VALUATION FOR INTER-BRANCH TRANSACTIONS UNDER GST

  • Category: Levy and supply
  • Date: 23-12-2019
  • Writers: Adv. Lavanya P.R, CA Vikram Katariya
  1. Need for Valuation Rules for Transactions Within Company

During the pre-GST era, for inter-State stock transfers, the major concern of the Industry was with regard to the additional cost of CST and the compliance burden of submission of statutory forms. However, there was no concept of deemed service between branches located in two different States and hence there was no requirement to pay Service Tax on such activities. With the introduction of GST, by virtue of Schedule I, the...

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Intermediary and Export of Services under GST

  • Category: Levy and supply
  • Date: 20-12-2019
  • Writer: Harish P Devda

Background

Under GST, tax is levied on the taxable supply of goods/services. Tax is applicable on the taxable services supplied in India.

In the GST regime, intermediary services by Indian suppliers to foreign principals are taxed to GST. In common parlance, any person who enables the supply of goods/services between two persons is considered as an intermediary.

There has been a lot of confusion regarding tax implications on the pre-sales and post-sales services vs intermediary...

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GST on Notice Period Recovery

  • Category: Levy and supply
  • Date: 13-12-2019
  • Writers: Bhavesh Mittal, CA Madhukar N Hiregange

The GST law was with also the objective of reducing multiple litigations pertaining to erstwhile regime like VAT, Service Tax, and Excise etc. being put to rest. However, there are still aspects like compensatory damages, employee notice period recovery which needs clarity. In many private organizations, employees would be legally bound to serve for specified period which could vary from 1 month to 3 months depending on termination. If employee fails, then the security amount collected...

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Taxability of warranty services in the hands of the Indian service provider

  • Category: Levy and supply
  • Date: 12-12-2019
  • Writers: Shilpi Jain, Shruthi Agarwal

In respect of many of the durable goods, the manufacturers provide after-sale warranty services i.e. for a specified period of time after the sale of the product, the manufacturer assumes responsibility to provide service for any defect in the product and/or replaces any part free of cost (or as mentioned in the agreement in this regard). In some cases, a manufacturer is a person located outside India who supplies the equipment or any good through an Indian dealer/intermediary and then also...

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All industry Duty Drawback for Deemed Supplies under FTP

  • Category: Levy and supply
  • Date: 25-11-2019
  • Writer: Adv.Venkatanaryana GM

Major retrospective benefit for exporters, EOUs etc. in the form of duty drawback availability for past supplies from 5th December 2017. Claims for 2 years can be made by the suppliers to EOUs or EOU itself and others.

Ministry of commerce implements and monitors the Foreign Trade Policy (FTP) framed for export and import transactions. FTP provides the basic framework of policy and strategy to be followed for promoting exports and trade. The policy is periodically reviewed to incorporate...

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Rate of tax for hotel accommodation – after 37th GST Council’s recommendation

  • Category: Levy and supply
  • Date: 30-09-2019
  • Writer: Shilpi Jain

Sep ‘19 The rate of tax for the accommodation services up to 30th Sep ’19 is as below: Old rate

Transaction value per unit per day

GST         (new

rate of tax)

Less than INR 1,000 (per unit)

Nil

INR 1,000 to INR 2,499

12 percent

INR 2,500 to INR 7,499

18 percent

INR 7,500 and more

28...

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GST Valuation – Construction Service - Actual land deduction

  • Category: Levy and supply
  • Date: 05-06-2019
  • Writers: CA Madhukar N Hiregange, CA Venkata Prasad

Valuation is the measurement of value on which any tax has to be paid. The typical construction contract is the composition of three components namely

  • Land or an undivided portion of land in case of apartments
  • Materials/goods like cement, steel etc.,
  • Services like labour in construction, designing etc. 

Before GST was introduced, different indirect taxes were levied on the above mentioned three components. State government levied Stamp Duty on transfer of immovable...

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Note on analyzing whether vendors can be suggested to opt for the new scheme for paying tax @ 6% under GST

  • Category: Levy and supply
  • Date: 27-04-2019
  • Writers: Monika Motta, Shilpi Jain

Introduction: To ease out the GST compliances for the MSME sector, the Government has introduced a new scheme of tax for the suppliers of goods or services who are not covered under the existing composition scheme u/s 10 of the CGST Act, wherein the GST shall be discharged at a flat rate of 6% and annual returns need to be filed with monthly payment of taxes. This scheme could be recommended to the vendors of registered persons who are not in a position to avail ITC for various reasons,...

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RCM ON PROCUREMENTS FROM UNREGISTERED VENDORS

  • Category: Levy and supply
  • Date: 04-02-2019
  • Writer: N Raghunandan

BACKGROUND

Indirect tax is normally paid by the supplier of the goods or the service provider. However, in certain cases, the receiver or the customer of such goods or services are made responsible to pay the taxes instead of the seller or service provider. This mechanism of paying taxes by the recipient is called payment of taxes under reverse charge mechanism [RCM].

The payment of tax liability fully under reverse charge by the recipient and partly by the supplier as well as the...

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