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Background

Food supplied by a restaurant is whether supply of goods or supply of services? This question has been hovering since last few decades. The Constitutional Amendment by inserting Article 366 (29A) (f) partially included it within the definition of deemed sale of goods. With introduction of service tax law, the service portion was separately identified in the restaurant services through deeming fiction provided in the Valuation Rule. Thus, both VAT and Service Tax were levied on...

Introduction:

Valuation of any supply is a critical aspect under GST. For that matter it is important in any tax law. After determining the levy and tax rate on any supply next question raises as to on what value tax should be paid. In GST it is called as transaction value.

Why it is critical?

Generally, the amount of tax paid is as a percentage on the value of supply. If there is any reduction in the value of supply, tax liability reduces and if there is any increase in the value...

Initially the imports by the EOUs were liable to IGST and compensation cess. However, from 13^th Oct ’17, the goods imported by them were also exempted from IGST and compensation cess (CC) by way of notification No. 78/2019-Customs. This notification provided exemption from IGST, CC in addition to basic customs duty (BCD) for the specified goods, which also included capital goods, i.e. EOUs could import the specified inputs and capital goods without payment of IGST, CC and BCD.

However,...

Goods and Service Tax (GST) is incorporated with an intention to provide a simple and streamlined tax flow structure. The intention itself provides a legal backing to section 67 to 72 of the Act that allows the enforcement machinery i.e. tax officers to inspect, search and seize records for proper ascertainment of payment of tax and prevent evasion of tax.

The article mainly focuses on two segments i.e. the power of inspection, search & seizure, the manner of its conduct, and the...

The GST audit under Section 35 (5) of CGST Act 2017 has to be done by a registered taxpayer whose annual turnover is more than Rs.5 Crores in a financial year (earlier threshold limit was Rs.2 Crores for FY 2017-18). However, the industry and trade need to carry out input tax credit review before the last date of filing of September return of the subsequent financial year. It is understood that there could be a number of errors of understanding, system errors and transactional mistakes. The...

Under GST, any registered person would be eligible to claim ITC of taxes paid on goods or services procured, which are used or intended to be used in the course or furtherance of business and to the extent used for effecting taxable supplies, unless specifically restricted u/s 17(5) of the CGST Act, 2017 (hereinafter referred to as the ‘Act’).

Apart from the restrictions specified in section 17(5) of the Act, there could be situations where credit would become ineligible, like...

Credit Mechanism is the backbone of the indirect tax regime which allows the assessee to take credit of tax paid on purchase of goods and services availed, in the course of business, though with some conditions and restrictions. Credit under GST is available if used for business purpose and in proportion of its usage for making taxable supplies. Reversal of input tax credit (ITC) is required in respect of procurements that are commonly used for taxable and exempted & non-business supplies or...

The primary focus of the industry at the time of introduction of GST was on implementation/modification of ERP module to suit GST requirements, appropriate classification of goods/services and providing training to staff. Initially, the area of focus was more on the aspect of migration, correct levy of taxes, reverse charge liability and ensure timely compliances with return uploading requirements.

However, after about 12 to 15 months of GST implementation, the focus had shifted to...

Introduction:

With the introduction of GST, there has been a huge chaos among SEZ Developers/ units as to the procedures to be followed w.r.t procurement of goods/ services. As the supplies to SEZ Units/Developers are declared as ‘zero rated supplies’, the suppliers to SEZ units were puzzled about the procedure to be followed for supplying the goods/services to SEZ units and SEZ Developer/units are puzzled about the procedure to be followed for procuring the goods or services.

The...

Advance Authorisation (AA), is one of the schemes under Foreign Trade Policy, 2015-20 (hereinafter referred to as the ‘FTP’) which allows the manufacturer exporter or merchant exporter to import inputs without payment of customs duties in terms of chapter 4 of FTP read with Notification No.18/2015 Cus dated 01.04.2015 as amended. The AA holder has to fulfill prescribed export obligation(EO) corresponding to the duty free imports made. The duty exemption claimed needs to be paid back...