Frequently Asked Questions
Overview of Goods and Services Tax (GST)
- What is Goods and Services Tax (GST)?
- What exactly is the concept of destination based tax on consumption?
- Which of the existing taxes are proposed to be subsumed under GST?
- What principles were adopted for subsuming the above taxes under GST?
- Which are the commodities proposed to be kept outside the purview of GST?
- What type of GST is proposed to be implemented?
Levy of and Exemption from Tax
- Where is the power to levy GST derived from?
- What is the taxable event under GST?
- Is the reverse charge mechanism applicable only to services?
- What will be the implications in case of purchase of goods from unregistered dealers?
- In respect of exchange of goods, namely gold watch for restaurant services will the transaction be taxable as two different supplies or will it be taxable only in the hands of the main supplier?
- Whether supplies made without consideration will also come within the purview of Supply under GST?
Registration
- ARN number and GST Provisional ID Acknowledgment
- What is advantage of taking registration in GST?
- Can a person without GST registration claim ITC and collect tax?
- What will be the effective date of registration?
- Who are the persons liable to take a Registration under the Model GST Law?
- What is aggregate turnover?
Meaning and Scope of Supply
- What is the taxable event under GST?
- What is the meaning of ‘Supply’?
- What is a taxable supply?
- What are the necessary elements that constitute supply under MGL?
- Can a transaction in which any one or more of the above criteria is not fulfilled, be still considered as supply under GST?
- Importation of Goods is conspicuous by its absence in Section 3. Why?
Time of Supply
- What is time of supply?
- When does the liability to charge GST arise in respect of supply of goods?
- What is time of supply of continuous supply of goods?
- What is time of supply of goods sent on approval basis?
- Where it is not possible to determine the time of supply in terms of sub-section 2, 3, 5 or 6 of Section 12 or that of Section 13 of MGL, how will time of supply be determined?
- When does the liability to pay GST arise in respect of supply of services?
Valuation in GST
- What is the value of taxable supply to be adopted for the levy of GST?
- What is transaction value?
- Are there separate valuation provisions for CGST, SGST and IGST and Goods and Services?
- Is contract price not sufficient to determine valuation of supply?
- Is reference to Valuation Rules required in all cases?
- What is to be done if there are certain factors affecting price though the transaction is not covered by section 15(4)?
Electronic Commerce
- What is e-commerce?
- Who is an e-commerce operator?
- Is it mandatory for e-commerce operator to obtain registration?
- Whether a supplier of goods/services supplying through e-commerce operator would be entitled to threshold exemption?
- Who is an aggregator?
- Is an aggregator required to be registered under GST?
Job Work
- What is job-work?
- Whether goods sent by a taxable person to a job-worker will be treated as supply and liable to GST? Why?
- Can a registered taxable person send goods without payment of tax to his job-worker?
- Is a job-worker required to take registration?
- Whether the goods of principal directly supplied from the job-worker’s premises will be included in the aggregate turnover of the jobworker?
- Can the principal supply the goods directly from the premises of the job-worker without bringing it back to his own premises?
Input Tax Credit
- What is input tax?
- What is the implication of different definition of “input tax” in three acts viz CGST, SGST and IGST Acts?
- Can GST paid on reverse charge be considered as input tax?
- Does input tax includes tax (CGST/ IGST/SGST) paid on input goods, input services and/ or capital goods?
- What is the ITC entitlement of a person who has been granted registration under Section 16(2)?
- A person is eligible for input tax credit on inputs held in stock within how many days
Concept of Input Service Distributor in GST
- What is Input Service Distributor (ISD)?
- What are the requirements for registration as ISD?
- What are the conditions/restrictions for distribution of credit?
- Is the ISD required to file return?
- Can a company have multiple ISD?
- What are the provisions for recovery of excess/ wrongly distributed credit by ISD?
Returns Process and matching of Input Tax Credit
- What is the purpose of returns?
- Who needs to file Return in GST regime?
- What type of outward supply details are to be filed in the return?
- Is the scanned copy of invoices to be uploaded along with GSTR-1?
- Whether all invoices will have to be uploaded?
- Whether description of each item in the invoice will have to be uploaded?
Assessment and Audit
- Who is the person responsible to make assessment of taxes payable under the Act?
- Is there any provision in MGL for tax treatment of goods returned by the recipient?
- Example of tax payable on return of inward supply
- When can a taxable person pay tax on a provisional basis?
- What is the latest time by which final assessment is required to be made?
