Central Goods and Services Tax Act, 2017 Amendments
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Questions and Answers

A registered person can collect tax in excess of the effective rate when goods or services are exempt from tax.

False

What is included in the expression 'aggregate turnover' for determining a person's eligibility to pay tax?

  • Value of exempt supply of services
  • Value of supplies from the 1st day of April of a financial year (correct)
  • Value of deposits, loans or advances
  • None of the above

    • What is the time of supply for goods?

    The time of supply is the earlier of the date of issue of invoice or the date of receipt of payment.

    The time of supply is deemed to have been made to the extent it is covered by the __________.

    <p>invoice</p> Signup and view all the answers

    Match the following terms with their definitions:

    <p>Input Tax Credit = Credit of input tax paid on supplies used in business Aggregate Turnover = Value of all taxable supplies made by a person Time of Supply = When tax liability arises for goods or services Exemption = Relief from paying tax on certain supplies</p> Signup and view all the answers

    What is the short title of the Act that extends to the whole of India?

    <p>Central Goods and Services Tax Act, 2017</p> Signup and view all the answers

    The Central Goods and Services Tax Act, 2017 has the force of law.

    <p>False</p> Signup and view all the answers

    Which of the following Acts amended the Central Goods and Services Tax Act, 2017? (Select all that apply)

    <p>The Finance Act, 2018</p> Signup and view all the answers

    The Central Goods and Services Tax Act was received the assent of the President on ___

    <p>12th April, 2017</p> Signup and view all the answers

    What does 'aggregate turnover' refer to?

    <p>The aggregate value of all taxable supplies, exempt supplies, exports and inter-State supplies.</p> Signup and view all the answers

    The term 'business' only includes activities for pecuniary benefit.

    <p>False</p> Signup and view all the answers

    What does 'composite supply' mean?

    <p>A supply made by a taxable person consisting of two or more taxable supplies.</p> Signup and view all the answers

    Match the following terms with their definitions:

    <p>Agent = A person conducting business on behalf of another. Audit = Examination of records for accuracy. Exempt supply = Supply that attracts nil tax rate. Inward supply = Receipt of goods or services.</p> Signup and view all the answers

    Which of the following includes the term 'construction'?

    <p>All of the above</p> Signup and view all the answers

    Goods or services used for personal consumption are eligible for input tax credit.

    <p>False</p> Signup and view all the answers

    What must a person do to be entitled to credit of input tax on inputs held in stock?

    <p>Apply for registration within thirty days from the date he becomes liable to registration.</p> Signup and view all the answers

    The Input Service Distributor must distribute the credit by way of issue of a ______ containing the amount of input tax credit.

    <p>document</p> Signup and view all the answers

    Which of these conditions applies to the distribution of credit by the Input Service Distributor?

    <p>Credit of tax paid on input services must be distributed only to that recipient</p> Signup and view all the answers

    What is the maximum period for distributing input tax credit?

    <p>One year from the date of issue of tax invoice.</p> Signup and view all the answers

    If a registered person opts to pay tax under section 10, they must pay an amount equivalent to the credit of input tax in respect of inputs held in stock and ______.

    <p>inputs contained in semi-finished or finished goods</p> Signup and view all the answers

    The principal may take credit of input tax on inputs sent for job work without first bringing them to his place of business.

    <p>True</p> Signup and view all the answers

    What is the time limit for receiving capital goods back from a job worker to avoid them being treated as supplied?

    <p>Three years</p> Signup and view all the answers

    What is meant by 'money' in the context of this Act?

    <p>Indian legal tender or any foreign currency, cheque, promissory note, bill of exchange, letter of credit, draft, pay order, traveller cheque, money order, postal or electronic remittance.</p> Signup and view all the answers

    What is a 'motor vehicle' as defined in this Act?

    <p>It has the same meaning assigned to it in clause (28) of section 2 of the Motor Vehicles Act, 1988.</p> Signup and view all the answers

    Who is considered a 'non-resident taxable person'?

    <p>Any person who occasionally undertakes transactions involving supply of goods or services but has no fixed place of business or residence in India.</p> Signup and view all the answers

    What constitutes a 'non-taxable supply'?

    <p>A supply of goods or services which is not leviable to tax under this Act or under the Integrated Goods and Services Tax Act.</p> Signup and view all the answers

    What does 'output tax' refer to in relation to a taxable person?

    <p>The tax chargeable under this Act on taxable supply of goods or services made by him or by his agent.</p> Signup and view all the answers

    What is meant by 'place of business' according to this Act?

    <p>A place from where the business is ordinarily carried on, including a warehouse, godown, or any other place where a taxable person stores goods.</p> Signup and view all the answers

    What is the criterion for a 'valid return' as per the Act?

