Page 7 - Ch15_Computation of GST

3) ÜAs per section 9(3) of CGST Act, Tax on legal services provided by Partnership firm of advocate
to a business entity, is payable under reverse charge by the business entity.

Ü Further, tax payable under reverse charge, being not an output tax, cannot be set off against ITC
and thus, will have to be paid in cash.
4) ÜAs per 1st proviso to section 16(2) of CGST Act, In case of goods received in lots, ITC can be taken
only upon receipt of the last lot.
Ü Hence, ITC on tools received will not be available in February, 20XX

5) Since discount given by ABC Ltd. on the packets of tools was not known at the time of supply, it shall
not be excluded from its value of supply.
Assumptions taken by ICAI:

Ü It is assumed that the aggregate turnover of ABC Ltd. in the preceding FY was above the threshold limit for
registration under GST law.
Ü It is also possible to assume the interest on delayed payment to be exclusive of GST and to compute the
same by taking the values as exclusive of GST (i.e. ₹ 5,00,000).

CCP 15.01.03.00
Jino Enterprises, a partnership firm is a regular taxable person registered in Guwahati, Assam and is
engaged in supply of Air conditioners and its accessories as well as air-conditioned repairing services.

Details of their various activities for the month of October 20YY are as follows:
1) Intra State supply of Air conditioner to customers in Assam. Freight is separately charged in invoices
for delivery of goods at customer's doorstep.
Particulars Amount (₹)

Value of goods 4,00,000
Value of freight charges charged separately in above invoices 1,00,000
2) Intra State supply of repairing services wherein apart from charging service charges, cost of parts/
spares provided to customers is also charged and consideration for the same is separately mentioned

in the invoices
Particulars Amount (₹)
Value of services component of invoices 3,00,000
Value of parts / spares component in invoices 50,000

3) In order to enhance their sales and to clear the stock of old models of air - conditioner, Jino
Enterprises made combo offers to customers wherein, if a customer purchases an Air-conditioner
along with a stabilizer, the same is offered at a combo price of ₹ 20,000 as against the original price of
₹ 30,000 (Air-conditioner ₹ 22,000 & stabilizer ₹ 8,000) if these are purchased separately. During

October 20YY, Jino Enterprises had made inter-State supply of 10 numbers of such combo products.
4) Purchased business class air tickets for intra State travel from Guwahati Airport, Assam to
Dibrugarh Airport, Assam for its executive employees relating to business of the concern. Basic air
fare was ₹ 40,000 and airlines charges GST @ 2.5% CGST, SGST each on basic freight, in case the
same is applicable.

Additional Information:
a) All the figures mentioned above are exclusive of taxes.
b) In respect of few of the invoices relating to F.Y. 20XX -20YY, involving ITC of CGST ₹ 20,000,
SGST of ₹ 20,000, IGST ₹ 80,000 was not taken earlier. Jino Enterprises now want to avail credit

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