5)
In case TOS is not ascertainable as
per any sub section
[Applicable in case of evasion of
GST by a taxable person]
Periodical return has been filed à Due date of filing such return
Periodical return not filed à Date of payment of GST
12(6) and
13(6)
In case of addition to value in the
form of interest, late fee etc., for
delay in payment of consideration
As and when such additional consideration is received.
(GST payable on Receipt basis)
Additional Points:
2. In case of goods covered under FCM, on advances GST is not payable and GST is payable only upon invoice, as the TOS
is Due date of Invoice (or) Actual Date of Invoice, whichever is EARLIER. But in case of services under FCM, GST is payable
on advances.
3. Upto `1,000 received in excess of the invoice, in case of services covered under FCM, TOS can be (i) Date of Invoice
(or) determined as per Sec. 13(2) – Supplier has option to choose
4. In case of supply of services between associated enterprises, where supplier is outside India and recipient is in India,
TOS shall be date of entry in the books of recipient or date of payment to supplier, whichever is EARLIER
5. When goods are taken outside India for exhibition, it is not a supply. But when the same is not brought back within 6
months it is deemed to be supply in terms of Sec. 31(7)
Time of supply in case of reverse charge, shall be EARLIER of
the following - Sec. 13(3)
Date of payment (Which is date of
entry in the books (or) date of credit in
bank account, whichever is EARLIER)
Date immediately following 60 days
from the date of issue of invoice by
the supplier i.e. 61st day from the
DOI
1. Date of payment
In case of supplier
Date of entry in books (or) Date of Credit in
Bank A/C whichever is EARLIER
In case of recipient
Date of entry in books (or) Date of Debit
in Bank A/C whichever is EARLIER
M 20

30
Various documents involved in GST:
S.No Document Situation of issuance? Who will issue? Time of
issue
1 Tax in voice Supplying
a) Taxable goods
b) Taxable services
If supplier is
registered
Supplier will
issue
Specified
[See above]
If supplier is
unregistered
Recipient will
issue in case
of RCM
2 Bill of
supply
A registered person
a)Supplying exempted goods or services or both
(Or)
b)Paying tax under the composition scheme
shall issue ‘Bill of Supply’
Supplier Specified
[Same as
due date of
invoice]
In case of low value supplies (i.e. Value of Supply < ` 200, tax invoice as well as bill of supply not required if the recipient
is unregistered, recipient is not in need of invoice and a consolidated invoice needs to raised by the end of the day.
Note: in case of multiplex theatres, an invoice (E Ticket deemed as invoice)
to be issued even if the value of supply is < ` 200
3 Debit Note a)The Taxable value charged less
(tax invoice<actual taxable value)
b)Tax charged less
(tax invoice < tax payable
Supplier Not
Specified
4 Credit Note
4
a) Taxable value charged in excess (tax invoice
> actual taxable value)
or
b) Tax charged in excess
(tax invoice >tax payable)
c) Sale return
d) Where goods or services or both supplied
are deficient
Supplier
Note: Credit note cannot be
issued in case of bad debts
Before Sep
end of next
FY (or) date
of filing
annual
return,
whichever is
earlier
5 Revised tax
invoice
Every registered person who has been granted
registration with effect from a date earlier than
the date of issuance of certificate of registration
to him, may issue revised tax invoices in respect
of taxable supplies effected during the period
starting from the effective date of registration
till the date of the issuance of the certificate of
registration
Effective Date of Registration:
If applied within 30 days from the date when
liable à Date on which such person is liable to
register
If not applied within 30 days à Date on which
registration is granted
Supplier
Note: Revised tax invoice
cannot be issued if application
for registration not made
within 30 days from the date
on which liability to register
arises
Within 1
month from
the date of
certificate of
registration
6 Receipt
Voucher
Supplier
Note: It is required only if
payment is received before
issuance of invoice
Not
specified
4
One or more Credit note/Debit Notes can be issued for multiple invoices- Notification No.74/2018 Dated 31.12.2018.
Advance
Payment
Supplier Recipient
Receipt
Voucher
M 20

31
7 Payment
Voucher
A registered person who is liable to pay tax
under section 9(3) and 9(4) shall issue a payment
voucher at the time of making payment to the
supplier
Recipient Not
specified
8 Refund
voucher
Supplier
Note: If amount is refunded
after issuance of tax invoice,
then a credit note shall be
issued by supplier to recipient
Not
specified
9 Delivery
Challan
The consigner may issue a delivery challan, for
the purposes of –
a) Supply of liquid gas where the quantity at the
time of removal from the place of business of
the supplier is not known.
b) Transportation of goods for job work,
c) Transportation of goods for reasons other
than by way of supply, or
d) Such other supplies as may be notified by the
board.
Supplier Not
specified
TOS in case of change in Rate – Applicable only in case of services [Sec. 14]:
Note: DOP for Sec. 14 is Date of entry in books or date of credit in Bank A/c, whichever is EARLIER (If payment is credited
within 4 days from change in rate); or Date of credit in the Bank A/c (If payment is credited after 4 days from change in
rate)
Date of Completion (DOC) of supply
Before change in rate
Date of Invoice (DOI)
or Date of Payment
(DOP), whichever is
EARLIER
After change in rate
If both DOI and DOP
before change in rate
DOI or DOP,
whichever is EARLIER
Either DOI or DOP
before change in rate
and the other after
change in rate
DOI or DOP,
whichever is LATER
Advance
Payment
Supplier Recipient
Receipt
Voucher
Refund Voucher
(if no supply, no
tax invoice)

