GST Ready Reckoner

CONTENTS

1 Introduction and Coverage 1
1.1 Evolution of GST Structure 1
1.2 Method for Computation of GST—General Concept 2
1.3 GST on Inter-State supplies 3
1.4 How IGST Model Works? 5
1.5 Flow of credits under GST 6
1.6 Sharing of GST between Centre and the State 8
1.7 Earlier Tax structure and GST—A Comparison 8
1.8 Framework of GST Laws 9
1.9 Coverage of CGST Act 10
1.9.1 Coverage under GST 10
1.9.2 Territorial Coverage of Act 11
1.10 Common Portal and Authentication 13
1.11 Appointed Day 13
1.12 Judgments 13
2 Concept of Supply 14
2.1 Supply—Section 7 14
2.2 Inclusions 16
2.2.1 Meaning of the specified transactions 18
2.2.1.1 Supply on approval basis 19
2.2.1.1.1 Export of Goods for Exhibitions 20
2.2.1.2 Clarification on GST implications on Cost
Petroleum earned by Oil Exploration Contractor 21
2.2.1.3 GST on Tenancy Premium or Pagadi 22
2.2.1.4 GST Applicability and ITC Availability on
Warranty and Extended Warranty 22
2.2.1.5 Clarification on GST applicability on holding
shares of subsidiary Company by a holding
Company 24
2.2.2 Made or agreed to be made 24
2.3 Provided or agreed to be provided 24
2.3.1 What is the significance of the phrase ‘agreed to be
provided’? 24
2.3.2 Does the liability to pay the service tax on a taxable
service arise the moment it is agreed to be provided
without actual provision of service? 24
2.3.3 Supply should be “For a Consideration”—Section 2(31) &
2(75) of CGST Act 25
2.3.3.1 Display of Name by Charitable Institution is
not a Supply 26
2.3.4 Supply should be made “by a Person”—Section 2(84) of
CGST Act 28
2.3.4.1 Supplies by Unincorporated Joint Ventures
to its members and vice-versa 29
2.3.5 Supply should be made “In the course or furtherance of
business”— Section 2(17) of CGST Act 30
2.3.5.1 No reverse charge on supplies not in the
course or furtherance of business 32
2.4 Inclusions—Second Limb 32
2.4.1 Activity or Transaction Between a Person and its Members 33
2.5 Inclusions—Third Limb 35
2.5.1 Permanent Transfer of business assets 35
2.5.2 Transaction between Related or Distinct persons 36
2.5.2.1 Press Release for Employer – Employee
Transactions 38
2.5.2.2 Taxability on transaction between employer
and employee 39
2.5.2.3 GST on Recoveries made by Employer 39
2.5.2.4 Taxability of Loan Granting Transaction Between
Related Parties 40
2.5.3 Transaction between Principal and Agent 41
2.5.3.1 Concept of Agent 41
2.5.3.2 Del Credere Agent 42
2.5.4 Import of services between related persons 43

CONTENTS xiii

2.5.4.1 GST on Import of Services By Related Parties 44
2.6 Inclusions—Fourth Limb 44
2.6.1 Schedule II – Activities or Transactions to be treated as
supply of goods 45
2.6.1.1 Transfer of title in goods Entry 1(a) 46
2.6.1.2 Transfer of Property in goods at later date 46
2.6.1.3 Transfer of Business Assets 46
2.6.1.4 Person ceasing to be a taxable person 47
2.6.1.5 Supply to a member by unincorporated
Associations 47
2.6.2 Schedule II – Activities or Transactions to be treated as
supply of services 48
2.6.2.1 Transfer of rights in goods related—Entries 1(b)
and 5(f) 49
2.6.2.2 Immovable property related—Entries 2 and
5(a), (b) and 6(a) 49
2.6.2.3 Treatment or process—Entry 3 50
2.6.2.4 Putting business goods to personal or
non-business use— Entry 4(b) 51
2.6.2.5 Intellectual Property Rights Related—Entry 5(c)
& (d) 52
2.6.2.6 Refrainment Related—Entry 5(f) 53
2.6.2.6.1 Clarifications issued by CBIC 54
2.6.2.7 Restaurant/Outdoor caterer Related—Entry 6(b) 58
2.7 Exclusions Schedule III 58
2.7.1 Employee related services—Schedule III Clause 1 59
2.7.1.1 Taxability of services provided by Employer to
Employee 59
2.7.1.2 Taxability of ESOP/ESPP OR RSU By An
Employer To Employee 60
2.7.2 Schedule III – Clauses 2 & 3 61
2.7.2.1 Clarification on fee/amount levied by Consumer
Disputes Redressal Forums 61
2.7.3 Schedule III – Clause 4 62
2.7.4 Schedule III – Clause 5 63
2.7.5 Schedule III – Clause 6 63
2.7.6 Schedule III – Clause 7 Merchant Trade Transactions
(with retrospective effect from 01.07.2017 64
xiv
2.7.6.1 Non-Reversal of ITC 64
2.7.6.2 No refund of tax earlier paid 64
2.7.7 Schedule III – Clause 8 High Sea Sales/Sales of Warehoused
Goods before clearance for home consumption (with
retrospective effect from 01.07.2017) 65
2.7.7.1 Non-Reversal of ITC 66
2.7.7.2 No refund of tax earlier paid 66
2.7.8 Schedule III- Clause 9: Co-insurance premium
Apportionment by Lead Insurer to Co-insurer 67
2.7.9 Schedule III- Clause 10: Ceding re-insurance premium after
netting of re-insurance commission by lead insurer to
re-insurer 68
2.8 Exclusion—Notified Activities by the Government 68
2.8.1 Grant of Alcoholic Liquor License by State Government 68
2.8.2 Inter-State Movement of Conveyances 69
2.9 Goods 70
2.10 Services 71
3 Taxable Event and Composition Levy 72
3.1 Charging Section under CGST Act—Section 9 72
3.1.1 Forward charge 73
3.1.2 Reverse Charge under CGST Act 74
3.2 Charging Section under IGST Act—Section 5 75
3.2.1 Forward charge 75
3.2.2 Judgments 76
3.2.3 Reverse Charge under IGST Act 77
3.2.4 Levy of IGST on import of goods 78
3.3 Composition Levy—Section 10 78
3.3.1 Composition Levy for Manufacturers and Specified Services 78
3.3.2 Composition Levy For Remaining Supplies of Goods
or Services or Both 83
3.3.2.1 Procedures for Adopting Composition Scheme by
Service Providers 84
3.3.3 Filing of Returns/Statement 85
3.3.4 Registration and intimation under the Composition scheme 85
3.3.5 Withdrawal from the composition levy scheme and
procedure thereafter 86
3.3.5.1 Effective Date of Withdrawal from
Composition Scheme 86
CONTENTS xv
3.3.6 Action for wrongly opting the scheme or for contravention
of any provision of the scheme 86
3.3.6.1 Effective Date of Denial of Composition Option by
Authorities 87
3.4 List of Composition Forms 87
4. Reverse Charge Mechanism 88
4.1 What is Reverse Charge? 88
4.2 Constitutional Validity 88
4.3 Whether Threshold applicable on Reverse Charge? 88
4.4 Charging Section under CGST Act—Section 9 89
4.4.1 Reverse Charge under CGST Act 89
4.4.2 Reverse charge on Supplies from Unregistered Persons 90
4.4.2.1 No reverse charge on supplies not in course or
furtherance of business 90
4.4.3 Reverse charge on supplies from unregistered persons not
applicable to TDS deductors 90
4.5 Supplies Notified under Reverse Charge 90
4.5.1 Reverse Charge on Services 91
4.5.1.1 Services received from outside India 91
4.5.1.2 Services provided by Goods Transport Agency 92
4.5.1.2.1 Reverse Charge Not Applicable on
Certain Supplies by GTA 93
4.5.1.2.2 Who will be treated as recipient of
GTA services? 93
4.5.1.2.3 Firm and LLP 94
4.5.1.2.4 Undertaking to be filed by GTA on
GSTN Portal 94
4.5.1.2.4.1 Declaration filing by
newly registered GTAs 94
4.5.1.2.5 Reverting to RCM by GTA operating
under forward charge 95
4.5.1.3 Legal Services provided by advocates, etc. 95
4.5.1.3.1 Clarifications issued in relation to
services by advocates 95
4.5.1.3.2 Press Release issued in relation to
services 96
4.5.1.4 Services by Arbitral Tribunal 96
xvi
4.5.1.4.1 Exemption for Services by Advocates
and Arbitral Tribunal 97
4.5.1.5 Sponsorship Services 98
4.5.1.6 Services provided by Government to
Business Entity 99
4.5.1.7 Renting Services provided by Government etc.
to a Registered Person 100
4.5.1.8 Services provided by Director of a Company 101
4.5.1.8.1 Clarification on Director Remuneration 101
4.5.1.8.2 Service supplied by director in his
personal capacity to Company 101
4.5.1.9 Services provided by Agent to an Insurance
Company 102
4.5.1.10 Services provided by Recovery Agent to a
Bank/FI 102
4.5.1.11 Transportation of goods by vessel
upto custom station 102
4.5.1.11.1 Dual Taxation and Special Valuation
Procedure for GST on Ocean Freight 103
4.5.1.11.2 Special Valuation Provision for
Transportation by Vessel 103
4.5.1.12 Services by music composer, photographer
and artist 104
4.5.1.13 Services by the members of Overseeing
Committee to Reserve Bank of India 104
4.5.1.14 Supplies by DSAs to banks or NBFCs 104
4.5.1.15 Reverse charge made applicable on specified
services to Banking Company 105
4.5.1.16 Reverse charge made applicable on specified
services to Business Correspondent 105
4.5.1.17 Reverse charge made applicable on Supply of
Security Services to Registered Person 105
4.5.1.18 Services supplied by way of TDR or Floor Space
Index (FSI) (including additional FSI) for
construction of a project by a promoter 106
4.5.1.19 Long-term lease of land (30 years or more) by any
person against consideration in the form of
upfront amount 106
4.5.1.20 Copyrights Granted by an Author 170
4.5.1.21 Services provided by way of Renting of
Motor Vehicle 108
CONTENTS xvii
4.5.1.22 Lending of Securities as Securities Lending
Scheme 1997 108
4.5.1.23 Renting of Residential Dwelling to Registered
Person 109
4.5.1.24 RCM on renting of immovable properties
(w.e.f. 10. 10.2024) 109
4.5.1.24.1 Renting of Immovable Property by
Unregistered Person to Composition
Dealers 109
4.5.2 Reverse Charge on Goods 110
4.5.2.1 Reverse Charge and Rate on Priority Sector
Lending Certificate (PSLC) 112
4.5.2.2 Reverse Charge on Supply of Second-Hand
Goods by Government Clarified 112
4.5.2.3 RCM on scrap (w.e.f. 10.10.2024) 113
4.5.2.3.1 Registration requirement for such
scrap suppliers (w.e.f 10. 10.2024) 113
4.6 Electronic Commerce Operator to be treated as supplier
for specified services 113
4.7 Reverse Charge on Receipt of Supplies from an
Unregistered Person 116
4.8 Reverse Charge Tax Not to be Paid by Credit 116
4.9 Credit on supplies used for making supplies on
which reverse charge is applicable 117
5. Classification of Supply 118
5.1 Composite Supply, Mixed Supply and Single Supply 118
5.1.1 Naturally bundled in ordinary course of business 119
5.1.2 Principles for determining single supply 120
5.1.3 Classification of Printing Contracts 120
5.1.4 Clarifications issued in relation to printing of books 121
5.1.5 Classification of Cut Pieces of Fabric 121
5.1.6 Clarification on classification of various supplies 122
5.1.7 Time of supply in case of Composite supply 123
5.1.8 Time of supply in case of mixed supplies 124
5.2 Determination of tax liability under Composite supplies and Mixed
supplies – Section 8 of CGST Act 124
5.3 Judgments 124
5.4 Classification of Services 126
xviii
5.5 Customs Classification under Customs Tariff Act, 1975 (‘CTA’) 127
5.5.1 Codification under CTA 127
5.5.2 Interpretation of CTA 128
5.5.3 Classification Rules at a glance 128
5.5.4 Other Rules 128
5.5.5 Interpretative Rules 129
5.5.6 Classification of Parts 129
5.5.7 General Principles of Classification 130
6. Time of Supply 131
6.1 Section 12—Concept of Time of supply 131
6.1.1 Timeline for issuance of invoice—Section 31 of CGST Act 132
6.2 Time of Supply of Goods—Section 12 of CGST Act 133
6.2.1 Special Provision for Government Supplies and
Goods on Approval Basis 134
6.2.2 GST on receipt of advance payment of specified
actionable claims 134
6.2.3 Vouchers—Section 2(118) of CGST Act 135
6.2.3.1 Supply of Vouchers are Outside the GST Ambit 136
6.3 Time of Supply of Service—Section 13 of CGST Act 136
6.3.1 Time of supply of services provided by contractor to NHAI
under hybrid annuity mode (HAM) [Section 13(2) of
CGST Act, 2017) 137
6.3.2 Time of supply of services provided by Government for
allocation of spectrum usage or other natural resource
(Section 13(3) of CGST Act, 2017) 138
6.3.3 Time of Supply in case of self-invoicing by recipient – A
dicotomy 139
6.4 Time of supply in case of change in rate of tax for both goods and
services—Section 14 of CGST Act 140
6.5 Date of receipt of payment in case of change in rate of tax 140
7. Place of Supply of Goods 141
7.1 Need for Ascertaining Place of Supply 141
7.2 Delivery 141
7.2.1 Constructive Delivery of Goods in Ex Works
Delivery Cases 142
7.3 Supply involving movement of goods 143

