Page 16 - Ch8_ EXEMPTION

Answer:-
(i) Legal Provision:-

Ø Services by an artist by performing folk or classical art forms of music, dance or theatre are exempt
from GST, if the consideration charged for such performance is not more than ₹ 1,50,000.
Ø However, this exemption is not available to an artist performing as a brand ambassador.
Discussion & Conclusion:-

Ø In the given case, Ms. Mahima is the brand ambassador of 'Forever Beauty' soap manufactured by XYZ
Pvt. Ltd.
Ø Hence, services rendered by her by way of a classical dance performance in the concert organized by XYZ
Pvt. Ltd. to promote its brand will not be eligible for exemption & thus, be liable to GST.

(ii) Even if the proceeds of concert is donated to a charitable organization, she will be liable to GST as this fact
will not have any bearing on eligibility or otherwise to above-mentioned exemption.

09. Exemptions relating to Banking & Financial Sector:-

CCP 08.09.16.00
M/s. Apna Bank Limited, a Scheduled Commercial Bank has furnished the following details for the
month of August, 20XX:- [CA Inter Exam May 19 New]

Particulars Rs. in Crore
(Excluding GST)
Extended Housing Loan to its customers 100
Processing fees collected from its customers on sanction of loan 20
Commission collected from its customers on bank guarantee 30
Interest income on credit card issued by the bank 40

Interest received on housing loan extended by the bank 25
Minimum balance charges collected from current account andsaving account holder 01
Answer:

Computation of value of taxable supply of M/s. Apna Bank Limited for the month of August, 20XX:-
Particulars Rs in Crore Reason
Extended Housing Loan to itscustomers Nil Exempt, since money does not constitute goods or services, extending
housing loan is not a supply

Processing fees collected from its 20 Taxable, since interest does not include processing fee on sanction of
customers on sanction of loan the loan.
Commission collected from its 30 Taxable, as any commission collected over & above interest on loan,
customers on bank guarantee advance or deposit is not exempt.

Interest income on credit card issued 40 Taxable, as interest income on extending loans is exempt but interest
by the bank income on credit card services is an exception to this exemption.
Interest received on housing loan Nil Exempt, as services of extending loans where consideration is
extended by the bank represented by way of interest are exempt.

Minimum balance charges collected 01 Taxable, as any charges collected over & above interest on loan, advance
from current account & saving account or deposit is not exempt.
holder
Value of Taxable Supply 91

124 CA VISHAL BHATTAD 09850850800 www.vsmartacademy.com V’Smart Academy