32
REVISION – 4
Input Tax Credit (ITC)
GSTR – 1: Details of outward supplies to
be furnished by every registered person –
Invoice wise
GSTR – 2A: Based on GSTR – 1 furnished
by every supplier, recipient can generate a
statement of inward supplies in GSTR-2A
auto populated from GSTR -1 filed by
suppliers
GSTR-3B: Consolidated details of outward
supplies, inward supplies, GST payable
and GST paid shall be reported by every
registered person
Electronic Credit Ledger (ECRL) –
Maintained by GSTN for every registered
person and it gets credited as and when
ITC is claimed through GSTR-3B and gets
debited by the amount utilized for
payment of tax liability
GSTR – 9: Annual return to be filed by a
registered person where in reconciliation
should be made between the ITC availed
in terms of GSTR-3B with ITC as per GSTR-
2A, which is usually termed as MATCHING
OF ITC and UNMATCHED ITC SHOULD BE
REVERSED
UNMATCHED ITC not to be reversed in the
following cases:
1. IGST paid on Import of goods
2. GST paid under RCM
3. Credit distributed by ISD
4. 20% of the eligible matched ITC
M 20

33
Manner of Utilization of Credit [Sec. 49(5) of CGST Act, 2017]:
Principle – 1:
1. There is no restriction w.r.to IGST i.e. IGST Credit can be used for payment of any GST liability and any GST
Credit can be used for payment of IGST liability
2. Amongst other taxes, respective credit can be used for payment of respective liability and Cross utilisation
not allowed
Principle – 2:
Priority IGST Credit CGST Credit SGST Credit UTGST Credit
1 IGST payable CGST payable SGST Payable UTGST Payable
2 CGST Payable (or) SGST (or)
UTGST payable – Rule 88A
IGST payable IGST Payable IGST Payable
Principle – 3:
Before utilizing CGST and SGST Credit; Credit of IGST should be completely exhausted. Order of utilization of IGST credit,
as specified in Principle 1
Principle – 4:
For payment of IGST liability, Credits should be utilised in following order:
1.IGST Credit
2.CGST Credit
3.SGST Credit (or) UTGST Credit
Illustration:
Compute net GST payable from the following data:
Particulars CGST SGST IGST
GST payable on outward supply `5,000 `5,000 `5,000
GST paid on inward supply `2,000 `2,000 `10,000
Particulars CGST SGST IGST
Gross GST Payable `5,000 `5,000 ₹ 5,000
(-) IGST Credit used for payment of IGST liability (₹ 5,000)
(-) IGST Credit used for payment of CGST/SGST liability (₹ 2,500) (₹ 2,500)
(-) CGST Credit used for payment of CGST liability (₹ 2,000)
(-) SGST Credit used for payment of SGST liability (₹ 2,000)
Net Liability ₹ 500 ₹ 500 ₹ 0
Author’s Note: Students may think that they can solve by using IGST Credit of ₹ 5,000 for payment of CGST alone and in
such situation -
There shall be an excess CGST Credit of ₹ 2,000 and payment of SGST liability of ₹ 3,000, which results into unnecessary
cash outflow of ₹ 2,000 even though there is a credit of ₹ 2,000. This is on account of the restriction that CGST Credit
cannot be used for payment of SGST liability. Students are requested to apply care and caution while answering
questions relating to computation of net GST payable.

34
Conditions for availing ITC [Sec. 16 of CGST Act, 2017]:
Contents of Invoice for Availing ITC :
if the invoice does not contain all the specified particulars but contains the details of the amount of tax charged,
description of goods or services, total value of supply of goods or services or both, GSTIN of the supplier and recipient and
place of supply in case of inter-State supply, input tax credit may be availed by such registered person.
Input tax means the central tax (CGST), State tax (IGST) or union territory tax (UTGST charged on supply of
goods or services or both made to a registered person. It also includes tax paid on reverse charge basis and
IGST charged on import of goods. It doesn’t include tax paid under composition levy.

