Contents

Para	Topics	Section/Rules/N/C/O
9.0	Levy and Collection of GST	NA
9.1	Levy of CGST on Intra State supplies at notified rate on value determined u/s 15	Section 9(1)
9.1.1	Non-GST Supply	Section 9(1)
9.1.2	GST Rates	Section 9(1)
9.2	Non-applicability of GST on petroleum, diesel, gas etc till notified date	Section 9(2)
9.3	Levy under RCM [Reverse Charge Mechanism]	NA
9.3.1	RCM on specified supplies received from any person	Section 9(3)
9.3.2	RCM on specified supplies received by specified RP from URP	Section 9(4)
9.4	Specified Services on which ECO shall pay GST	NA
9.4.1	Meaning of ECO	Section 2(45)
9.4.2	Payment of GST by ECO on specified services supplied through it	Section 9(5)
9.4.3	If ECO does not have physical presence in taxable territory	1st Proviso to Section 9(5)
9.4.4	If ECO does not have physical presence and no representative in taxable territory	2nd Proviso to Section 9(5)

 

9.0 Levy and Collection of GST

	The provisions relating to levy and collection of CGST and IGST are contained in section 9 of the CGST Act, 2017 and section 5 of the IGST Act, 2017, respectively.
	Section 9 of the CGST Act and Section 5 of the IGST Act are charging sections

 

9.1 Levy of CGST on Intra State supplies at notified rate on value determined u/s 15

	Section 9(1) Subject to the provisions of sub-section (2), there shall be levied Central goods and services tax (CGST) on all intra-State supplies of goods or services or both, except on the supply of alcoholic liquor for human consumption, on the value determined u/s 15 and at such rates, not exceeding 20%, as may be notified by the Government and collected in such manner as may be prescribed and shall be paid by the taxable person.
1	Levy of Central Tax (CGST) on Intra State Supply CGST (Central Tax) + SGST/UGST shall be levied on all intra-State supplies of goods or services or both.
2	Levy of IGST on Inter-State Supply IGST shall be levied on all inter-State supplies of goods or services or both. Refer section 5 of IGST Act for levy of IGST on inter-state supply.
	Refer section 7 of IGST Act for meaning of “Intra-state supply”
	Refer section 8 of IGST Act for meaning of “Inter-state supply”
3	Taxable Value for levy of GST GST shall be levied on value to be determined as per section 15.
4	GST shall be paid by taxable person A supply to attract GST should be made by a taxable person. Hence, a supply between two non-taxable persons does not constitute taxable supply under GST.
	Refer section 2(107) for meaning of “Taxable person”
	Question & Answer

 

9.1.1 Non-GST Supply

Supply of alcoholic liquor for human consumption is outside the purview of GST Laws.

 

9.1.2 GST Rates

	GST shall be levied at such rates, not exceeding 20%, as may be notified by the Government. IGST Rate = CGST Rate + SGST/UTGST Rate
	CGST Rates presently notified are 0%, 0.125%, 0.75% 1.5%, 2.5%, 6%, 9% and 14%
	For updated list of CGST Rates on supply of goods and services, click here
	Maximum rate of CGST can be 20%. Maximum rate of IGST can be 40%.
	Question & Answer

 

9.2 Non-applicability of GST on petroleum, diesel, gas etc till notified date

	Section 9(2) CGST on the supply of petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas and aviation turbine fuel shall be levied with effect from such date as may be notified by the Government.
	Govt. has not yet notified the date for levy of CGST on above item.
	Question & Answer

 

9.3 Levy under RCM [Reverse Charge Mechanism]

	Concept of RCM Generally, the supplier of goods or services is liable to pay GST. However, under RCM, the liability to pay GST is cast on the recipient of the goods or services.
	Under RCM, only the compliance requirements, [i.e. to obtain registration under GST, deposit the tax with the Government, filing returns, etc.] have been shifted from supplier to recipient. The burden to pay GST ultimately lies on the recipient only.
	Refer section 2(98) for meaning of “Reverse Charge”

 

9.3.1 RCM on specified supplies received from any person

	Section 9(3) The Government may, by notification, specify categories of supplies, the tax on which shall be paid on reverse charge basis by the recipient of such supplies and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to such supplies.
	Similar provisions are contained u/s 5(3) of the IGST Act for Inter State Supply.
	For updated list of specified supply of goods and services on which RCM is applicable, click here

 