CONTENTS xix

7.4 Intra-State Supplies—Sections 8 & 9 of IGST Act 144
7.5 Inter-State Supplies—Section 7 of IGST Act 144
7.6 Location of Recipient of Services—Section 2(14) of IGST Act 145
7.6.1 Recipient of Supplies–Section 2(93) of CGST Act 146
7.7 Location of supplier of Services—Section 2(15) of IGST Act 146
7.7.1 Supplier—Section 2(105) of CGST Act 147
7.8 Judgments 147
7.9 Place of Supply of Goods (not Import and Export)— Section 10
of IGST 148
7.9.1 Place of Supply of Goods to Unregistered Person-Section 10(1)
(ca) of the IGST Act 150
7.10 Place of Supply of Goods imported into or exported
from India—Section 11 of IGST Act 150
8. Place of Supply of Services (Both Supplier and
Recipient in India) 151
8.1 General Rule—Section 2(2) of IGST Act 151
8.1.1 Address on Record as defined u/s 2(3) of CGST Act 151
8.1.2 Place of Supply of Software Development Services 151
8.1.3 Bill to Ship to scenario for supply of Services 152
8.1.4 Place of Supply in case of Services Provided by Ports 152
8.1.5 Place of Supply for Advertisement Services 153
8.2 Immovable Property Related—Section 12(3) of IGST Act 153
8.2.1 What are the criteria to determine if a service is
‘directly in relation to’ immovable property? 154
8.2.2 Judgments 155
8.2.3 Determination of Place of Supply in case of Immovable
Property Related Services in Multiple States
[Section 12(3) of IGST Act] 157
8.2.4 Place of Supply for Advertisement Services 157
8.3 Where personal appearance is required—Section 12(4) of IGST Act 158
8.4 Training and Performance Appraisal Related—Section 12(5) of
IGST Act 158
8.5 Admission to Events—Section 12(6) of IGST Act 158
8.6 Organisation of Events—Section 12(7) of IGST Act 159
8.6.1 Determination of Place of Supply in case of Event, etc.,
in Multiple States [Section 12(7) of IGST Act] 160
8.6.2 Judgments 160
8.7 Transportation of Goods—Section 12(8) of IGST Act 161
8.8 Transportation of Passengers—Section 12(9) of IGST Act 161
8.8.1 Continuous Journey—Section 2(3) of IGST Act 162
8.9 Supply of services on board or conveyance or
vessel— Section 12(10) of IGST Act 164
8.10 Supply of Telecommunication Services including Data Transfer,
Broadcasting, Cable and Direct to Home Television
services— Section 12(11) of IGST Act 164
8.10.1 Determination of Place of Supply in case of
provision of Lease Circuit Services in Multiple States
[Section 12(11) of IGST Act] 165
8.11 Supply of Banking or other financial or stock broking
services —Section 12(12) of IGST Act 165
8.12 Supply of Insurance services—Section 12(13) of IGST Act 165
8.13 Supply of Advertisement services—Section 12(14) of IGST Act 166
8.13.1 Determination of place of supply of advertisement
services to Government 166
9. Place of Supply of Services–II (Either Supplier or
Recipient are located outside India) 168
9.1 Import and Export of Goods or Services or Both 168
9.2 Zero Rated Supplies and Import/Export of Goods and
Services— (Section 16 of IGST Act) 169
9.3 Place of Supply of Services Rules (Either Supplier or Recipient
are located outside India)—Section 13 of IGST Act 170
9.3.1 General Rule—Section 13(2) of IGST Act 170
9.3.1.1 Exemption to services having place of
supply in Nepal and Bhutan 170
9.3.1.2 Place of Supply of Software Development
Services 171
9.3.1.3 Place of Supply in relation to Advertising
Services to Foreign Clients 171
9.3.2 Actual Performance Basis—Section 13(3) of IGST Act 173
9.3.2.1 Place of supply for testing software loaded in a
prototype 174
9.3.2.2 Place of Supply in case of Temporary Imports of
Diamonds 175
9.3.2.3 Judgments 175
9.3.3 Immovable Property Related—Section 13(4) of IGST Act 175
CONTENTS xxi
9.3.4 Admission to or Organisation of Event,
etc.—Section 13(5) of IGST Act 175
9.3.5 Service supply in taxable and non-taxable
territory— Section 13(6) of IGST Act 176
9.3.6 Service supply in multiple States /UTs—Section 13(7) of
IGST Act 176
9.3.6.1 Determination of Place of Supply in case of
Performance Based Services are
Received / Provided in Multiple States
[Section 13(7) of IGST Act] 177
9.3.6.2 Determination of Place of Supply in case of
Immovable Property R elated Services in Multiple
States [Section 13(7) of IGST Act] 177
9.3.6.3 Determination of Place of Supply in case of
Event, etc., in Multiple States
[Section 13(7) of IGST Act] 178
9.3.7 Service supplied by Banking co./FI/NBFC—
Section 13(8)(a) of IGST Act 178
9.3.7.1 Place of supply of Custodial Services by an Indian
Bank to FPI (Section 13(8) of IGST Act, 2017) 179
9.3.8 Service provided by an intermediary—Section 13(8)(b) of
IGST Act 180
9.3.8.1 Determining factors to be an intermediary 181
9.3.8.2 CBIC Clarification on Intermediary 182
9.3.8.3 Exemption to intermediary services in case of
merchant trade transactions of goods 184
9.3.8.4 Place of Supply in relation to Advertising
Services to Foreign Clients 185
9.3.8.5 Place of Supply of Data Hosting Services
provided by suppliers located in India to cloud
computing service providers located
outside India 186
9.3.8.6 Judgments 187
9.3.9 Service provided by hiring of Yachts, etc.—Section 13(8)(c)
of IGST Act 189
9.3.10 Transportation of goods—Section 13(9) of IGST Act 190
9.3.10.1 Place of Supply for Launch of Satellite 191
9.3.11 Transportation of Passengers—Section 13(10) of IGST Act 192
9.3.12 Supply of services on board conveyance,
etc.— Section 13(11) of IGST Act 192
xxii
9.3.13 Supply of Online Information and Database—
Section 13(12) & Section 14 of IGST Act 192
9.3.14 Place of effective use and enjoyment of service—
Section 13(13) of IGST Act 195
9.3.14.1 Place of Supply of R&D services related to
Pharmaceutical Sector 196
9.3.14.2 Place of Supply in case of Aircraft MRO Services 197
9.3.14.2.1 Rate of Aircraft MRO Services 198
9.3.14.3 Place of Supply in case of MRO Services For
Ships and Vessels 198
9.3.14.3.1 Rate of Ship or Vessel MRO Services 198
10. GST Rate on Supply of Services 199
10.1 Construction Services and Real Estate 199
10.2 Commission Agents, etc. 200
10.3 Services relating to mining, petroleum exploration, electricity, gas
and water distribution 201
10.4 Accommodation Services in Hotels, etc. 202
10.5 Restaurant Related Services 202
10.6 Passenger Transportation in Rail 202
10.7 Passenger Transportation in Cab 202
10.8 Passenger Transportation through Air 202
10.9 Goods Transportation through Rail 202
10.10 Goods Transportation through Vessel 202
10.11 Goods Transportation through Road by Goods
Transport Agency (GTA) 202
10.12 Rental Services of Vehicles meant for Transportation 202
10.13 Transportation of goods by postal or courier services 202
10.14 Services by Foreman of Chit Fund 202
10.15 Transfer of Right to Use Goods 202
10.16 Real Estate Related 203
10.17 IPR Related 203
10.18 Lease of Goods 203
10.19 R&D and Legal and Accounting Services 203
10.20 Advertisement Space Selling and other professional services 203
10.20.1 GST Rate on selling of space for advertisement in souvenirs 204
10.21 Supply of E-Books, Telecommunication, Broadcasting, etc. 204
10.22 Tour Operator and Other Support Services 205

CONTENTS xxiii

10.23 Agriculture Related Services 205
10.24 Maintenance, Repair and Installation Services 205
10.24.1 Meaning of not taking input tax credit on goods or services 206
10.25 Job Work Related Services 207
10.26 Other Manufacturing, Publishing, Printing, etc. Services 207
10.27 Public Administration and Social Security Services 207
10.28 Education and Health Related Services 207
10.28.1 GST Rate on Catering in Educational Institution 208
10.29 Sewage and Waste Collection Related Services 208
10.30 Membership of Organisation Related Services 208
10.31 Admission to Events, films and Actionable Claim Related 208
10.32 Residuary Entry 209
10.33 Domestic Services 209
10.34 Services provided by extra territorial organisations and bodies 209
10.34.1 Activities of extra territorial organizations and bodies 209
10.35 Construction, Engineering or Installation Services in relation to
Renewable Energy Plants 210
10.36 GST applicability on services of Film Distributors and
sub-distributors 210
10.37 Definition of the Terms used in the Rate Notifications 211
10.37.1 Meaning of Goods 211
10.37.2 Applicability of Customs Tariff Act, 1975 211
11. Exemptions on Supply of Services 212
11.1 Charitable Institution Services 212
11.1.1 CBIC Clarification on Charitable Institutions 216
11.1.1.1 GST on management of educational
institutions by charitable trusts 217
11.1.1.2 Import of Services 217
11.1.1.3 Services by and to Educational Institutions
(including institutions run by Charitable trusts) 217
11.1.1.4 GST on arranging yoga and meditation
camp by charitable trusts 218
11.1.1.5 GST on hospital managed by charitable trusts 218
11.1.1.6 GST on services provided to charitable trusts 219
11.1.1.7 GST on supply of goods by Charitable Trusts 219
11.1.2 Judgments 219
xxiv
11.2 Transfer of a Going Concern, as a Whole or an Independent
Part Thereof 219
11.3 Services to or by Government 220
11.4 Construction related Services 220
11.5 Rent Related Services 220
11.6 Accommodation in Hotel, etc. Related Service 220
11.7 Passenger Transport Related Service 220
11.8 Goods Transport Related Service 220
11.9 Transfer of Right to Use or Leases, etc. 220
11.10 Financial Institutions, Insurance, Employee Benefits, etc. Related 220
11.11 Education or Sports Related 221
11.12 Agriculture Related 221
11.13 Health Related 221
11.13.1 Applicability of GST on Services provided by Hospitals 223
11.14 Event, Brand Ambassador, Artist, Music, etc. Related 224
11.15 Public Convenience Related 225
11.16 Services to members by societies, unincorporated body or
non-profit entity 225
11.16.1 CBIC Clarification on Services by RWAs 226
11.17 Tour Operator Services 227
11.18 Incubator or Incubatee Related 227
11.19 Advocate, Arbitral Tribunal Related 228
11.19.1 Partnership firm and LLP 229
11.20 Transmission of Electricity Related 230
11.20.1 Exemption to meter testing and ancillary services to
transmission and distribution of electricity
(w.e.f. 10.10.2024) 231
11.20.1.1 Regularizing payment of GST on certain
support services provided by an electricity
transmission or distribution utility 232
11.21 Exemption and Refund to Canteen Store Departments (CSD)
(Section 55 of CGST Act) 232
11.22 Exemption on Supplies to TDS Deductor in Specified
Circumstances 232
11.23 Exemption from Reverse Charge Payment on Purchase of
Second Hand Goods From Unregistered Supplier 233
11.24 Inter-State Supply of Conveyances—Not a Supply 233

CONTENTS xxv

11.25 Services Associated with Transit Cargo to Nepal and Bhutan 234
11.26 Exemption to services having place of supply in Nepal and Bhutan 235
11.27 Toll charges to Road, etc. 235
11.27.1 GST on Overload Charges at Toll Plazas 235
11.27.2 Applicability of GST on Payment of Annuity for
Construction of Road 235
11.27.3 GST on payment of additional toll fee 236
11.28 Exemption to royalties payment to be made outside India 236
11.29 Import of Services by SEZ unit or Developer 237
11.30 Import of Goods by SEZ unit or Developer 237
11.31 Services Provided by Indian Establishment to Establishment
Located Outside India 237
11.32 Services Imported by UNO or Specified Organizations 238
11.33 Services Imported by Foreign Diplomatic Missions, Consular posts,
Diplomatic Agent or Career Consulars 238
11.33.1 Services Provided by ADB and IFC 239
11.34 Import of Services by Individual for Non-Business Purposes 239
11.35 Satellite Launch by ISRO 239
11.36 Miscellaneous Exemptions 240
12. Compensation Cess and Rate of Tax on Goods 241
12.1 Compensation Cess 241
12.2 GST Rate on Supplies of Goods 244
12.2.1 GST Rate on REC certificates and PSLC certificates 245
12.3 Special Rate on Intra State Supply of Goods or Services 245
12.4 GST Rate on laterals and other parts (Even if supplied
separately) solely used for another goods 245
13. Valuation of Supply 246
13.1 Valuation of Taxable Supply—Section 15 of CGST Act 246
13.1.1 Price payable—Section 15(1) of CGST Act 247
13.1.2 Inclusions u/s 15(2) of CGST Act 248
13.1.3 Exclusions from value of supplies u/s 15(3) of CGST Act 251
13.1.3.1 Post Supply Discount 252
13.1.3.2 Treatment of Gifts, Samples, Discounts and
Post Supply Discounts 252
13.1.3.3 Treatment of Additional Discounts 253
xxvi
13.1.3.4 Evidence for non-inclusion of discount in
taxable value of the supplier
(Section 15 of CGST Act, 2017) 254
13.1.4 Related Person u/s 15 of CGST Act 254
13.1.5 Examples for Valuation of Supplies 255
13.1.6 Inclusion of Value of Moulds and Dies for Valuation
Purposes 256
13.1.7 GST on Car Maintenance Comprising of Both Goods
and Services 256
13.1.8 Value of Supply where Kerala Flood Cess is Applicable
(Rule 32A of CGST Rules) 256
13.2 Valuation Rules—Section 15(4) of CGST Act 256
13.2.1 Valuation based on costing of goods (Rule 30) 257
13.2.2 Residual Rule (Rule 31) 257
13.2.3 Consideration not wholly in money (Rule 27) 257
13.2.4 Branch Transfer or Supplies to Related Persons of
goods and services (Rules 28 and 32(7)) 259
13.2.4.1 Valuation of Extending Corporate
Guarantees (Rule 28(1)) 259
13.2.4.1.1 Corporate Guarantee related
clarifications 261
13.2.4.2 GST applicability on transactions between
HO and Branches 262
13.2.4.2.1 Whether Input Service Distributor
(ISD) route is mandatory to follow? 262
13.2.4.2.2 What should be taxable value for
services provided by HO to BO? 262
13.2.4.3 Taxability Of Loan Granting Transaction Between
Related Parties 263
13.2.4.4 GST On Import of Services by Related Parties 263
13.2.5 Supplies of Goods (only) Through Agent (Rule 29) 264
13.3 Valuation of Specific Supplies (Rule 32) 265
13.3.1 Valuation of Foreign Currency Exchange—Rule 32(2) 265
13.3.2 Valuation of Air Travel Agent Services—Rule 32(3) 265
13.3.3 Life Insurance Services—Rule 32(4) 265
13.3.4 Margin Scheme – Sale of Second Hand Goods—Rule 32(5) 265
13.3.5 Vouchers, Coupons and Stamps
(Other than postage stamp)— Rule 32(6) 265