35
Apportionment of Credit [Sec. 17(1), 17(2) and 17(3) of CGST Act, 2017]:
Note: Zero Rated Supplies will be covered in taxable supplies under for the purpose of availement of ITC
Sec. 17(3): MEANING OF EXEMPT SUPPLIES (This definition is only for the purpose of non availement/ reversal of ITC)
1. Supplies notified as exempt (Other than the interest and transportation of goods by vessel – Discussed below)
2. Nil rated supplies
3. Non-taxable supplies
4. Supplies covered under RCM (i.e. Supplier of RCM supplies cannot take any ITC but recipient can take ITC)
5. Sale of land (In such case, the value shall be deemed to be Stamp duty value)
6. Sale of building, where entire consideration is received after obtaining completion certificate or first occupation,
whichever is earlier
7. Sale of securities (In such case, the value shall be deemed to be 1% of the sale value of such security.
The following are excluded from the definition of exempted supply [Even though these are exempt for payment of GST
but not treated as exempt(i.e. treated as taxable)
for availing ITC]:
1. Services by way of accepting deposits, extending loans or advances, in so far as the consideration is represented by
way of interest or discount except in case of banking company or Financial institution or NBFC.
2. Services by way of transportation of goods by a vessel from the customs station of clearance in India to a place
outside India.
Further analysis of complex scenarios:
S.No. Type of Supply For the purpose of
payment of GST
For the purpose of
availement of ITC
1. Export of goods against INR Zero rated Supply Taxable Supply
2. Export of services to Nepal & Bhutan against INR Zero rated Supply Taxable Supply
3. Export of services to UK against INR Taxable Supply Taxable Supply
4. Interest income earned by a bank Exempt Supply Exempt Supply
5. Interest income earned by a trading concern Exempt Supply Taxable Supply
6. Transportation of goods from India to outside India by vessel Exempt Supply Taxable Supply
7. Transportation of goods from outside India to India by vessel Taxable Supply Taxable Supply
8. Transportation of goods from India to outside India by air Exempt Supply Exempt Supply
9. Transportation of goods from outside India to India by air Exempt Supply Exempt Supply
10. Sale of Land Not a Supply Exempt Supply
11. Supply of Securities Not a Supply Exempt Supply
12. Sale of warehoused goods under Customs Not a Supply N.A
Used/Intended to be used in the course
of furtherance of Business
INWARD SUPPLIES MEANS
1. Capital Goods-Goods which are capitalized in the books
2. Inputs-Goods others than Capital Good
3. Input Services- Any Services Received
Sec. 17(1)
Sec. 17(2)

36
Rule 42 of CGST Rules, 2018 – Manner of availement of ITC w.r.to Inputs and Input Services:
• C3 will be computed separately for ITC of CGST, SGST/ UTGST and IGST.
• ∑ (D1 + D2) will be computed for the whole financial year, by taking exempted turnover and aggregate turnover
for the whole financial year. If this amount is more than the amount already added to output tax liability every
month, the differential amount will be added to the output tax liability in any of the month till September of
succeeding year along with interest @ 18% from 1st April of succeeding year till the date of payment.
• If this amount is less than the amount added to output tax liability every month, the additional amount paid
has to be claimed back as credit in the return of any month till September of the succeeding year.
IT on I + IS used
exclusively for exempt
supplies
IT on I + IS used
exclusively for non-
business purpose
Blocked credits u/s
17(5)
Remaining ITC credited
to ECrL =
T – (T1 + T2 + T3)
(i) Exempt supplies include reverse charge
supplies, transactions in securities, sale of land
and saleofbuilding when entire consideration is
received after CC.
(ii) Aggregate value of exempt supplies and total
turnover exclude the CED, SED & VAT
Credit attributable to exempt supplies -
!" = $%&
'
(
E = Value of ES during tax period
F = Total turnover during tax period
If no turnover during the tax period / values
not available, values for last period may be
used.
Credit attributable to non-business
purpose if common I + IS used partly
for business + non – business
purposes
D2 = 5% ´ C2
Remaining common
credit
= C2 – (D1 + D2)
Eligible ITC
attributable to
business & taxable
supplies including
ZRS
T Total IT on I + IS
T1 T2 T3 C1
Credit attributable to I + IS used
exclusively in taxable supplies
including ZRS
Common credit
= C1 – T4
T4 C2
D1 D2 C3
To be added to output tax liability
Ineligible credits

37
Rule 43 of CGST Rules, 2018 – Manner of availement of ITC w.r.to capital goods:
Treatment in case of Capital goods – 2:
1. Avail 100% ITC w.r.to GST paid and transfer to Electronic Credit Ledger
2. Compute Monthly Credit = ITC availed/60 months (Assumption: Life of capital goods – 5 years or 60 months)
3. For next 60 months from the date of purchase, compute monthly ITC attributable to exempted supply ie.
MONTHLY ITC X (Exempted supply for that month/Total Supply for that month)
4. The above amount to be added to output tax liability for every month, for the next 60 months along with
interest @ 18% p.a. from the date of availement of ITC till the date of addition to output tax liability is paid.
Note: The above procedure not required from the month when CG-2 becomes CG-1 (or) the capital goods are sold
Special provision for availment of ITC by Banking company & FI (incl. NBFC) – Sec. 17(4)

