Date: 7th February, 2024

LIVE LEARNING CLASSES

PAPER 3B – GOODS AND SERVICES TAX

SUPPLY UNDER GST

CA. SHEFALI JAIN, FACULT Y BOS

Board of Studies (Academic), ICAI

 Taxability of ‘Tenancy Rights’ against ‘Tenancy
Premium’ under GST

Transfer of tenancy rights by an outgoing tenant to a new tenant against

consideration in the form of tenancy premium is taxable.

Service provided here is service by way of surrendering the tenancy rights.

Renting of residential dwelling for use as a residence to an unregistered person

is exempt .

2
 Pagdi Exempt
system
New Tenant

Portion of tenancy

tenancy rights
Tenancy premium + Periodic Rent

Surrender of
Taxable

premium
Exempt

Landlord Grant of tenancy rights Outgoing

Tenant 3
Applicability on liquidated damages, compensation
and penalty arising out of breach of contract or
other provisions of law

Expression “Agreeing to the obligation to

refrain from an act or to tolerate an act
or a situation, or to do an act” has three
limbs

Agreeing to the Agreeing to the

Agreeing to the
obligation to obligation to
obligation to do
refrain from an tolerate an act or
an act
act a situation

4
 Example of agreeing to the obligation to
REFRAIN from an act
A builder refraining from constructing more than a certain
number of floors, even though permitted to do so by the
municipal authorities, against a compensation paid by the
neighbouring housing project, which wants to protect its
sunlight, or an industrial unit refraining from manufacturing
activity during certain hours against an agreed compensation
paid by a neighbouring school, which wants to avoid noise
during those hours.

5
 Example of agreeing to the obligation to
TOLERATE an act or a situation
• A shopkeeper allowing a hawker to operate from
the common pavement in front of his shop against a
monthly payment by the hawker.
• An RWA tolerating the use of loud speakers for early
morning prayers by a school located in the colony
subject to the school paying an agreed sum to the
RWA as compensation.
6
Example of agreeing to the obligation to DO an
act
Where an industrial unit agrees to install equipment
for zero emission/discharge at the behest of the RWA
of a neighbouring residential complex against a
consideration paid by such RWA, even though the
emission/discharge from the industrial unit was within
permissible limits and there was no legal obligation
upon the individual unit to do so.
7
 Conditions

There must be an expressed or implied

Conditions

agreement or contract must exist

Consideration must flow in return to this

contract/agreement

8
 Taxability of Liquidated Damages

Performance is the essence of a contract.

Liquidated damages cannot be said to be a consideration received for

tolerating the breach or non-performance of contract. They are rather
payments for not tolerating the breach of contract.
The liquidated damages or penalty are not the desired outcome of the
contract.

9
 Examples

Damages resulting from damage to property, negligence, piracy, unauthorized

use of trade name, copyright

Penalty stipulated in a contract for delayed construction of houses

Forfeiture of earnest money by a seller in case of breach of ‘an agreement to

sell’ an immovable property by the buyer

10
Taxability of some other transactions

Cheque Penalty
Bond amount
dishonor fine/ imposed for
by an employee
penalty violation of laws

Late payment Fixed charges Cancellation

surcharge or fee for power charges

11
Taxability of Fixed charges for power

Minimum Variable Components

Not per unit
fixed of Price for
taxable as charge
charges Sale of
a separate
electricity.
supply
Thus, Exempt.
NOT a service for tolerating the act of not scheduling or
consuming the minimum or contracted or available capacity
or a minimum threshold 12
 NON-SUPPLIES UNDER GST

