If the supplier considers the supply as forward charges, the recipient having paid the taxes to supplier and the supplier having discharged the taxes, would be a sufficient cause to justify the recipient of paying the taxes. Hence no further action is required.
Hello, This is the Test answer for Indirect TAX
Sir / Madam, You're right that supplies to SEZ units are eligible for ab initio exemption on the premise that the said inward supplies are 'used in authorized operations'. As you have provided an explanation in support of the proximate link between insurance and authorized operations, in order for SEZ unit to assure insurer that benefit of ab initio exemption will be admissible, the said insurance services must be included in the list of services in sezindia.nic.in or else, the jurisdictional Specified Officer of the concerned SEZ must confirm that endorsement will be granted under second proviso to rule 89. Since insurance does not appear in the uniform list of services, specific endorsement must be allowed. And this is not a certainty but a matter of careful consideration of the facts and end-use by the Specified Officer. Before any assurance is given to the insurer to extend ab initio exemption, it would be advisable to confer with the Specified Officer (of the concerned SEZ) that endorsement will be allowed in due course. Based on confirmation of Specified Officer (preferably by email), insurer may be advised to allow ab initio exemption. Please note insurer will expect indemnity in the eventuality of any eventuality of any difficulty to secure the required endorsement later. It is advisable to proceed based on some assurance from Specified Officer rather that just based on the logical justification that SEZ is intensively people-dependent in its business. Hope this helps. Kind regards, Tax Clinic
Sir / Madam, You're right that supplies to SEZ units are eligible for ab initio exemption on the premise that the said inward supplies are 'used in authorized operations'. As you have provided an explanation in support of the proximate link between insurance and authorized operations, in order for SEZ unit to assure insurer that benefit of ab initio exemption will be admissible, the said insurance services must be included in the list of services in sezindia.nic.in or else, the jurisdictional Specified Officer of the concerned SEZ must confirm that endorsement will be granted under second proviso to rule 89. Since insurance does not appear in the uniform list of services, specific endorsement must be allowed. And this is not a certainty but a matter of careful consideration of the facts and end-use by the Specified Officer. Before any assurance is given to the insurer to extend ab initio exemption, it would be advisable to confer with the Specified Officer (of the concerned SEZ) that endorsement will be allowed in due course. Based on confirmation of Specified Officer (preferably by email), insurer may be advised to allow ab initio exemption. Please note insurer will expect indemnity in the eventuality of any eventuality of any difficulty to secure the required endorsement later. It is advisable to proceed based on some assurance from Specified Officer rather that just based on the logical justification that SEZ is intensively people-dependent in its business. Hope this helps. Kind regards, Tax Clinic
Dear Sir, as per section 22(1) of CGST Act, every supplier shall be liable to be registered in the State or Union Territory (other than special category states) from where he makes supply of goods or services or both, if his aggregate turnover in a financial year exceeds Rs. 20 lakhs. To understand whether you are required to register under GST, we need to understand what all components are to be added in Aggregate Turnover. As per Explanation (i) to Section 22, Aggregate Turnover shall include all supplies made by the taxable person, whether on his own account or made on behalf of all his principals. Sec. 7 provides for the scope of Supply, read with Schedules I, II and III. As per clause 1 of Sch. III of CGST Act, Services by an employee to the employer in the course of or in relation to his employment is not considered as Supply. Accordingly, in the given scenario, Salary will not be considered for the purpose of calculating the Aggregate Turnover of Rs. 20 lakhs, but all other incomes shall be considered as Supplies irrespective of the point that they are taxable or exempt. Therefore, the Total value of supplies in this case would be Rs. 15,40,000 (Interest income 3,00,000 + Rental Income 2,40,000 + Professional Income Rs. 10,00,000). Thank you - Tax Clinic
