CITY GROUP OF COLLEGES, LUCKNOW

LECTURE
PLAN
(UNITII)
COURSE: - B.COM NEP SEMESTER: 4TH

PAPER: VOCATIONAL SUBJECT: GST

Concepts and
practice
Syllabus: : Definition - Supply, Aggregate Turnover, Person, Business,
Appropriate Government, Mixed Supply, Composite Supply, GSTN, GSTIN, E-
Commerce Input Tax Credit etc. GST Models: Single GST & Dual GST; Types
of GST: - CGST, SGST/UTGST, IGST; Levy and Collection of GST.

LECTURE 1 PART-A Definition - Supply, Aggregate Turnover, Person, Business,

Appropriate Government, Mixed Supply, Composite Supply, GSTN,
GSTIN, E-Commerce Input Tax Credit etc.
PART-B Definition - Supply, Aggregate Turnover, Person, Business,
Appropriate Government, Mixed Supply, Composite Supply, GSTN,
GSTIN, E-Commerce Input Tax Credit etc.
LECTURE 2 GST Models: Single GST & Dual GST

LECTURE 3 Types of GST: - CGST, SGST/UTGST, IGST

LECTURE 4 Levy and Collection of GST.

 LECTURE 1

PART-A

Definition - Supply, Aggregate Turnover, Person, Business, Appropriate Government, Mixed Supply,
Composite Supply, GSTN, GSTIN, E-Commerce Input Tax Credit etc.

1. Person -Section 2(84): person includes,

(a) An individual;
(b) A Hindu Undivided Family;
(c) A company;
(d) A firm;
(e) A Limited Liability Partnership;
(f) An association of persons or a body of individuals, whether incorporated or not, in India or outside India;
(g) any corporation established by or under any Central Act, State Act or Provincial Act or a Government
company as defined in clause (45) of section 2 of the Companies Act, 2013;
(h) Anybody corporate incorporated by or under the laws of a country outside India;
(i) A co-operative society registered under any law relating to co-operative societies;
(j) A local authority;
(k) Central Government or a State Government;
(l) Society as defined under the Societies Registration Act, 1860;
(m) Trust; and
(n) Every artificial juridical person, not falling within any of the above.
2. Goods [Section 2(52) of CGST Act 2017]: “Goods” means every kind of movable property other than
money and securities but includes actionable claim, growing crops, grass and things attached to or forming
part of the land which are agreed to be severed before supply or under a contract of supply.
3. In terms of Section 2(102) “Services” means anything other than goods, money and securities. Services
include activities relating to the use of money or its conversion of Money by cash or by any other mode,
from one form of currency or denomination to another form, currency or denomination for which a separate
consideration is charged.

4. Meaning of ‘Money’ {Section 2(75) of CGST Act}: Money means Indian legal tender or any foreign
currency, cheque, promissory Note, bill of exchange, letter of credit, draft, pay order, traveller cheque,
money Order, postal or electronic remittance or any other instrument recognized by the Reserve Bank of
India when used as a consideration to settle an obligation or Exchange with Indian legal tender of another
denomination. However, money shall not include any currency that is held for its numismatic Value.

5. Section 2 (107)-Taxable person” means a person who is registered or liable to be registered under
section 22 or section 24;

6. Section 2 (7)-Agriculturist” means an individual or a Hindu Undivided Family who undertakes

cultivation of land— By own labour, or By the labour of family, or By servants on wages payable in cash or
kind or by hired labour under personal supervision or the personal supervision of any member of the family;

7. Section 2(56): India means the territory of India as referred to in article 1 of the Constitution, its
territorial waters, seabed and sub-soil underlying such waters, continental shelf, exclusive economic zone or
any other maritime zone as referred to in the Territorial Waters, Continental Shelf, Exclusive Economic
Zone and other Maritime Zones Act, 1976, and the air space above its territory and territorial waters.