A. Non-supplies listed in Schedule III

B. Non-supplies notified vide notification

C. Non-supplies clarified by way of circular

13
 Schedule –III
Neither supply of goods nor supply of services
Services by employee to employer in course of employment.
Services by Court/Tribunal
Functions performed by Members of Parliament/State Legislature/Panchayats/Municipalities
and other local authorities
Funeral/burial/crematorium/mortuary including transportation of the deceased.
Sale of land and, subject to para 5(b) of Schedule II, sale of building.
Actionable claims, other than betting, gambling and lottery specified actionable claims.
Supply of goods from non-taxable territory to non-taxable territory without entering into
India.
Supply of warehoused goods before clearance for home consumption
Supply of goods by the consignee by endorsement of documents of title to goods, after
dispatch of goods from the port outside India but before clearance for home consumption.
19 February 2024 Board
© THE INSTITUTE OF CHARTERED ACCOUNTANTS OF of Studies (Academic), ICAI
INDIA 14
 Schedule –III
Para-1
Services by an employee to the employer in the course of or in relation to
his employment
• Annapurna is a director in Nilgiri Ltd. receiving
remuneration which is declared as salaries in the books
of the company and subject to TDS under section 192 of
the Income-tax Act, 1961. In this case, services provided
by Annapurna to Nilgiri Ltd. are in course of her
employment with the company.

IN COURSE OF EMPLOYMENT
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 15
 Schedule –III
Para-1
Services by an employee to the employer in the course of or in relation to
his employment
• Perquisites provided by the employer
to its employees in terms of
contractual agreement entered into
between the employer and the
employee are in lieu of the services
provided by employee to the employer
in relation to his employment.

IN COURSE OF EMPLOYMENT
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 16
 Schedule –III
Para-1
Services by an employee to the employer in the course of or in relation to
his employment
• Services provided on contract basis by a person to
another i.e. principal-to-principal basis
• Any amount paid by employer to employee for not
joining a competing business is paid for providing the
service of forbearance to act.

NOT IN COURSE OF EMPLOYMENT

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 17
 Schedule –III
Para-2
Services by any Court or Tribunal established under any law for the time
being in force.

District High Supreme

Court Court Court

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 18

Schedule –III
Para-3(a)
Functions performed
by:
• Members of
Parliament
• Members of State
Legislature
• Members of
Panchayats
• Members of
Municipalities and
Members of other
local authorities.
 Schedule –III
Para-3(b)
Duties performed by any person who holds any post in pursuance of the
provisions of the Constitution in that capacity.

• President of India
• Vice President of India
• Prime Minister of India
• Governors
• Chief Justice of India
• Speaker of the Lok Sabha
• Chief Election Commissioner
• Comptroller and Auditor General of India
• Chairman of Union Public Service Commission
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 20
• Attorney General of India
 Schedule –III
Para-3(a)
Duties performed by any person as a Chairperson or a Member or a Director in a body
established by the Central Government or a State Government or local authority and who is
not deemed as an employee before the commencement of this clause.

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 21

 Schedule –III
Para-4

Services of funeral, burial,

crematorium or mortuary including
transportation of the deceased.
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 22
 Schedule –III
Para-5

Sale of land and,

subject to paragraph
5(b) of Schedule II,
sale of building

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 23

 Schedule –III
Para-6
Actionable claims, other than specified actionable claims.
Horse Racing

Specified

Gaming
Lottery

Money
Online
Actionable
Claims

Gambling
Casinos
Betting

Supply
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 24
 Schedule –III
Para-6
Actionable claims, other than specified actionable claims.

NOT
Claims for
Insurance Claim Arrears of rent Specified
future rents Actionable
Claims

Unsecured Bills of Promissory

loans exchange Note
NOT a
Supply
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 25
Panchayat or
Municipality
functions –NOT A
SUPPLY

Activity in relation
to Panchayat/
Municipality
functions
entrusted in
Constitution

© THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA

Grant of alcoholic liquor license-
NOT A SUPPLY
Applicable to grant of alcoholic liquor license by
the State Governments

Not applicable to services provided by

Government to business entities including grant
of privileges, licences, mining rights, natural
resources such as spectrum etc. against payment
of consideration in the form of fee, royalty etc.

27
Sarvanna & Sons wishes to start
supplying alcoholic liquor for human
consumption in the State of Tamil Nadu.
Therefore, it applies for license to the
Tamil Nadu Government for selling liquor
for which the State Government has
charged specified fee from it. Examine
whether the grant of alcoholic liquor
license by the Tamil Nadu Government to
Sarvanna & Sons qualifies as supply.

