Mock Test Paper - Series I: November, 2024

Date of Paper: 25th November, 2024

Time of Paper: 2 P.M. to 5 P.M.

INTERMEDIATE COURSE: GROUP - I

PAPER – 3: TAXATION
SECTION – A: INCOME TAX LAW
ANSWERS
Division A – Multiple Choice Questions
MCQ No. Sub-part Most Appropriate MCQ Most Appropriate
Answer No. Answer
1. (i) (b) 3. (d)
(ii) (b) 4. (d)
(iii) (a)
2. (i) (d)
(ii) (c)
(iii) (b)
Division B – Descriptive Questions
1. Computation of total income of Mr. Amit for A.Y. 2024-25
Particulars ` ` `
I Income from house property
Let out portion [First floor]
Gross Annual Value [Rent 2,28,000
received is taken as GAV, in
the absence of other
information]
Less: Municipal taxes paid by 30,000
him in the P.Y. 2023-24
pertaining to let out portion
[` 60,000/2]
Net Annual Value (NAV) 1,98,000
Less: Deduction u/s 24
(a) 30% of ` 1,98,000 59,400
1,38,600
Self-occupied portion
[Ground Floor]
Annual Value Nil
[No deduction is allowable in 1,38,600

1
 respect of municipal taxes
paid]
II Profits and gains of business
or profession
Income from SEZ unit 20,00,000
III Capital Gains
On transfer of 60,000 shares
(2,00,000 x 30%)
Sales consideration [60,000 x 36,00,000
` 60 per share]
Less: Cost of acquisition, 30,00,000
higher of –
- Actual cost [60,000 x 24,00,000
` 40 per share]
- Lower of
FMV on 31.1.2018 [60,000 30,00,000
x 50]
Actual sales consideration 36,00,000
[60,000 x 60]
Long-term capital gains u/s 6,00,000
112A (since shares are held for
a period of more than 12
months before transfer)
IV Income from Other Sources
Royalty from artistic book 2,88,000
Less: Expenses incurred for 40,000
earning royalty
2,48,000
Interest on savings bank 30,000
deposits
2,78,000
Gross Total Income 30,16,600
Less: Deduction u/s 10AA -
[Not available, since he
commenced operation in P.Y.
2021-22]
Less: Deduction under
Chapter VI-A
Deduction under section 80C
Tuition fee paid for maximum 28,000
of two children is allowable
(` 14,000 x 2)

2
 Insurance premium paid on life 39,000
insurance policy of son
allowable, even though not
dependent on Mr. Amit
Insurance premium paid on life - 67,000
insurance policy of father not
allowable, even though father
is dependent on Mr. Amit
Deduction under section 1,90,000
80QQB
Royalty [` 2,88,000 x 15/18 =
` 2,40,000, restricted to
amount brought into India in
convertible foreign exchange
` 2,30,000 minus ` 40,000
expenses already allowed as
deduction while computing
royalty income]
Deduction under section 10,000
80TTA
Interest on savings bank
account, restricted to ` 10,000
2,67,000
Total Income 27,49,600
Computation of tax liability of Mr. Amit for A.Y.2024-25 under
the normal provisions of the Act
Particulars ` `
Tax on total income of ` 27,49,600
Tax on LTCG of ` 5,00,000, being the sum 50,000
exceeding ` 1 lakh @10%
Tax on remaining total income of ` 21,49,600
Upto ` 2,50,000 Nil
` 2,50,001 – ` 5,00,000[@5% of ` 2.50 lakh] 12,500
` 5,00,001 – ` 10,00,000 [@20% of ` 5,00,000] 1,00,000
` 10,00,001 – ` 21,49,600 [@30% of ` 11,49,600] 3,44,880 4,57,380
5,07,380
Add: Health and education cess@4% 20,295
Total tax liability 5,27,675
Tax liability (rounded off) 5,27,680

