Page 26 - Ch_10 ITC

Notes:-
1. Supply of detergent and bucket together with a single price of ₹ 400 is a mixed supply & it shall be treated as

supply of that particular supply that attracts highest rate of tax (28%).
2. Supply of online educational journal to an educational institution which provides a qualification recognised
by law in India is exempt. Since, private coaching centre does not provide any recognised qualification,
supply of online educational journals to the same will be taxable.

3. ITC can be taken only on basis of a valid tax paying document u/s 16(2)(a) of CGST Act. Thus, ITC will not
be available on goods of Rs. 20000 for which the invoice is missing.
4. ITC is not blocked u/s 17(5)(a) of CGST Act on motor vehicles for transportation of persons with seating
capacity more than 13 persons (including driver) & thus, ITC is not blocked on its repair also u/s 17(5)(ab).

5. IGST credit shall be first used fully to pay IGST & then to pay CGST and SGST in any order and in any
proportion. Thus, there cannot be one answer for minimum net CGST and SGST payable in cash.

CCP 10.08.33.00
M/s. Comfortable (P) Ltd. is registered under GST in Chennai, Tamil Nadu. It is engaged in the
manufacture of iron and steel products. It has carried out following transactions in the financial year
20XX-XY:-

(a) Purchased 1,000 Metric Ton (MT) iron @1,000 per MT (excluding GST) from M/s. Hard Ltd. of
Chennai. M/s. Hard Ltd. has fulfilled the order as follows:-
Date Quarterly (MT) Taxable Value (Rs)
28-Feb-20XY 200 2,00,000

10-Mar-20XY 250 2,52,000
25-Mar-20XY 250 2,50,000
28-Mar-20XY 200 2,00,000
Balance order requirement has been fulfilled by Hard Ltd. on 5-Apr-20XY. However, Hard Ltd. has

raised the invoice for full order at the time of dispatch of first lot, i.e. on 28-Feb-20XY. M/s.
Comfortable (P) Ltd. has made the full payment on 28-Feb-20XY for the order.
(a) Company has received IT engineering service from M/s. Dynamic Infotech (P) Ltd. of Chennai for
Rs. 11,00,000/- (excluding GST) on 28-Oct-20XX. Invoice for service rendered was issued on 5-
Nov- 20XX. M/s Comfortable (P) Ltd. made part-payment of Rs. 4,13,000/- on 31-Dec-20XX.

Being unhappy with service provided by M/s Dynamic Infotech (P) Ltd., it did not make the balance
payment. Deficiency in service rendered was made good by M/s Dynamic Infotech (P) Ltd. by 15-
Feb-20XY. M/s. Comfortable (P) Ltd. made payment of Rs. 2,95,000/- on 15-Feb-20XY towards

full & final settlement of the dues and did not pay the balance amount. [Study Mat covers (b)]
(b) Company has made following intra State supplies (excluding GST) for the financial year 20XX-XY:-
S.No. Particulars Amount (₹)
(1) Value of intra-State supplies made to registered persons 10,00,000
(2) Value of intra-State supplies made to unregistered persons 2,00,000

(i) Compute the GST liability (CGST, SGST or IGST, as the case may be) of M/s. Comfortable (P) Ltd.
for the financial year 20XX-XY:-
(ii) Compute amount of ITC to be reversed in FY 20XX-XY and/or in the next FY 20XY-YZ, if any.

Assume the rate of GST as under:- CGST @9%, SGST @9%, & lGST @18%

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