28
Non-supplies notified vide circular
Inter-State movement of
• various modes of conveyance
• including rigs, tools and spares, and all goods
on wheels [like cranes]
• between distinct persons
• carrying goods/passengers
• for repairs and maintenance
• such movement should not be for further
supply of conveyance

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 29

Gagan Engineering Pvt. Ltd., registered in
Haryana, is engaged in providing maintenance
and repair services for heavy steel machinery.
For carrying out the repair work, Gagan
Engineering Pvt. Ltd. sends its container
trucks equipped with items like repair
equipments, consumables, tools, parts etc.
from Haryana workshop to its own repairing
centres (registered under GST law) located in
other States across India where the clients’
machinery are being brought and are being
repaired.
Discuss the leviability of GST on the inter-
State movement of trucks from the workshop
of Gagan Engineering Pvt. Ltd. in Haryana to
its own repairing centres located in other
States across India.
 No
Is the activity a supply of goods/services such as sale,
transfer, barter, exchange, licence, rental, lease or disposal?
Yes

Is it for a No No
Is it an activity specified
consideration? under Schedule I?

Yes Yes

Is it in course No
or furtherance
Is it in course Is it No of business?
or furtherance import of
No
of business? service?
Yes

Yes Yes

Is it an activity specified in No
Schedule III or section Activity is Activity is
7(2)(b)? Supply NOT Supply
Yes
© THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 19 February 2024 31
 Supply Leviable to GST

Supply must be
made by a
taxable person
Supply
Leviable to
Supply must be GST
a taxable
supply
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 32
 Composite Supplies

Composite supply means a supply made by a taxable

person to a recipient and:
▪ comprises two or more taxable supplies of goods or
services or both, or any combination thereof.
▪ which are naturally bundled and supplied in conjunction
with each other, in the ordinary course of business
▪ one of which is a principal supply
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 33
 Principal supply

Principal supply means the supply

of goods or services which
constitutes the predominant Predominant
element of a composite supply and element
to which any other supply forming
part of that composite supply is
ancillary.
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 34
 How to determine whether the services are
bundled in the ordinary course of business?

The perception of the consumer or the service recipient

• Mobile phone is always sold with battery

Majority of service providers in a particular area of business provide similar bundle of

services.

• Bundle of services of catering on board and services of transport by air is a bundle

offered by a majority of airlines.

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 35

 How to determine whether the services are
bundled in the ordinary course of business?
Nature of the various services in a bundle of services

• If the nature of services is such that one of the services is the MAIN
SERVICE and the other services combined with such service are in the
nature of INCIDENTAL OR ANCILLARY SERVICES which help in better
enjoyment of the main service, then it would be treated as services
bundled in the ordinary course of business.
• Service of stay in a hotel is often combined with provision of breakfast and
dinner provided free of cost during the stay. Such service is an ancillary
service to the provision of hotel accommodation and the resultant package
would be treated as services naturally bundled in the ordinary course of
business.
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 36
 Other Illustrative Indicators

The elements are normally advertised as a package.

The different elements are not available separately.

The different elements are integral to one overall supply. If one or more is removed, the
nature of the supply would be affected.

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 37

 No straight jacket formula can be laid
down to determine whether a service is
naturally bundled in the ordinary course
of business. Each case has to be
individually examined in the backdrop of
several factors some of which are
outlined earlier.

19 February 2024
 Examples
Poshaak Manufacturers entered into a contract with Cheeku Ltd. for supply of readymade
shirts packed in designer boxes at Cheeku Ltd.’s outlet. Further, Poshaak Manufacturers
would also get them insured during transit. In this case, supply of goods, packing materials,
transport & insurance is a composite supply wherein supply of goods is principal supply.

When a consumer buys a television set and he also gets mandatory warranty and a
maintenance contract with the TV, this supply is a composite supply. In this example, supply
of TV is the principal supply, warranty and maintenance services are ancillary.

A travel ticket from Mumbai to Delhi may include service of food being served on board, free
insurance, and the use of airport lounge. In this case, the transportation of passenger,
constitutes the pre-dominant element of the composite supply, and is treated as the
principal supply and all other supplies are ancillary.
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 39
 Example
Rati Computers supplies laptop (worth Rs. 52,000)
alongwith laptop bag (worth Rs. 4,000) to all its customers
for Rs. 55,000. Being naturally bundled, supply of laptop
bag along with the laptop is composite supply which is
treated as the supply of the principal supply [viz. laptop].
Assuming that the rate of tax applicable on laptop is 18%
and on laptop bag is 28%, in the given case, rate of principal
supply, i.e. laptop @ 18% will be charged on the entire
value of Rs. 55,000.
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 40
 Clarification regarding Printing industry

