Page 23 - Chap24Computation of GST

v. Supply of chemical to one of its customers in Mumbai who required the chemical to be 6,50,000
tested before dispatch and subject to test report coming according to his parameters. (excluding

Testing was successful and testing charges of ` 50,000 were charged extra. testing
charges)
vi. Supply of chemical at subsidized rate for research and development activity not 5,00,000
related to the business of JC to an unrelated charitable association in Haridwar,
Uttarakhand. Open market value of the chemical is ` 6,50,000.

Assume that the rates of GST on chemicals are lGST-12%, CGST-6% and SGST-6%, and on testing
and development services are lGST-18% and SGST-9%.

You are required to determine the taxable value (most beneficial) and GST liability (lGST, CGST and
SGST separately) of Jupiter Chemicals (JC) Haridwar for the month of April 20XX.
[CA Final Dec 21 Exam]

Answer:-

Determination of taxable value and GST liability of Jupiter Chemicals (JC) Haridwar for the month of
April 20XX:

S.No. Particulars Taxable Value IGST (`) CGST (`) SGST (`)
i) Inter-State supply of chemicals to 54,00,000* 6,48,000
consignment agent – PD, Chennai [Value, [54,00,000
× 12%]
at the option of supplier, is:
( i ) O p e n m a r k e t v a l u e ( O M V )

[55,00,000] or
(ii) 90% of `60,00,000 which is the price
charged for supply of goods of like kind
and quality by recipient to his unrelated

customer, where goods are intended for
further supply by the said recipient which
comes to `5400000.
(Refer Assumption 1)

ii) Inter-State supply of chemicals to related 37,80,000* 4,53,600
person - AT [Value of supply of goods to a [37,80,000
related person who further supplies such × 12%]

goods as such, at the option of supplier, is:
(i) OMV, if OMV is available [ 38,00,000] or₹
(ii) 90% of 42,00,000 which is the price ₹
charged for supply of goods of like kind and
quality by recipient to his unrelated

customer, where goods are intended for
further supply by the said recipient which
comes to 37,80,000. ₹
(Refer Assumption 2)

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