CONTENTS xxvii

13.3.6 Value of supply of services in case of Pure
Agents—Rule 32(7) 266
13.3.6.1 Non-Inclusion of Airport Levies in
Taxable Value 267
13.3.6.2 Judgments 267
13.3.7 Value of Lottery 268
13.3.8 Valuation of Betting, Gambling, online gaming,
online money gaming, casinos and Horse Racing 268
13.3.9 Special Valuation Provision for Transportation by Vessel 269
13.4 Valuation for Construction of Renewable Energy Projects 269
13.5 Exchange rate for Valuation of Supplies (Rule 34) 270
14. Input Tax Credit 271
14.1 Some important definitions 271
14.1.1 Scope of Credits under CCR and GST 275
14.2 Eligibility for availment of input credit—Section 16 of CGST Act 275
14.2.1 ITC Not Available on Input Invoices Not Available in
GSTR-2B 279
14.2.1.1 Clarification Put Forth for Restriction of Credit
Availment 280
14.2.1.2 Full credit allowed owing to COVID-19 during
Specified Time Period 281
14.2.1.3 DRC 01C Notice in case of difference between
ITC in GSTR-3B and auto populated in
GSTR-2B (Rule 88D) 281
14.2.2 Clarification as to availability of credit to suppliers engaged
in passenger transportation by air in economy class 281
14.2.3 Credit Availability in respect of addition to taxable
value pursuant to Valuation Provisons 281
14.2.4 Specifying return in Form GSTR-3B as return to be filed
under Section 39 282
14.2.5 Restriction on ITC Utilisation on specified Taxpayers
for Tax Payment: Section 49 and Rule 86B 282
14.2.6 Restricted credit in GSTR-2B as per Section 38 283
14.2.7 Reversal of ITC where supplier has not paid the taxes:
Section 41 284
14.2.8 Timing of ITC availability in case of RCM Payment on
supplies by unregistered persons 284
14.2.9 Whether ITC is available on “Any Other Duty paying
Document”? 285
xxviii
14.2.10 Evidence for non-inclusion of discount in taxable
value of the supplier (Section 15 of CGST Act, 2017) 285
14.2.11 Constructive Delivery of Goods in Ex Works
Delivery Cases 285
14.2.12 Judgments 286
14.3 Disallowed Credits—Section 17(5) of CGST Act 289
14.3.1 Additional categories on which input tax credit is
restricted or not available 294
14.3.2 ITC Availability in case of Sales Promotion Scheme 294
14.3.3 ITC Availed and Reversed 295
14.3.4 Clarification on barred ITC on motor vehicle, etc. 295
14.3.4.1 ITC availability on purchase and resale of
demo cars 296
14.3.5 ITC availability on manholes to Telecommunication Service
Providers 296
14.3.6 GST Applicability and ITC availability on warranty and
extended warranty 297
14.3.7 Judgments 298
14.4 ITC reversal / restriction for exempt/non-business
supplies— Section 17(1) of CGST Act 305
14.4.1 CBIC Flyer 308
14.4.2 Value of Land and Security 308
14.4.3 Value of exempt Supplies 308
14.5 Special cases—Section 18 of CGST Act 309
14.5.1 Removal of Capital goods or Plant & Machinery—
Section 18(6) of CGST Act 309
14.5.2 Credit on taking registration—Section 18(1) and 18(4) of
CGSTAct 310
14.5.3 Credit Transfer on Amalgamation, Merger, etc. allowed to
Transferee—Section 18(3) of CGST Act 311
14.5.3.1 Rules for allowing the credit on
amalgamation, etc. 312
14.5.3.2 Clarifications on Transfer of Credits in
case of Demerger 312
14.5.4 Credit Transfer on Obtaining Separate Registration for
Multiple Places of Business within State
(Rule 41A of CGST Rules w.e.f. 01.02.2019) 313
14.5.5 Credits and Job Work—Section 19 of CGST Act and
Input Credit Rules 313
CONTENTS xxix
14.6 Input Service Distributor (‘ISD’)—Section 20 of CGST Act 314
14.6.1 Meaning of ISD—Section 2 of CGST Act 314
14.6.2 Input Service Distributor (ISD) 315
14.6.3 Refund claim by ISD and Non-Resident Taxable Person 318
14.6.4 CBIC Flyer 318
14.6.5 Judgments 320
14.7 Blocking Available Input Tax Credit (Rule 86A) 320
14.7.1 Reasons for disallowing the usage of input tax credit 320
14.7.2 Consequences of such disallowance 321
14.7.3 Revocation of such Disallowance 321
14.7.4 Whether the order given is Appealable? 321
14.7.5 Guidelines for Blocking the Credit under Rule 86A 322
14.7.5.1 Grounds for blocking the credit 322
14.7.5.2 Proper Authority for Blocking the Credit 323
14.7.5.3 Process of Blocking the Credit 323
14.7.5.4 Period of Blocking of Credit 323
14.7.6 Judgments 323
14.8 ITC Related Amensty Schemes 324
14.8.1 ITC Availment of FY 2017-18 to FY 2020-21 input
invoice till 30th November, 2021 324
14.8.2 ITC availment by persons whose registration
cancellation has been revoked 324
14.9 Forms under Input Tax Credit Rules 325
15. Job Work 326
15.1 Job work Definition—Section 2(68) of CGST Act 326
15.1.1 Whether Manufacturing Activity Will Come under
Job Work Process 327
15.2 Job Work Procedure—Section 143 of CGST Act 327
15.2.1 Issue of Challan under Job Work Procedures 329
15.2.2 Character of supply of goods by Principal to a job worker 330
15.2.3 Usage of goods by job worker 330
15.2.4 Input Tax Credit Availability to Job Worker and Principal 330
15.2.5 Registration Requirements for principal and job worker 331
15.2.6 Movement of goods for job work 331
15.2.7 Issuance of intimation by principal under
Section 143 of CGST Act, 2017 332
xxx
15.2.7.1 ITC-04 filing periodicity 333
15.2.8 Valuation of Job work services 333
15.2.9 Determination of Place of Supply for moving job
worked goods directly from job worker’s premises 333
15.3 Job Work and Credit to Principal—Section 19 of CGST Act 334
15.4 Whether Goods or Service?—Schedule II of CGST Act 335
15.4.1 Classification of Printing Contracts 335
15.4.2 Clarifications issued in relation to printing of books 336
15.4.3 GST on Body building of Motor Vehicles 336
15.4.4 Job work in relation to manufacture of alcoholic liquor 336
15.5 Place of Supply—Section 12 of IGST Act 337
15.6 Place of Supply—Section 13 of IGST Act 337
15.7 GST Rate on Job Work Services 337
15.7.1 Job Work Related 338
15.7.1.1 GST Rate on job work to manufacture
alcoholic liquor 344
15.7.2 Other Manufacturing, Publishing, Printing, etc., Services 344
15.8 Exemptions 346
15.8.1 Customised Milling of Paddy 346
15.9 CBIC Flyer on Job Work 347
15.9.1 Job work Procedural aspects 347
15.9.2 Input Tax credit on goods supplied to job worker 348
15.9.3 Extended Meaning of input 348
15.9.4 Waste clearing provisions 348
16. Construction of Complex & Real Estate 349
16.1 Construction of Complex—Schedule II of CGST Act 349
16.2 Definitions 351
16.3 Various models prevalent in the industry for construction
of complex 352
16.3.1 GST Applicability on Transfer of Development Rights 352
16.4 Whether Goods or Service?—Schedule II of CGST Act 353
16.5 Input Credit—Section 17(5) of CGST Act 353
16.5.1 Determination of Proportionate credit attributable to
Taxable and Exempt Supplies for Construction of Complex 354
16.6 Place of Supply—Section 12 of IGST Act 354
16.7 Place of Supply—Section 13 of IGST Act 355
CONTENTS xxxi
16.8 GST Rates 355
16.8.1 Meaning of not taking input tax credit on goods or services 374
16.8.1.1 Value of Land and Total Amount 374
16.8.1.2 Government Authority [Para 4(ix)] 375
16.8.1.3 Government Entity [Para 4(x)] 375
16.8.1.4 CBIC Flyer on Valuation of Construction
of Complex Services 375
16.8.1.5 What are Affordable Housing Projects? 376
16.8.1.6 Definitions 376
16.8.2 Real Estate Related Supplies 382
16.8.2.1 Meaning of Total Amount 383
16.8.3 Rate on Services Supplied by Unregistered Suppliers to
Promoters 384
16.8.4 Rate on Goods Supplied by Unregistered Suppliers
to Promoters 385
16.8.5 GST applicability on PLC charges in relation to
Construction of Complex 385
16.9 Exemptions 386
16.9.1 Residential Complex 387
16.9.2 Original Works 387
16.9.3 Exemption on Transfer of Development Rights, etc. 389
16.9.3.1 Determination of Value for the purpose of
Exemption and Payment by Promoter
under RCM 392
16.10 Liability to pay tax in case of joint development
(Section 148 of CGST Act) 393
16.10.1 Special Provision for Payment of GST by Promoter on
Procurement of Development Rights or FSI or
Long-Term Lease (Section 148 of CGST Act) 394
16.11 Press Release in relation to Construction of Complex 396
16.12 Refund of Input Tax 396
16.13 Reverse Charge 397
16.13.1 Reverse Charge on Receipt of Supplies from an
Unregistered Person 397
16.13.2 Reverse Charge on Services 398
16.14 Judgments 398
16.15 ITC Reversals 402
xxxii
16.15.1 ITC Reversal in relation to inputs and input
services for Construction of Complex 402
16.15.1.1 Periodic Calculation of “E” and “F” for tax
period wise calculations in case of
Construction of Complex services 402
16.15.1.2 Final Calculation of “E” and “F” in case of
Construction of Complex services 402
16.15.1.3 For projects commence on or after 1st April, 2019,
which did not undergo or did not require
transition of input tax credit consequent
to change of rates of tax on 1st April, 2019 402
16.15.1.4 For commercial portions in projects other than
RREP which underwent transition of input tax
credit consequent to change of rates of tax on
1st April, 2019 403
16.15.1.5 For RREP projects which underwent transition of
input tax credit consequent to change of rates of
tax on 1st April, 2019 403
16.15.2 ITC Reversal in relation to capital goods for Construction
of Complex 404
16.15.2.1 Periodic Calculation of “E” and “F” for tax
period wise calculations
in case of Construction of Complex services 404
16.15.2.2 Final Calculation of “E” and “F” in case of
Construction of Complex services 404
16.16 Clarifications on Real Estate 405
16.17 GST on sale of developed land 406
16.18 GST on Preferential Location Charges (PLC) 406
16.19 Challenges 406
17. Services by or to Government 408
17.1 Supplies By Government 408
17.2 GST Rates 415
17.2.1 Real Estate Related Suppllies 415
17.3 Exemptions available to supply by or to Government 416
17.3.1 Clarification on non-applicability of GST on general
insurance services provided to/by Government 434
17.3.2 Exemption on Supplies to TDS Deductor in Specified
Circumstances 434
17.3.3 Applicability of GST on Milling of Wheat/Paddy
under PDS 434
CONTENTS xxxiii
17.3.4 Applicability of GST on Loans Guaranteed by
State Government to its undertakings and PSUs 435
17.3.5 GST Exemptions to Coaching Services Supplied by
NGOs under Central Scheme of ‘Scholarship for
Students with Disabilities’ 435
17.3.6 GST Exemption on services supplied by District Mineral
Foundations Trusts 435
17.3.7 GST Exemption on services supplied to CPWD by way of
horticulture 435
17.3.8 GST on statutory collections made by RERA 435
17.3.9 Exemption to grants received for R&D by Government
Entity or specified Institutions (w.e.f. 10.10.2024) 436
17.3.10 DDA is not a local authority 436
17.3.11 Facility Management services to MCD is not exempt 436
17.4 Reverse Charge on Services 437
17.5 Reverse Charge on Goods 439
17.5.1 Reverse Charge on Supply of Second-Hand Goods by
Government Clarified 440
17.5.2 Judgments 440
18. Services relating to Agriculture 441
18.1 Registration 441
18.2 Exemption of Services in relation to Agriculture 442
18.2.1 Terminologies in the Exemptions 445
18.2.2 Customised Milling of Paddy 446
18.2.3 Clarification as to Agricultural Produce 446
18.2.4 Applicability of GST on storage or warehousing of
cotton in baled or ginned form 447
18.2.5 Judgments and Advance Rulings Relating to
Agricultural Produce 447
18.3 GST Rate on services 448
18.3.1 Meaning of Agriculture Extension (Para 24) 450
18.3.2 Meaning of Agricultural Produce (Para 24) 450
18.3.3 Meaning of Agricultural Produce Marketing Committee or
Board (Para 24) 450
18.4 Reverse Charge on Goods 450
19. Service in Relation to Passenger Transport 454
19.1 Rate of GST on Passenger Transport Services 454
xxxiv
19.1.1 Passenger Transportation in Rail 454
19.1.2 Passenger Transportation in Cab 455
19.1.3 Rental Services of Vehicles Meant for Transportation 457
19.1.4 Passenger Transportation through Air 460
19.1.4.1 Clarification as to availability of credit to
passenger transportation by air in economy class 461
19.1.4.2 Meaning of not taking input tax credit on
goods or services 462
19.1.4.3 Specified Organisations 462
19.1.5 GST on Helicopter Transportation Services
(w.e.f. 10.10.2024) 462
19.2 Exemption on Passenger Transport Services 462
19.2.1 Stage carriage 464
19.2.2 Metro, monorail or tramway 465
19.2.3 Inland waterways 466
19.2.4 Metered cabs, radio taxis or auto rickshaws or e-rickshaw
Metered Cab 466
19.2.5 Contract Carriage 467
19.2.6 Maxi cab and motorcab 468
19.2.7 Omnibus 468
19.2.8 Motor Vehicle 468
19.2.9 GST exemption on hiring of vehicle by Companies for
transportation of employees 468
19.2.10 GST applicability on passenger transportation through
private ferry 469
19.2.11 Difference between renting of motor vehicle and
passenger transportation 469
19.3 Liability of Electronic Commerce Operator to pay Tax for specified
services under Section 9(5) of the CGST Act 470
19.4 Place of Supply (When both recipient and provider are located in 470
India)—Section 12(9) of IGST Act 470
19.4.1 Continuous Journey—Section 2(3) of IGST Act 470
19.5 Place of Supply (When either recipient or supplier is located outside
India)—Section 13(10) of IGST Act 471
19.5.1 Supply of services on board conveyance,
etc.—Section 13(11) of IGST Act 471
19.6 Valuation of Air Travel Agent Services (Valuation Rule) 471
19.7 Inter-State Movement of Conveyances 472
CONTENTS xxxv
19.8 Reverse Charge on Services provided by way of Renting of
Motor Vehicle 473
19.9 Exemption on Import of Services by Establishment of Foreign
Airlines in India (w.e.f. 10.10.2024) 474
20. Transportation of Goods 476
20.1 What is Goods? 476
20.2 Goods Transport Agency (GTA) 477
20.2.1 Enrolment for Transporters 477
20.3 Courier Agency 478
20.3.1 Door to Door Transportation 478
20.3.2 Difference between Courier Agency and GTA 478
20.4 GST Rate on Goods Transportation Services 479
20.4.1 Goods Transportation through Rail 479
20.4.2 Goods Transportation through Vessel 480
20.4.3 Goods Transportation through Road by Goods
Transport Agency (GTA) 481
20.4.4 Transportation of Goods Through Pipeline 484
20.4.5 Multimodal Transportation of Goods 485
20.4.6 Support Services in Transportation of Goods by GTA 485
20.4.7 Multimodal Transportation, Mode of Transport and
Multimodal Transporter 488
20.4.8 Transportation of goods by postal or courier services 489
20.4.9 Transportation of goods by ropeway 489
20.5 Exemption on Goods Transportation Services 490
20.5.1 Goods Transportation Through Air 490
20.5.2 Goods Transportation Through Vessel or Rail 490
20.5.3 Goods Transportation by GTA 491
20.5.4 Partnership firm and LLP 494
20.5.5 Services associated with transit cargo to Nepal and Bhutan 495
20.5.5.1 GST exemption on services associated with transit
cargo both to and from Nepal and Bhutan 495
20.5.6 Aircraft, Vessel, Goods Carriage and Custom Station 495
20.5.7 Inland waterways 497
20.6 Reverse Charge Mechanism on Services 498
20.6.1 Who will be treated as recipient of GTA services? 499
20.6.2 Firm and LLP 500
xxxvi
20.6.3 Special Valuation Provision for Transportation by Vessel 500
20.6.4 Undertaking to be filed by GTA 500
20.6.5 Reverting to RCM by GTA operating under forward charge 500
20.7 Place of Supply (both supplier and recipient are located in