In case of printing of books, pamphlets,

brochures, annual reports, and the like, where
only content is supplied by the publisher or
the person who owns the usage rights to the
intangible inputs while the physical inputs
including paper used for printing belong to
the printer, supply of printing [of the content
supplied by the recipient of supply] is the
principal supply and therefore such supplies
would constitute supply of service.
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 41
 Clarification regarding Printing industry

In case of supply of printed envelopes, letter

cards, printed boxes, tissues, napkins, wall
paper etc. by the printer using its physical
inputs including paper to print the design, logo
etc. supplied by the recipient of goods,
predominant supply is supply of goods and the
supply of printing of the content [supplied by
the recipient of supply] is ancillary to the
principal supply of goods and therefore such
supplies would constitute supply of goods.
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 42
 Food supplied to the patients

Food supplied to the in-patients as

advised by the doctor/nutritionists is
a part of composite supply of health
care and not separately taxable.

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 43

 Activity of bus body building
It is a composite supply.

Classification of this composite

supply, as goods or service would
depend on which supply is the
principal supply which may be
determined on the basis of facts and
circumstances of each case.
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 44
 Retreading of tyres
In retreading of tyres, which is a composite
supply, the pre-dominant element is process
of retreading which is a supply of service.
Rubber used for retreading is an ancillary
supply.
Supply of retreaded tyres, where the old
tyres belong to the supplier of retreaded
tyres, is a supply of goods.
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 45
 Mixed Supplies
Mixed supply means:
❑two or more individual supplies of goods or
services, or any combination thereof, made
in conjunction with each other by a taxable
person
•for a single price where such supply does
not constitute a composite supply
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 46
How to determine if a particular supply is a mixed
supply?
Rule out that the supply is a composite supply.

If the transaction consists of supplies not naturally bundled

in the ordinary course of business, then the possibility of it
being a mixed supply needs to be checked.

Whether a single consideration is charged for the entire

supply of different
19 February 2024
components.
© THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA
47
 Examples
A supply of a package consisting of canned foods, sweets, chocolates, cakes,
dry fruits, aerated drink and fruit juices when supplied for a single price is a
mixed supply. Each of these items can be supplied separately and is not
dependent on any other. It shall not be a mixed supply if these items are
supplied separately or separate prices are charged.

A house is given on rent through a single rent deed - one floor of which is to
be used as residence and the other for housing a printing press, at a lump
sum rent amount. Such renting for two different purposes is not naturally
bundled in the ordinary course of business. Said supplies are mixed supply.
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 48
 Example

Sringaar Enterprises supplies 10,000 kits (at Rs. 50 each) amounting to Rs.
5,00,000 to Raghav General Store. Each kit consists of 1 shampoo, 1 face
wash and 1 kajal pencil. It is a mixed supply and is treated as supply of that
particular supply which attracts highest tax rate. Assuming that the rate of
tax applicable on shampoo is 18%, on face wash is 28% and on kajal pencil is
12%, in the given case, highest tax rate [viz. face wash] @ 28% will be
charged on the entire value of Rs. 5,00,000.

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 49

More than one supply made together and taxed at
the individual rates

There can also be a case where an activity/transaction involves more than

one supply of goods or services or both, but neither they are composite
supplies nor can be categorised as mixed supplies, that is, all supplies carry
independent significance.

In such a case, if separate consideration is indicated against each supply, each

such supply shall be charged at the respective rate applicable to that
particular supply.

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 50

 Example

In case of servicing of cars involving

supply of both goods (spare parts) and
services (labour) where the value of
goods and services are shown
separately, the goods and services
would be liable to tax at the rates as
applicable to such goods and services
separately.

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 51

Dumdum Electronics has sold the following
electronic items to Akbar Retail Store.
(i) Refrigerator (500 litres) taxable @ 18%
(ii) Stabilizer for refrigerator taxable @ 12%
(iii) LED television (42 inches) taxable @
12%
(iv) Split air conditioner (2 Tons) taxable @
28%
(v) Stabilizer for air conditioner taxable
@12%
Dumdum Electronics has issued a single invoice,
indicating price of each of the above items
separately in the same.
Akbar Retail Store has given a single cheque of
Rs. 1,00,000/- for all the items as a composite
discounted price. State the type of supply and
the tax rate applicable in this case. 52
 Questions

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 53

 Quiz
Quiz time!

