PART A: Multiple Choice Questions (Each carries 2 marks)
Choose the most appropriate option:
Q1) 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 a) i, iii and iv b) ii, iii and iv c) ii and iii d) i and ii
Q2) GST is not payable by recipient of services in the following cases:
i. Services provided by way of sponsorship to ABC Ltd. located in India. ii. Services supplied by a director (registered under GST) of Galaxy Ltd. to Mr. Krishna iii. Services by Department of Posts by way of speed post to MNO Ltd. located in India. iv. Services supplied by a recovering agent to SNSP Bank located in India. a) (i) & (iii) b) (i) & (iv) c) (ii) & (iii) d) (ii) & (iv)
Q3) Various taxes have been subsumed in GST to make one nation one tax one market for consumers. Out of the following, determine which taxes have been subsumed in GST. i. Basic customs duty levied under Customs Act, 1962 ii. Taxes on lotteries iii. Environment tax a) (ii) b) (ii) and (iii) c) (iii) d) (i), (ii) and (iii)
Q4) Determine which of the following independent cases will be deemed as supply even if made without consideration in terms of Schedule I of the CGST Act 2017? i. AB & Associates (Registered under GST) 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 is blocked. iii. Mrs. Riddhi, an employee of Sun Ltd., received gift from her employer on the occasion of Diwali worth ₹ 21,000. a) (i) b) (ii) c) (iii) d) Both (i) and (ii)
Q5) TT Pvt. Ltd., registered in Rajasthan, furnished following information for the month of June: (i) Inter-State sale of goods for ₹ 1,25,000 to JJ Enterprises registered in Haryana (ii) Inter-State purchases of goods from XYZ company, registered in Punjab, for ₹ 40,000 (iii) Intra-State purchases of goods from RR Traders, registered in Rajasthan, for ₹ 65,000 The applicable rate of GST is 18%. All the above amounts are exclusive of taxes. GST liability payable in cash is: a) CGST ₹ 1,800 & SGST ₹ 1,800 b) (b) SGST ₹ 3,600 c) (c) IGST ₹ 3,600 d) (d) CGST ₹ 3,600
Q6) Which of the following is not covered under Schedule III of CGST Act, 2017? a) Director's monthly salary under employment agreement b) Sitting fees to independent directors for attending AGMs c) Payment to employee for providing broking services to the employer for purchase of commercial property. Such services do not form part of the employment contract entered into by the employer with the employee. d) Both (b) and (c)
Q7) XX, registered in Delhi, purchased books from PC Traders, registered in Uttar Pradesh. Books are exempt from GST. XX arranged the transport of these books from a goods transport agency (GTA) which charged a freight of ₹ 9,000 for the same. GST is payable @ 5% on such GTA services as GTA is not opting to pay GST under forward charge. Which of the following statement is correct in the given context: a) GST of ₹ 450 is payable by XX on revere charge basis. b) Supply of goods and supply of GTA service is a composite supply wherein supply of goods is the principal supply and since, principal supply is an exempt supply, no tax is payable on freight c) Since, exempt goods are being transported service provided by GTA for transporting the same is also exempt. d) GST of ₹ 450 is payable by the GTA Q8) There is a difference in taxability of goods forming part of composite supply and mixed supply. Here are few examples from which you need to identify which is correct example of composite supply and mixed supply. i. Mr. A buys a car and purchases warranty and maintenance of the car by paying nominal amount. Car, warranty and maintenance here are a mixed supply. ii. Mr. A buys a car and purchases warranty and maintenance of the car by paying nominal amount. Car, warranty and maintenance here are a composite supply. iii. Mrs. A buys a microwave oven and some utensils for use in microwave oven. Both microwave oven and utensils are sold at a single price. Microwave oven and its utensils here are a mixed supply. iv. Mrs. A buys chocolates, juices and biscuits from a shop. All items have different prices. Chocolates, juices and biscuits are a mixed supply. The correct examples of composite and mixed supply are: - a) i, iv b) ii, iii c) ii, iii, iv d) None of the above
Q9) Which of the following statements is true under GST law?