38
Blocked Credits [Sec. 17(5) of CGST Act, 2017]:
1. Motor Vehicles related:
2. Construction related:
EXCEPTIONS:
1. The above discussion is not applicable to supplier i.e. If a works contractor receives construction service
for construction of an immovable property then ITC can be availed on construction services
2. Construction of plant and machinery even though immovable (P&M excludes telecommunication towers
and pipelines laid outside factory)
3. If Construction expenditure is charged to P&L, then also ITC can be availed on above inward supplies
Motor Vehicles
For transporting
persons
Capacity ≤ 13
1.Held as stock
in trade
2. Used in
business of
transportation
of passengers
3. Driving
Schools
ITC available
Other cases
ITC not
available
Capacity > 13
ITC available
Eg: Stage
Carriage,
Contract
Carriage, Buses
for
transporting
employees
Vessels and Aircraft
1. Held as
stock in trade
2. Used in
business of
transportation
of passengers
3. Driving
Schools
4. Used for
transportation
of goods
ITC available
Other Cases
ITC not
available
Others
ITC available
Eg: Trucks,
lorries,
Ambulance,
etc.,
1. Repairs and
maintenance
2. Insurance
3. Servicing
4. Hiring, renting
or leasing
Motor Vehicles,
Vessels & Aircrafts
If ITC available
w.r.to motor
vehicles, Vessels &
Aircrafts
ITC available on
those services
If ITC not available
w.r.to motor
vehicles, Vessels &
Aircrafts
ITC not available
on those services
1. Any services
2. Works Contract Services
3. Goods
purchased or
received in
relation to
Construction
of an
immovable
property
ITC not available on
those inward
supplies

39
3. Other blocked Credits:
Inward
Supply
Membership of a
club, health &
fitness centre
Exception:
Provided by employer to
employee under a
statutory obligation
Travel benefits to employees
on vacation (i.e. Leave Travel
Concession)
Exception:
Provided by employer to
employee under a statutory
obligation
Non resident taxable
person (NRTP)
Exception:
Import of goods by NRTP
Food & Beverages, Outdoor
Catering, Beauty treatement
incl. cosmetic, plastic & hair
transplantation, Life
Insurance & Health Insurance
Exceptions:
1. Inward supply and outward supply
are same
2. Inward supply is part of composite or
mixed outward supply
3. Provided by employer to employee
under a statutory obligation
From a person opting for
composition scheme
For personal Consumption
Goods lost/stolen/ destroyed/written off
(or) disposed by way of gifts or free samples

40
ITC in Special Circumstances [Sec. 18 of CGST Act, 2017]:
Where tax credit is claimed under Section 18(1) with respect to closing stock, section 18(2) provides that a registered
person shall not be entitled to take input tax credit in respect of any supply of goods or services or both to him after the
expiry of one year from the date of issue of tax invoice relating to such supply. [THE ABOVE CLOSING STOCK SHOULD
HAVE BEEN PURCHASED WITHIN 1 YEAR]
Note:
Ü An electronic declaration in FORM GST ITC 01 shall be made by the registered person Within 30 days or such extended
time by commissioner, from the date of eligibility of availement of ITC under Sec. 18(1).
Ü This declaration shall be certified by a practicing CA/CMA if the claim of ITC > `2,00,000
Sec. 18(1)

41
Sec. 18(3) - Transfer of ITC:
• Where there is a change in the constitution of a registered person on account of sale, merger, demerger,
amalgamation, lease or transfer of the business with the specific provisions for transfer of liabilities, the said
registered person shall be allowed to transfer the ITC which remains unutilised in his electronic credit ledger to
such sold, merged, demerged, amalgamated, leased or transferred business
• Transferor furnishes details of such transaction on sale of business in form GST ITC-02 electronically in common
portal with request to transfer unutilised tax credit in electronic credit ledger of transferee
• A certificate of CA/CMA is to be furnished and the transfer details to be accepted by the transferee.
• In case of demerger, credit shall be transferred to the new entities in the ratio of net assets [Whether ITC availed
on not on such assets], post demerger
Sec. 18(4)
Sec. 18(6)
Sec. 29(5)

42
Job Work Provisions [Sec. 19 read with Sec. 143 of CGST Act, 2017]:
Additional Points:
1. Job worker can avail ITC w.r.to inputs or input services used for job work
2. If processed goods or capital goods are returned by the job worker after 1 year or 3 years, it is treated as new
supply by job worker and chargeable to GST, which can be availed as ITC by principal
3. the period of 1 year in case of processed goods & 3 years for capital goods on sufficient cause being shown,
be extended by the commissioner for a further period not exceeding 1 year or 2 years respectively.
Job Worker
Principal can transfer input
or capital goods to job
worker without payment
of tax
Whether
principal sends
input to job
worker
Principal brings
back input
within 1 year
No consequences
Whether
principal sends
capital goods
to job worker
Whether these
are moulds, dies,
jigs or fixtures
Principal brings
back capital goods
within 3 years
STOP
(For capital goods other
than moulds,
dies, jigs or fixtures)
No
No
Yes Yes
Deemed to be supply
on which tax is
payable along with
Interest @ 18%
No time limit to
return to principal
Yes
Yes
Yes
No
No
No

