Page 29 - Chap24Computation of GST

15 Since the value of taxable supply other than zero-rated supply in the given tax period (₹ 14 lakh

+ ₹ 6 lakh + ₹ 0.50 lakh + ₹ 2.50 lakh) does not exceed ₹ 50 lakh, provisions of rule 86B are not
applicable and Motopower Ltd. can discharge its entire output tax liability for said period from
the electronic credit ledger.
16 Ü CGST and SGST are chargeable on intra-State inward & outward supplies and IGST is chargeable
on inter-State inward & outward supplies.
Ü Rate of CGST, SGST and IGST applied is 9%, 9% and 18% except in case of renting of cars wherein

the rate of CGST and SGST applied is 2.5% and 2.5% respectively

CCP 24.01.09.00
In Que 07.06.24.00 in ITC Chapter, all other things remaining the same, compute the value of supply
(most beneficial) made by Bangalore unit as well as the value of supply (most beneficial) made by
Ahmedabad Retail Showroom, with respect to transfer of goods by these units to M/s. Equilibrium
Sales, M/s. Paridhi Sales and M/s. Dhara Enterprises, if Super Lever Limited furnishes the following

additional information for the month of October:
(i) Bangalore unit has appointed M/s. Equilibrium Sales as its sole selling agent.
M/s. Equilibrium Sales sells the electronic goods of Bangalore unit under the invoice
issued in its own name. The Bangalore unit transferred the goods costing ` 7,25,000 to M/s.

Equilibrium Sales on 20th October which were sold by M/s. Equilibrium Sales on 31st October at `
7,65,000. On 20th October, another electronic goods’ manufacturer supplied the goods of like
kind and quality to M/s. Equilibrium Sales as the one supplied by the Bangalore unit at a price of `
7,75,000.
(ii) The Retail Showroom at Ahmedabad transfers goods costing ` 85,000 to its agent, M/s. Paridhi

Sales on 12th October. M/s. Paridhi Sales sells such goods on 18th October at ` 5,00,000 under
the invoice issued in the name of Retail Showroom at Ahmedabad. On 17th October, M/s Paridhi
Sales has sold goods of like kind and quality as the one supplied by the Retail Showroom at

Ahmedabad to an unrelated customer at ` 4,70,000.
The Retail Showroom at Ahmedabad also transfers goods costing ` 95,000 to its agent,
M/s. Dhara Enterprises on 15th October. M/s. Dhara Enterprises sells such goods on 20th
October at ` 1,00,000 under the invoice issued in its own name. On 19th October, M/s Dhara
Enterprises has sold goods of like kind and quality as the one supplied by the Retail Showroom at

Ahmedabad to an unrelated customer at ` 98,000.
Note: M/s. Equilibrium Sales, M/s. Paridhi Sales and M/s. Dhara Enterprises are not eligible for full
input tax credit. Further, open market value of the goods is not available in any of the above cases.
[CA Final RTP Nov 22]

Answer:-
(i) Ü As per explanation to section 15, persons who are associated in the business of one another
in that one is the sole agent or sole distributor or sole concessionaire, howsoever described,

of the other, shall be deemed to be related.
Ü Thus, in the given case, since M/s. Equilibrium Sales is a sole selling agent of Bangalore unit,
both are related persons.
Ü Further, an activity/transaction qualifies as supply under GST only if it is undertaken for a

consideration and is in course/furtherance of business.

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