India)—Section 12(8) of IGST Act 502
20.7.1 ITC on Transportation of Goods with destination
outside India 502
20.8 Place of Supply (either supplier or recipient is located in
India)— Section 13(9) of IGST Act 502
20.9 Inter-State Movement of Conveyances 504
20.10 Clarification on GTA 505
20.10.1 Who is a GTA – Goods Transport Agency? 505
20.10.2 Position under GST 505
20.10.3 What is a consignment note? 506
20.10.4 Significance of the term ‘in relation to’ in the
definition of GTA 506
20.10.5 GST on Ancillary services with GTA services 506
21. Transfer of Right To Use, Lease, License, Etc. 507
21.1 Transaction as supply of goods or services 507
21.2 GST Rate on supply of such services 508
21.2.1 Rental Services of Transport Vehicles with Operators 508
21.2.1.1 GST on Renting of trucks and other
freight vehicles 510
21.2.2 Transfer of Right to Use Goods 510
21.2.2.1 Meaning of not taking input tax credit on
goods or services 512
21.2.2.2 Meaning of Operator for Leasing of Aircraft
(Para 15(iv)) 513
21.2.2.3 Meaning of Scheduled Air Transport Services
for Leasing of Aircraft (Para 15(iv) 513
21.2.2.4 Meaning of Scheduled Air Cargo Services for
Leasing of Aircraft (Para 15(iv)) 513
21.2.2.5 SAC is determining factor to determine whether
supply falls under “same line of business” 513
21.2.3 IPR Related 514
21.2.3.1 Meaning of Information Technology Software
(Para 17(ii)) 514
21.2.3.2 Copyright 514
CONTENTS xxxvii
21.2.3.3 SAC is determining factor to determine whether
supply falls under “same line of business” 514
21.2.3.4 Trademark 515
21.2.3.5 Patent 515
21.2.3.6 Design 515
21.2.3.7 Possible Classification of Software 516
21.2.3.8 Permanent Transfer of Intellectual Property Rights 516
21.2.4 Lease 516
21.2.4.1 Clarification on Grant of Right for Mineral
Exploration and Mining 519
21.2.4.2 SAC is determining factor to determine whether
supply falls under “same line of business” 519
21.3 Compensation Cess Rate 519
21.4 Exemptions 520
21.4.1 Hire or Renting of Vehicles 522
21.4.2 Exemption to Royalties Payment to be made Outside India 522
21.4.3 Difference between instalment sales, conditional sale,
outright sales and hire purchase 522
21.4.4 Lease 523
21.4.5 Hiring 523
21.4.6 Transfer of right to use 523
21.4.7 Judgments 523
21.5 Reverse charge 524
21.5.1 Copyright 526
21.6 Clarification on GST Rate Applicable on Imported Equipment 526
22. Renting of Immovable Properties 527
22.1 Whether service or goods? 527
22.2 What is renting in relation to immovable property? 527
22.3 GST Rate 528
22.3.1 GST rate on electricity charges charged by owner
from tenant 528
22.4 Exemptions 528
22.4.1 Residence and Dwelling (S.No. 13) 533
22.4.1.1 Exemption to residential dwelling 533
22.4.2 Precincts and Religious ceremony (S.No. 14) 534
22.4.3 Religious place 534
xxxviii
22.4.4 Exemption to Upfront Premium Payable in Instalment 535
22.5 Place of Supply of Services (When both supplier and recipient
are located in India) 536
22.6 Place of Supply of Services (When either supplier or recipient
is located outside India) 536
22.7 Reverse Charge 537
22.7.1 Renting Services Provided by Government etc.,
to a Registered Person 537
22.7.2 Renting of Residential Dwelling to Registered Person 537
22.7.2.1 Meaning of Residential Dwelling 537
22.7.2.2 Service supplied by director in his personal
capacity to Company 538
22.7.3 RCM on renting of immovable properties
(w.e.f. 10. 10.2024) 538
22.7.3.1 Renting of Immovable Property by Unregistered
Person to Composition Dealers 539
22.8 Judgments 539
23. Specified Actionable Claims 541
23.1 Supplier of specified actionable claims 541
23.2 GST Rate on Services 542
23.3 GST Rate on Goods 543
23.3.1 Judgments 543
23.4 Online Gaming and Online Money Gaming 544
23.4.1 Online Gaming 544
23.4.2 Online Money Gaming 544
23.4.2.1 Virtual Digital Asset 545
23.5 GST on receipt of advance payment of specified actionable claims 545
23.6 Value of specific specified actionable claims (Section 15(5)
of CGST Act) 546
23.7 Value of Online Gaming including actionable claim involved in
Online Money Gaming (Rule 31B of CGST Rules) 546
23.8 Value of actionable claim involved in Casinos
(Rule 31C of CGST Rules) 546
23.9 Value of Lottery 547
23.10 Valuation of Betting, Gambling and Horse Racing 548
23.10.1 Clarification issued for Betting and Gambling 548
23.11 Exemptions 549
CONTENTS xxxix
23.12 Reverse Charge 549
23.12.1 Lottery distributor or selling agent 550
23.13 Mandatory Registration for supplier of online gaming services
from outside India (Section 14A of IGST Act, 2017) 550
24. Education and Sports 551
24.1 GST Rate 551
24.1.1 GST Rate on Catering in Educational Institution 552
24.2 Exemptions 552
24.2.1 Educational Institution (S.No. 69) 557
24.2.1.1 Pre-School 559
24.2.1.2 Higher Secondary School or equivalent 559
24.2.1.3 Forming part of curriculum 560
24.2.1.4 Maritime Training Institutions 560
24.2.1.5 Judgments 560
24.2.2 Approved vocational courses 561
24.2.3 Recognised Sports Body 561
24.3 Clarification as to Catering Services Provided by
Educational Institution 561
24.3.1 Applicability of GST on Supply of Food in
Anganwadis and Schools 562
24.4 Clarification on accommodation services provided to students
by a Trust 562
24.5 Taxability of Programmes Run by IIMs 562
24.6 Applicability of GST on Services Provided by Central and State
Boards such as NBE 563
24.6.1 GST Exemption on Testing Services Provided by
Certain Institutes 563
24.7 Applicability of GST on entrance fee or issue of eligibility
certificate or migration certificates by educational institutions 563
24.8 Exemption to grants received for R&D by Government Entity
or specified Institutions (w.e.f. 10.10.2024) 564
24.8.1 Regularisation of past cases on as is where is basis 564
24.9 GST on Affiliation provided by Universities to Colleges 564
24.10 GST on DGCA approved flying courses conducted by
Flying Training Organisations approved by DGCA 564
24.11 Place of Supply 565
24.12 CBIC clarification on Education 565
xl
24.12.1 Composite and Mixed Supply insofar as Education is
concerned 565
24.13 Judgments 566
25. Financial Institutions, Insurance, Pension, Etc. 567
25.1 Services by Foreman of Chit Fund 567
25.1.1 Meaning of not taking input tax credit on goods or services 568
25.1.2 Chit 568
25.2 Transfer of Right to Use Goods 569
25.2.1 Meaning of not taking input tax credit on goods or services 570
25.2.2 Scheduled Air Transport Services for Leasing of
Aircraft [Para 15(iv)] 570
25.2.3 Scheduled Air Cargo Services for Leasing of Aircraft
[Para 15(iv)] 570
25.2.4 Aircraft 571
25.2.5 Meaning of taking input tax credit on goods or services 571
25.2.6 Goods Carriage 571
25.3 Lease of Goods 571
25.3.1 Meaning of not taking input tax credit on goods or services 573
25.4 Exemptions 573
25.4.1 Authorised Dealer of Foreign Exchange 581
25.4.2 Banking Company 581
25.4.3 Business Facilitator or Business Correspondent 581
25.4.4 Insurance Business 581
25.4.5 Interest 582
25.4.6 Rural Area 582
25.5 Reverse Charge on Services 583
25.5.1 Services Provided by Business Facilitator (BF) or business
Correspondent (BC) 584
25.6 Reverse Charge on Supply of Goods 584
25.7 Valuation of Foreign Currency (Valuation Rules) 585
25.8 Valuation of Life Insurance Services (Valuation Rules) 585
25.8.1 Whether Life Insurance Premium not includible in
taxable value is exempt? 585
25.9 Place of Supply of Banking or other financial or stock broking
Services (Both supplier and recipient are located in India) 586
25.10 Place of Supply of Insurance Services (Both supplier and recipient
are located in India) 587
CONTENTS xli
25.11 Place of Supply of Service supplied by Banking Co./FI/NBFC
(When either supplier or recipient is located outside India)
Section 13(8)(a) of IGST Act 587
25.12 Applicability of GST on Additional/Penal Interest on Late
Payment of EMIs 587
25.12.1 Penal Charges levied by Banks / NBFC are not subjected
to GST 588
25.13 Taxability of no claim bonus by Insurance companies 588
25.14 GST applicability on the salvage/wreck value in an insurance claim 589
25.15 ITC Availability to insurance company on the repair work done
by garages 590
25.16 GST applicability on sharing of incentive by acquiring banks
with other stakeholders in RuPay Debit cards and low value BHIM-UPI 590
25.17 Retrospective benefit of reinsurance services in certain cases 591
25.18 Schedule III Transactions 591
25.18.1 Schedule III- Co-insurance premium Apportionment
by Lead Insurer to Co-insurer 591
25.18.2 Schedule III- Ceding re-insurance premium after
netting of re-insurance commission by lead insurer
to re-insurer 591
25.18.2.1 ITC availability to insurance company on the
repair work done by garages 592
25.18.3 Schedule III Insurance Activities Regularised on as is
where is Basis 593
25.19 Exemption to Payment Aggregators 593
25.20 Judgments 594
26. Tour Operator Services 595
26.1 Tour Operator 595
26.2 GST Rate 596
26.2.1 Meaning of not taking input tax credit on goods or services 597
26.2.2 SAC is determining factor to determine whether
supply falls under “same line of business” 597
26.3 Exemptions 598
26.4 Valuation of Air Travel Agent Services (Valuation Rules) 600
26.5 Judgments 600
27. Event, Brand Ambassador, Artist, etc., Services 601
27.1 GST Rate 601
27.1.1 Admission to Events, films, etc. Related 601
xlii
27.1.2 Clarification issued for Events, etc. 605
27.1.3 Clarification on GST rate on admission to place
having casino, etc., and otherwise 606
27.2 Exemptions 606
27.2.1 GST on payment of honorarium to guest anchors 609
27.3 Place of Supply for Admission to Events (Both supplier
and recipient are located in India)—Section 12(6) of IGST Act 609
27.3.1 Place of Supply of organisation of Events
(Both supplier and recipient are located in
India)—Section 12(7) of IGST Act 609
27.3.1.1 Determination of Place of Supply in case of
Event, etc. in Multiple States [Section 12(7)
of IGST Act] 609
27.4 Place of Supply of organisation of or admission to Events
(Either supplier or recipient are located in India)—Section 13(5)
of IGST Act 610
27.4.1 Determination of Place of Supply in case of Event, etc. in
Multiple States (Section 13(7) of IGST Act) 610
28. Restaurant, Hotel and Catering Services 611
28.1 Restaurant Services—Entry 6(b) of Schedule II of CGST Act 611
28.2 Composition Levy 612
28.3 Place of Supply—Section 12 of IGST Act 612
28.4 Place of Supply—Section 13 of IGST Act 612
28.4.1 Hotel Accommodation services to SEZ are
always inter-State 612
28.5 GST Rates for Restaurant Services 613
28.5.1 Restaurant Related Services 613
28.5.1.1 GST Rate on catering in Indian railways 615
28.5.1.2 GST Rate on Supply of food and beverage in
Cinema Hall 616
28.5.2 Accommodation Services in Hotels, etc. 616
28.5.2.1 Declared Tariff 617
28.5.2.2 Clarification in respect of accommodation in
Hotels, etc. 618
28.5.2.3 Clarification on accommodation services
provided by Air Force mess to its personnel 620
28.5.2.4 Provision of food and beverage in cinema hall 620
28.5.3 GST Rates on Outdoor Catering 621
CONTENTS xliii
28.5.4 GST Rates on Food etc, supplied by IRCTC in
Trains or at Platforms 623
28.5.5 Clarification on GST Rate on Takeaway Services and
Door Delivery Services 624
28.5.6 Clarification on GST Rate on Ice Cream supply by Ice
Cream Parlours 624
28.5.6.1 GST rate on supply of ice-cream by ice-cream
parlours 624
28.6 Exemptions 624
28.7 Reverse Charge on Electronic Commerce Operator for
specified services 625
28.7.1 Clarifications in relation to Restaurant services
tax to be paid by E Commerce 626
29. Works Contract 629
29.1 Distinction between Contract for Works or Services and
Contract for Sales of Goods 629
29.2 Works Contract—Section 2(119) of CGST Act 630
29.2.1 Some Definitions 631
29.3 Works Contract: Whether Goods or Service?
Schedule II of CGST Act 633
29.4 Input Credit—Section 17(5) of CGST Act 633
29.5 Place of Supply of Works Contract Service—Section 12 of IGST Act 634
29.6 Place of Supply of Works Contract Service—Section 13 of IGST Act 635
29.7 GST Rate on Works Contract Services 635
29.7.1 Meaning of not taking input tax credit on
goods or services 649
29.7.2 Value of Land and Total Amount 649
29.7.3 Government Authority Para 4(ix) 650
29.7.4 Government Entity Para 4(x) 650
29.7.5 Applicable GST Rate on construction of Ropeway 650
29.8 Exemption 650
29.8.1 Original Works 651
29.9 Works Services by Contractor to Government and Time of Supply 652
29.10 Valuation for Construction of Renewable Energy Projects 653
29.11 Judgments 654
xliv
30. Online Information Database Access or Retrieval Services 655
30.1 What is online information and database access or retrieval
services? 655
30.2 What will not constitute online information and database access
and retrieval services? 656
30.3 Compulsory Registration—Section 24 of CGST Act 656
30.4 Place of Supply of Services (Either Supplier or Recipient located
outside India) 657
30.5 Place of Supply of Services (Both supplier and recipient located in
India)—Section 12 of IGST 659
30.6 Exemptions 659
30.7 Reverse Charge 661
30.8 Service Tax Clarification 661
30.9 Some Important Clarifications 661
30.9.1 Examples of what could be or could not be OIDAR services 661
30.9.2 Indicative List of OIDAR Services 662
30.9.2.1 Website supply, web-hosting, distance
maintenance of programmes and equipment: 662
30.9.2.2 Supply of software and updating thereof: 662
30.9.2.3 Supply of images, text and information and
making available of databases: 662
30.9.2.4 Supply of music, films and games, including
games of chance and gambling games, and
of political, cultural, artistic, sporting, 662
30.9.2.5 Supply of Distance Teaching: 663
31. Electronic Commerce Operator and TCS 664
31.1 Electronic Commerce Operator 664
31.2 Liability of ECS to pay GST 666
31.2.1 Clarifications in relation to Restaurant services tax to
be paid by E Commerce 669
31.3 E-Commerce Operators Not Required To Reverse ITC 672
31.4 Tax Collected at Source (TCS)—Section 52 of CGST Act 672
31.5 Registration Requirements – Section 24 of CGST Act 675
31.6 Procedure to be followed by ECS allowing persons
(exempted from obtaining registration) supplying
goods through ECS 676
31.7 Procedure to be followed by ECS allowing persons under
Composition Scheme supplying goods through ECS 676
CONTENTS xlv
31.8 Penal Provisions – Section 122(1B) 677
31.9 Judgements 677
32. Supply of Second hand Goods and Vehicles 678
32.1 Supply of Old Goods by Individual is not Subject to GST 678
32.2 Margin Scheme – Sale of Second Hand Goods—Rule 32(5) 678
32.3 Exemption from Reverse Charge on Purchase of
Second Hand Goods 679
32.4 Exemption from Compensation Cess to dealers operating under 679
Margin Scheme 679
32.5 GST Rate on Supply of Second Hand Vehicles 680
32.6 Concessional Rate on Supply of Specific Second Hand Vehicles 681
32.7 Reverse Charge 682
32.7.1 Supply of Used, Confiscated, Waste and Scrap by
Government, etc. to Registered Person 682
32.8 Judgments 682
33. Registration 683
33.1 Registration—Section 22 of CGST Act 683
33.1.1 Credit Transfer on Obtaining Separate Registration
for Multiple Places of Business within State (Rule 41A