3
 Computation of adjusted total income and AMT of Mr. Amit for
A.Y. 2024-25
Particulars `
Computation of adjusted total income
Total income as per the normal provisions of the Act 27,49,600
Add: Deduction u/s 80QQB 1,90,000
Adjusted Total Income 29,39,600
Alternative Minimum Tax@18.5% 5,43,826
Add: Health and education cess@4% 21,753
AMT liability 5,65,579
AMT liability (rounded off) 5,65,580
Since the regular income-tax payable is less than the alternate minimum
tax payable, the adjusted total income shall be deemed to be the total
income and tax is leviable @18.5% thereof plus cess@4%. Therefore,
liability as per section 115JC is ` 5,65,580.
2. (a) An Indian citizen or a person of Indian origin who, being outside India,
comes on a visit to India (and whose total income, other than from
foreign sources, does not exceed ` 15,00,000) would be resident in
India only if he or she stays in India for a period of 182 days or more
during the previous year. Even if his total income, other than from
foreign sources, exceeds ` 15,00,000, he would be resident in India if
stays in India for 120 days or more during the relevant previous year
and 365 days or more during the 4 previous years immediately
preceding the relevant previous year.
Since Mrs. Riya is a person of Indian origin who comes on a visit to
India only for 60 days in the P.Y.2023-24, she is non-resident for the
A.Y. 2024-25.
A non-resident is chargeable to tax in respect of income received or
deemed to be received in India and income which accrues or arises or
is deemed to accrue or arise to her in India. Accordingly, her total
income and tax liability would be determined in the following manner:
Computation of total income and tax liability of Mrs. Riya for
A.Y. 2024-25
Particulars Amt (`)
Salaries
Pension received from Russian Government [Not taxable, Nil
since it neither accrues or arises in India nor it is received
in India]
Income from House Property
Annual Value [Rental Income from house 90,000
property in New Delhi is taxable, since it is

4
 deemed to accrue or arise in India, as it accrues
or arises from a property situated in India]
Less: Deduction u/s 24(a) @ 30% 27,000 63,000
Capital Gains
Long-term capital gains on sale of land at New Delhi 3,00,000
[Taxable, since it is deemed to accrue or arise in India as
it is arising from transfer of land situated in India]
Short-term capital gains on sale of shares of Indian listed 60,000
companies in respect of which STT was paid [Taxable,
since it is deemed to accrue or arise in India, as such
income arises on transfer of shares of Indian listed
companies]
Gross Total Income 4,23,000
Less: Deduction under Chapter VI-A
Deduction under section 80C [Not available under default Nil
tax regime]
Total Income 4,23,000
(b) Determination of Advance Tax Liability of Mr. Sameer
Particulars `
Estimated tax liability for the financial year 2023-24 80,000
Less: Tax deducted at source 12,000
Tax payable 68,000
Due Date of Amount payable `
installment
On or before Not less than 15% of
15th June, 2023 advance tax liability 10,200
On or before Not less than 45% of 20,400
15th September, advance tax liability (` 30,600, being 45% of
2023 less amount paid in ` 68,000 - ` 10,200)
earlier installment
On or before Not less than 75% of 20,400
15th December, advance tax liability (51,000, being 75% of
2023 less amount paid in ` 68,000 - ` 30,600)
earlier installment(s)
On or before Whole of the advance 17,000
15th March, tax liability less (68,000, being 100% of
2024 amount paid in earlier ` 68,000 - ` 51,000)
installment(s)

5
3. (a) (i) Computation of depreciation for A.Y.2024-25
Particulars `
W.D.V. of the block as on 1.4.2023 7,70,000
Add: Purchase of second hand plant during the
year [in December, 2023] 6,10,000
13,80,000
Less: Sale consideration of old machinery during 10,00,000
the year [in July, 2023]
W.D.V of the block as on 31.03.2024 3,80,000
Depreciation @ 15% but restricted to 50% 28,500
thereon. ` 3,80,000 X 7.5%
[Since the value of the block as on 31.3.2024
represents part of actual cost of second hand
plant purchased in December, 2023, which has
been put to use for less than 180 days,
depreciation is restricted to 50% of the prescribed
percentage of 15% i.e. depreciation is restricted
to 7½%. Therefore, the depreciation allowable for
the year is ` 28,500 being 7½% of ` 3,80,000]
(ii) In the given case, no capital gains would arise, since the block of
asset continues to exist, and some of the assets are sold for a
price which is lesser than the written down value of the block as
increased by the actual cost of asset purchased during the year
(iii) Computation of deduction allowable under section 35
Particulars Amount Section % of Amount of
(` in weighted deduction
lakhs) deduction (` in lakhs)
Payment for
scientific
research
UV University, 15 35(1)(ii) 100% 15
an approved
University
Satyawati 17 - NIL NIL
College [Since it
is not
mentioned as
an approved
University]