Time!

Mr. Champak has made an inter-State

supply of goods from Madhya Pradesh to
Lakshadweep. Tax to be charged in this
case.
IGST
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 54
 Quiz
Quiz time!

Time!

Mr. Champak has made an inter-State

supply of goods from Madhya Pradesh to
Delhi. Tax to be charged in this case.
IGST
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 55
 Quiz
Quiz time!

Time!

Mr. Champak has made an intra-State

supply of goods within Puducherry. Tax to
be charged in this case.

19 February 2024
CGST and SGST
© THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 56
 Quiz
Quiz time!

Time!

Mr. Champak has made an intra-State

supply of goods within Ladakh. Tax to be
charged in this case.

19 February 2024
CGST and UTGST
© THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 57
 Quiz
Quiz time!

Time!

Mr. Champak has made an intra-State

supply of goods within Uttar Pradesh. Tax
to be charged in this case.

19 February 2024
CGST and SGST
© THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 58
 Quiz
Quiz time!

Time!
Which of the following taxes are NOT subsumed in GST?
(i) Central Sales Tax
(ii) Service Tax
(iii) Entertainment Tax levied by local bodies
(iv) Value Added Tax
(v) Customs Duty
Choose the most appropriate option.
(b)(iii) and (c)(i) and (d)(i), (ii)
(a)(v)
(v) (v) and (iv)

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 59

 Quiz
Quiz time!

Time!
Which of the following taxes are subsumed in GST?
(i) Luxury Tax
(ii) Entry Tax
(iii) Entertainment Tax levied by local bodies
(iv) Value Added Tax
(v) Purchase Tax
hoose the most appropriate option.

(a) (i), (ii), (b)(iii) (c)(i) and (d)(i), (iii)

(iv) and (v) and (iv) (iv) and (iv)

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 60

 Quiz
Quiz time!

Time!

Tobacco is subject to _______.

(b) State excise

(a) GST duty and
(c) Central (d) Both
Excise Duty. (a) and (c).
VAT/CST.

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 61

 Quiz
Quiz time!

Time!

Which of the following statements is

incorrect?
(a) Alcoholic (c) Inter-
(b) Manufacture/
liquor for human State/intra-State (d) Alcoholic
production of
consumption is sale of the liquor for human
alcoholic liquor is
outside the alcohol is subject consumption is
subject to State
realm of GST to CST/ VAT subject to GST.
excise duty.
respectively.
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 62
 Quiz
Quiz time!

Time!

Presently, _________________ is leviable on ______________ of petroleum

and diesel.
(i) GST; supply
(ii) Central excise duty; manufacture/production
(iii) Central sales tax; inter-State sale
(iv) Value Added Tax; intra-State sale
(v) State excise duty; manufacture

(a)(ii), (iii) and

(iv) (b) (i) (c)(i) and (ii) (d)(i) and (v)

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 63

 Quiz
Quiz time!

Time!

Mr. Popat has imported architect services

free of cost from his brother, a well settled
architect in Germany for his house.
Not a supply
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 64
 Quiz
Quiz time!

Time!

Mr. Popat has imported architect services

free of cost from his brother, a well settled
architect in Germany for his office.
Not a supply
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 65
 Quiz
Quiz time!

Time!

Mr. Popat has imported architect services

free of cost from his brother who has gone
to Germany for studies on Mr. Popat’s
expenses, for his office.
Supply
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 66
 Quiz
Quiz time!

Time!

Mr. Popat has imported architect services

for $ 50,000 from his brother, a well settled
architect in Germany for his house.
Supply
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 67
 Quiz
Quiz time!

Time!

Mr. Venkat hired a professional firm based in UK to receive the

legal consultancy services for his family dispute. The services
received by Mr. Venkat _____________ in case such services are received
by Mr. Venkat (I) free of cost; or (II) for a consideration of US$ 1,000.