9.3.2 RCM on specified supplies received by specified RP from URP

	[1][Section 9(4) The Government may, by notification, specify a class of RPs who shall in respect of supply of specified categories received from an URP pay the tax on RCB as the recipient of such supplies and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to such supply]
	Similar provisions are contained u/s 5(4) of the IGST Act for Inter State Supply.
	Specified RP who receives specified supplies from URP shall pay gst under RCM u/s 9(4).
	For updated list of specified supplies from URP on which RCM is applicable, click here
	Question & Answer

 

9.4 Notified services on which ECO shall pay GST u/s 9(5)

 

9.4.1 Meaning of ECO

	For meaning of ECO, refer section 2(45) of CGST Act
Ex	Amazon, Flipkart, Urban clap etc
	Sometimes, ECO itself supplies the goods or services displayed on its electronic portal. However, many a times, the products/services displayed on the electronic portal are actually supplied by some other person to the consumer. When a consumer places an order for a particular product/ service on this electronic portal, the actual supplier supplies the selected product/ service to the consumer. The price/ consideration for the product/ service is collected by the ECO from the consumer and passed on to the actual supplier after the deduction of commission by the ECO.

 

9.4.2 ECO shall be liable to pay GST on notified services supplied through it

	Section 9(5) The Government may, by notification, specify categories of services, tax on which shall be paid by the ECO if such services are supplied through it, and all the provisions of this Act shall apply to such ECO as if he is the supplier liable for paying the tax in relation to the supply of such services:
Ex	Mr A provides cleaning services to customer (Mr D) through Urban clap portal. In such cases, GST on services provided to Mr D shall be paid by Urban clap.
	Section 9(5) shall apply only in case of supply of SERVICES.
	Question & Answer

 

9.4.3 List of notified services u/s 9(5)

	Vide Notification No. 17/2017 - Central Tax (Rate) dated 28-06-2017, govt has notified following services subject to some conditions (i) transportation of passengers by a radio-taxi, motorcab, maxicab [1][, motor cycle, [2][or any other motor vehicle except omnibus (ia) transportation of passengers by an omnibus except where supplier is a company.; (ii) accommodation in hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes, except where supplier is liable for registration u/s 22(1) (iii) services by way of house-keeping, such as plumbing, carpentering etc except where supplier is liable for registration u/s 22(1); (iv) Supply of restaurant service other than the services supplied by restaurant, eating joints etc. located at specified premises.
	For updated list or other conditions of notified supplies on which ECO shall pay GST, click on above notification.
	In case of (i), (ia) and (iv), supplier may be registered or unregistered person, ECO shall pay tax u/s 9(5)
	In case of (ii), and (iii), supplier must be unregistered person. It means supplier is liable for registration u/s 22(1), then section 9(5) shall not apply. In such a case, supplier shall obtain the registration and pay the tax on such services. In that case, ECO will not be liable to pay tax on such services.
Ex	Mr X of Delhi avails the services of a carpenter online through an ECO – Amazon. The carpenter is unregistered under GST since his turnover has not yet crossed the threshold limit. In this case, GST on the services availed by Mr X shall be paid by Amazon u/s 9(5)..
Ex

 

 

9.4.3 For Notified services u/s 9(5), all provisions of act shall apply to ECO

	Extract of Section 9(5) all the provisions of this Act shall apply to such ECO as if he is the supplier liable for paying the tax in relation to the supply of such services:
	This implies that the invoice for notified services will be issued by the ECO only and not by suppliers.

 

 

9.4.3 If ECO does not have physical presence in taxable territory, then ECO’s representative shall be liable to pay GST

1st Proviso to Section 9(5) where an ECO does not have a physical presence in the taxable territory, any person representing such ECO for any purpose in the taxable territory shall be liable to pay tax:

 

9.4.4 If ECO does not have physical presence and no representative in taxable territory

2nd Proviso to Section 9(5) where an ECO does not have a physical presence in the taxable territory and also he does not have a representative in the said territory, such ECO shall appoint a person in the taxable territory for the purpose of paying tax and such person shall be liable to pay tax.

 

 

9.4.4 Reporting of notified services by ECO in GSTR-3B

The ECO may, on notified services, including on restaurant service provided through ECO, pay GST, by furnishing the details in Form GSTR-3B2, reporting them as OUTWARD TAXABLE SUPPLIES.

 

 

 

Question & Answer

 

9.1 Levy of CGST on Intra State supplies at notified rate on value determined u/s 15

Question-1

Which of the following taxes levied on intra-State supply?

(a) CGST; (b) SGST/UTGST; (c) Both (a) and (b); (d) IGST.