8. Aggregate Turnover: - As per section 2(6) of CGST Act, 2017 ‘aggregate turnover’ means the
aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a
person on reverse charge basis), exempt supplies, exports of goods or services or both and inter-State
supplies of persons having the same Permanent Account Number, to be computed on all India basis but
excludes central tax, State tax, Union territory tax, integrated tax and cess.

ONE LINER

1. Section 2(84) person includes (a)…………. (b) …………….(c)……………...

2. …………. means every kind of movable property other than money and securities.
3. ………………….means anything other than goods, money and securities
4. Meaning of ‘Money’ is given under ………......of CGST Act.
5. Section 2 (107) …………….means a person who is registered or liable to be registered under section
22 or section 24.
6. Section ………..means an individual or a Hindu Undivided Family who undertakes cultivation of
land.
7. Section ………… India means the territory of India as referred to in article 1 of the Constitution its
territorial waters, seabed and sub-soil underlying such waters, continental shelf, exclusive economic
zone.
8. Aggregate Turnover is given under section……………. of CGST Act, 2017.

ANSWER

1. (a) An individual (b) A Hindu Undivided Family (c) A company

2. “Goods”
3. “Services”
4. Section 2(75)
5. Taxable person
6. 2 (7)-Agriculturist”
7. 2(56)
8. 2(6)
 LECTURE 1

PART-B

Definition - Supply, Aggregate Turnover, Person, Business, Appropriate Government, Mixed Supply,
Composite Supply, GSTN, GSTIN, E-Commerce Input Tax Credit etc

9. Supply under GST-The expression “supply” simply means all forms of supply of goods/services. It is
made for a consideration during the course of business and includes the following: -Sale -Transfer -Barter
Exchange -License -Rental -Lease -Disposal -Import of services for a consideration (if even it is not in the
course or furtherance of business) Certain activities specified in Schedule I of GST Act will also be treated
as supply.

10. Composite Supply under GST, a composite supply would mean a supply made by a taxable person to a
recipient consisting of two or more taxable supplies of goods or services or both, or any combination
thereof, which are naturally bundled and supplied in conjunction with each other in the ordinary course of
business, one of which is a principal supply.

11. Mixed Supply under GST, a mixed supply means two or more individual supplies of goods or services,
or any combination thereof, made in conjunction with each other by a taxable person for a single price
where such supply does not constitute a composite supply.

12. Business Under section 2(17) CGST Act (a) any trade, commerce, manufacture, profession, vocation,
adventure, wager or any other similar activity, whether or not it is for a pecuniary benefit; (b) any activity or
transaction in connection with or incidental or ancillary to (a) above; (c) any activity or transaction in the
nature of (a) above, whether or not there is volume, frequency, continuity or regularity of such transaction;
(d) supply or acquisition of goods including capital assets and services in connection with commencement or
closure of business; (e) provision by a club, association, society, or any such body (for a subscription or any
other consideration) of the facilities or benefits to its members, as the case may be; admission, for a
consideration, of persons to any premises; and (f) services supplied by a person as the holder of a number
office which has been accepted by him in the course or furtherance of his trade, profession or vocation; (g)
activities of a race club including by way of totalizator or a license to book maker or activities of a licensed
book maker in such club; and”; (h) any activity or transaction under taken by the Central Government, a
State Government or any local authority in which they are engaged as public authorities.

13. Goods and Services Tax Network (GSTN) was set up as a private company in 2013 by the
Government under Section 25 of the Companies Act, 1956. GSTN is expected to offer the frontend services
of registration, payment, and returns to taxpayers. It would also develop back-end technical modules that
will be utilized by 25 states that have opted in. GSTN has also identified 34 IT and financial technology
companies and tagged them as GST Suvidha Providers (GSPs). These organisations will develop
applications that will be used by taxpayers when they interact with GSTN.