6
(b) Computation of income chargeable under the head “Capital
Gains” for A.Y.2024-25
Particulars ` `
(in lakhs) (in lakhs)
Capital Gains on sale of residential
building
Actual sale consideration ` 600 lakhs
Value adopted by Stamp Valuation
Authority ` 670 lakhs
Full Value of Consideration 670.00
[In case the actual sale consideration
declared by the assessee is less than the
value adopted by the Stamp Valuation
Authority for the purpose of charging
stamp duty, then, the value adopted by
the Stamp Valuation Authority shall be
taken to be the full value of consideration
as per section 50C.
In a case where the date of agreement is
different from the date of registration,
stamp duty value on the date of
agreement can be considered provided
the whole or part of the consideration is
paid by way of account payee
cheque/bank draft or by way of ECS
through bank account on or before the
date of agreement.
However, where the stamp duty value
does not exceed 110% of the sale
consideration received or accruing as a
result of the transfer, the consideration so
received or accruing shall be deemed to
be the full value of the consideration. In
this case, since advance of ` 20 lakh is
paid by cash, stamp duty value of ` 620
lakhs on the date of agreement cannot be
adopted as the full value of consideration
and stamp duty value on the date of
registration would be considered.
However, since stamp duty value on the
date of registration exceeds 110% of the
actual consideration, stamp duty value on
the date of registration would be the full
value of consideration]
Less: Brokerage@1% of sale 6.00
consideration (1% of ` 600 lakhs)

7
 Net Sale consideration 664.00
Less: Indexed cost of acquisition
- Cost of vacant land, ` 80 lakhs,
plus registration and other
expenses i.e., ` 8 lakhs, being 271.01
10% of cost of land [` 88 lakhs ×
348/113]
- Construction cost of residential 285.25
building (` 100 lakhs x 348/122) 556.26
Long-term capital gains before 107.74
exemption
Less: Exemption under section 54EC 50.00
Amount deposited in capital gains
bonds of NHAI within six months
from the date of transfer (i.e., on or
before 09.08.2024) would qualify for
exemption, to the maximum extent of
` 50 lakhs.
Therefore, in the present case,
exemption can be availed only to the
extent of ` 50 lakh out of ` 60 lakhs,
even if the both the investments are
made on or before 09.08.2024 (i.e.,
within six months from the date of
transfer).
Long Term Capital Gains [Since it was 57.74
held for more than 24 months]

4. (a) Computation of tax liability of Mr. Vijay Prasad for A.Y.2024-25

Particulars ` `
Salary
Income by way of salary (computed) 2,75,000
Profits and gains from business and
profession
Business Income- Retail business 1,20,000
Less: Set-off of business loss of ` 1,00,000
from wholesale business 1,00,000
20,000
Less: Set-off of brought forward business loss
of ` 1,35,000 of A.Y.2021-22 allowable to the
extent of ` 20,000 by virtue of section 72(1) 20,000 Nil
[Balance brought forward business loss of
` 1,15,000 (i.e., ` 1,35,000 – ` 20,000) to be
carry forward to A.Y. 2025-26 for set-off
8
 against business income of that year]
Capital Gains
Long-term capital gain on sale of building 2,00,000
Less: Set-off of short term capital loss 1,85,000 15,000
Income from Other Sources
Lottery winnings 45,000
Income of minor daughter from special talent -
[Not included in Vijay Prasad’s income since it
is earned from special talent]
Gross Total Income 3,35,000
Less: Deduction under section 80C
Contribution to provident fund and NSC 150,000
` 1,50,000
Total Income 1,85,000
Tax on ` 1,85,000
Tax on lottery income of ` 45,000 @30% 13,500
[Unexhausted basic exemption limit can not be
reduced from lottery income]
Tax on LTCG of ` 15,000 @20% [Unexhausted 3,000
basic exemption limit can not be reduced from
LTCG as Mr. Vijay is a non resident]
Tax on other income of ` 1,25,000 (since it -
does not exceed basic exemption limit)
16,500
Add: Health and education cess @4% 660
Tax liability 17,160
(b) [First Alternative]
Consequences for non-filing return of income within the due date
under section 139(1)
Interest under section 234A
Interest under section 234A@1% per month or part of the month for the
period commencing from the date immediately following the due date
under section 139(1) till the date of furnishing of return of income is
payable, where the return of income is furnished after the due date.
However, no interest u/s 234A shall be charged on self-assessment tax
paid by the assessee on or before the due date of filing of return.
Fee under section 234F
Late fee of ` 5,000 would be payable under section 234F, if the return
of income is not filed before the due date specified in section 139(1).