Dear Sir, as per section 22(1) of CGST Act, every supplier shall be liable to be registered in the State or Union Territory (other than special category states) from where he makes supply of goods or services or both, if his aggregate turnover in a financial year exceeds Rs. 20 lakhs. To understand whether you are required to register under GST, we need to understand what all components are to be added in Aggregate Turnover. As per Explanation (i) to Section 22, Aggregate Turnover shall include all supplies made by the taxable person, whether on his own account or made on behalf of all his principals. Sec. 7 provides for the scope of Supply, read with Schedules I, II and III. As per clause 1 of Sch. III of CGST Act, Services by an employee to the employer in the course of or in relation to his employment is not considered as Supply. Accordingly, in the given scenario, Salary will not be considered for the purpose of calculating the Aggregate Turnover of Rs. 20 lakhs, but all other incomes shall be considered as Supplies irrespective of the point that they are taxable or exempt. Therefore, the Total value of supplies in this case would be Rs. 15,40,000 (Interest income 3,00,000 + Rental Income 2,40,000 + Professional Income Rs. 10,00,000). Thank you - Tax Clinic
Conservative View - Ask the NRI to obtain registration in GST and pay the taxes alongwith interest. Credit not claimed by Lessee - Credit can be claimed within 6 months from the end of the FY to which the invoice relates to. Assuming we are referring to FY 2019-20 and 2020-21 for which taxes were not discharged by the NRI. Then NRI needs to pay taxes for both the years. He can raise invoice on Lessee for FY 2020-21 with taxes and Lessee can claim credit of the same since the last date for availing credit for FY 2020-21 is September 30, 2021.
Prize winnings is different from match fee only to the extent of (i) uncertainty of receiving the prize (ii) conditions to win the said prize. But other than that, it is another activity integral to participation in the sport which is a contractual payout. If prize is given by a stranger (or fan) who did not have the contract with the sportsperson then, there may be a different view which also needs to be carefully considered before ruling out nexus with participation in the sport. All emoluments, whether certain or uncertain, contingent or definite, flowing from the same contract engagement, would receive the same GST treatment. Hope that helps. If more information were available, such as nature of sport, details of contract, etc., perhaps some more talking points could have been brought out for your consideration. Kind regards, Tax Clinic
1. Whether the practice of the firm not discharging the GST on apartments registered after just obtaining the permanent connections from BWSSB and BESCOM is correct in law? In our understanding of the law, a completion certificate (different from OC) is essential to get out of GST liability. As regards the first occupation are concerned, in my view, it should be of that particular flat and not that of other flats. Any other view may lead to litigation. 2. If yes, please suggest the basis of the defense that the Firm may take shelter as the law specifically on the requirement of the OC. Since the answer is no, there cannot be a defense. However if still such view is taken, in litigation it can be argued that the transaction of sale of immovable property is outside the scope of GST, referring to discussions in the GST Council meeting. However, the outcome of it is dependent upon the outcome of decisions by judicial forums court. 3. Whether the practice of receiving advance in the account of partner as a loan and then repaying and receiving in the firm could be construed as clandestine activity? In our view yes.
The question is not clear. I am assuming the Audited Sales Figure means Financial Statements - Correct numbers should be disclosed in GSTR 9. In GSTR 9C there will be difference between revenue as per Financial Statements and Turnover declared in GSTR 9 for which reason will have to be assigned that a invoice was considered twice in the Financial Statements. GST Paid on Bad Debts - Credit note cannot be raised in respect of the same and hence it will be a cost to the supplier.