43
Input Service Distributor [Sec. 20 & 21 of CGST Act, 2017]:
Additional Points:
1. ISD shall distribute CGST/SGST credit as CGST/SGST credit to a unit in the same state where ISD is registered
and as IGST credit to a unit registered in different state than that of ISD
2. ISD shall distribute IGST Credit as IGST credit to all the units
Sec. 21

44
Important notifications:
1. ITC reversal not applicable in case of exclusions from supply under Schedule III except sale of land and sale of
building
2. Value of assets for the purpose of apportionment of ITC in case of demerger to include value of entire assets
of the business, whether or not ITC has been availed thereon - Explanation added w.e.f 29/03/2019
3. Whether section 18(3) of the CGST Act provides for transfer of ITC which remains unutilized to the transferee
in case of death of the sole proprietor?
Circular No. 96/15/2019 GST dated 28.03.2019 clarified that for the purpose of section 18(3) of the CGST Act
and rule 41(1) of the CGST Rules, transfer or change in the ownership of business will include transfer or change
in the ownership of business due to death of the sole proprietor.
4. Transfer of ITC on obtaining separate registration for multiple place of business within the state/UT - Rule 41A
of CGST Rules, 2017 w.e.f 01/02/2019:
5. Central Sales Tax (CST) excluded while arriving at exempted turnover and total turnover - Notification No. 3/2019
w.e.f 29/01/2019:
Rules 42 and 43 of the CGST Rules provide the manner of determination of ITC in respect of inputs, input services
and capital goods and reversal thereof.
For the above purpose, the value of turnover, exempt turnover and total turnover excludes –
ü Central Excise Duty
ü State Excise Duty
ü Value Added Tax
ü Central Sales Tax

45
REVISION – 5
Place of Supply (POS)
Nature of Supply Inter State or Intra-State [Sec. 7 & Sec. 8 of IGST Act, 2017]:
Supplier is located
in India + POS is
outside India
Inter-State supply
a) Appears to be export supply but it is
required to check definition of export of
goods [2(6)] and export of services [2(7)].
b) If it is the export transaction, it will be the
case of ‘zero rated supply’ and eligible to
get refund by complying the due procedure.
Is supply made to
or by SEZ unit/SEZ
developer
a) Inter-State supply.
b) It will be the case of ‘Zero Rated Supply’ and
eligible to get the refund of ITC; supplier is
having an option to pay IGST and can get
refund by complying the due procedure.
Is it import
transaction?
Goods
Supply of goods imported into the territory
of India, till they cross the customs frontiers
of India, shall be treated to be a supply of
goods in the course of inter-state trade or
commerce.
LOS & POS
are in
same state
or UT
Is it supply of
goods/services or
both?
Not the taxable event, so stop
Intra-State
Inter-State Supply
Supply of services imported into the
territory of India shall be treated to be a
supply of services in the course of inter-
state trade or commerce
NO
YES
YES
YES
NO
NO
YES
YES
NO
NO
YES
NO (i.e. import of
service)

46
Export of goods Vs. Export of Services:
Export of goods – Sec.
2(5) of IGST Act, 2017
Export of Services – Sec. 2(6) of IGST Act, 2017
Taking goods out of
India to a place outside
India
• Supplier of service located in India
• Recipient of Service located outside India
• Place of supply of service is outside India
• Payment for such service has been received by the supplier of service in convertible
foreign exchange (Except for services to Nepal & Bhutan, as notified by RBI)
• Supplier and recipient are not merely establishments of the same person
Note: If supplier is located in India and Place of supply is outside India, and any of the
other conditions is not satisfied, then it is deemed to be inter-state supply
Deemed inter-state supplies:
The following supplies are deemed to be inter-state supplies, irrespective of location of supplier and place of supply:
1. Supplies to/by SEZ
2. Import of goods
3. Import of services
4. Supply of goods to a tourist
5. Supply of services, where location of supplier is in India and Place of supply is outside India and other conditions
for export of service, not satisfied
6. Supply of goods or services, beyond territorial waters and upto Exclusive Economic Zone
Benefits in case of zero-rated supplies:
Meaning 1. Export of goods or Services
2. Supplies to SEZ unit/Developer
Whether GST payable
on outward supply?
No
Whether GST paid on
inward supply?
Yes and can be availed as ITC
Option (i) Pay IGST on outward supply by utilizing ITC and get the refund of gross IGST
Option (ii) Don’t pay any GST on outward supply but get refund of ITC w.r.to GST paid on inward supply
Supplies in territorial waters (i.e. 12 Nautical Miles from base line) – Sec. 9 of IGST Act, 2017:
If location of supplier or place of supply is in territorial waters, then the nearest coastal state/UT shall be taken as the
location of supplier or place of supply
For Example, If a marine engineer registered in Tamil Nadu provides repair services to a shipping company incorporated
outside India, for their ship located in territorial waters of India, and the place of supply is the location where services are
actually performed, then the place of supply is the location of the Ship. But, as the Ship is in territorial waters, place of
supply shall be the nearest coastal state where the ship is located and if the nearest coastal state is Andhra Pradesh, then
the nature of supply is inter-state supply to the marine engineer.