9
 However, such fee cannot exceed ` 1,000, if the total income does not
exceed ` 5,00,000.
Carry forward and set-off of certain losses not permissible
Following losses would not be allowed to be carried forward, where a
return of income is not furnished within the time allowed under section
139(1):
- business loss, speculation business loss, loss from specified
business,
- loss under the head “Capital Gains”; and
- loss from the activity of owning and maintaining race horses.
(b) [Second Alternative]
Transaction Is quoting of PAN mandatory in
related documents?
1. Payment of life insurance No, since the amount paid does not
premium of ` 40,000 in exceed ` 50,000 in the F.Y.2023-24.
the F.Y.2023-24 by
account payee cheque to
LIC for insuring life of self
and spouse
2. Payment of ` 1,10,000 to Yes, since the amount paid exceeds
RBI for acquiring its ` 50,000
bonds
3. Applied to SBI for issue of Yes, quoting of PAN is mandatory
credit card. on making an application to a
banking company for issue of credit
card.
4. Payment of ` 1,00,000 by No, since the amount was paid by
account payee cheque to account payee cheque and not in
travel agent for travel to cash, quoting of PAN is not
Dubai for 3 days to visit mandatory even though the
payment exceeds ` 50,000

10
 SECTION B – GOODS AND SERVICES TAX (50 MARKS)
SUGGESTED ANSWERS
Division A - Multiple Choice Questions
Case Scenario-1
Question Answer
No.
1. (a) Service availed from Insurance Agents
2. (c) ` 23,00,000
3. (c) ` 3,80,000
Case Scenario-2
Question Answer
No.
4. (b) 90 days
5. (d) 30th June, 2024
6. (b) E-way bill can be cancelled within 24 hours of generation
7. (c) 5th August
8. (b) Credit Note

Division B - Descriptive Questions

1. (a) Computation of minimum net GST payable in cash by M/s Happy
Enterprise for the month of December 2024
Particulars Value CGST SGST IGST
(`) (`) (`) (`)
GST payable under forward charge
Intra-State supply of 7,00,000 17,500 17,500
goods to M/s Natural & [7,00,000 [7,00,000
Sons × 2.5%] × 2.5%]
Intra-State branch 1,00,000 -- --
transfer