GST Implications on Layout Development – (Plotted Development) Background At the first instance it would be important to distinguish – Sale of land vis.a.vis. the concept of immovable property. We know that the taxable event under the GST law is supply but there are certain specific supplies which are excluded from the scope of levy. Few such exceptions are carved out in Schedule III which contains the list of Activities or Transactions which shall be treated neither as a supply of goods nor a supply of services. Thus, these are the items which have fulfilled the criteria for supply but are excluded from levy owing to the special treatment and hence we may term them as “non-taxable supplies”. The words used in Para 5 of Schedule III is not “immovable property” but Sale of land. The Sale of land needs to be executed vide a duly registered ‘Conveyance Deed’ as per Section 54 of the Transfer of Property Act,1882. Para 5(b) of Schedule II insists on treating construction of civil structure or a part thereof, as supply of service, except where the entire consideration has been received after completion. Thus, if plots are sold after completion of development, then they get qualified as non-taxable supplies (Schedule III) while on the other hand if they are sold before completion, they become supply of taxable services (Schedule II). Query-wise Replies 1. Registration requirement – In case all the plots are sold after the issuance of completion certificate, then all the transactions fit into Para 5 of Schedule III, and hence although the value of Sale of land needs to be reckoned for the purpose of aggregate turnover computation as per Section 2(6) (owing to the reason that non-taxable supplies are part of the exempt supply definition) one can claim the benefit of exemption from registration owing to Section 23(1)(a). However, if partly the plots are sold before completion and partly after completion, then one would be required to register based on the aggregate turnover thresholds. 2. Transactions where advances received before completion – Agreement for Sale confers a right in the property which is inferior to sale and the ownership does not get transferred and hence cannot qualify as sale of land. Thus, once advances are received before completion, then GST needs to be discharged on the entire consideration received towards that transaction owing to Para 5(b) of Schedule II. Plotted development includes construction of civil structure and hence the above clause would be applicable for plotted development too. 3. Transactions where entire consideration received after completion – Since, the transfer of ownership happens and they qualify as Sale of land, they squarely fit into Schedule III and hence GST is not applicable. Although, the above view is based on a strict reading of the law. There is a more liberal view being taken that sale of plot should not be taxed as the plot remains essentially land, which is excluded from GST (as per para 5, schedule III discussed earlier). In such a case, landowner would not be liable to register and any GST on the work carried out by Developer / Contractor would be subject tax in the normal course.
In case of Service Recipient who is providing services mentioned in 17/2017, dt. 28.06.2017 and 23/2017 dt. 22.08.2017 wherein the notified services for Sec. 9(5) are Services provided in the form of Accommodations, Cab Operators and House Keeping Services, then the E-commerce operator is required to pay the taxes on behalf of the service provider, hence Threshold limit is available only to these notified services. In any other case, any service provider is required to register compulsorily under GST as per Sec. 24(ix) as the threshold exemption is not available to such persons and they would be liable to be registered irrespective of the value of supply made by them. This requirement is, however, applicable only if the supply is made through such e-commerce operator who is required to collect tax at source under section 52 of the CGST Act, 2017. Therefore the answers to your questions are as follows: a) Yes GST Liability arises since the service provider is required to mandatorily register under GST for providing services through E-Commerce platform other than services notified u/s 9(5) b) Service Provider is liable to charge the service recipient and pay the taxes.
There are two queries – one from the recipient perspective and the other one from the supplier perspective Recipient perspective: Yes, Recipient may retain all genuine input tax credit on purchases made and it is advisable to obtain ‘Tax paid confirmation letter’ (invoice-wise) from the Supplier to substantiate the fact that taxes have been discharged by the Supplier and the condition set out in Section 16(2)(c) has been fulfilled. Please expect that this issue may be taken up during GST audit or inquiry and may need to be suitably explained based on the confirmation collected from Supplier. Supplier perspective: Since annual return has already been filed and these invoices are correctly reported in the in the annual returns for the respective financial year, it would not be advisable to once again report the invoices in the current year GSTR-1 as this would result in any ‘double’ reporting of those invoices. Please inform Supplier that non-filing of GSTR1 may be questioned and may need to justified based on substantive compliance and timely discharge of GST on these invoices.
Too Many possible permutations in the question. Every registered person is responsible to maintain the books of accounts as per sec 35. One cannot plead an ignorance insufficient documentation. Supply : In the current case, what does the contract with publisher and the end customer determine, whether the company is a ecommerce operator and liable for TCS and sec 52 or they are acting as principal supplier and liable under sec 9(1) Taxation : Please also be aware of sec 8(b) where you are supplying Taxable and Exempt together for a single price, such supply will be fully taxable. Registration: Appears that registration would be mandatory a) if their turnover exceed 20 lacs - gross Turnover (or) b) if they are treating themselves as eCommerce operator then mandatory registration as per sec 24 ITC: Concept is simple , outward taxable inward available for ITC subject 17(5) if outward is partly taxable, then proportionate claim.