14. GSTIN- GSTIN is the Goods and Services Tax Identification Number or GST number. The Government
of India introduced a tax for goods as well as services, popularly known as GST, on 1 July 2017 to ensure
transparency and simplification in India’s tax collection structure. GST replaces different state and central
taxes to promote the motto- one tax in one nation A GSTIN is a 15-digit PAN-based unique identification
number allotted to every registered person under GST.
GSTIN structure comprises-
• First 2 numbers → State code of the registered person
• Next 10 characters → PAN of the registered person
• Next number→ Entity number of the same PAN
• Next character → Alphabet Z by default
• Last number → Check code which may be alpha or digit, used for detection of errors

15. Electronic Commerce has been defined in Sec. 2(44) of the CGST Act, 2017 to mean the supply of
goods or services or both, including digital products over digital or electronic network.

16. Input Tax Credit refers to the tax already paid by a person at time of purchase of goods or services and
which is available as deduction from tax payable.

17. Appropriate government refers to the Central Government for IGST, UTGST and CGST, and the State
Government for SGST.

ONE LINER

1. …………………….refers to the Central Government for IGST, UTGST and CGST, and the State
Government for SGST.
2. …………………refers to the tax already paid by a person at time of purchase of goods or services
and which is available as deduction from tax payable.
3. GSTIN Full form………………………..
4. GSTIN is a ………………….unique identification number allotted to every registered person under
GST.
5. …………………was set up as a private company in 2013 by the Government under Section 25 of
the Companies Act, 1956.
6. GSTN has also identified ……………………………and tagged them as GST Suvidha Providers
(GSPs).

ANSWER

1. Appropriate government
2. Input Tax Credit
3. Goods and Services Tax Identification Number
4. 15-digit PAN-based
5. GSTN
6. 34 IT and financial technology companies
 LECTURE NO.2

GST Models: Single GST & Dual GST

Meaning of dual GST model

Dual GST means that GST will be levied simultaneously by Center and State Governments. Hence, every
transaction of supply of goods or services shall suffer Central GST (CGST) and State GST (SGST), when
the transaction is within the State. However, when the transaction is between states, there will be Integrated
GST (CGST + SGST), which will be collected by the Central Government and then the SGST component
paid to the State Government where the goods or services have been consumed.

Example — if a dealer in UP, selling goods to consumers within the state, makes a sale of INR 20,000 at
18% GST rate. Then the dealer will collect INR 3,600 as total tax. In this case CGST and SGST will be
shared by Centre and State equally as INR 1,800 each.

Types of single GST model

1. Single National GST National GST is one of the peculiar models of GST wherein two level of
Government viz. the Centre and the State, combine their levies in the form of a single National GST along
with appropriate revenue sharing arrangements among them. In simple words, under this model, taxes are
levied by the center with provision for revenue sharing with the provinces/states. Australia is most recent
example of a National GST, which is levied and collected by the centre, but the proceeds of which are
allocated entirely to the States.

2. Single State GST This model is inverse of the Single National GST model, under this model GST would
be levied by the State only and Centre relinquish its entitle to collect GST. USA is the most prominent
example of this kind of model.

Types of dual GST model:

1. Non-concurrent Dual GST This model is designed to enable State to levy taxes on all goods and Centre
is entitled to collect tax on all services. This model was suggested by Poddar-Ahmed Working to avoid
constitutional amendment. This model was also not adopted as this model not able to address the existing
problem of cascading and dual taxation.

2. Concurrent Dual GST As the name suggests, under this model, a concurrent or dual GST is levied by
the Centre and State on both goods and services. This model is based on concept of sharing of revenue by
State and Center to create good balance between fiscal autonomy of state and the union. The Concurrent
Dual GST model has been successfully implemented in Canada and Brazil where this model proved to be an
efficient model to remove cascading effect of taxation and create fiscal balance between Union and State.