 

Question-2

IGST is levied on

(a) Inter-State supplies; (b) Intra-State Supplies; (c) Both (a) and (b); (d) None of the above.

 

9.1.2 GST Rates

Question-1

What is the maximum rate of CGST prescribed under CGST Act?

(a) 20% (b) 28% (c) 24% (d) 40%.

 

Question-2

The maximum rate of IGST can be:

(a) 20% (b) 30% (c) 40% (d) None of the above.

 

9.2 Non-applicability of GST on petroleum, diesel, gas etc till notified date

Question-1

On supply of which of the following items, GST shall be levied with effect from such date as may be notified by the Government on the recommendations of the Council:

(a) Petroleum crude

(b) Alcoholic liquor for human consumption

(c) Both (a) and (b)

(d) None of the above.

 

Question-2 [ICSI-E-J22-57-1]

Unless and until notified by the Central Government on the recommendation of the Council, CGST or IGST or UTGST shall not be levied on the following supplies :

(i) Petroleum Crude and High Speed Diesel

(ii) Motor Spirit

(iii) Natural Gas and Aviation Turbine Fuel

(A) (i) only (B) (i) & (iii) (C) (ii) & (iii) (D) (i), (ii) and (iii)

 

Quesiton-3 [ICSI-E-J21-52-1]

Which of the following product is liable for Central Excise duty and not liable for GST ?

(A) Aviation Turbine Fuel (B) Jewellery (C) Floor Tiles (D) Iron and Steel

 

9.3.2 RCM on specified supplies received by specified RP from URP

Question-1 [ICMAI-D19-F-1(iv)-2]

What are the supplies on which reverse charge mechanism would apply?

(A) Notified categories of goods or services or both u/s 9(3).

(B) Inward supply of goods or services or both from an unregistered dealer u/s 9(4).

(C) Both of (A) and (B)

(D) None of the above.

 

Question-2 [ICMAI-D19-I-1(a)(ii)-1]

Reverse Charge Mechanism shall apply

(A) only in respect of services

(B) only in respect of goods

(C) both in respect of goods or services

(D) only in respect of inward supplies from unregistered persons.

 

Question-3 [ICSI-E-D18-O-75-1]

The exception to the general rule that ‘‘normally, the supplier of goods and services is liable to pay tax on supply, even if he does not collect from his customer i.e. recipient of supply of goods or services’’ shall be applicable where there are:

(A) supply from an unregistered dealer to registered dealer

(B) specified services through an e-commerce operator

(C) both (A) and (B)

(D) none of the above

 

9.4.2 Payment of GST by ECO on specified services supplied through it

Question-1 [ICAI-F-SM-Ch3-3]

Suvidha Technologies is in the business of development of e-commerce platforms for various customers. Chennai Creations obtained the ownership rights of an e-commerce platform developed by Suvidha Technologies by paying a specified amount against ownership rights of said platform. Chennai Creations also entered into an annual maintenance contract with Suvidha Technologies for technical maintenance of the said platform. Chennai Creations supplies its own goods and services through the said platform to ultimate customers Examine who is the e-commerce operator in the given case as per the provisions of the GST law.

Answer

As per section 2(44), electronic commerce means the supply of goods or services or both, including digital products over digital or electronic network. Further, as per section 2(45), electronic commerce operator means any person who owns, operates or manages digital or electronic facility or platform for electronic commerce.

In the given transaction, the e-commerce platform is developed by Suvidha Technologies. However, the ownership of the electronic platform is sold by Suvidha Technologies to Chennai Creations. Thus, Chennai Creations is the owner of the e-commerce platform and is also operating/managing the said platform for supply of its own goods and services.

In view of the definition of e-commerce operator, it is Chennai Creations which owns, operates or manages digital or electronic facility or platform for electronic commerce Suvidha Technologies is merely providing the annual maintenance services for the electronic platform, but the ownership rights lie with Chennai Creations. Thus, Suvidha Technologies cannot be termed as electronic commerce operator in the given case and Chennai Creations is the e-commerce operator.

 

Question-2 [ICAI-F-SM-Ch3-11]

Harishchandra of New Delhi makes a request for a motor cab to "Super ride" for travelling from New Delhi to Gurgaon (Haryana). After Harishchandra pays the cab charges his debit card, he gets details of the driver - Jorawar Singh and the cab's registration number.

"Super ride" is a mobile application owned and managed by Perry India Ltd. located in India. The application "Super ride" facilitates a potential customer to connect with the persons providing cab service under the brand name of "Super ride".

