Page 11 - Chapter 2.cdr

(b) The monetary value of any act or forbearance, in respect of, in response to, or 2. Supply of goods or services or both between related persons or between distinct
for the inducement of, the supply of goods or services or both, whether by the persons as specified in section 25 , when made in the course or furtherance of
recipient or by any other person but shall not include any subsidy given by the business: CH 2
Central Government or a State Government: Provided that gifts not exceeding `50,000 in value in a financial year by
Provided that a deposit given in respect of the supply of goods or services or both an employer to an employee shall not be treated as supply of goods or services or
shall not be considered as payment made for such supply unless the supplier applies both.

such deposit as consideration for the said supply 3. Supply of goods-
(a) by a principal to his agent where the agent undertakes to supply such goods
11. Section 7(1) (b)- Import of service for consideration on behalf of the principal; or
CCP 02.11.23.00 (b) by an agent to his principal where the agent undertakes to receive such Charge of Tax & Concept of Supply
goods on behalf of the principal.
Shreya a student of engineering plans to pursue her higher education in US. He
receives career consultancy services from a US based consultant for ` 2, 50,000. 4. Import of services by a person from a related person or from any of his other
Does it qualify as a supply? establishments outside India, in the course or furtherance of business.
Answer: Yes, As per section 7(1)(b) of CGST Act, 2017, Supply includes import of
services for a consideration whether or not in the course or furtherance of business. CCP 02.12.25.00 (Para 1 & Para 3)
Hence, in the above case it will be treated as a supply. Answer the following questions:

Note:- As per Sr. No. 10 of Exemption N/N 9/2017(IT), If service is received from a (a) Sudama Associates, a registered supplier, disposes the computers owned by
person located in non-taxable territory by as individual for the purpose other than the business without consideration and it has not claimed input tax credit
commerce, Business or profession then such service is exempted from payment of tax on such computers.
Examine whether the disposal of computers by Sudama Associates qualifies
12. Section 7(1) (c)- Activities to be treated as supply even if made as deemed supply under Schedule I of the CGST Act.
without consideration read with schedule I (b) Prithvi Enterprises appoints Champak to procure certain goods from the

CCP 02.12.24.00 market. Champak identifies various suppliers who can provide the goods as
Whether supply of goods or services without consideration is liable to tax? desired by Prithvi Enterprises, and asks a supplier – Satya Manufacturers to
Answer: Normally as per Sec 7(1)(a) supply of goods or services for consideration is send the goods and issue the invoice directly to Prithvi Enterprises.
liable to GST. You are required to determine whether Champak can be considered as an
agent of Prithvi Enterprises in terms of Schedule I of the CGST Act. [ICAI
The activities enumerated in Schedule I will qualify as supply even if made
Material]
without consideration. Following are the transactions mention in Schedule I.
Answer :- (a) As per section 7(1)(c) read with Schedule I of the CGST Act,
1. Permanent transfer or disposal of business assets where input tax credit has been
permanent transfer or disposal of business assets is treated as supply even
availed on such assets.

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CA Final GST Questioner