47
POS in case of goods [Sec. 10 & Sec. 11 of IGST Act, 2017]:
Place of supply
Goods
Import & Export
Sec. 11
Other Cases
Sec. 10
Services
Location of supplier
and Location of
recipient is in India
Sec. 12
Location of supplier
(or) Location of
recipient is outside
India
Sec. 13
POS of goods
Import and Export (sec. 11)
Others
(Sec. 10) i.e.,
Domestic
Transactions
Import Export
POS – Place of
receiver POS outside India 4. Goods are
assembled
POS- Place of
Installation
3. No
Movement
of Goods
2. On
direction of
third person
1.
Movement
of goods
POS – place
of delivery
(or)
Ending point
of goods
POS – place
of third
person (or)
Billing
Address
POS – place
of goods
5. Supplied on board
POS- Place
where goods are
taken on board
i.e., starting
point of goods

48
POS in case of Services [Sec. 12 & Sec. 13 of IGST Act, 2017]:
Note: General Provisions u/s 12(2) & 13(2)
v Location of recipient available ® POS = Location of recipient
v Location of recipient not available ® POS = location of supplier
In case of an exporter of services outsources a portion of the services contract to another person located outside India,
what would be the tax treatment of the said portion of the contract at the hands of the exporter? There may be instances
where the full consideration for the outsourced services is not received by the exporter in India - Circular No. 78/52/2018
GST dated 31.12.2018
It is clarified that the supplier of services located in India would be liable to pay IGST on reverse charge basis on the
import of services on that portion of services which has been provided by the supplier located outside India to the
recipient of services located outside India. Furthermore, the said supplier of services located in India would be eligible
for taking ITC of the IGST so paid.
For export of services in terms of section 2(6)(iv) of the IGST Act, provided the:
a) IGST has been paid by the supplier located in India
b) RBI by general instruction or by specific approval has allowed
Step - 1: Determine Location of supplier of Service
Step - 2: Determine Location of Recipient of Service
Whether both location of supplier of
service and location of recipient of
service is in India
Yes
Provisions of Sec. 12
of IGST Act is
applicable
Provisions of Sec.
12(2) are applicable
i.e., general provisions
Provisions of Sec.
12(3) to Sec. 12(14)
are applicable
No
Location of both
supplier of service and
Location of recipient
of service are outside
India
Provisions of GST are
not applicable
Exceptions
Transportation of
goods by vessal from
outside India to India-
GST payable by
imported of such
goods
Location of supplier of
service (or) Location
of recipient of service
is outside India
Provisions of Sec. 13
of the IGST Act
applicable
General Provisions
Provisions of Sec.
13(2) are applicable
Specific Provisions
Provisions of Sec.
13(3) to Sec. 13(13)
are applicable

49
Situation Location of supplier and location of recipient in India – Sec.12
B2B supply
(i.e. recipient is registered)
B2C supply
(i.e. recipient is unregistered)
Location of supplier (or) location of
recipient outside India – Sec.13
1. Service directly (or)
indirectly in relation to
immovable property
accommodation (including
stay in a boat or vessel)
Note: Intended to be located is also covered
POS = Location of such immovable
property [Sec. 13(4)]
2. Performance based service
in relation to person
Sec. 12(4) – restaurant, catering, grooming, beauty , treatment, health care.
à POS = location where services are actually performed
Physical presence of recipient required
POS = Location where services are
actually performed – Sec.13(3)(b)
Physical presence of recipient not
required
POS as per General provisions – Sec
13(2)
Training and performance appraisal – sec 12(5)
B2B B2C
POS =location of recipient POS= location where services are actually
performed.
Other cases, not specified elsewhere Sec.12(2) – General provisions
3. Performance based
services in relation to
goods
General provisions- sec .12.(2)
# If goods are temporarily imported and exported after repairs then POS is as per General
provisions u/s 13(2)
Physical presence of goods required
POS= location where services are
actually performed – sec 13(3)(a)#
Physical presence of goods not required
POS = location of goods Sec.13(3)(a)
4. Services in relation to
admission to event (or)
place
POS= location where event is held (or) place is situated - Sec.12(6) POS= location where event is held - Sec.
13(5)
Location of immovable property, Boat (or)
Vessel [Sec. 12(3)]
In India
POS = Location of such
immovable property, boat (or)
Vessel
Outside India
POS = Location of recipient

