Page 17 - Chap24Computation of GST

for the relevant tax period is Nil. [CA Final RTP May 22]

Answer:- Computation of net GST payable by Adityanath Private Limited for the month of August:

Particulars (`)
Gross GST liability on outward supply [as computed in Answer CCP 24.01.04.00 above] 52,00,000
Less: Input tax credit (ITC) [Note 1] [Refer Working Note 2] 2,74,417

GST payable from Electronic Cash Ledger [A] 49,25,583
Add: GST payable on inward supplies under reverse charge
Legal services [` 3,50,000 × 18%] [Note 2] 63,000

Services received from GTA [` 4,00,000 × 5%] [Note 3] 20,000
Tax payable under reverse charge [B] 83,000
Total GST paid from Electronic Cash Ledger [A] + [B] [Note 4] 50,08,583

Working Note - 1

Computation of common credit attributable to exempt supplies during August:
Particulars Amount (`) ITC (`)
Repair of machinery by George Inc. of USA [Note 5] 5,20,000 Nil

Life insurance premium paid by the company for the life insurance of employees 48,50,000 Nil
[Note 6]
Audit fees [6,50,000 × 18%] [Note 7] 6,50,000 1,17,000
Raw material [`(10,00,000 - 1,50,000) × 12% + ` 29,970] [Note 8] 10,00,000 1,31,970
Transportation charges for transporting the goods [` 4,00,000 × 5%] [Note 9] 4,00,000 20,000

Telephone expenses [` 4,25,000 × 18%] [Note 7] 4,25,000 76,500
Bank charges paid towards company’s current account maintained with bank 2,00,000 36,000
[` 2,00,000 × 18%] [Note 7]

Common credit on inputs and input services 3,81,470
Common credit attributable to exempt supplies (rounded off) = Common credit 1,70,053
on inputs and input services x (Exempt turnover during the period / Total
turnover in State during the period) = ` 3,81,470 x ` 2,96,00,000/ ` 6,64,00,000
Exempt turnover = ` 2,96,00,000 and total turnover in State = ` 6,64,00,000

[Note 10]
Legal services received from advocate [`3,50,000 × 18%] [Note 11] 3,50,000 63,000

Working Note - 2

Computation of ITC available in the Electronic Credit Ledger of Adityanath Private Limited for the
month of August:
Particulars (`)
Common credit on inputs and input services [Refer working note-1] 3,81,470

Legal services used in the manufacture of taxable Product ‘Beta’ [Refer Working Note-1]
63,000
ITC available in the Electronic Credit Ledger 4,44,470
Less: Common credit attributable to exempt supplies during August [Refer Working Note 1]
1,70,053
Net ITC available 2,74,417

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