of CGST Rules w.e.f. 01.02.2019) 689
33.1.2 Mandatory Furnishing of Bank Account (Rule 10A of CGST
Rules) 690
33.1.2.1 Bank account to be linked with PAN of the
registered person 690
33.2 Person not Requiring Registration—Section 23 of CGST Act From
01.10.2023 by Finance Act, 20235
with retrospective effect
from 01.07.2017 691
33.2.1 Movement of Goods on Approval Basis 696
33.2.2 Clarification in respect of non-registration by small service
provider providing services through E-Commerce 697
33.3 Cases requiring Compulsory Registration—Section 24 of CGST Act 697
33.3.1 Section 24 is a Mandatory Provision 698
33.4 Special provisions relating to casual taxable and non-resident
taxable person — Section 27 of CGST Act 698
33.4.1 Special Provision as to Enrolment of Warehouse
Operator and Transporters (Rule 58) 699
33.4.2 Special procedure for registration, etc. of transporter
godown for storing goods 699
xlvi
33.4.3 Special Registration Procedure for Corporates
undergoing Resolution Procedure 700
33.4.4 Mandatory Registration for supplier of online gaming
services from outside India (Section 14A of IGST Act, 2017) 701
33.4.4.1 Consequences of not obtaining mandatory
registration (Section 14A(3) of IGST Act) 702
33.4.5 Temporary Identification Number (Rule 16A) 702
33.5 AADHAAR Based Authentications For New and Existing
Registrations (Section 22 of CGST Act, 2017) 702
33.5.1 Deemed Approval of Registration Application 704
33.5.2 AADHAAR Validation For Registered Taxable Persons
(section 25(6A) of CGST Act, 2017) 704
33.5.2.1 Mandatory AADHAAR authentication of
already registered persons in specified cases 704
33.5.2.2 Exceptions to AADHAAR authentication of
already registered persons (w.e.f. 24.09.2021) 705
33.5.3 Mandatory declaration of PAN and State of
Applicant (Rule 8(1) of CGST Rules) 705
33.5.4 Separate registration for ISD (Rule 8(1) of CGST Rules) 706
33.5.5 Physical Verification of Business Premises (Rule 25) 706
33.5.6 Physical verification at facilitation centre in case of certain
assessees (W.E.F. 01.02.2025 vide Notification
No. 09/2025-Central Tax, dated 01.02.2025 706
33.6 Amendment to and Cancellation or Suspension and Revocation of
cancellation of registration — Sections 28, 29 & 30 of CGST Act 707
33.6.1 Procedure for Extension of time for filing revocation
application 711
33.6.2 Relaxation in Revocation of Cancelled Registrations 712
33.6.2.1 Who can file the revocation application under
Amnesty Scheme? 712
33.6.2.2 Further extensions by Commissioner for
revocation application relating to
Amnesty Scheme 713
33.6.2.3 Further relaxation for revocation of registration
application in specific cases 714
33.6.2.4 ITC availment by persons whose registration
cancellation has been revoked 714
33.7 Forms under Registration (Registration Rules) 715
33.8 Process Flow Under Registration (Rules) 717
33.8.1 Migration of Person Registered Under the Existing Law 717
CONTENTS xlvii
33.8.1.1 Surrender of Registration by Migrated Taxpayer 718
33.8.1.2 Special Procedure of Registration for Persons
Who Received only Provisional Identification
Number (PID) till 31.12.2017 718
33.8.2 Registration Procedure in General 718
33.8.2.1 Mandatory Furnishing of Bank Account
(Rule 10A of CGST Rules) 720
33.8.2.2 Mandatory Verfication Through AADHAAR 720
33.8.3 Casual Taxable Person 721
33.8.4 Non-resident Taxable Person 722
33.8.4.1 Difference between Casual Taxable Person and
Non-resident Taxable Person 722
33.8.4.2 Validity Period of the Registration Certificate
Issued to a Casual Taxable Person and
Non-Resident Taxable person 723
33.8.5 Person Liable to Deduct Tax at Source 723
33.8.6 Person supplying Online Information & Data Base
Access or Retrieval service from a place outside
India to a non-taxable online recipient 724
33.8.6.1 Person supplying online money gaming
from a place outside India to a person in India 724
33.8.7 Suo Moto Registration by Proper Officer 724
33.8.8 Unique Identification Number to Certain Special Entities 724
33.8.9 Amendment to Registration 725
33.8.9.1 Effective Date of Amendment to Registration
(Rule 19) 726
33.8.10 Cancellation of Registration (On Application
Made by Registered Person) 726
33.8.11 Cancellation of Registration by Proper Officer
Suo Moto 727
33.8.12 Revocation of Cancellation of Registration 728
33.8.13 Goods & Services Tax Practitioner 729
33.8.13.1 Flow Chart Depicting Enrolment of
GST Practitioner 731
33.8.14 Miscellaneous 732
33.9 Modes of Authentication (Rule 26) 732
34. Payment of Tax, Interest, TDS & TCS 735
34.1 Payment of Tax, Interest, etc. —Section 49 of CGST Act 735
34.1.1 Utilisation of input credit 737
xlviii
34.1.2 Inter-head Transfer of Tax, Interest, Penalty, Fee or
Any Other Amount [Rule 67 (13) of CGST Rules] 737
34.1.3 Restriction on ITC Utilisation on specified
Taxpayers for Tax Payment (Rule 86B) 738
34.2 Interest —Section 50 738
34.2.1 Interest Payable only on utilization of wrongly
availed ITC : Section 50(3) 739
34.2.2 Lower Interest in COVID 19(I) Conditions 740
34.2.2.1 Lower Interest in COVID 19 (II) Conditions 743
34.2.3 Non-payment of Interest on Liability Arising Due to
Late Filing of Returns (Section 50) 745
34.2.4 Interest Applicable Only on Net Cash Liability 745
34.2.4.1 Interest Applicable on Net Cash Liability
Retrospectively from 01.07.2017 745
34.2.4.2 No interest on amount lying in Electronic
Cash Ledger (Valid from 10.07.2024) 745
34.2.5 Prescribing procedure for calculation of interest
under Section 50 746
34.2.5.1 Calculation of interest on wrong availment and
reversal of IGST 746
34.3 Interest Related Amnesty Scheme 747
34.3.1 Waiver of Interest and Penalty Pertaining to 01.07.2017
till 31.03.2020 (Section 128A) 747
34.4 Tax Deduction at Source (TDS)—Section 51 of CGST Act 751
34.4.1 CGST Exemption on Supplies to TDS Deductor in
Specified Circumstances 752
34.4.2 Date from which the TDS Provisions are Effective? 753
34.4.3 Exemption From TDS provisions 753
34.4.4 TDS on Scrap (w.e.f. 10. 10.2024) 754
34.4.5 Judgments 755
34.5 Tax Collected at Source (TCS)—Section 52 of CGST Act 755
34.5.1 Date from which TCS Provisions are Effective? 757
34.5.2 Clarification on TCS Collection by Tea Board 757
34.5.3 Clarification on TCS in case of more than one Electronic
Commerce Operators (ECOs) in a transaction 757
34.5.4 GST Flier 759
34.6 Tax Payment Procedures (Payment of Tax Rules) 760
34.6.1 Electronic Tax Liability Register 760
CONTENTS xlix
34.6.1.1 CBIC Flyer on Electronic Liability Register 761
34.6.2 Electronic Credit Ledger 762
34.6.2.1 CBIC Flyer on Credit Ledger 762
34.6.3 Electronic cash Ledger 763
34.6.3.1 CBIC Flyer on Cash Ledger 764
34.6.3.2 Transfer of balance in Electronic Cash Ledger
between GSTINs under same PAN 765
34.7 Utilisation of amount in cash ledger and credit ledger 765
34.8 Form Index for Payment of Tax 766
35. Tax Invoice, Credit Notes & Debit Notes 767
35.1 Issue of Tax invoice—Section 31 of CGST Act 767
35.1.1 Types of Invoices 767
35.1.2 Timelines for issuance of Invoices 768
35.1.3 Tax Invoice—General Requirement 770
35.1.4 Revised Invoice 772
35.1.5 Bill of Supply and Bill of Supply-Cum-Invoice 773
35.1.6 Receipt Voucher 774
35.1.7 Refund Voucher 774
35.1.8 Payment Voucher (Reverse Charge) 775
35.1.9 Input Service Distributor 775
35.1.9.1 Invoice to be issued by Taxpayer to its ISD 776
35.1.10 Banks/NBFC/Insurance 777
35.1.11 Goods Transport and Passenger Transport 777
35.1.12 Completely/Semi Knocked Down or in Batches or Lots 777
35.1.13 Specific Cases for Transportation of Goods without
issue of Invoice 777
35.1.14 Movement of Goods on Approval Basis 778
35.1.15 Creation of Challan in Job Work 778
35.1.16 Mandatory Recording of State of Unregistered Recipient
in case of Online Services to Unregistered
Service Recipients 779
35.2 E-Invoice 779
35.2.1 What is E-invoice 779
35.2.2 Format of E-Invoice 780
35.2.3 Objective of introduction of E-Invoices 780
l
35.2.4 Interfaces in Generation of E-Invoice 780
35.2.5 Portals for Generation of E-Invoice (IRN) 780
35.2.6 Documents for Which E Invoice has to be generated 780
35.2.6.1 Obligation of Suppliers 780
35.2.7 Format of IRN 780
35.2.8 Mandatory Fields in an E-Invoice 781
35.2.9 Whether QR Code is mandatory to be included
in E-invoice? 781
35.2.10 Notified persons to issue E-Invoice 781
35.2.11 E-Invoice Not Applicable For Following Persons 782
35.2.11.1 Declaration on Tax- Invoice in specified cases 782
35.2.11.2 Whether exemption from E-invoice is
service specific? 782
35.2.12 E-invoice not to be issued in Duplicate or Triplicate 783
35.2.13 E-invoice not to be issued for below supplies 783
35.2.14 Clarification on E-invoice for invoices to be issued to
Government Department etc., registered due to
TDS deduction only 783
35.3 Mandatory mention of Dynamic QR Code on Specified
B2C Tax Invoices 783
35.3.1 Clarifications Issued For Dynamic Quick Response Code 783
35.3.2 Dynamic Quick Response (QR) Code for supplies
not qualifying as exports 786
35.4 Consolidated Invoice or No Invoice 786
35.5 Bar on Unauthorised Collection of Tax—Section 32 of CGST Act 787
35.6 Credit Note & Debit Note—Section 32 of CGST Act 787
35.6.1 Credit Notes (Section 34) 788
35.6.1.2 Reducing Output Liability by Suppliers on
Issue of Credit Notes 788
35.7 Documents to accompany during Transportation of
Goods (Rule 55A) 789
35.8 Procedure for Return of Material 789
35.9 CBIC Flyer on Tax Invoice 790
35.9.1 Importance of tax invoice under GST 790
35.9.2 Revised Invoice 791
35.9.3 Issue of invoice in case, where supply of service
ceases under a contract before completion of supply 791
35.9.4 Sale on approval basis 791
CONTENTS li
35.9.5 Amount of tax to be indicated in invoice 791
35.10 Some important Clarifications 791
36. Returns 793
36 EASING OUT OF COMPLIANCE BURDEN : 27th GST COUNCIL
MEETING 793
36.1 New Return Filing System 793
36.2 Furnishing of Returns 793
36.3 Contents of Form GSTR-1 Return (Rule 59) 795
36.3.1 Restriction on Filing of Form GSTR-1 (Rule 59) 795
36.3.2 Rectification of omissions or errors in Form GSTR-1
(Section 37 of CGST Act, 2017) 796
36.3.3 Outer Limit for Filing Form GSTR-1 796
36.3.3.1 Return in Form GSTR-1A for amending
Form GSTR-1 (applicable from 10.07.2024) 796
36.3.3.2 Lowering threshold for reporting B2C Large in
GSTR-1 (applicable from 10.07.2024) 797
36.4 Contents of Invoice Furnishing Facility (IFF) (Rule 59) 797
36.5 Inward Supplies Details : Section 38 and Rule 60 797
36.5.1 Difference between Form GSTR-2A and Form GSTR-2B 798
36.5.2 Form GSTR-2A and Form GSTR-3B mismatch for FY 2017-18
and 2018-19 799
36.5.3 Clarification on dealing with differences in ITC as
mentioned in Form GSTR-3B and that in Form GSTR-2A 800
36.6 Quarterly Return Monthly Payment Scheme – Proviso to Section
39(1) and Rules 59,60 and 61 801
36.6.1 Eligibility for the Scheme 801
36.6.2 QRMP Scheme is GSTIN wise 802
36.6.3 How to opt for OR opt out of the Scheme 802
36.6.3.1 Default For First Quarter of QRMP 802
36.6.3.2 Opting for QRMP 802
36.6.3.3 Opting out of QRMP 802
36.6.4 Filing of outward Supplies Return by QRMP 802
36.6.4.1 Invoice Furnishing Facility (IFF) 803
36.6.5 Monthly Tax Payment by QRMP 803
36.6.5.1 Fixed Sum Method 804
36.6.5.1.1 Interest liability under Fixed Sum
Method 804
lii
36.6.5.1.2 Late Fee for delay in payment of
deposit 804
36.6.5.2 Self-Assessment Method 804
36.6.5.2.1 Interest liability under Self-assessment
Method 804
36.6.5.2.2 Late Fee for delay in payment of
deposit 805
36.6.6 Quarterly Form GSTR-3B by QRMP 805
36.7 NIL Form GSTR-3B Filing Through SMS 805
36.8 Specifying return in Form GSTR-3B as return to be filed
under Section 39 805
36.8.1 How to take care of differences between
Form GSTR-3B and Form GSTR-1? 806
36.8.2 System based reconciliation between Form GSTR-3B and
GSTR-1/ GSTR-2 807
36.8.3 Mismatches in Forms GSTR-3B and GSTR-1 and
consequential tax payments 808
36.8.3.1 Intimation of difference of liability in
Forms GSTR-1 and GSTR-3B (Rule 88C) 808
36.8.4 Rectification of any omission or Error in
Form GSTR-3B: Section 39(9) 809
36.8.5 Restriction in filing of Form GSTR-3B 809
36.8.6 Outer Limit for Filing GSTR-3B 809
36.8.7 Amendment to Return in Form GSTR-3B 810
36.8.7.1 Clarifications in relation to amended
Form GSTR-3B 810
36.8.8 Reclaim Ledger for Section 16(4) 811
36.9 First Return—Section 40 812
36.10 Annual Return—Section 44 812
36.10.1 Annual Return from 01.08.2021 by Finance Act, 2021 813
36.10.2 Optional Annual return (GSTR-9) and Reconciliation
Statement (Form GSTR-9C) For Eligible Persons 814
36.10.3 Non-Filing of Form GSTR-9C by Foreign Airline
Companies 814
36.10.4 Abolition of CA Certification of Form GSTR-9C by
Finance Act, 2021 814
36.10.5 Outer Limit for Filing Form GSTR-9 814
36.11 Final Return—Section 45 815
36.12 Fee for Late Filing—Section 47 815
CONTENTS liii
36.12.1 Reduced Late Filing Fee (w.e.f. 01.06.2021) 815
36.12.1.1 Reduced fines for late filings (Till 31.05.2021) 817
36.12.2 General Amnesty For Late Filing of Returns For
Past Periods 817
36.12.2.1 Late filing of Form GSTR-4 return for past
periods 817
36.12.2.2 Reduced Late Filing Fee for Annual Return
for Past periods and from FY 2022-23 818
36.12.2.3 Reduced Late Filing Fee for Final Return in
Form GSTR-10 818
36.13 Return Rules (List of Forms) 818
36.14 Online Information and Database Access or Retrieval
Services (OIDAR) 819
36.15 Form and Manner of Submission of Return by Non-resident Taxable
Person (Monthly Returns) 819
36.16 Form and Manner of Submission of Return by ISD (Monthly) 819
36.17 Form and Manner of Submission of Return by a Person
Required to Deduct Tax at Source (Monthly) 820
36.18 Other Returns 820
36.18.1 Rectification of any omission or Error in
Form GSTR-8: Section 52(6) 820
36.18.2 Outer Limit for Filing Form GSTR-8 820
36.18.3 Time limit for filing Form GSTR-04 (Valid from 10.07.2024) 821
36.19 Person Having Unique Identification Number 821
36.19.1 Returns to be filed by UN Entities 821
36.20 Returns to be filed by OIDAR and Online Money Gaming Suppliers
located Outside India to persons in India (Rule 64) 821
36.21 Judgments 821
37. Import, Export and Supplies To Sez 822
37.1 Export and Import of Goods and Services 822
37.1.1 Export of Services Through a Third Party 825
37.1.2 Difference Between Exempted Supplies and Zero
Rated Supplies 825
37.1.3 Supply of Goods by Duty Free Shops 826
37.1.4 Taxability of short-term accommodation
services to SEZ developer or unit 826
37.1.5 Export condition of “Establishments of a Distinct Person” 827
37.2 Duties on Import of Goods and Services 828
liv
37.3 Import of Goods 828
37.3.1 Duty Calculation 828
37.3.2 Change in the Import Procedures 829
37.3.2.1 Import Export Code (IEC) 829
37.3.2.2 Bill of Entry Regulations and Format 829
37.3.2.3 Import under Export Promotion Schemes
and Duty Payment through EXIM Scrips 830
37.3.2.4 IGST on Import of Goods by EOUs and SEZ 830
37.3.2.5 IGST on Import of Services by SEZ 830
37.3.2.6 Project Imports 830
37.3.2.7 Baggage 830
37.3.2.8 Input Tax Credit 830
37.3.3 Supply on High Seas basis and Sale of Warehoused Goods,
before Clearance, are not Supply
(Schedule III to CGST Act) 831