Features of dual GST model -

1. GST has two components – one levied by the Centre (called the Central GST) and the other imposed by
states (called the State GST).
2. Central GST and the state GST would apply to all supplies of goods and services.
3. The amounts collected as the Central GST and State GST must be individually deposited to the Centre
and the state’s accounts.
4. Central GST and state GST must be treated independently. Further, the taxes paid against the Central GST
towards the intrastate transactions shall be allowed as Input Tax Credit (ITC) against the Integrated GST
charged on the interstate transactions.
5. The Constitution does not permit cross utilization of ITC between the Central GST and the state GST,
except where there is an inter-state supply.
6. Both upper ceiling and floor tax rates concerning the annual aggregate turnover must be fixed for
composition or compounding schemes under GST.
7. The taxpayer must submit returns periodically, in a common format, to both the Central and the concerned
state GST authorities.
8. Every taxpayer is allotted a 15 digit PAN-based identification number under GST, popularly known as the
GSTIN.
Benefits / advantages of dual GST model- The following are the advantages of adopting a dual GST
model-
1. The total number of taxes levied by the Centre and state governments reduces.
2. The effective tax rate for different goods gets reduced.
3. This model helps in eliminating the cascading effect of taxes.
4. The model proves to reduce the taxpayer’s transaction costs by way of simplified tax compliance.
5. Increase in the tax collections due to broadening the tax base and compliance improvement.
ONE LINER

1. ………..means that GST will be levied simultaneously by Center and State Governments.
2. Central GST and the state GST would apply to all supplies of……………...
3. ………………….is allotted a 15 digit PAN-based identification number under GST, popularly
known as the GSTIN.
4. …………………… model is designed to enable State to levy taxes on all goods and Centre is
entitled to collect tax on all services.
5. ………………………….model has been successfully implemented in Canada and Brazil.
6. ……………………….model is inverse of the Single National GST model, under this model GST
would be levied by the State only.
7. …………………………..is most recent example of a National GST.
8. The taxpayer must submit returns periodically, in a common format, to both the Central and the
concerned state……………………...
9. . The amounts collected as the Central GST and State GST must be individually deposited to
the………………………..

ANSWER

1. Dual GST
2. goods and services
3. Every taxpayer
4. Non-concurrent Dual GST
5. The Concurrent Dual GST
6. Single State GST
7. Australia
8. GST authorities
9. Centre and the state’s accounts
 LECTURE 3

Types of GST: - CGST, SGST/UTGST, IGST

Structure of GST in India

❖ Intra-State supply of goods or services is when the location of the supplier and the place of supply i.e.,
location of the buyer are in the same state. In Intra-State transactions, a seller has to collect both CGST and
SGST from the buyer. The CGST gets deposited with the Central Government and SGST gets deposited
with the State Government.

❖ Inter-State supply of goods or services is when the location of the supplier and the place of supply are in
different states. Also, in cases of export or import of goods or services or when the supply of goods or
services is made to or by a SEZ unit, the transaction is assumed to be Inter-State. In an Inter-State
transaction, a seller has to collect IGST from the buyer.

Conditions-
1. Two different States; or
2. Two different Union territories; or
3. State and a Union territory.
Types of GST As per the newly implemented tax system, there are 4 different types of GST:-
1. Integrated Goods and Services Tax (IGST)
2. State Goods and Services Tax (SGST)
3. Central Goods and Services Tax (CGST)
4. Union Territory Goods and Services Tax (UTGST)
1. Integrated Goods and Services Tax or IGST- The Integrated Goods and Services Tax or IGST is a tax
under the GST regime that is applied on the interstate (between 2 states) supply of goods and/or services as
well as on imports and exports. The IGST is governed by the IGST Act. Under IGST, the body responsible
for collecting the taxes is the Central Government. After the collection of taxes, it is further divided among
the respective states by the Central Government.

Example- If a trader from Uttar Pradesh has sold goods to a customer in Karnataka worth Rs.5000, then
IGST will be applicable as the transaction is an interstate transaction. If the rate of GST charged on the
goods is 18%, the trader will charge Rs.5900 for the goods. The IGST collected is Rs.900, which will be
going to the Central Government.

2. State Goods and Services Tax or SGST- The State Goods and Services Tax or SGST is a tax under the
GST regime that is applicable on intrastate (within the same state) transactions. In the case of an intrastate
supply of goods and/or services, both State GST and Central GST are levied. However, the State GST or
SGST is levied by the state on the goods and/or services that are purchased or sold within the state. It is
governed by the SGST Act. The revenue earned through SGST is solely claimed by the respective state
government.