[Such transfer is not a

supply as the branch has
the same GSTIN as that
of the head office and
thus, is not a distinct
person.]
Permanent transfer of 80,000 --
old computers to
orphanage home without
consideration.
[Permanent transfer or
disposal of business
11
assets was not treated
as supply even if made
without consideration in
terms of Schedule–I of
the CGST Act, 2017, as
ITC was not availed on
the same.]
Advance received for 40,000 3,600 3,600
future intra-State supply [40,000 [40,000
of management × 9%] × 9%]
consultancy service
(In case of supply of
service, tax is payable at
the time of receipt of
advance amount too)
Total output tax 21,100 21,100
Less: ITC utilized 27,200 27,200
Net GST payable [A] Nil Nil
Legal services availed 50,000 4,500 4,500
[B] [50,000 [50,000
× 9%] × 9%]
[Tax on legal services
availed by a business
entity from an advocate
is payable under reverse
charge.
Further, tax payable
under reverse charge
cannot be set off against
ITC and thus, reverse
charge has to be paid in
cash since the tax
payable under reverse
charge is not an output
tax.]
Minimum net GST 4,500 4,500
payable in cash
[A] + [B]
Working Note:
Computation of ITC available
Particulars Value CGST (`) SGST (`) IGST
(`) (`)
Intra-State purchase of 8,00,000 20,000 20,000
taxable goods [8,00,000 × [8,00,000 ×
2.5%] 2.5%]
[ITC of goods used in
the course/ furtherance
12
 of business is
available.]
Works contract service 30,000 2,700 2,700
for repair of office [30,000 × [30,000 ×
[ITC is available since 9%] 9%]
the repair amount is
debited in the profit &
loss account and not
capitalized in the books
of account.]
Legal services availed 50,000 4,500 4,500
[50,000 × [50,000 ×
[ITC of services used in 9%] 9%]
the course/ furtherance
of business is available
Total 27,200 27,200
(b) ITC to be claimed by Renuka Sales in its GSTR-3B for the month of
January to be filed by 20th February will be computed as under-
Invoices Amount of ITC Amount of ITC that
involved in the can be availed (`)
invoices (`)
80 invoices furnished in 6 lakh 6 lakh
GSTR-1 [Refer Note 1]
20 invoices not furnished 4 lakh Nil
in GSTR-1 [Refer Note 2]
Total 10 lakh 6 lakh

Notes:
(1) 100% ITC can be availed on invoices furnished by the suppliers in
their GSTR-1.
(2) Input tax credit in respect of any supply of goods or services or both
is available to a registered person only, inter alia, if the details of
the invoice/debit note in respect of said supply has been furnished
by the supplier in the statement of outward supplies (GSTR-1) and
such details have been communicated to the recipient of such
invoice/debit note in the manner specified under section 37. Thus,
in respect of 20 invoices not furnished in GSTR-1s, no ITC is
available.
2. (a)
S. Particulars Taxability
No.
(i) Service provided by a private transport operator to Exempt
Vintage Girls Higher Secondary School by way of
transportation of students to and from the school.
[Services provided TO an educational institution by
13
 way of transportation of students are exempted from
GST]
(ii) Services provided by way of vehicle parking to Taxable
general public in a shopping complex.
[Services provided by way of vehicle parking to
general public are not exempted from GST.
Therefore, it would be taxable.]
(iii) Food supplied by the canteen run by a hospital to the Exempt
in-patients as advised by the doctors.
[Services by way of health care services by a clinical
establishment, an authorised medical practitioner or
para-medics are exempt from GST. Food supplied to
the in-patients by a canteen run by the hospital, as
advised by the doctor/nutritionists, is a part of
composite supply of healthcare and not separately
taxable. Thus, said services are exempt from GST.]
(iv) An RWA in a housing society, registered under GST, Exempt
collects the maintenance charges of ` 6,500 per
month per member.
[Supply of service by a RWA (unincorporated body or
a non-profit entity registered under any law) to its own
members by way of reimbursement of charges or
share of contribution up to an amount of ` 7500 per
month per member for providing services and goods
for the common use of its members in a housing
society/a residential complex are exempt from GST.
Hence, in the given case, services provided by the
RWA are exempt from GST since the maintenance
charges collected per month per member do not
exceed ` 7500.]
(b) (i) If services provided by an individual advocate including a senior
advocate or firm of advocates by way of legal services, directly or
indirectly, then GST is payable on reverse charge basis.
Accordingly, in this case, GST on legal services supplied by an
advocate [Mr. Abhishek] to any business entity [M/s. Navya Trading
Company] located in the taxable territory is payable on reverse
charge basis.
Therefore, in the given case, person liable to pay GST is the
recipient of services, i.e., M/s. Navya Trading Company.
(ii) The part of director’s remuneration which is declared as salaries in
the books of a company and subjected to TDS under section 192
of the Income-tax Act (IT Act), is not taxable being consideration
for services by an employee to the employer in the course of or in
relation to his employment in terms of Schedule III of the CGST
Act,2017.