a) Grand-parents are never considered as related persons to their grand-son/grand-daughter b) Grand-parents are always considered as related persons to their grand-son/grand-daughter c) Grand-parents are considered as related persons to their grandson/grand-daughter only if they are wholly dependent on their grand-son/granddaughter d) Grand-parents are considered as related persons to their grandson/grand-daughter only if they are not dependent on their grandson/granddaughter
Q10) Which of the following services does not fall under reverse charge provisions as contained under section 9(3) of the CGST Act? a) Services supplied by arbitral tribunal to business entity located in Ladakh b) Sponsorship services provided to a partnership firm located in Jammu & Kashmir c) Sponsorship services provided to a body corporate located in Kerala d) Service of renting of motor vehicle for passengers provided to a recipient other than body corporate
PART B: Descriptive Questions
Question 1: (12 Marks) State the person liable to pay GST in the following independent services provided:- a) Siddhi Builders, registered in Haryana, rented out 20 residential units owned by it in Sanskriti Society to Rudra Technologies, an IT based firm registered in the State of Haryana, for accommodation of its employees. b) M/s. Purohit Consultants, a partnership firm registered in Delhi as a regular tax payer, paid sponsorship fees of ₹ 70,000 at a seminar organized by a private NGO (a partnership firm) in Delhi c) Mr. Kamal Jain, an unregistered famous author, received ₹ 20 lakh of consideration from PQR Publications Ltd. for supply of services by way of temporary transfer of a copyright covered under section 13(1)(a) of the Copyright Act, 1957 relating to original literary works of his new book d) Rental income received by Tamil Nadu State Government from renting an immovable property to Mannappa Pvt. Ltd. (Turnover of the company was ₹ 22 lakhs in the preceding F. Y.) e) “Safe Trans”, a Goods Transport Agency, transported goods of Kapil & Co., a partnership firm which is not registered under GST f) Ranka Jewellers Ltd. paid ₹ 50 lakhs for sponsorship of Miss India beauty pageant
Question 2: (4 + 4 Marks = 8 Marks)
1) List some of the benefits that GST may accrue to the economy.
2) Examine whether the following independent cases would amount to supply under section 7: a) Wesco Ltd, a registered person in Ahmedabad (Gujarat) having head office located in Singapore, received management consultancy services free of cost from its head office. b) Daksh gold Pvt. Ltd. is an Indian subsidiary (in Mumbai) of Moksh Gold Inc. (Japan based company). On occasion of Diwali, Daksh gold Pvt. Ltd. distributes gift hamper to its employee worth ₹ 3,00,000.
Question 3: (4 + 3 + 3 Marks = 10 Marks)
1) Happy Constructions Ltd., a registered builder under GST in Bengaluru, Karnataka has got permission to build five floors from the Municipal Projects for one of its projects at Suraj Nagar. Aditya Constructions, a neighbouring housing project approached Happy Constructions Limited to discuss regarding blockage of sun light issue arising out of construction of five floors and asked it to build only three floors for which ₹ 20 lakh was offered as compensation. Happy Constructions Limited agreed to the offer. It may be noted that Aditya Constructions is not ready to pay any further amount to Happy Constructions Ltd. in addition to the amount already agreed. Briefly explain with correct legal provision whether the above amount received as compensation is liable to GST or not? And if considered as taxable, then calculate the total GST payable by Happy Constructions Ltd. Assume the applicable rate of CGST and SGST is 9% each. Also state the conditions to be complied with.
2) Examine the implications of GST on supply of food and beverages at cinema halls.
3) Dumdum Electronics has sold the following electronic items to Akbar Retail Store. a) Refrigerator (500 litres) taxable @ 18% b) Stabilizer for refrigerator taxable @ 12% c) LED television (42 inches) taxable @ 12% d) Split air conditioner (2 Tons) taxable @ 28% e) 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 ₹ 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.