Example- if a trader from Uttar Pradesh has sold goods to a customer in Uttar Pradesh worth Rs.5000, then
the GST applicable on the transaction will be partly CGST and partly SGST. If the rate of GST charged is
18%, it will be divided equally in the form of 9% CGST and 9% SGST. The total amount to be charged by
the trader, in this case, will be Rs.5900. Out of the revenue earned from GST under the head of SGST, i.e.
Rs.450, will go to the Uttar Pradesh state government in the form of SGST.

3. Central Goods and Services Tax or CGST- Just like State GST, the Central Goods and Services Tax of
CGST is a tax under the GST regime that is applicable on intrastate (within the same state) transactions. The
CGST is governed by the CGST Act. The revenue earned from CGST is collected by the Central
Government.

Example-if a trader from Uttar Pradesh has sold goods to a customer in Uttar Pradesh worth Rs.5000, then
the GST applicable on the transaction will be partly CGST and partly SGST. If the rate of GST charged is
18%, it will be divided equally in the form of 9% CGST and 9% SGST. The total amount to be charged by
the trader, in this case, will be Rs.5900. Out of the revenue earned from GST under the head of CGST, i.e.
Rs.450 will go to the Central Government in the form of CGST.

4. Union Territory Goods and Services Tax or UTGST- The Union Territory Goods and Services Tax or
UTGST is the counterpart of State Goods and Services Tax (SGST) which is levied on the supply of goods
and/or services in the Union Territories (UTs) of India. The UTGST is applicable on the supply of goods
and/or services in Andaman and Nicobar Islands, Chandigarh, Dadra and Nagar Haveli Daman and Diu,
Lakshadweep, Ladakh. The UTGST is governed by the UTGST Act. The revenue earned from UTGST is
collected by the Union Territory government. The UTGST is a replacement for the SGST in Union
Territories. Thus, the UTGST will be levied in addition to the CGST in Union Territories.

. ONE LINER

1. ……………..of goods or services is when the location of the supplier and the place of supply i.e.,
location of the buyer are in the same state.
2. The CGST gets deposited with the ………………..and SGST gets deposited with the…………….
3. ……………………..of goods or services is when the location of the supplier and the place of supply are
in different states.
4. ………….transaction, a seller has to collect IGST from the buyer.
5. ……………….is a tax under the GST regime that is applied on the interstate (between 2 states) supply
of goods and/or services as well as on imports and exports.
6. ……………………………..is a tax under the GST regime that is applicable on intrastate (within the
same state) transactions.
7. …………………………….is the counterpart of State Goods and Services Tax (SGST) which is levied
on the supply of goods and/or services in the Union Territories (UTs) of India.
8. The revenue earned from CGST is collected by the ………………………….
9. Types of GST As per the newly implemented tax system, there are ………….. different types of GST.

ANSWER

1. Intra-State supply
2. Central Government , State Government
3. Inter-State supply
4. Inter-State
5. The Integrated Goods and Services Tax or IGST
6. The State Goods and Services Tax or SGST
7. The Union Territory Goods and Services Tax or UTGST
8. Central Government.
9. 4
 LECTURE 4

Levy and Collection of GST

Levy and Collection of GST The charging section (Section 9 of CGST Act, 2017, Levy and collection of
GST) is the most important section in any law for levy (impose) and collection (payment) of taxes. The very
basic for the charge of tax in any taxing statute is taxable event. i.e. the point of time when tax will be
imposed. The tax becomes payable when liability to pay tax arises and liability to pay tax arises by the
happening of the taxable event. The taxable event under GST Act is supply of goods or services or both.
This article covers provisions of charging section 9(1) to 9(5) of CGST Act 2017.

There are two types of Charges under GST-

1. Forward Charge: Forward charge or direct charge is the mechanism where the supplier of goods or
services is liable to pay tax. Section- 9(1) of CGST Act 2017 deals with Forward Charge.

