No.1 for CAICWA & MEGICEC MASTER MINDS 3. LEVY AND COLLECTION OF GST 1. BACKGROUND a) The very basis for the charge of tax in any taxing statute is the taxable event (i.e. the point on which the levy of tax gets attracted). The taxable event under GST is Supply. ee i > Intrastate Supplies _ €GST/ SGST/ UTGST | Levied” a, b) i) What do you mean by Intra - state Supply? It is a case where the Supplier location and Place of Supply falls in the same State or Union territory. ii) What do you mean by Inter - state Supply? Itis a case where the Supplier location and Place of Supply are different. Further, the supplier location and place of supply may fall in different states or between a state and union. c) Various definitions covered for the purpose of Levy & Collection of GST: i) Exempt Supply (Sec.2(47)): Exempt supply means supply of any goods or services or both which attracts nil rate of tax or which may be wholly exempt from tax under section 11, or under section 6 of the Integrated Goods and & Tax Act, and includes non-taxable supply. Exempt ‘Supply of any “s an “win — nil Supply services or both cramer | including Non- Ww Taxable Supply Aggregate turnover (Sec.2 (6)): Aggregate turnover means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by @ person ‘on reverse charge basis), exempt supplies, exports of goods or services or both and inter- State supplies of persons having the same Permanent Account be computed on all India basis but excludes central tax, State tax, Union territory tax, integrated tax and cess. iii) Recipient (Sec.2(93)): Situation Recipient or Deemed as Recipient “In a case where - a) A consideration is payable for the| Person who is liable to pay that supply of goods/ services/ both consideration b) No consideration is payable for the | The person to whom — supply of goods a) the goods are delivered or b) made available or ¢) possession or use of the goods is given or made available ©) No consideration is payable for the |The person to whom the service is supply of a service rendered and includes an agent or any reference to a person to whom the supply is made, CA Inter_39e_Indirect Taxes_GST_Levy and Collection of GST. 3.1Ph: 98851 25025/26 www.mastermindsindia.com iv) Reverse charge (Sec.2{98)): Reverse charge means the liability to pay tax by the recipient of supply of goods or services or both instead of the supplier of such goods or services or both under section 9(3)/9(4), or under section 5(3)/5(4) of the IGST Act. 2. SCOPE & EXTENT OF GST LEGISLATURE (CGST, SGST, UTGST) |. Central Goods and Services Tax Act, 2017 (CGST Act): 1. Sec.1 of the Act specifies that the Act extends to whole of | India including Jammu & Kashmir. ‘ 2. As per Sec.2(56), India means - a) Territory of India as referred to in article 1 of Constitution (The territory of the Union of India viz., state and the union territories.) b) Its Territorial Water, seabed and sub-soil, such underlying waters, continental shelf, ‘exclusive economic zone or any other maritime zone as defined in the Territorial Waters, Continental Shelf, Exclusive Economic Zone and Other Maritime Zones Act, 1976 ¢) The air space above its territory and territorial waters, Att Space above Teastory aad ‘Temitarial water | i 1 i i i r Continental Shelf + EEZ Any ott Marking ' Zone ' 1 1 I 1 1 1 1 1 1 1 1 1 1 ‘ 1 4 1 1 1 ll State Goods and Services Tax Act, 2017 (SGST Act): State GST law of the respective State or Union Territory with State Legislature [Delhi and Puducherry (See Note)] extends to whole of that State/Union Territory. Note: As per the Act, State includes a union territory with legislature Example, Maharashtra GST Act, 2017 extends to whole of the State of the Maharashtra. Il, Union Territory Goods and Services Tax Act, 2017 (UTGST Act): As per Sec.1 of the Act, Union territory means the territory of — + The Andaman and Nicobar Islands + Lakshadweep * Dadra and Nagar Haveli | Union territory without state legislature shall be treated as separate union territory ‘+ Daman and Diu i + Chandigarh ‘+ Other territory. CA Inter_39e_Indirect Taxes_GST_Levy and Collection of GST. 3.2No.1 for CA/CWA & MECICEC MASTER MINDS 3. LEVY & COLLECTION OF CGST ISec.9] 1. CGST shall be levied on all Intra-State Supplies of goods/ services/ both (except Alcoholic liquor for human consumption) at a rate not exceeding 20%. Who will pay the CGST? ‘A taxable person What is the Value on which CGST is payable? | Transaction Value under Sec. 15 of the Act 3. What are the rates prescribed under CGST? Particulars Rates in % In respect of goods 0, 0.125, 1.5, 2.5.6, 9, 14 In respect of services 0,2.5,6,9, 14 Note: S.G/ UT also levies similar rate of GST (Maximum rate of CGST 20%) 4. As of now, even though the GST is not leviable on the following products, tax could be levied from a date to be notified by the C.G considering the recommendation of GST council What are they? + Petroleum crude + High speed diesel + Motor spirit (Petrol) + Natural gas and + Aviation turbine fuel 5. Reverse charge shall be applicable in respect RS a) Notified supplies under Sec.9 (3) b) Notified supplies of specified cate supplier to a specified class of Further, it is important to note th to pay GST) - ‘+ The burden to pay GST is on the recipient of goods/services/both by an unregistered persons [Sec.9 (4)} r reverse charge mechanism (i.e. the recipient is liable ‘+ But the compliance requirements has been shifted from supplier to recipient ‘A. What are the. goods taxable under reverse Charge mechanism? The goods taxable under reverse charge mechanism where the entire CGST shall be paid by the Recipient. Goods | Liable to pay tax Cashewnuts [not shelledi/peeled], Bidi wrapper leaves, Tobacco leaves, Supply of Lottery, Silk yarn, Used vehicles, Seized and Confiscated| Recipient [goods, Old and Used goods, Waste and Scrap, Raw cotton, etc. B. What are the ser es taxable under reverse Charge mechanism? Notifications No. 13/2017 CT (R) dated 28.06.2017 specifies the services taxable under reverse charge mechanism where the entire CGST shall be paid by the Recipient. Nature of the Supply of Service ‘Supplier Recipient 1. Supply of services by a Goods GTA who has not | the recipient, located in the Transport Agency (GTA) in paid CGST @ 6% | taxable territory and liable to respect of transportation of Pay freight is — goods by road. a) Any registered factory b) Any registered society c) Any co-operative society CA Inter_39e_Indirect Taxes_GST_Levy and Collection of GST. 3.3