- Where the tax liability as per the final assessment is higher than in provisional assessment, will the taxable person be liable to pay interest?
Refunds
- What is refund?
- Can unutilized Input tax credit be allowed as refund?
- Can unutilized ITC be given refund, in case goods exported outside India are subjected to export duty?
- Can ITC of goods lying in stock at the end of the financial year (after introduction of GST) be refunded?
- Is tax wrongly paid adjustable?
- Whether purchases made by Embassies or UN be taxed or exempted?
Demands and Recovery
- Which is the applicable section for the purpose of recovery of tax short paid or not paid or amount erroneously refunded or input tax credit wrongly availed or utilized?
- Can the person chargeable with tax pay the amount of demand along-with interest before issue of notice under section 51A?
- If notice is issued under Section 51A and thereafter the noticee makes payment, is there any need to adjudicate the case?
- What is the relevant date for issue of Show Cause Notice under Section 51A/B?
- Is there any time limit to issue SCN or adjudicate the case u/s 51A/B?
- Can the person chargeable with tax pay the amount of demand along-with interest before issue of notice under section 51B?
Appeals, Review and Revision in GST
- Whether any person aggrieved by any order or decision passed against him has the right to appeal?
- When Commissioner of CGST feels that the order passed is not legal and proper, whether he can revise the order himself?.
- What is the time limit to file appeal to First Appellate Authority?
- Whether this time limit applies even for the departmental appeal/application filed consequent to order of Commissioner of CGST?
- Whether the first appellate authority has any powers to condone the delay in filing appeal?
- Whether the first appellate authority has any powers to allow additional grounds not specified in the appeal memo?
Advance Ruling
- What is the meaning of Advance Ruling?
- Which are the matters enumerated in Section 97 for which advance ruling can be sought?
- What is the objective of having a mechanism of Advance Ruling?
- What will be the composition of Authority for advance rulings (AAR) under GST?
- What is the Appellate Authority for Advance Ruling (AAAR) and what would be its composition?
- How may AAR and AAAR will be constituted under GST?
Settlement Commission
- What are the basic objective of Settlement Commission?
- Can tax disputes arising on account of both intra-state and inter-state transactions be settled under the MGL?
- What is meant by a Case under the provisions of Settlement in the MGL?
- What will be the composition of members which will consider/hear settlement application?
- What happens when there is difference of opinion amongst members hearing the settlement application?
- Who can apply for settlement?
Inspection, Search, Seizure and Arrest
- What is the meaning of the term “Search”?
- What is the meaning of the term “Inspection”?
- Who can order for carrying out “Inspection” and under what circumstances?
- Can the proper officer authorize Inspection of any assets/premises of any person under this Section?
- Who can order for Search and Seizure under the provisions of MGL?
- What is meant by ‘reasons to believe’?
Offences and Penalties, Prosecution and Compounding
- What are the prescribed offences under MGL?
- What is meant by the term penalty?
- What are the general disciplines to be followed while imposing penalties?
- What is the quantum of penalty provided for in the MGL?
- What will be considered as ‘repeated short payments’ for the purpose of levy of penalty?
- Is any penalty prescribed for any person other than the taxable person?
Overview of the IGST Act
- What is IGST?
- What are inter-state supplies?
- How will the Inter-State supplies of Goods and Services be taxed under GST?
- What are the salient features of the draft IGST Law?
- What are the advantages of IGST Model?
- How will imports/exports be taxed under GST?
Place of Supply of Goods and Services
- What is the need for the Place of Supply of Goods and Services under GST?
- Why are place of supply provisions different in respect of goods and services?
- What proxies or assumptions in a transaction can be used to determine the place of supply?
- What is the need to have separate rules for place of supply in respect of B2B (supplies to registered persons) and B2C (supplies to unregistered persons) transactions?
- What would be the place of supply where goods are removed?
- What will be the place of supply if the goods are delivered by the supplier to a person on the direction of a third person?
Transitional Provisions
- Will the CENVAT/ITC carried forward in the last return prior to GST under earlier law be available as ITC under GST?
- Example of credit of CENVAT
- VAT credit was not available on items 'X' & 'Y' as capital goods in the earlier law. Since they are covered in GST, can the registered taxable person claim it now?
- Assuming such a person wrongly enjoyed the credit, will the recovery be done in GST or earlier law?
- Give two examples of registered taxable persons who were not liable to be registered under the earlier law but are required to be registered under GST?
- Will ITC be allowed to a service provider on VAT paid inputs held as stock on the appointed day?