37.4 Export of Goods or Services 831
37.4.1 Drawback 831
37.4.2 Refund under GST 831
37.4.2.1 Option 1: Refund on Exports Under Bond or
Letter of Undertaking (LUT) (Refund Rules) 833
37.4.2.1.1 Online Filing of LUT for FY 2018-19
and onwards 836
37.4.2.1.2 Requirement of filing of LUT/Bond
in case of export of exempted supplies 837
37.4.2.1.3 Availability of refund of IGST paid
on non-receipt of consideration in
time for exports 837
37.4.2.2 Option 2: Refund of IGST Paid on Export of
Goods (Refund Rules) 838
37.4.2.2.1 Refund of IGST paid on upward
revision of prices post export of goods 839
37.4.2.2.2 Persons or goods which can
export/supply to SEZ on payment of
IGST and seek refund of IGST so paid
(Section 16 of IGST Act) 842
37.5 Export of Services 843
37.5.1 Clarifications on Exports to Nepal and Bhutan 844
37.6 Supplies to SEZ Unit or Developer 844
37.6.1 Exemption on Import of Services by SEZ Unit or Developer 844
CONTENTS lv
37.6.2 Exemption on Import of Goods by SEZ Unit or Developer 844
37.6.3 Persons or goods which can export/supply to SEZ on
payment of IGST and seek refund of IGST so paid
(Section 16 of IGST Act) 845
37.7 Concessional Rate to Trader Exporters for Procurement of Goods 845
37.8 CBIC Clarification on Certain Import Transactions 847
37.8.1 Import as Baggage 847
37.8.2 Import of Goods by 100% EOU’s and SEZs 847
37.8.3 Input tax Credit of Integrated Tax 848
37.8.4 Import of Services 848
38.1 Refunds 850
38.1 Kinds of Refunds and General Points—Section 54 of CGST Act 850
38.1.1 Relevant Date 851
38.1.1.1 Extension of Time Limit for Filing Refund Claim 852
38.1.2 Kinds of Refund Claims that can be Filed by Form RFD-01 852
38.1.3 Jurisdiction for Filing the Refund Claim 853
38.1.4 Steps in Refund Claim Processing 853
38.1.4.1 Facility of Withdrawal of Refund Claim 853
38.1.5 Pre-requisites, Periodicity and Procedure of Filing the
Refund Claims 854
38.1.5.1 Mandatory AADHAAR authentication of
already registered persons seeking refunds 855
38.1.6 Drawbacks and Refund Claims 856
38.1.7 Special Dispensation of Zero-Rated Supplies of
Services with Payment of GST 856
38.1.8 Whether realization proof is required for refund of
export of goods? 856
38.1.9 Refund Filing Process where inadvertently NIL Refund has
Already Been Filed 857
38.1.10 Refund claim by ISD and Non-Resident Taxable Person 857
38.1.10.1 Time of claiming refund by
Non-Resident Taxable Person (Rule 89) 857
38.1.11 Refund of Compensation Cess when final
product is not leviable to Cess 858
38.2 Refund of Unutilised Input Tax Credit—Section 54(3) of CGST Act 858
38.2.1 Supplies of Services on which Refund is not Allowed 859
38.2.2 Eligibility of Refund of accumulated ITC in case of
Export Goods attracting Nil rate of Export Duty 859
lvi
38.3 Inverted Duty Refunds 859
38.3.1 Supplies of Goods on which Refund is not Allowed
(Inverted Duty) 859
38.3.2 How to reverse the input credit for intervening period? 862
38.3.3 Filing of refund claim by persons who have not
reversed the lapsed credit till prescribed date 862
38.3.4 Refund of input credit allowed on export of specified items 863
38.3.5 Restriction on granting refund of CESS due to
inverted duty structure 863
38.3.6 Clarifications Relating to Refund Arising on Account
of Inverted Duty 863
38.3.7 Calculation of Refund Amount For Inverted Duty
Structure 864
38.3.8 Reduction of GST Rate on a goods will not result in
Refund on Account of Inverted Duty Structure 865
38.3.8.1 Inverted Tax Refund owing to concessional
lower rate 865
38.4 Deemed Exports 865
38.4.1 Refund of Deemed Exports 867
38.4.2 Procedure to be followed by Recipient of Deemed
Export Supplies 867
38.4.3 Debit entry to be passed in case of Refund filed
by recipients of Deemed Exports 868
38.5 Time of Filing the Refund Claim in Specific Instances—Section
54(3) of CGST Act 869
38.6 Refund Restrictions in Some Cases 869
38.6.1 Allowability of Refund Pursuant to Deemed Exports Supplies
and Supplies at Reduced Rate for Trader Exporter
[Rule 89(4A) and (4B) of CGST Rules] 869
38.6.2 Allowability of Refund of IGST Paid on Export of Supplies
Pursuant to Deemed Exports Supplies and Supplies at
Reduced Rate for Trader Exporter [Rule 96(10) of
CGST Rules] 871
38.6.3 Refund Restrictions on export of supplies procured at
concessional GST rate or exempt 873
38.6.4 Restriction on refund of Input Tax in case of
Construction of Complex 874
38.6.5 Regulated refunds on specified goods or to specified persons
(Section 16(4 ) IGST Act) 874
CONTENTS lvii
38.6.6 No Refund on Zero Rated Supplies of Goods Subjected to
Export Duty (Section 16(5) of IGST Act) 874
38.7 Refund of unutilised Credit of concessional rate of 0.05%/0.1% 875
38.8 Other Clarification 875
38.8.1 One to One Correlation not Required 875
38.8.2 Input Invoice dated For Previous Period is Valid
For Claiming Refund of Subsequent Relevant Period 875
38.8.3 Refund Applications Generated on GSTN Portal But
Documents Not Received 876
38.8.4 ITC Availed and Reversed 876
38.8.5 Clarifications on Refund of Compensation Cess 876
38.9 Disbursal of Entire Refund Claim Amounts [Section 54(8A) of
CGST Act] by Jurisdictional Authority 877
38.10 Amount of Refund Claim of ITC in Relation to Zero Rated Supply 877
38.10.1 Capping Value of Export Goods for Refund Purposes 880
38.10.2 NET ITC restricted up to the input invoices reflecting in
Form GSTR-2B 880
38.10.2.1 Incorporation of HSN codes against the input
supplies while
providing NET ITC Details in Annexure B 881
38.10.3 Adjusted Total Turnover 881
38.10.3.1 Calculation of adjusted total turnover for
export of goods 882
38.10.4 Calculation of Refund Amount 882
38.10.5 Bifurcation of Refund Claim amount of Respective
Taxes for Both Zero Rated and inverted Duty Refund 882
38.10.6 Availability of refund of IGST paid on non-receipt of
consideration in time for exports (Rule 96A) 883
38.10.6.1 Availability of refund of unutilised ITC 883
38.10.6.2 Availability of refund of IGST paid pursuant
to non-receipt of consideration or non-export
of goods within time allowed 884
38.11 Endorsement for SEZ Supplies 884
38.12 Documents to be filed 887
38.12.1 Refund to Supplier of IGST paid on Supplies to
SEZ Unit or Developer 896
38.13 Acknowledgement and Refund order 896
38.14 Provisional Refund 896
38.15 Deficiency Memo 897
lviii
38.16 Recredit in Credit Ledgers 897
38.16.1 Recredit in case of Type 1 Rejections 898
38.16.2 Recredit in case of Type 2 Rejections 898
38.16.3 Procedure for recredit pursuant to excess or erroneous
refund sanctioned corresponding 898
38.17 Bank Account and Disbursal of Refund Claim 899
38.17.1 Payment of refund in credit 900
38.17.2 Refund Payment in cash and credit in certain cases 900
38.18 Unjust Enrichment—Sections 54(8), 57 and 58 901
38.18.1 Consumer Welfare Fund 902
38.19 Withholding Refund or Adjustment of Refund—Section 54(10) 905
38.19.1 Adjustment of Refund (Rule 92) 906
38.19.2 Withholding and Release of Withheld Refund Claim 906
38.19.3 Automatic intimation / transfer of withheld refund
cases of IGST paid on export of goods 906
38.20 Interest on Delayed Refunds—Section 56 906
38.21 Refunds filed by UNO, etc. and Canteen Store Department
(CSD)—Section 55 907
38.21.1 Conditions for allowing the refunds to UNO 908
38.21.1.1 Refund Claim Processing for application by UN
Entities 910
38.21.2 Exemption and Refund to Canteen Store
Departments (CSD) (Section 55 of CGST Act) 911
38.21.2.1 Refund of Canteen Stores Department 912
38.21.2.1.1Automated Refunds to CSDs 913
38.22 Refund Under ‘Seva Bhoj Yojna’ of the Ministry of Culture 914
38.23 Refund of Tax Paid on Inward supplies by Duty Free Shops,
Etc. at International Airport for Goods Supplied to Outgoing
International Tourist without Payment of Tax 915
38.23.1 Procedure for Filing such a Refund 916
38.24 Refund of TDS/TCS Deposited in Excess 917
38.25 Refund claim Pursuant to Order by Appellate Authority 918
38.26 Refund Filing of incorrect payment of Tax (w.e.f. 24.09.2021) 918
38.27 Refund of Excess Balance in Cash ledger 919
38.28 Special procedure prescribed for seeking refund of ITC on export
of electricity 919
38.28.1 Procedure for refund of unutilised ITC on account of
export of electricity 920
CONTENTS lix
38.29 Recredit in case of wrongly sanctioned refund 921
38.30 Instructions for Scrutiny of Refund Claims 922
38.30.1 Uploading of detailed order along with Form RFD-06 922
38.30.2 Contents of refund order for all refund claims 922
38.30.3 Contents of refund order pertaining to refund of accumulated
ITC on zero rated supplies or inverted tax supplies and
refund of IGST paid on export of zero rated supplies 922
38.30.3.1 Details for refund of accumulated credit for
zero rated supplies and inverted rated structure 922
38.30.3.2 Additional details for refund of accumulated
credit on account of zero-rated supplies 923
38.30.3.3 Additional details for refund of accumulated
credit for inverted rated structure 923
38.30.3.4 Additional details for refund relating to IGST
paid on zero rated supplies 923
38.30.3.5 Additional details for refund relating to zero
rated supplies to SEZ 923
38.30.4 Contents of refund order pertaining to refund of
accumulated ITC on zero rated supplies or inverted tax
supplies and refund of IGST paid on export of zero
rated supplies 924
38.30.5 Contents of refund order pertaining to refund of excess
balance in cash ledger 924
38.30.6 Contents of refund order pertaining to refund
under “Any Other” category 924
38.30.7 Post audit 924
38.30.8 Review of Refund orders by Commissioner 924
38.31 Exclusion of COVID-19 related period from adjudication
and refund filing 924
38.32 Filing of refund by unregistered persons 925
38.33 Refund of IGST paid on upward revision of prices post
export of goods 927
38.34 Refund Forms under Refund Rules 929
38.35 Judgments 929
39. Accounts, Audit and Inspection 936
39.1 Account and Records—Section 35 of CGST Act 936
39.1.1 Records Maintenance by Registered Person (Rules) 937
39.1.2 Records Maintenance by Agent (Rules) 938
39.1.2.1 Records Maintenance by Auctioneer 938
lx
39.1.3 Records Maintenance by Manufacturer (Rules) 939
39.1.4 Records Maintenance by Service Providers (Rules) 939
39.1.5 Records Maintenance by Works Contractor (Rules) 939
39.1.6 Requirement as to Electronic Records (Rules) 939
39.1.7 Requirement as to Warehouse Operator and
Transporters (Rules) 940
39.2 Access to Business Premises—Section 71 of CGST Act 940
39.3 Audit—Section 65 of CGST Act 941
39.3.1 Audits under Service Tax 941
39.3.2 Definition of Audit Under CGST Act 942
39.3.3 Types of Audits—Sections 65 & 66 of CGST Act 942
39.3.4 GST Audit Manual 943
39.3.4.1 Selection of Assessees for Audit 944
39.3.4.2 Apprising the registered person of irregularities
noticed and ascertaining his view point 945
39.3.4.3 Preparation of Draft Audit Report and
submission to senior officers 945
39.3.4.4 Final Audit Report 945
39.3.4.5 Follow up action and issue of show cause notice 945
39.4 Special Audit 945
39.5 Issues arising out of Audits 946
39.6 Audit Forms (Rules) 946
39.7 Inspection, Search and Seizure—Section 67 of CGST Act 946
39.7.1 Process Flow of inspection, search or seizure 948
39.7.2 Amount of Bond and Security for Release of
Goods (Inspection, Search and Seizure Rules) 949
39.7.3 Procedure in Respect of Seized Hazardous or Perishable
Goods (Inspection, Search and Seizure Rules) 951
39.7.4 Specification of Goods that can be disposed off as
soon as possible after seizure 951
39.7.5 Procedure for Search Under Section 67 951
39.7.5.1 Pre-requisite for a valid search 951
39.7.5.2 Procedure to be followed during a search 951
39.7.5.3 Rights of person searched 952
39.8 Power to Arrest—Section 69 953
39.9 Important Clarifications on Search, Seizure and Inspection 953
39.10 Guidelines to be followed During Investigation 962
CONTENTS lxi
39.11 Forms Under Accounts, Audit and Inspection 964
40. Assignment of Functions to Various Officers 965
40.1 Functions Under GST as per Departmental Hierarchy 965
40.2 Monetary Limits to Issue SCNs 965
40.3 Issuance of SCNs by Audit Teams or DGST Intelligence 965
40.4 Rank wise Section wise Distribution of Work 966
40.5 Adjudication of SCNs issued by DGGSTI 969
40.6 Judgments 970
41. Assessments 971
41.1 Provisional Assessment—Section 60 of CGST Act 972
41.1.1 CBIC Flyer on Provisional Assessment 972
41.1.1.1 Procedure 972
41.1.1.2 Finalization of provisional assessment 973
41.1.1.3 Interest Liability 973
41.1.1.4 Release of Security Consequent to Finalization 974
41.2 Scrutiny of Returns—Section 61 of CGST Act 974
41.2.1 Procedure for Scrutiny of Return 974
41.2.2 Specified items to be scrutinised by POs 975
41.2.2.1 Outward Tax Liability Related 975
41.2.2.2 Input Tax Credit Related 975
41.2.2.3 General 976
41.3 Assessment of Unregistered Persons—Section 63 of CGST Act 976
41.4 Summary Assessment—Section 64 977
41.5 Best Judgment Assessment—Section 62 977
41.5.1 Procedure for Assessment in case of Non-Filers of Returns 978
41.5.2 Best Judgment Assessment Amnesty for certain orders 979
41.6 Assessment Proceedings not to be Invalid—Section 160 979
41.7 List of Forms (Audit and Assessment Rules) 979
41.7.1 Provisional Assessment: 979
41.7.2 Scrutiny Assessment 979
41.7.3 Best Judgment and Assessment of Unregistered Persons 980
41.7.4 Summary Assessment 980
41.8 Judgments 980
lxii
42. Show Cause Notice, Demands and Recoveries 981
42.1 Some of the Essential Attributes of Show Cause Notice 981
42.2 Notice has to be served on the assessee (Section 169 of CGST Act) 982
42.3 What constitutes fraud, or wilful misstatement, or suppression
of facts to evade tax ? 983
42.4 Furnishing a memo before issuance of SCN 986
42.4.1 Partial payment of demand in Form DRC 01A 986
42.4.2 Judgments 986
42.5 Issuance of SCN in case of no Fraud, etc. pertaining to period
upto F.Y. 2023-2024 (Section 73) 986
42.5.1 Extension of timeline for passing order Section 73(10) 988
42.5.1.1 Force Majeure Event and Time Extension
(Section 168A) 989
42.5.2 Mandatory uploading of summary to SCN and summary to
order on GSTN Portal 989
42.6 Issuance of SCN in case of Fraud, etc. pertaining to period
upto F.Y. 2023-24 (Section 74) 989
42.6.1 No need of issue of SCN for Seizure and Confiscation
Procedures 991
42.7 Issuance of SCN pertaining to period From 2024-25 onwards
(Section 74A) 991
42.7.1 Difference between Section 73, Section 74 and Section 74A 994
42.8 General Provision as to Adjudication of SCN (Section 75) 995
42.8.1 Redetermination of demand pursuant to non-sustenance of
allegation of fraud, etc. 996
42.8.2 Exclusion of COVID-19 related period from
adjudication and refund filing 997
42.8.3 Judgments 997
42.9 Monetary Limits to Issue SCNs 1001
42.9.1 Summary of Adjudication Order (Rule 142) 1001
42.10 Adjudication of SCNs by Audit Teams or DGST Intelligence 1001
42.10.1 Adjudication of SCNs issued by DGGSTI 1002
42.11 Tax Collected but not paid (Section 76) 1002
42.12 Opportunity of Being Heard to Such Person 1004
42.12.1 Judgments on Principles of Natural Justice 1004
42.13 Recovery Proceedings—Sections 78 & 79 1005
42.13.1 Mode of Recoveries and Procedure
(Demand Recoveries Rules) 1006