Perry India Ltd. claims that cab service is provided by Jorawar Singh and hence, he is liable to pay GST. With reference to the provisions of IGST Act, 2017, determine who is the person liable to pay GST in this case?

Answer

Section 5(5) of the IGST Act, 2017 provides that tax on inter-State supplies of specified services notified by Government shall be paid by the electronic commerce operator (ECO) located in taxable territory if such services are supplied through it. Services by way of transportation of passengers by a motor cab supplied through ECO is one of the notified service. Electronic commerce operator (ECO) means any person who owns, operates or manages digital or electronic facility or platform for supply of goods or services or both [Section 2(45)].

Since Perry India Ltd. owns and manages a mobile application in the name of “Super ride”, to facilitate supply of passenger transportation service in motor cabs over a digital network, it is an ECO. Thus, Perry India Ltd., an ECO located in India, is liable to pay GST in the given case.

 

Question-3 [ICSI-P-D21-1b-5]

Sanjay of New Delhi made a request for a Motor cab to “Destiny Rides” for travelling from New Delhi to Jaipur (Rajasthan). Sanjay after paying the cab charges using his debit card, get details of the drivers Joga Singh and the cab’s registration number

“Destiny Rides” is a mobile application owned and managed by “D.T. Ltd”, located in India. The application “destiny Rides” facilities a potential customer to connect with the persons providing cab service under the brand name of “Destiny Rides”.

D.T. Ltd. Claims that cab service is provided by Joga Singh and hence, he is liable to pay GST under the provisions of goods and service tax laws and Act.

You are required in the context of IGST Act, 2017 to determine who is liable to pay GST in this case would your answer be different, if D.T. Ltd, is located in New York (USA)

Answer

As per section 5(5) of the Integrated Goods and Services Tax Act, 2017, the Government may, on the recommendations of the Council, by notification, specify categories of services, the tax on inter-state supplies which shall be paid by the electronic commerce operator if such services are supplied through it, and all the provisions of this Act shall apply to such electronic commerce operator as if he is the supplier liable for paying the tax in relation to the supply of such services.

As per section 2(45) of the Central Goods and Services Tax Act, 2017, “Electronic commerce operator" (ECO) means any person who owns, operates or manages digital or electronic facility or platform for electronic commerce.

The Central Government has notified services by way of transportation of passengers by a radio-taxi, motorcab, maxicab and motor cycle and the tax on inter-state supplies which shall be paid by the electronic commerce operator.

Thus, in the above case D.T. Ltd., is liable to pay GST in respect of supply of the said service. Thus, the contention of D.T. Ltd. that Joga Singh should pay GST on the same as he is provider of service is not correct.

Further, proviso to section 5(5) of the Integrated Goods and Services Tax Act, 2017, provides that where an electronic commerce operator does not have a physical presence in the taxable territory, any person representing such electronic commerce operator for any purpose in the taxable territory shall be liable to pay tax.

Where an electronic commerce operator does not have a physical presence in the taxable territory and also he does not have a representative in the said territory, such electronic commerce operator shall appoint a person in the taxable territory for the purpose of paying tax and such person shall be liable to pay tax.

Thus, even if D.T. Ltd, is located in New York (USA) a non-taxable territory its liability to pay GST will not be extinguished. The representative of D.T. Ltd or the person appointed by D.T. Ltd will be required to discharge the GST liability on behalf of D.T. Ltd.

 

 

RCM QUESTION

[ICSI-E-D21-72-1]

Generally the supplier of goods or services is liable to pay GST. However, in specified case the liability may be cast on the recipient under the reverse charge mechanism (RCM). Find and state in which out of the following cases the GST is payable by the recipient of services under RCM :

(i) Services provided by way of sponsorship to MNO Ltd

(ii) Services given by Y Ltd to Ram through its director

(iii) Services by department of Posts by way of speed post to ABC Ltd

(iv) Services provided by a recovery agent to IGB Bank Ltd

(A) (i) and (iii) (B) (i) and (iv) (C) (ii) and (iii) (D) (ii) and (iv)

 

[ICAI-F-J21-3b-4]

XYZ Ltd. has obtained a loan from a foreign bank. The company does not have an account
with the foreign bank from whom it has taken the loan. Whether RCM liability under GST
laws should be discharged in this regard for import of services received in relation to the
loan?
Provide relevant legal provisions in support of your answer.