50
5. Service in relation to
organizing an event
Section 12(7)
B2B
POS = location of recipient
B2C
POS = location where event is held.
Note: If event held outside India, POS = Location of recipient (B2C)
POS = location where event is held – Sec.
13(5)
6. Transportation of goods
services
Section 12(8)
B2B
B2C
POS = Starting point of goods (or)
POS = Destination point of goods (If goods
are transported to a place outside India)
[Same provisions applicable for mail, courier]
Other than mail, courier Sec. 13(9)
POS = Ending point of goods
In case of mail, courier:
General provisions u/s 13(2)
7. Transportation of
passengers service
Section 12(9)
B2B
B2C
POS = Starting point of passengers
Section 13(10)
POS = Starting point of passengers
8. Passenger transportation
where point of
embarkation is not known
Section 12(9)
B2B
B2C
9. Service provided on board
a conveyance
Section 12(10)
POS = Starting point of conveyance
Section 13(11)
POS = Starting point of Conveyance

51
10. Telecommunication
services, internet,
broadcasting, DTH
General provisions U/S 13(2)
11. Banking and other financial
services
(including intermediary
services)
Section 12(12)
Section 13(8)
POS = location of supplier
12. Insurance Services Section 12(13)
POS = Location of Recipient
Section 13(2)
General Provisions
13. Hiring of means of
transport
® Aircraft of vessel Section 12(2) Section 13 (2)
® Other vehicles (Incl.
Yacht)
- Upto 1 Month Section 12(2) POS= location of supplier
- Beyond 1 month Section 12(2) Section 13(2)

52
14. Advertisement services to
CG/ SG/ LA/ UT/ Statutory
body
Contract entered separately w.r. to each state/UT:
POS = Such State/UT
Single contract entered w.r. to all states/ UT:
POS = Proportion to the amount attributable to each state / UT
Section 13(2)
15. OIDAR* Services Section 12(2)
General Provisions
Section 13(12)
Location of Recipient
*Online Information Database Access & Retrieval Services.
Amendments through Circulars:
In case of supply of research and development services related to pharmaceutical sector as specified in Notification No. 04/2019- IT dated 30-9-2019 (These activities are
highly technical and students are not required to remember the same), by a person located in taxable territory to a person located in the non-taxable territory, the place of
supply is place of effective use and enjoyment of a service i.e. location of recipient of service (who is out of India), if conditions as specified in Notification No. 04/2019-IT dated
30-9-2019 are satisfied i.e. all requirements of 'export of service' as specified in section 2(6) of IGST Act, except one relating to place of supply are satisfied.
a) Location of supplier is in India
b) Location of recipient is outside India
c) Consideration is received in foreign exchange
d) Supplier and recipient are not two establishments of the same person
Hence, the service of R&D services (clinical research service) will be Zero rated w.e.f. 1-10-2019, though it is performance on goods related service.
In case of Cargo handling services, the POS should be determined based on general provisions and not in terms of immovable property services.
place of supply of software/design by supplier located in taxable territory to service recipient located in non-taxable territory by using sample prototype hardware / test kits
in a composite supply, where such testing is an ancillary supply, is the location of the service recipient as per section 13(2) of the IGST Act.
In case of cutting and polishing activity on unpolished diamonds which are temporarily imported into India are not put to any use in India, the place of supply would be
determined as per the provisions contained in section 13(2) of the IGST Act.

53
IGST Rules notified w.e.f 1.1.2019 for determination of place of supply in special cases, where POS cannot be
determined as per provisions of IGST Act, 2017:
Rule
No
Rule Description How to determine POS?
3 Manner for determination of
proportion of value
attributable to different
States or Union territories, in
the case of supply of
advertisement services to
the Central Government, a
State Government, a
statutory body or a local
authority
S.No. Type of
Advertisement
Determining factor for proportionate
value allocation
1 In news papers &
publications
Amount payable for publishing an
advertisement in all the editions of a
newspaper or publication, which are
published in each state/UT
2 Through printed
material like
pamphlets, T.Shirts
etc.,
Amount payable for the distributions of
a specific number of such material in
each state/UT
3 In hoardings (Other
than trains)
Amount payable for hoardings located
in each state/UT
4 On Trains Length of railway track in each
state/UT, for that train
5 On the back of utility
bills of oil and gas
companies etc.,
Amount payable for the advertisements
on the bills pertaining to consumers
having billing address in each state/UT
6 On railway tickets No. of railway stations in each state/UT
7 On radio stations Amount payable to radio station in
each state/UT
8 On Television
Channels#
Number of viewers (Published by
BARC*) of such channel in each
state/UT
9 In Cinema halls Number of halls or screens in each
state/UT
10 On internet#
DEEMED TO BE PROVIDED ALL OVER
INDIA
Number on internet subscribers in all
states & UT’s
11 Through SMS#
Number of telecom subscribers
(Published by TRAI**) in each state/UT
*BARC - Broadcast Audience Research Council
**TRAI - Telecom Regulatory Authority of India
#
Figures of last week of a given quarter will be used for calculations for the
succeeding quarter. If the data pertains to more than one state, ratio of
population shall be used
4 Computation of value of
services where immovable
property is located in more
than one State and where the
location of supplier and
recipient is in India
Type of service in relation to
immovable property
Factor for proportionate value
allocation
Accommodation and its ancillary
services (other than the cases where
such property is a single property
located in 2 or more contiguous
States/ UT or both)
Number of nights stayed in such
property