14
 Further, the part of employee director’s remuneration which is
declared separately other than salaries in the company’s accounts
and subjected to TDS under section 194J of the IT Act as fees for
professional or technical services are treated as consideration for
providing services which are outside the scope of Schedule III and
is therefore, taxable. The recipient of the said services i.e. the
company, is liable to discharge the applicable GST on it on reverse
charge basis.
In lieu of the above provisions, Rs. 1 Lakh sitting fees to Padam
Srivastav, an independent director is subjected to TDS under
section 192 of the Income-Tax Act (IT Act), is not taxable being
consideration for services by an employee to the employer in the
course of or in relation to his employment in terms of Schedule III
of the CGST Act,2017.
Therefore, recipient of the said services i.e. the One 4th Private
Limited, is liable to discharge the applicable GST on it on reverse
charge basis.
3. (a) (i) A supplier is liable to be registered in the State/Union territory from
where he makes a taxable supply of goods and/or services, if his
aggregate turnover in a financial year exceeds the threshold limit.
The threshold limit for a person making exclusive intra-State
taxable supplies of goods is as under:-
(a) ` 10 lakh for the Special Category States of Mizoram, Tripura,
Manipur and Nagaland.
(b) ` 20 lakh for the States, namely, States of Arunachal Pradesh,
Meghalaya, Puducherry, Sikkim, Telangana and Uttarakhand.
(c) ` 40 lakh for rest of India except persons engaged in making
supplies of ice cream and other edible ice, whether or not
containing cocoa, pan masala and tobacco and manufactured
tobacco substitutes, fly ash bricks; fly ash aggregates; fly ash
blocks, bricks of fossil meals or similar siliceous earths,
building bricks, earthen or roofing tiles.
The threshold limit for a person making exclusive taxable supply of
services or supply of both goods and services is as under:-
(a) ` 10 lakh for the Special Category States of Mizoram, Tripura,
Manipur and Nagaland.
(b) ` 20 lakh for the rest of India.
Aggregate turnover includes the aggregate value of:
1. all taxable supplies,
2. all exempt supplies,
3. exports of goods and/or services and
4. all inter-State supplies of persons having the same PAN.
15
 The above aggregate turnover is computed on all India basis.
Further, the aggregate turnover excludes central tax, State tax,
Union territory tax, integrated tax and cess. Moreover, the value of
inward supplies on which tax is payable under reverse charge is
not taken into account for calculation of ‘aggregate turnover’.
CGST is not leviable on five petroleum products i.e. petroleum
crude, motor spirit (petrol), high speed diesel, natural gas and
aviation turbine fuel. Exempt supply includes non-taxable supply.
Thus, supply of high speed diesel in U.P., being a non-taxable
supply, is an exempt supply and is, therefore, includible while
computing the aggregate turnover.
In the backdrop of the above-mentioned discussion, the aggregate
turnover of Right Oils for the month of April is computed as under:
S. Particulars Amount
No. (in `)
(i) Supply of machine oils in U.P. 15,00,000
(ii) Add: Supply of high speed diesel in U.P. 10,00,000
(iii) Add: Supply of machine oil made by Right 10,00,000
Oils from its branch located in Punjab
Aggregate Turnover 35,00,000
Right Oils is making exclusive supply of goods and hence the
threshold limit for registration would be ` 40,00,000. Since the
aggregate turnover does not exceed ` 40,00,000, Right Oils is not
liable to be registered till April. However, if in remaining months of
the financial year, its turnover exceeds the said limit, then it would
be liable to be registered.
(ii) In case Right Oils makes the supply in capacity of an agent of
Center Oils Ltd.:
Section 24 of the CGST Act, 2017 provides that an agent who is
engaged in making taxable supplying of goods on behalf of other
taxable persons, shall be liable to obtain registration irrespective of
the threshold turnover limit. However, in the present case, if Right
Oils supply high speed diesel on behalf of Center Oil Ltd. in U.P.
as its agent where invoices to customers are issued in name of
Right Oils, it shall still not be liable to obtain registration in U.P.
since section 24 comes into play only when agent or in other
capacity is making taxable supply of goods on behalf of taxable
persons (principal) whereas in the given case, Right Oils is
supplying non-taxable goods on behalf of Center Oils Ltd., who is
non-registered.
In case if Center Oils Ltd. is registered entity, then also the answer
would remain unchanged as attraction of section 24 of the CGST
Act, 2017, inter-alia, requires that there should be taxable supply