CONTENTS lxiii

42.13.1.1 Auction Process under Rule 144A of
CGST Rules, 2017 1010
42.13.1.2 Regularisation of payment of liability in liability
ledger though Form DRC-03 1010
42.13.1.3 Procedure for Recovery before Prescribed
3 months 1010
42.13.1.4 Judgements 1011
42.13.2 Mode of Recoveries of Central Excise, CENVAT
Credit and Service Tax 1011
42.13.2.1 Type of Demand and its recovery 1011
42.13.2.2 Excise Duty and Services Tax payment of
period prior to 01.07.2018 1012
42.13.3 Intimation for Recovery of certain amounts
under Section 79 (Rule 142B) 1012
42.14 Payment of Tax in Installments—Section 80 1013
42.14.1 Disallowance of Facility of Tax Payment in
Installments (Demand Recoveries Rules) 1013
42.15 GST to have first charge on Property (Section 82 of CGST Act) 1013
42.16 Provisional Attachment (Section 83 of CGST Act and Rule 159 of
CGST Rules) 1013
42.16.1 Guidelines for Attachment of Property 1014
42.16.1.1 Circumstances when the property
can be attached 1014
42.16.1.2 How would the Commissioner form
an opinion? 1015
42.16.1.3 Cases fit for Provisional Attachment 1015
42.16.1.4 Procedure for Provisional Attachment 1016
42.16.1.5 Release of movable attached property 1016
42.16.1.6 Some important things to be taken care of 1017
42.16.1.7 Period of Attachment 1017
42.16.2 Judgments 1017
42.17 Recovery Procedures for Enhancement or Reduction of
Government Dues (Section 84 of CGST Act) 1020
42.18 SCN Related Amnesty Scheme 1021
42.18.1 Waiver of interest and penalty pertaining to
01.07.2017 till 31.03.2020 (Section 128A) 1021
42.19 List of Forms under Demand and Recoveries 1023
43. Amnesty Schemes 1025
43.1 Waiver of Interest and Penalty Pertaining to 01.07.2017
till 31.03.2020 (Section 128A) 1025
43.2 Due Date Up To Which Taxes Are To Be Paid And Application For
Availment Of Amnesty Scheme Has To Be Filed 1026
43.3 Proper officer under the Amnesty Scheme 1027
43.4 Scenarios when the waiver granted under Amnesty Scheme would
become void 1027
43.5 Procedure to be followed by a registered taxpayer 1028
43.6 Procedure post issue of Order 1029
43.7 ITC Availment of FY 2017-18 to FY 2020-21 input invoice till 30th
November, 2021 1035
43.8 ITC availment by persons whose registration cancellation has been
revoked 1036
43.9 PROCEDURE FOR ITC AMNESTY SCHEME (w.e.f. 08.10.2024) 1036
43.9.1 Clarifications issued in relation to ITC Amnesty Schemes 1037
43.9.2 Some important points for Amnesty Scheme 1038
43.9.3 How to file rectification application on GSTN portal 1039
44. Advance Ruling 1040
44.1 Application for Advance Ruling (AR)—Section 97 of CGST Act 1040
44.2 Procedure for AR and Questions under AR—Section 98 1041
44.2.1 Procedure of Application to AAR
(Advance Ruling Rules) 1042
44.2.2 Certification of AR (Rules) 1042
44.3 Manual Filing of Application for Advance Ruling (Rules) 1042
44.3.1 Application to Advance Ruling 1042
44.4 Appeal to AAAR and Procedure—Sections 100 & 101 1043
44.4.1 Procedure of Application to AAAR (Rules) 1043
44.5 Manual Filing of Application for Advance Ruling (Rules) 1043
44.5.1 Application of appeal against Advance Ruling 1044
44.5.2 Certification of AAAR Rulings (Rules) 1044
44.5.3 Judgments 1044
44.6 Rectification and Applicability of AR—Sections 102 &
103 of CGST Act 1045
44.7 Other important points—Sections 104 & 105 1046
44.8 Appeal to National Appellate Authority (NAA)
(Section 101B of CGST Act) (effective from date to be notified) 1046