(b) (I) do not (c) (I) (d) (I) do not

(a) (I) amount
amount to supply; amount to supply; amount to supply;
to supply; (II)
amount to supply
(II) amount to (II) do not (II) do not
supply amount to supply amount to supply

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 68

 Quiz
Quiz time!

Time!

Which of the following activities/transactions qualify as supply of

goods?

(a) Dhruvtara (b) Bigbang Steels (c) Larsen (d) Vigyaan

Technicians Technologies
Electronics Ltd. supplies a
retreads the tyres develops a
supplies washing machinery on given by Deendayal customised
machines to its rent to Jigayasa Automobiles on job software for a
customers. Manufacturers. work basis. business school.

19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 69

 Quiz
Quiz time!

Time!

Which of the following activities are considered neither as supply

of goods nor supply of services?

(a) Inter-State (b) Grant of

movement of (c) Services
mining rights
trucks between provided by an
by the (d) Lottery
distinct persons employer to
for repairs and Governments
the employee.
maintenance. to businesses.
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 70
 Quiz
Quiz time!

Time!

Jaskaran supplies gift packages at Rs. 30 each to its customers.

Each package consists of 2 chocolates, 2 fruit juice bottles and a
packet of toy balloons. Rates of GST applicable on chocolates, fruit
juice bottles and toy balloons are 18%, 12% and 5% respectively.
Jaskaran is liable to pay GST @________________.
(a) 18%, 12%
and 5% separately (b) 18% on (c) 12% on (d) 5% on
on value of supply
the price the price the price
of chocolates, fruit
juice bottles & toy charged for the charged for the charged for the
balloons gift package gift package gift package
respectively
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 71
 1. Meghraj & Co. wishes
to commence the business of
supplying ready-made garments
within Punjab and in the
neighbouring States of Delhi and
Haryana. Kindly state as to what
is the taxable event under GST
and leviability of CGST,
SGST/UTGST and IGST on the
same?

19 February 2024
 Sulekha Manufacturers have a
factory in Delhi and a depot in
Mumbai. Both these
establishments are registered in
respective States. Finished goods
are sent from factory in Delhi to
the Mumbai depot without
consideration so that the same
can be sold from the depot.
Examine whether the said activity
would amount to supply under
section 7 read with Schedule I
19 February 2024 © THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 73
Raman is an architect in Chennai.
His brother who is settled in
London is a well-known lawyer.
Raman has taken legal advice from
him free of cost with regard to his
family dispute. Examine whether
the said activity would amount to
supply under section 7 read with
Schedule I
Would your answer be different if
in the above case, Raman has taken
advice in respect of his business
unit in Chennai?

74
Which of the following services received, in the course or
furtherance of business, without consideration amount to
supply?

(i)Import of services by a person in India from his son

well-settled in USA

(ii)Import of services by a person in India from his brother

well-settled in Germany

(iii)Import of services by a person in India from his brother

(wholly dependent on such person in India) in France

(iv)Import of services by a person in India from his

daughter (wholly dependent on such person in India) in
Russia
75
Which of the following is not
considered as ‘goods’ under the CGST
Act, 2017?
(i)Old ten-paisa coin having sale value
of Rs.100.
(ii)Shares of unlisted company
(iii)Lottery tickets

76
Which of the following
statements is true under GST
law?
(i) Grand-parents are never
considered as related persons to
their grand-son/grand-daughter
(ii) Grand-parents are always
considered as related persons to
their grand-son/grand-daughter
(iii) Grand-parents are considered
as related persons to their grand-
son/grand-daughter only if they
are wholly dependent on their
grand-son/grand-daughter
(iv) Grand-parents are considered
as related persons to their grand-
son/grand-daughter only if they
are not dependent on their
grand-son/grand-daughter
77
Determine which of the following
independent transactions even if made
without consideration in terms of Schedule
I of the CGST Act, 2017, will be deemed as
supply?
(i) AB & Associates transfers stock of goods
from its Mumbai branch to Kolkata depot
for sale of such goods at the depot.
(ii) Mr. Raghuveer, a dealer of air-
conditioners permanently transfers the
motor vehicle free of cost. ITC on said
motor vehicle was blocked and therefore,
was not availed.
(iii) Mrs. Riddhi, an employee of Sun Ltd.,
received gift from her employer on the
occasion of Diwali worth Rs.21,000.
THANK YOU