16
 by agent and here, Right Oils is supplying non-taxable goods on
behalf of Center Oils Ltd.
(b) (i) A supplier engaged in the manufacture of notified goods during the
preceding financial year is not eligible for composition scheme
under section 10(1) and 10(2) of the CGST Act, 2017. Ice cream
and other edible ice, whether or not containing cocoa, Pan masala,
Tobacco and manufactured tobacco substitutes, aerated waters, fly
ash bricks, fly ash aggregate, fly ash blocks, bricks of fossil meals
or similar siliceous earths, building bricks, earthen or roofing tiles
are notified under this category. However, in the given case, since
Shyam Enterprises is engaged in trading of pan masala and not
manufacture and his turnover does not exceed ` 1.5 crore, he is
eligible for composition scheme subject to fulfilment of specified
conditions.
(ii) Since supplier of inter-State outward supplies of goods or services
is not eligible for composition levy, Sahaj Manufacturers is not
eligible for composition levy.
4. (a) section 12 of IGST Act, 2017 deals with the provisions of place of supply
of services, where location of supplier of service and the location of the
recipient of service is in India.
In accordance with sub-section (13) of section 12 of IGST Act, 2017, The
place of supply of insurance services shall:-
(a) to a registered person, be the location of such person;
(b) to a person other than a registered person, be the location of the
recipient of services on the records of the supplier of services.
So, in the given case, when insurance service is provided to an
unregistered person, Mr. Pappan, the location of the recipient of services
on the records of the supplier of insurance services is the place of
supply. So, Faridabad is the place of supply.
Or
(a) The statement is not correct. While GST is payable on advance received
for supply of services taxable under forward charge, the same is not
payable in case of advance received for supply of goods taxable under
forward charge.
As per section 13 of the CGST Act, 2017, the time of supply of services
taxable under forward charge is –
 Date of issue of invoice or date of receipt of payment, whichever is
earlier, if the same is issued within 30 days from the date of supply
of service;
OR
 Date of provision of service or date of receipt of payment,
whichever is earlier, if the invoice is not issued within 30 days from
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 the date of supply of service.
Thus, in case of services, if the supplier receives any payment before
the provision of service or before the issuance of invoice for such
service, the time of supply gets fixed at that point in time and the liability
to pay tax on such payment arises. However, the tax can be paid by the
due date prescribed with reference to such time of supply.
As regards time of supply of goods taxable under forward charge is
concerned, Notification No. 66/2017 CT dated 15.11.2017 provides that
a registered person (excluding composition supplier) should pay GST on
the outward supply of goods at the time of supply as specified in section
12(2)(a), i.e. date of issue of invoice or the last date on which invoice
ought to have been issued in terms of section 31. Therefore, in case of
goods, tax is not payable on receipt of advance payment.
(b) In accordance with section 37(1) of CGST Act, 2017, GSTR-1 for a
particular tax period is filed on or before the 10th day of the immediately
succeeding tax period. In other words, GSTR-1 of a month/quarter can
be filed any time between 1st and 10th day of the succeeding
month/quarter. The due date of filing GSTR-1 may be extended by the
Commissioner/ Commissioner of State GST/ Commissioner of UTGST
for a class of taxable persons by way of a notification.
So, the statement is partially valid.
A taxpayer cannot file Form GSTR-1 before the end of the current tax
period. However, following are the exceptions to this rule:
a. Casual taxpayers, after the closure of their business.
b. Cancellation of GSTIN of a normal taxpayer.
A taxpayer who has applied for cancellation of registration will be allowed
to file Form GSTR-1 after confirming receipt of the application.

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