    <p>A return furnished under sub-section (1) of section 39 on which self-assessed tax has been paid in full.</p> Signup and view all the answers

    What is 'reverse charge'?

    <p>The liability to pay tax by the recipient of supply instead of the supplier under certain specified provisions.</p> Signup and view all the answers

    What does the term 'telecommunication service' refer to in this Act?

    <p>Service of any description made available to users through various forms of transmission or reception of signs, signals, writing, images, sounds, etc.</p> Signup and view all the answers

    What is meant by 'tax period'?

    <p>The period for which the return is required to be furnished.</p> Signup and view all the answers

    What is a 'voucher' in the context of this Act?

    <p>An instrument where there is an obligation to accept it as consideration or part consideration for a supply of goods or services.</p> Signup and view all the answers

    What constitutes a 'works contract'?

    <p>A contract for building, construction, fabrication, or associated activities involving transfer of property in goods.</p> Signup and view all the answers

    What is the 'taxable territory'?

    <p>The territory to which the provisions of this Act apply.</p> Signup and view all the answers

    Study Notes

    Overview of the Central Goods and Services Tax Act, 2017

    • The Act was enacted to provide a framework for levy and collection of tax on intra-State supply of goods or services by the Central Government.
    • Received Presidential assent on 12th April, 2017, and became effective on a date appointed by the Central Government.

    Amendments and Extensions

    • Various amendments have been made to the Act since its inception, including:
      • Central Goods and Services Tax (Extension to Jammu and Kashmir) Act, 2017.
      • Finance Act amendments in 2018, 2019, and 2020.
      • Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020.

    Structure of the Act

    • The Act is divided into multiple chapters addressing distinct aspects of GST:
      • Administration, Levy and Collection of Tax, Input Tax Credit, Registration, and more.
      • Includes chapters detailing procedural aspects such as Returns, Payment of Tax, and Refunds.

    Key Definitions

    • Aggregate Turnover: Total value of all taxable supplies, exempt supplies, exports, and inter-State supplies, computed on an all-India basis.
    • Casual Taxable Person: A person who occasionally undertakes supply transactions without a fixed place of business.
    • Composite Supply: A supply consisting of two or more taxable supplies that are naturally bundled together; one is the principal supply.

    Authorities and Compliance

    • The Adjudicating Authority is designated to pass orders under the Act, excluding certain higher authorities.
    • Appellate Authority and Appellate Tribunal handle appeals and disputes regarding GST matters.
    • Compliance measures include assessments, audits, and provisions for inspection, search, and seizure.

    Business and Taxation

    • Business includes all commercial activities with or without a profit motive, covering a wide range of industries and services.
    • Central Tax refers to the tax levied under Section 9 of the Act.

    Important Concepts

    • Consideration for supply refers to any payment made in monetary form or otherwise, excluding government subsidies.
    • Input Tax Credit allows businesses to deduct taxes paid on purchases from their tax liabilities.
    • Drawback involves rebates on duties or taxes for goods manufactured in India and exported.

    Procedural Aspects

    • Businesses are required to maintain records, issue tax invoices, and comply with regulations for returns and assessments.
    • The Common Portal facilitates taxpayers in filing returns and making payments electronically.

