Page 4 - Ch5_Value of Supply

01. Sec 15(2):- Additions to Transaction Value

CCP 05.01.01.00
Can any addition be made to the contracted price when 'Transaction Value' is acceptable?
Answer:
Yes, As per section 15(2) of CGST Act, 2017, the following inclusions shall be made to the transaction value
determined as per section 15(1):-

a) any taxes, duties, cesses, fees and charges levied under any law other than the GST law, if charged
separately by the supplier.
b) any amount that the supplier is liable to pay in relation to such supply but which has been incurred by the
recipient & also not included in the price actually paid or payable for the goods &/or services.

c) incidental expenses, including commission and packing, charged by the supplier to the recipient, and any
amount charged for anything done by the supplier in respect of the supply until delivery of goods or supply
of services.
d) interest or late fee or penalty for delayed payment of any consideration for any supply &
e) subsidies directly linked to the price excluding subsidies provided by the Central Government & State

Government.

Sec 15(2)(a): Taxes, duties, Cess, Fees and Charges other than GST

CCP 05.01.02.00

i) The Value of supply shall be Rs. 16,000 which is including the house tax
(i.e. Rent ` 15,000 + House tax ` 1,000).

ii) Contract Value is ` 14,000 including GST @18%. GST charged shall be worked out as per Rule 35 of
CGST Rules i.e. `14,000 * 18/118 = ₹ 2,1366. Thus, the value of supply for GST will be `11,864.

Author's Note:- we can show value of supply excluding GST as Rs. 14,000 * 100/118 = Rs.11,864
iii) The value of taxable supplies on which the Indian company will pay GST under reverse charge shall
be ₹ 1,00,000 which is including TDS under income tax act.

Sec 15(2)(b): Payment made to third party
CCP 05.01.03.00
XYZ Ltd. sells plant & machinery installed at its factory on 'as is whereas basis at 2,00,000. In order to ₹
remove machinery from the factory, the buyer incurs dismantling charges of 3000, which are paid to ₹
third party. Determine the value of supply as per GST Act.

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