Answer

Yes. RCM liability needs to be discharged on such services. The place of supply of services supplied by a banking company in case where either supplier or recipient is located outside India is location of supplier provided said services are supplied to an account holder, otherwise the place of supply  the location of the recipient.

Accordingly, in the given case, the place of supply is the location of recipient – XYZ Ltd.,  i.e., India.  Since the supplier is outside India and recipient and place of supply are in India, said service qualifies as import of services which in turn, is considered as inter-State supply.

 

[ICAI-I-M18-O-9b(i)-1.5]

State, with reason, person liable to pay GST. Assume recipient is located in taxable territory.

Rental income received by Tamil Nadu State Government from renting an immovable property to Mannappa Pvt. Ltd. (Turnover of the company was Rs.22 lakhs in the preceding F. Y.)

Answer

(i) GST is payable on reverse charge basis on services supplied by the State Government to a business entity located in taxable territory. However, reverse charge is not applicable on supply of renting of immovable property service by the State Government. Therefore, in the given case, person liable to pay GST is the supplier of services, i.e., Tamil Nadu State Government.

 

[ICAI-I-N18-10c(i)-1.5]

Which person is liable to pay GST, where the recipient is located in the taxable territory. Ignore the Aggregate Turnover and Exemption available.

Mr. Raghu provided sponsorship services to WE-WIN Cricket Academy, an LLP.

Answer

In case of services provided by any person by way of sponsorship to any body corporate
or partnership firm / LLP, GST is liable to be paid under reverse charge by such body
corporate or partnership firm / LLP located in the taxable territory. Therefore, in thegiven case, WE-WIN Cricket Academy is liable to pay GST under reverse charge.

 

[ICAI-I-N20-6b(ii)-2]

Decide, who is liable to pay GST, if any. You may assume that recipient is located in the taxable territory. Ignore the aggregate turnover exemption available.

Mr. Kamal Jain, an unregistered famous author, received Rs.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.

Answer

Supply of services by an author by way of transfer of a copyright covered under section 13(1)(a) of the Copyright Act, 1957 relating to original literary works to a publisher located in the taxable territory is taxable under reverse charge mechanism

Thus, in the given case, the recipient of service, i.e. PQR Publications Ltd. is liable to pay GST. The tax can be paid by the author under forward charge if the author is a registered person. Since in the given case, the author is an unregistered person, the said option is not available to him.

 

[ICAI-I-M22-8a-5]

“Under the GST law, taxes on taxable services supplied by the Central Government or the State Government to a business entity in India are payable by recipient of services”.

State the exception of the above stated statement.

 

[ICAI-I-SM-Ch3-1]

State the person liable to pay GST in the following independent cases provided recipient is located in the taxable territory:

(a) Services provided by an arbitral tribunal to any business entity.

(b) Sponsorship services provided by a company to an individual.

(c) Renting of immovable property service provided by the Central Government to a registered business entity.

Answer

(a) Since GST on services provided or agreed to be provided by an arbitral tribunal to any business entity located in the taxable territory is payable under reverse charge, in the given case, GST is payable by the recipient - business entity.

(b) GST on sponsorship services provided by any person to any body corporate or partnership firm located in the taxable territory is payable under reverse charge. Since in the given case, services have been provided to an individual, reverse charge provisions will not be attracted. GST is payable under forward charge by the supplier – company.

(c) GST on services supplied by Central Government, State Government, Union territory or local authority by way of renting of immovable property to a person registered under CGST Act, 2017 is payable under reverse charge. Therefore, in the given case, GST is payable under reverse charge by the recipient – registered business entity.

 

[ICAI-I-SM-Ch3-2]

Vivek Goyal, an independent director of A2Z Pvt. Ltd., has received sitting fee amounting to Rs.1 lakh from A2Z Pvt. Ltd for attending the Board meetings.  Who is the person liable to pay tax in this case?

Answer

GST on supply of services by director of a company to the said company located in the taxable territory is payable on reverse charge basis. Therefore, in the given case, person liable to pay GST is the recipient of services, i.e., A2Z Pvt. Ltd.

 

[ICAI-I-SM-Ch3-3]

Raghu Associates provided sponsorship services to WE-WIN Cricket Academy, an LLP. Determine the person liable to pay tax in this case.

Answer

In case of services provided by any person by way of sponsorship to any body corporate or partnership firm, GST is liable to be paid under reverse charge by such body corporate or partnership firm located in the taxable territory. Further, for the reverse charge purposes, Limited Liability Partnership formed and registered under the provisions of the Limited Liability Partnership Act, 2008 is also be considered as a partnership firm. Therefore, in the given case, WE-WIN Cricket Academy is liable to pay GST under reverse charge.