54
Services by way of lodging
accommodation by a house boat or
vessel and its ancillary services
Time spent by the boat or vessel
in each such State/ UT, to be
determined on the basis of
declaration made by the service
provider
All other services provided in relation
to immovable property not covered
above
Area of the immovable property
lying in each State/ UT
services where event is
organised in more than one
State and where the location
of supplier and the recipient is
in India
State/ UT in proportion to the value of services determined in terms of the
contract or agreement entered into in this regard. In the absence of any such
contract or agreement,
It shall be determined by applying generally accepted accounting
principles.
services where leased circuit
is installed in more than one
State and where the location
of supplier and the recipient is
in India
the supply of services shall be treated as made in each of the respective States
or Union territories, in proportion to the number of points lying in the State
or Union territory.
services where the service is
performed in more than one
State in relation to goods and
where the location of supplier
or the recipient is outside
India
taken as being in each such State/ UT and the value of such supplies is
determined in terms of the contract or agreement entered into in this regard.
In the absence of any such contract or agreement,
Case Manner of computing the proportionate value
Services supplied on the
same goods
Equally dividing the value of service in each of
the States/ UT where the service is performed
Services supplied on
different goods
Considering the ratio of the invoice value of
goods in each States/ UT, on which service is
performed, as the ratio of the value of the
service performed in each State/UT
Services supplied to
individuals
Applying generally accepted accounting
principles.
services where immovable
property is located in more
than one State and where the
location of supplier or the
recipient is outside India
in terms of the contract or agreement entered into in this regard. Rule 8 of
the IGST Rules lays down that in the absence of any such contract or
agreement. (Same as Rule 4)
services where event is held
in more than one State and
where the location of supplier
or the recipient is outside
India
in terms of the contract or agreement entered into in this regard. Rule 8 of
the IGST Rules lays down that in the absence of any such contract or
agreement. (Same as Rule 5)

55
REVISION – 6
Registration & Composition Scheme
Threshold limits for registration and composition scheme:
State Aggregate turnover during current year for
registration
Aggregate turnover during PY
for opting composition scheme
during CY
Services Goods
1.North Eastern States
`75 lakhs
a) Manipur
> `10 lakhs > `10 lakhs
b) Mizoram
c) Tripura
d) Nagaland
e) Arunachal Pradesh
> `20 lakhs
> `20 lakhs
f) Meghalaya > `20 lakhs
g) Sikkim > `20 lakhs
h) Assam > `20 lakhs > `40 lakhs `1.5 Crore
2. Himachal Pradesh > `20 lakhs > `40 lakhs `1.5 Crore
3. Uttarakhand > `20 lakhs > `20 lakhs `75 lakhs
4. Pondicherry > `20 lakhs > `20 lakhs `1.5 Crore
5. Telangana > `20 lakhs > `20 lakhs `1.5 Crore
6. Other States (incl J & K) > `20 lakhs > `40 lakhs `1.5 Crore
How to remember?
1. For 4 North Eastern States (MMTN) - Manipur, Mizoram, Tripura & Nagaland - ₹ 10 lakhs limit for both
goods and Services
2. For (USTAMP) - Uttarakhand, Sikkim, Telangana, Arunachal Pradesh, Meghalaya & Pondicherry - ₹ 20 lakhs
limit for both goods and services
3. For all other 21 states - ₹ 20 lakhs limit for services and ₹ 40 lakhs limit for goods
Important Points:
• The limit of ₹ 40 lakhs is applicable only in case of exclusive supply of goods.
• If a person is engaged in exclusive supply of services (or) supply of both goods and services, the limit of ₹ 20
lakhs/10 lakhs should be considered.
• The limit of ₹ 40 lakhs is not applicable in the following cases:
1. Persons who voluntarily got registered
2. Persons who are compulsorily required to get registered under sec. 24
3. Persons making supply of ice cream, edible ice, Pan Masala, Tobacco and tobacco products

CA NOTES ON GST AND CUSTOMS

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