Page 12 - Chap24Computation of GST

Electronic Credit Ledger and/or Electronic Cash Ledger, as the case may be, for the given tax period
using the above-mentioned information.

Note: All the above transactions are exclusive of GST, wherever applicable. Assume that rates of GST
on inward and outward supply of goods and services are 12% and 18% respectively (Ignore bifurcation
of CGST, SGST or IGST for the sake of simplicity). Subject to the information given above, assume
that all the other conditions necessary for availing ITC have been fulfilled.

Turnover of Jankinandan Associates was ₹ 72 lakh in the preceding financial year. Unless
otherwise mentioned, exports are made under letter of undertaking. [CA Final RTP May 23]

Answer:
1) Computation of GST payable on outward supply:-
Particulars Value(`) GST(`)
Turnover of 'Zeta' [liable to GST @ 12%] 21,00,000 2,52,000
Turnover of 'Sigma' [Tax on 'Sigma' is payable under reverse charge by the 9,00,000 Nil

recipient of such goods]
Turnover of 'Omega' [liable to GST @ 12%] 15,00,000 1,80,000
Export of 'Zeta' with payment of IGST @ 12% 3,75,000 45,000

Export of 'Omega' [Note 1] 15,00,000 Nil
Consultancy services provided to independent clients located in foreign 30,00,000 Nil
countries. [Note 2]
Sale of shares [Note 3] 3,75,00,000 Nil

Sale of building [Note 4] 1,80,00,000 Nil
Interest received on investment in fixed deposits with a bank [Note 5] 6,00,000 Nil
Total GST payable on outward supply 4,77,000

2) Computation of common credit attributable to exempt supplies during the tax period:-
Particulars ( )₹
Common credit on inputs and input services [Tax on inputs: ₹ 6,30,000 (₹ 52,50,000 x 10,35,000
12%) + Tax on input services: ₹ 4,05,000 (₹ 22,50,000 x 18%)]
Common credit attributable to exempt supplies (rounded off) = Common credit on inputs 6,97,742

and input services x (Exempt turnover during the period / Total turnover during the period)
= ₹10,35,000 x ₹ 1,87,75,000/ ₹ 2,78,50,000 Exempt turnover = ₹ 1,87,75,000 & total
turnover = ₹ 2,78,50,000 [Note 6]

3) Computation of ITC available in Electronic Credit Ledger of Jankinandan Associates for the tax period:-
Particulars (₹)
Common credit on inputs and input services 10,35,000
Add: Legal services used in the manufacture of taxable product 'Zeta' 94,500

ITC available in the Electronic Credit Ledger 11,29,500
Less: Common credit attributable to exempt supplies during the tax period 6,97,742
[As calculated in above table]

Net ITC available 4,31,758

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