 

[ICAI-I-SM-Ch3-6]

State the person liable to pay GST in the following independent cases provided recipient is located in the taxable territory:

(a) Services supplied by an insurance agent to an insurance company.

(b) Services supplied by a recovery agent to a car dealer.

(c) Security services (services provided by way of supply of security personnel) provided to a registered person.

Answer

(a) GST on services supplied by an insurance agent to any person carrying on insurance business located in the taxable territory is payable under reverse charge. Therefore, in the given case, GST is payable under reverse charge by the recipient – Insurance Company.

(b) GST on services supplied by a recovery agent to a banking company or a financial institution or a non- banking financial company located in the territory is payable under reverse charge. However, since, in the given case, services are being supplied by a recovery agent to a car dealer, GST is payable under forward charge by the service provider - recovery agent.

(c) GST on security services (services provided by way of supply of security personnel) provided to a registered person, located in the taxable territory is payable under reverse charge. Therefore, in the given case, GST is payable under reverse charge by the recipient – registered person receiving the services.

 

[ICAI-F-SM-Ch3-1]

Panini Private Limited, Jaipur, agrees to sponsor a sports event organized by Pink City Club in Jaipur. Panini Private Limited has paid an amount of Rs.5,00,000 for such sponsorship of the sports event. Consequently, said event was named after the brand name of Panini Private Limited. Examine who is the person liable to pay tax in the given case.

Answer

Notification no 13/2017 CT (R) dated 28.06.2017 as amended (hereinafter referred to as reverse charge notification), provides that sponsorship services provided by any person to a body corporate or partnership firm located in the taxable territory, shall be liable to GST under reverse charge in the hands of recipient.

In the present case, Pink City Club is the supplier of sponsorship services which is receiving the consideration in the form of sponsorship fee of Rs.5,00,000 from Panini Private Limited, against the provision of sponsorship service. Since the recipient of sponsorship services- Panini Private Limited is a body corporate, GST on said services is payable by the recipient – Panini Private Limited, under reverse charge.

 

[ICAI-F-SM-Ch3-2]

Arpan Singhania is an executive director in Narayan Limited, Haryana. The company paid him the sitting fee amounting to Rs.25,000, for the month of January. Further, salary was paid to Arpan Singhania amounting to Rs.1.5 lakh for the month of January on which TDS was also deducted as per applicable provisions under Income-tax law. Tapasya & Associates, in which Arpan Singhania is a partner, supplied certain professional services to Narayan Limited in the month of January for an amount of Rs.2 lakh. Discuss the person liable to pay GST in each of the supplies involved in the given case.

Answer

Sitting fee paid to director – As per reverse charge notification, tax on services supplied by a director of a company/ body corporate to the said company/ body corporate, located in the taxable territory, is payable under reverse charge. Hence, in the present case, the sitting fee amounting to Rs.25,000, payable to Arpan Singhania by Narayan Limited, is liable to GST under reverse charge and thus, recipient of service - Narayan Limited – is liable to pay GST on the same.

Salary paid to director - As per Circular No.140/10/2020 GST dated 10.06.2020, the part of director’s remuneration which is declared as salary in the books of a company and subjected to TDS under section 192 of the Income-tax Act, are not taxable being consideration for services by an employee to the employer in the course of or in relation to his employment in terms of Schedule III. Therefore, in the given case, the salary received by Arpan Singhania of ` 1.5 lakh is not liable to GST.

Services provided by Tapasya & Associates – Tapasya & Associates have rendered certain professional services to Narayan Limited. The fact that Arpan Singhania is a partner in Tapasya & Associates and a director in Narayan Limited does not have any impact on the taxability of the professional services supplied by Tapasya & Associates to Narayan Limited. The professional services provided by Tapasya & Associates to Narayan Limited are liable to GST under forward charge and thus, supplier – Tapasya & Associates – is liable to pay GST on the same.

 

Question-1

GST is payable by the recipient under reverse charge on:

(a) Sponsorship services; (b) Transport of goods by rail; (c) Transport of passengers by air; (d) All of the above

 

Question-1

State person liable to pay GST in the following independent cases provided recipient is located in the taxable territory:

(a) Services provided by an arbitral tribunal to any business entity.

(b) Sponsorship services provided by a company to an individual.

(c) Renting of immovable property service provided by the Central Government to a registered business entity.