Page 11 - Ch2_Supply

Answer:-
Legal provision:-

Ü As per section 7(1)© read with para 2 of schedule I of CGST Act, 2017, Supply of goods &/or services
between distinct person u/s 25 in the course or furtherance of business shall be treated as supply even
when it is made without consideration.
Ü Section 25(4) of CGST Act, 2017 states that if more than one registration is obtained or is required to be

obtained by a person in one or more State, then for each of such registration, he shall be treated as
distinct persons.
Discussion & Conclusion:-
Ü In given case, factory & retail showroom of Raghubir Fabrics are registered in the States where they are

located. So, both are treated as establishments of distinct person u/s 25(4).
Ü Although, no consideration is charged, supply of goods from factory to retail showroom constitutes supply
as per para 2 of schedule I stated above as it is in course or furtherance of business.

CCP 02.05.13.00
On occasion of Diwali, Daksh gold pvt. ltd. distributes gift hamper to its employee worth ₹ 3,00,000.
Does it qualify as supply? Would your answer be different, if gifts of ₹ 42,000 have been given to a
employee?

Answer:-
Legal Provision:-
Ü As per section 7(1)(c) read with Para 2 of Schedule I of CGST Act, 2017, Supply of goods &/or services
between related persons is treated as supply even if it is without consideration.
Ü Proviso to para 2 of schedule I states that if gifts given by employer to an employee are not exceeding ₹

50,000 in value in a financial year, then it shall not be treated as supply of goods &/or services.
Ü As per explanation to section 15, employer and employee are deemed to be related persons.
Discussion & Conclusion:-

1)Diwali gift to employee worth 3,00,000 will qualify as supply and such supply would be leviable to GST ₹
as the employer & employee are related and value of gift exceeds Rs 50000 in a financial year.
2) If gift of 42,000 is given instead of 3,00,000, the same will not qualify as supply. This is because, the ₹ ₹
value of gift is not exceeding 50,000 in a financial year. ₹

CCP 02.05.14.00
Gagan Engineering Pvt. Ltd., registered in Haryana, is engaged in providing maintenance and repair
services for heavy steel machinery. For carrying out the repair work, Gagan Engineering Pvt. Ltd.

sends its container trucks equipped with items like repair equipments, consumables, tools, parts etc.
from Haryana workshop to its own repairing centres (registered under GST law) located in other
States across India where the clients' machinery are being brought and are being repaired.
Discuss the leviability of GST on the inter-State movement of trucks from the workshop of Gagan
Engineering Pvt. Ltd. in Haryana to its own repairing centres located in other States across India.

[Study Mat] [CA Inter MTP Oct 23]
Answer:-
Legal Provision:-
Ü Section 25(4) of CGST Act, 2017 states that if more than one registration is obtained or is required to be

obtained by a person in one or more State, then for each of such registration, he shall be treated
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