CONTENTS lxv

44.8.1 Procedure of Application to NAA 1046
44.9 List of Advance Ruling Forms 1047
45. Appeals and Revision 1048
45.1 Types of Available Avenues Post Adjudication 1048
45.2 Appeals to Appellate Authority—Section 107 1048
45.2.1 Judgments 1050
45.2.2 Procedure for Appeal to Appellate Authority by Assessee
(Appeal and Revision Rules) 1052
45.2.2.1 Amnesty Scheme for Filing Appeal before First
Appellate Authority 1053
45.2.3 Procedure for application to Appellate Authority by
Authorities (Rules) 1054
45.2.4 Authority to whom Appeal will be filed? 1054
45.2.5 Additional Evidence before Appellate Authority (Rules) 1055
45.2.6 Withdrawal of Appeal (Rule 109C) 1055
45.2.7 Order of Appellate Authority (Rules) 1056
45.2.8 Pre-Deposit for stopping recovery proceedings post
order of first appellate authority 1056
45.3 Revision—Section 108 1057
45.3.1 Circumstances when RA cannot revise—Section 108(2)
of CGST Act 1057
45.3.2 Other RA Related Points—Section 108(2) of CGST Act 1058
45.4 Appeal to Tribunal—Section 109 of CGST Act 1058
45.4.1 Types of Tribunal and their Jurisdiction 1058
45.4.2 Constitution of Tribunal Benches 1059
45.4.3 Hearing by a Single Bench and Double bench 1059
45.4.3.1 Hearing by a Single Bench 1059
45.4.3.2 Hearing of Other Cases 1059
45.4.4 Procedure before the Tribunal—Section 112 of CGST Act 1060
45.4.4.1 Procedure for filing an appeal before
Tribunal notified (Rule 110 of CGST Rules) 1062
45.4.5 Authorised Representative before the
Tribunal—Section 116 of CGST Act 1063
45.4.6 Procedure for Appeal to Tribunal by Assessee (Rules) 1064
45.4.7 Procedure for application to Appellate Tribunal by
Authorities (Rules) 1064
45.4.8 Additional Evidence before Tribunal (Rules) 1064

45.4.9 Order of Tribunal (Rules) 1065
45.4.10 Difference of Opinion Between Members (Section 109(9) 1065
45.4.11 State Benches Location 1066
45.4.12 Pre-Deposit for stopping recovery proceedings
post order of first appellate authority 1067
45.5 Appeals to High Court—Section 117 1068
45.5.1 Substantial Question of Law 1068
45.6 Appeals to Supreme Court (Section 118) 1069
45.7 COVID-19 Related Time Extensions 1069
45.7.1 Supreme Court COVID Orders 1069
45.7.2 CBIC Clarification on COVID related Limitation Periods 1070
45.8 Demand Decided is payable even if appealed against (Section 119) 1071
45.9 Fixing monetary limits for filing Departmental Appeal(s)
(Section 120 of CGST Act, 2017) 1071
45.9.1 Monetary Thresholds for non-filing a departmental appeal 1071
45.9.2 Determination of monetary limits 1072
45.9.3 Exclusions where monetary limits are not applicable 1072
45.10 Judgments 1073
45.11 List of Forms for Appeal and Revisions 1076
46. Penalties, Detention, Prosecution & Compounding 1077
46.1 General Discipline for Penalty—Section 126 of CGST Act 1077
46.2 Penalty under no fraud—Section 122(2) of CGST Act 1079
46.3 Penalty under fraud etc.—Section 122(2) of CGST Act 1079
46.4 Penalty under Various Cases—Section 122(1) of CGST Act 1080
46.4.1 Penalty Provisions in Specific Circumstances 1082
46.4.2 Clarification on demand and penalty in respect of
fake invoices 1082
46.5 Power to Impose Penalty in Certain Cases (Section 127 of
CGST Act, 2017) 1083
46.6 Waiver of Penalty (Section 128 of CGST Act, 2017) 1083
46.7 Offences by Companies (Section 137 of CGST Act, 2017) 1084
46.8 Detention, Seizure of Goods/Conveyance—Section 129 of
CGST Act 1084
46.8.1 Owner of Goods 1085
46.8.2 Reduced Penalties on Minor Deficiency During Inspection 1085
46.8.3 Inspection of vehicle 1086

CONTENTS lxvii

46.8.4 Procedure of inspection of Vehicle, 1086
46.8.5 Procedure for Detention and Release of Vehicle 1087
46.8.6 Auction Process under Rule 144A of CGST Rules, 2017 1088
46.8.7 Judgments 1088
46.9 Confiscation of Goods/Conveyances—Section 130 of CGST Act 1090
46.9.1 Fine payable in lieu of confiscation 1091
46.9.2 Procedure for Confiscation of Vehicle 1092
46.9.3 Goods/Conveyances Violating Provisions of
GST alone are to be detained/confiscated 1092
46.9.4 No need of issue of SCN for Seizure and Confiscation
Procedures 1092
46.9.5 Guidelines for Issuance of Summary of Demand
Order in Form GST DRC-07 1093
46.10 Prosecution Provisions—Section 132 of CGST Act 1093
46.10.1 Circumstances for Prosecution 1093
46.10.2 Imprisonment and Fine 1095
46.10.3 Guidelines to arrest 1095
46.11 Compounding of Offences—Section 138 1097
46.11.1 Procedure for Compounding
(Offences and Penalties Rules) 1098
46.11.2 Amount of Compounding (Rule 162(3A) 1099
46.12 Penalty Related Amesty Scheme 1101
46.12.1 Waiver of Interest and Penalty Pertaining to
01.07.2017 till 31.03.2020 (Section 128A) 1101
46.13 List of Forms under Compounding 1102
46.14 List of Forms for Vehicle Inspection, Detention and Confiscation 1102
47. Transitional Provisions 1103
47.1 Transitional Provisions for CENVAT Credit—Section 140 of
CGST Act 1103
47.1.1 Other Compliances to be Undertaken under
Section 140 (Transitional Provisions Rules) 1108
47.1.1.1 Revision of GST TRAN-1 1109
47.1.1.2 Extension of TRAN-1 Filing Not Filed Due to
Technical Faults 1109
47.1.2 Transitional Provisions for Unregistered Persons not
possessing duty paying document—Section 140(3) of
CGST Act 1110

47.1.2.1 Methods for allowing Credit Section 140(3) of
CGST Act 1111
47.1.2.2 Credit Transfer Documents (CTD) 1111
47.1.2.3 Credit Availment at Prescribed Percentage 1113
47.2 Job Work Related Transitional Provisions—Section 141 of
CGST Act 1114
47.3 Miscellaneous Transitional Provisions—Section 142 of
CGST Act 1115
47.4 Some Specific Cases—Section 142 of CGST Act 1116
47.5 Non-Utilisation/Transition of Disputed and Not
Allowed Credits 1117
47.6 Procedure for verification of Transitional Credit 1118
47.6.1 Basis on which the assessee needs to be picked by
authorities for verification 1118
47.6.2 Transition of CENVAT Credit in relation to Cesses 1119
47.6.3 Documents that can be asked by the verification authorities 1119
47.6.4 Information details to be filed by the specific taxpayers 1119
47.6.5 Prescribed procedure for carrying out the verification 1120
47.7 Appeal to be filed against adjudication order in case of
Transition Credits 1120
47.8 Forms Under Transitional Provisions 1121
48. E-Way Bill 1122
48.1 Concept and Validity of EWB 1122
48.1.1 Restriction on Filing Part A of EWB 1129
48.1.1.1 Relaxation in rule restricting generation of
e-way bill by a registered person 1129
48.1.2 EWB Generation in Case of ‘Bill to’ ‘Ship To’ Transaction 1129
48.1.3 EWB Generation in Case of ‘Bill From’ and
‘Ship From’ Scenario 1130
48.1.4 Procedure to be Adopted for Transportation through Road 1131
48.1.4.1 Procedure to be adopted when consignor or
consignee does not generate EWB in case of
inter-State supplies 1132
48.1.4.2 EWB Requirement if Goods are supplied
within a State but Transited Through
Different States 1132
48.1.4.3 Procedure for generating E-way Bill by
unregistered persons 1132

CONTENTS lxix

48.1.5 Procedure to be Adopted for Transportation
Through Rail or Air or Vessel 1133
48.1.6 Procedure to be adopted for transportation of
goods supplied through electronic commerce
operator (ECO) or Courier Agency 1133
48.1.7 Re-assignment to new transporter for
updation of information in EWB 1134
48.1.8 E-Way Bill Details to be made available by Portal 1134
48.1.9 Documents to be carried 1135
48.1.9.1 Physical Copy of invoice not to be carried when
E-invoice has been generated 1135
48.1.10 Verification of Documents and Coveyance 1136
48.1.11 Prescribed Goods not requiring EWB for transportation 1136
48.1.12 Generation of E Way Bills 1136
48.1.13 Consolidated EWB 1137
48.1.14 E-Way Bills for multi modal transportation of goods 1138
48.1.15 Transporters and E-Way Bills 1139
48.1.15.1 Special Provision as to Enrolment of Warehouse
Operator and Transporters (Rule 58) 1140
48.1.16 Reports Generated on E-Way Bill System 1140
48.1.17 Transportation of goods: One Invoice Multiple Vehicles 1141
48.1.18 Facilities given to large units having considerable EWBs 1141
48.1.19 Miscellaneous issues 1142
48.1.20 E-Way Bill generation in case of movement of goods
pursuant to service as principal supply 1142
48.1.21 EWB for intra State movement of gold, precious stone etc. 1143
48.2 Judgments 1144
49. Anti Profiteering 1145
49 ANTI-PROFITEERING MEASURES—SECTION 171 OF CGST ACT 1145
49.1 Discontinuation of Anti Profiteering Authority 1145
49.1.1 Anti-Profiteering Rules, 2017 1145
49.1.1.1 Different Authorities provided under the said
Rules 1145
49.1.1.2 Process to be followed for complaints received
under Section 171 1146
49.1.1.3 Powers, Duties, etc. of Authority 1146
49.2 Competition Commission of India 1148
lxx
49.3 Judgments 1148
50. Liability and Other Miscellaneous Provisions 1149
50.1 Liability Provisions (Chapter XVI of CGST Act, 2017) 1149
50.1.1 Liability in case of Transfer of Business
(Section 85 of CGST Act, 2017) 1149
50.1.2 Liability of Agent and Principal
(Section 86 of CGST Act, 2017) 1149
50.1.3 Taxability of Supplies during intervening period in Case of
Amalgamation or Merger (Section 87 of CGST Act, 2017) 1150
50.1.4 Liability of Directors of Private Company
(Sections 88 and 89 of CGST Act, 2017) 1151
50.1.5 Liability of a Partner of Firm
(Section 90 of CGST Act, 2017) 1151
50.1.6 Liability of a Guardian or Trustee, etc.
(Section 91 of CGST Act, 2017) 1152
50.1.7 Liability of Legal Representative
(Section 93 of CGST Act, 2017) 1152
50.1.8 Liability in other Cases (Section 94 of CGST Act, 2017) 1152
50.2 Culpable Mental State (Section 135 of CGST Act, 2017) 1152
50.3 Goods and Service Tax Compliance Rating—Section 149 of
CGST Act 1152
50.4 Information Return—Section 150 of CGST Act 1153
50.5 Power to Collect Statistics—Section 151 of CGST Act 1154
50.6 Sharing of Information by GSTN Portal (Section 158A) 1154
50.6.1 Consent based sharing system (Rule 163) 1154
50.7 Publication of Names (Section 159 of CGST Act, 2017) 1155
50.8 Rectification of errors—Section 161 of CGST Act 1155
50.9 Rounding off of Taxes—Section 170 of CGST Act 1155
50.10 Mandatory Provision of Electronic Payment Option by Specified
Suppliers 1155
50.11 Mandatory Mention of Document Identification Number (DIN) 1156
50.12 Extension of Timeline for Other Compliances in view of
COVID-19 (I) 1156
50.12.1 Extension of Timeline for Other Compliances in
view of COVID-19 (II) 1157
50.12.2 Exclusion of COVID-19 related period from
adjudication and refund filing 1158
50.13 COVID-19 Related Time Extensions 1159

CONTENTS lxxi

50.13.1 Supreme Court COVID Orders 1159
50.13.2 CBIC Clarification on COVID related Limitation Periods 1160
50.14 Details of Machines to be submitted by Guthka and Tobacco
manufacturers 1161
50.14.1 CLARIFICATIONS BY CBIC 1163
50.15 New Track and Trace Mechanism 1165

APPENDIX

 The Central Goods and Services Tax Act, 2017 1171-1359
 The Integrated Goods and Services Tax Act, 2017 1360-1367
 The Union Territory Goods and Services Tax Act, 2017 1368-1389
 The Goods and Services Tax (Compensation to States) Act, 2017 1390-1403
 The Central Goods and Services Tax Rules, 2017 1404-1593
 The Integrated Goods and Services Tax Rules, 2017 1594-1605
 The Goods and Services Tax Compensation Cess Rules, 2017 1606
 The Goods and Services Tax (Period of Levy and Collection of
Cess) Rules, 2022 1607
 The Goods and Services Tax Settlement of Funds Rules, 2017 1608-1620