2. Reverse Charge: Reverse charge is the mechanism where tax is payable by the person who is recipient of
the goods and/or services. Section- 9(3) and 9(4) deals with Reverse Charge.

3. In addition, there is a charging section 9(5) of CGST Act 2017, where Government specified the
categories of services on which tax shall be paid by the E Commerce Operators.

1. Section 9(1) of CGST Act-Relevant points of charging Section 9 (1) under CGST Act 2017 are as
follows:-

(a) CGST and SGST/ UTGST shall be levied on all intra state supplies.

(b) Tax shall be levied on Goods and /or Services (except on supply of alcoholic liquor for human
consumption)

(c) Section 15 of the Act determines the value on which tax shall be charged.

(d) Rate of GST will be notified by Central Government on recommendation of GST Council. (Maximum
rate of CGST is 20%)

2. Section 9(2) of CGST Act – GST on Petroleum products at later stage: The GST on the supply of
petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas and aviation
turbine fuel shall be levied with effect from such date as may be notified by the Government on the
recommendations of the GST Council. These five petroleum products falls under category – non leviable.

3. Section 9(3) of CGST Act – RCM on specified Category of Goods & Services: Section 9(3) of CGST
and SGST Act and section 5(3) of IGST Act state that Government can specify categories of supply of
goods or services or both, the tax on which is payable on reverse charge basis. The tax thereon shall be paid
by the recipient of such goods or services or both. All the provisions of this Act shall apply to such person as
if he is the person liable for paying the tax in relation to the supply of such goods or services or both.

4. Section 9(4) of CGST Act – Supply received from unregistered person: In case of receipt of supply of
goods or services or both from unregistered supplier, IGST/CGST will be payable by the recipient, in
respect of specified categories of goods or services as may be notified by Government on recommendation
of GST Council. The words ‘in respect of specified categories of goods or services’ inserted vide IGST
(Amendment) Act, 2018 and CGST (Amendment) Act, 2018. w.e.f. 1-2-2019. Prior to this Amendment,
such reverse charge was applicable to all the supplies received from unregistered person, though this
provision was kept in abeyance for the period 13-10-2017 to 30-9-2019.

5. Sec 9(5) of CGST Act – Liability of E Commerce Operator to pay Tax: Section 9(5) of CGST Act 2017
is a charging section under GST for supply of notified services. As per section 9(5) of CGST Act, the
Government may specify categories of services, the tax on which shall be paid by the electronic commerce
operator, if such services are supplies through it and all the provisions of this Act shall apply to such
electronic as if he is the supplier liable for paying the tax in relation to the supply of such services.

The Government vide notification No. 17/2017-CT (Tax) dated 28-6-2017 specified following categories of
services on which e commerce operator is liable to pay tax :-
• Service of transportation of passengers
• Service of providing accommodation in hotels, inn, and campsites
• Home stay service or guest house service provided through e-commerce operator.
• House-keeping like plumbing, carpentering etc.

ONE LINER

1. …………or ………… is the mechanism where the supplier of goods or services is liable to pay tax.
2. Levy and Collection of GST is given under section …………
3. ………….is the mechanism where tax is payable by the person who is recipient of the goods and/or
services.
4. ……………………. of the Act determines the value on which tax shall be charged.
5. Rate of GST will be notified by Central Government on recommendation of ………………..
6. …………… of CGST Act 2017 is a charging section under GST for supply of notified services.
7. Section ………of CGST Act is related to a Supply received from unregistered person.
8. Section ………of CGST Act is related to RCM on specified Category of Goods & Services.
9. Section ………of CGST Act is related to Petroleum products.
10. . Section…………..and ……….. Deals with Reverse Charge.

ANSWER

1. Forward charge or direct charge

2. Section 9
3. Reverse charge
4. Section 15
5. GST Council
6. Section 9(5)
7. 9(4)
8. 9(3)
9. 9(2)
10. 9(3) and 9(4)