    Additional Notes

    • The Act incorporates provisions for transitional measures and miscellaneous topics important for trade and industry.
    • Focused on ensuring seamlessness in taxation across different states and union territories, promoting compliance and reducing tax evasion.### Definitions and Key Terms
    • Electronic Cash Ledger: Refers to a digital record for cash transactions as per section 49(1).
    • Electronic Commerce: Supply of goods/services including digital products through electronic networks.
    • Electronic Commerce Operator: Individual or entity operating a platform for electronic commerce.
    • Electronic Credit Ledger: A digital ledger for credits as defined in section 49(2).
    • Exempt Supply: Goods/services with nil tax rate or fully exempt from tax under specified sections.
    • Existing Law: Prior legislation regarding tax or duty on goods/services before this Act's commencement.
    • Family: Encompasses spouse, children, and dependent relatives such as parents and siblings.
    • Fixed Establishment: A stable place of business distinct from the registered office with sufficient resources.
    • Consumer Welfare Fund: Fund established under section 57 for consumer protection and welfare.
    • Goods: Movable property excluding money/securities, also includes actionable claims and growing crops.
    • Government: Refers to the Central Government of India.
    • Goods and Services Tax (Compensation to States) Act: Legislation enacted in 2017 for state compensation.
    • Goods and Services Tax Practitioner: Individuals approved to assist with GST-related services as per section 48.
    • Input: Goods (excluding capital goods) used in business operations.
    • Input Service: Services utilized by a supplier in the course of their business activities.
    • Input Service Distributor: Office distributing credit for input services among suppliers sharing the same PAN.
    • Input Tax: Taxes associated with the receipt of goods/services, excluding taxes paid under composition levy.
    • Input Tax Credit: Credit that can be claimed for input tax paid.
    • Intra-State Supply: Defined under section 8 of the Integrated Goods and Services Tax Act.
    • Job Work: Processing done on goods owned by another registered person.
    • Local Authority: Bodies such as Panchayats, Municipalities, and other specified government entities.
    • Market Value: The price required to acquire goods/services of similar kind and quality at the same market level.
    • Mixed Supply: Combination of multiple goods/services offered together under a single price.
    • Money: Includes legal tender and approved financial instruments but excludes numismatic currency.
    • Non-Resident Taxable Person: Individuals involved in supply transactions without a fixed business presence in India.
    • Output Tax: Tax payable on taxable supply made by a taxable person.
    • Outward Supply: Goods/services supplied by a person in the course of business.
    • Person: Includes individuals, corporations, partnerships, local authorities, and other legal entities.
    • Place of Business: Any location where business activities are conducted (warehouses, offices, etc.).
    • Place of Supply: Defined location related to the supply as per Chapter V of the Integrated Goods and Services Tax Act.
    • Principal Supply: The primary component of a composite supply that holds the most significance.
    • Proper Officer: Assigned tax officer with designated responsibilities under the Act.
    • Recipient: Person liable to pay for the supply of goods/services or the individual receiving such goods/services without payment.
    • Registered Person: Individual/entity registered under section 25 for GST purposes.
    • Taxable Person: Registered individuals or those required to register under specified sections.
    • Taxable Supply: Goods/services to which tax applies under this Act.
    • Taxable Territory: Areas subjected to the provisions of the Act.
    • Telecommunication Service: Includes a variety of communication forms through electronic means.
    • Turnover in State: Total taxable and exempt supplies made by a taxable person within a state excluding certain taxes.
    • Union Territory: Refers to specific territories in India including Andaman, Lakshadweep, Chandigarh, and others.### Definitions and Key Concepts
    • Each territory specified in the Act is recognized as a separate Union territory.
    • "Union territory tax" refers to the tax on goods and services as per the Union Territory Goods and Services Tax Act.
    • The "Union Territory Goods and Services Tax Act" was enacted in 2017 to govern taxation in Union territories.
    • A "valid return" is one where self-assessed tax is fully paid, as per section 39.
    • A "voucher" is an instrument that obliges acceptance for goods or services, with details provided within the document or related conditions.
    • "Works contract" includes contracts for construction or maintenance involving transfer of property in goods.
    • Undefined terms in this Act will take meanings from the Integrated Goods and Services Tax Act or related taxation Acts.
    • Laws not in force in Jammu and Kashmir are interpreted as corresponding laws applicable in that State.

    Administration and Officers

    • Various officers are appointed under this Act including Principal Chief Commissioners, Chief Commissioners, Commissioners, Additional Commissioners, and Assistant Commissioners of Central Tax.
    • Officers from the Central Excise Act are considered appointed under this Act.
    • Additional officers may be appointed as deemed necessary for effective administration.
    • Officers under State and Union Territory GST are authorized to act in specific circumstances.

    Supply and Taxation

    • "Supply" encompasses all forms of transactions involving goods and services, including barter and leasing.
    • The government can define transactions either as "supply of goods" or "supply of services" by notification.
    • Composite supplies have tax liability based on the principal supply, while mixed supplies are taxed at the highest rate of the involved items.

    Levy and Collection of Taxes

    • A central goods and services tax is levied on intra-State supplies, excluding alcoholic liquor, at rates not exceeding twenty percent.
    • Tax on petroleum products will be notified separately by the government.
    • The reverse charge mechanism allows taxes to be paid by the recipient for specified categories and registered persons must follow specific tax obligations.

    Composition Levy

    • Small businesses with turnover under fifty lakh rupees can opt for a composition scheme in lieu of regular tax payments.
    • Different rates apply for manufacturers (one percent), specific supplies (two and a half percent), and others (half percent).
    • Eligibility for the scheme has specific conditions regarding service supply, inter-State transactions, and registration requirements.
    • A person opting for this scheme cannot collect tax from recipients or claim input tax credit.

    Compliance and Penalties

    • If a taxable person claims composition benefits but exceeds the allowed turnover, they may face penalties in addition to owed taxes.
    • The rules were subject to amendments over time to adapt to evolving tax circumstances and practices.

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    Related Documents

    CGST Act, 2017 (Updated 30092020) PDF

    Description

    This quiz covers the amendments made to the Central Goods and Services Tax Act, 2017 including extensions, finance acts, and other amendments. Test your knowledge of the updates to this important tax legislation.

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