Qn Ans. Q2 Ans. Ans. Qa Ans. Overview of Goodsand | Service fax (GST) Valuation in GST What is the value of taxable sup- ply to be adopted for the levy of GST? The value of taxable supply of goods and services shall ordi rrarily be ‘the transaction value’ which is the actually the price paid or payable, when the par lies are not related and price is the sole consideration. The MGL further elaborates various inclu- sions and exclusions from the ambit of transaction value. For example, the transaction value shall not include refundable de- posit, discount allowed before or at the time of supply. ‘What is transaction value? Transaction value refers to the price actually paid or payable for the supply of goods and or services where the supplier and the recipient are not related and price is the sole consideration for the supply. It includes any amount which the supplier is li- able to pay but which has been incurred by the recipient of the supply Are there separate valuation provisions for CGST, SGST and IGST and Goods and Services? No, section 15s common for ll three faxes and also common for goods and services, Is contract price not sufficient to determine valuation of supply? Contract price is more speci- cally referred to as ‘transaction Wale’ and thats the basis for computing ax However, when the price is in fluenced ‘by some factors tke relationship of partes ‘or cer tain transactions are deemed to be supply, which do not have a Qs. Ans Q6. Ans. Ans. Qs. Ans. Qs. red to overcome to dete the price, it is req these fac transaction valtte correctly Is reference to Valuation Rules required in all cases? No. Reference to Valuation Rules is required only in cases listed under section 15¢4) ie., where consideration payable “isnot money, ot parties to the transac tion are related. What is to be done if there are certain factors affecting price though the transaction is not ‘covered by section 15(8)? Section 15(2) provides the list of adjustments that may be made to make the price of a transaction reliable for purposes of deter mining tax payable. Can the transaction value de- clared under section 15(1) be ac- cepted? Yes, it can be accepted after ex amining for inclusions in seccion 15(2). Furthermore, the transac tion value can be accepted! even where the supplier and eeeipient are related, provided the relation- ship has not influenced the price. (Rule 3(4) of draft GST valuation rules) Whether post-supply discounts or incentives are to be included in the transaction value? Yes. Unless the post-supply dis- count is established as per the agreement and is known at or before the time of supply and specifically linked to relevant in- Whether pre-supply discounts allowed before or at the time of supply are includible in th transaction value? Ans, Q10. Ans. qn. Ans Qn Ans, Ans. No, provicled itis allowed in the course of normal trade practice and has been duly recorded in the invoice When are Valuation Rules ap- plicable? Valuation Riles are applicable when (i) Consideration not in money terms; (ii) parties are re lated or supply: by any specified category of supplier; and (iii) ransaction value dee reliable What are the reasons for doubt- ing transaction value declared? The teavons have been indicat ed in Rule 7(b) of the draft GST Valuation Rules. Ibis (i) compa rable supplies are at significantly higher value (i) transsetion is al significaniisYower or higher than market value” of supplies; and (ii) misdeclaration in parameters like description, quantity, qual ity, vear of make ete, The list is indicative and not exhaustive, What are the methods provided for determining the value, in [0 GST Valuation terms of Rules? thodsare prescribed un Valuation Rules for de termining th» transaction value ie, comparative method, com: ulation method and residual method, which are required to be followed sequentially. Besides, some specific valuation methods. have been specified like in case of pure agents anel money changers, Further specific rules may Tater be notified in case of Insurer, Air travel Agent and distributor or selling agents of lotery What are the inclusions specified in Section 152) which could be added to Transaction Value? The inelusions specified in Sec tion 15(2) whieh could be added Tya b) o 4) to Transaction Value are as fol: ows Any amounts paid by recipient that are obligation of supplier to pay, Money value of goods or services provided free or at concession by recipient; Royalties and license fees pay- able by recipient as a condition of supply; Taxes levied under any other law(s) (other than SGST / CGST or IGST); e) Expenses incurted by supplier belore supply and changed sepa- 1) Subsidy reatized by supplier on the supply: 8) Reimbursements claimed sepa- rately by supplier; hh) Discounts allowed ‘after’ supply except when known before sup ply: (Discounts allowed as a nor ‘mal trade practice and reflected ton the face of the invoice shall not be included), : GST Payment of Tax a. Ans. 22 Ans, Qs. What are the Payments to be made in GST regime? In the GST regime, for any intea- state supply, taxes to be paid are the Central GST (CGST, going into the account of the Central Government) and the State GST (SGST, going iyo! the account of the concerned State Govern meni). For any interstate supply, tax to be paid is Integrated GST (GST) which will have compo- nents of both CGST and SST. {iy addition, certain .eategories of registered persons will be re- quired to pay to the government account Tax Deducted at Source (TDS) and Tax Collected at Source (TCS). In addition, wher- ever applicable, Interest, Penalty, Fees and any other payment will also be required to be made Who is liable to pay GST? In general the supplier of yous or service i Hable to pay CST However in specified Eases lik Imports and other notified sup. ples the ality may be cast on the recipient under the reverse charge mechanism. Further, an Some cases the Tability to pay ison the third person (sayin the ease of ecommerce opetatr responsible for TCS oF Cover ment Department responsible or 19, When is GST payment to be done by the taxable person? At the time of supply of Goods Asexplained in Secon 12and al the time of supply of series as explained in Section 13. The time is generally the earlest of one of the tee event, namely reel ‘or-completion of supply. Differ- ent situations envisaged and dif ferent tax points have been ex: plained in the aforesaid secti~ns, Qa, What are the main features of GST payment process? Ans, The payment processes under proposed GST regime will have the following features + Electronically generated cchallan from GSTN Com- mon Portal in all modes ‘of payment and no use of manuially prepared chal- lan; + Facilitation for the tax: payer by providing hassle free, anytime, anywhere mode of payment of tax; * Convenience of making payment online; * Logical tax collection data in electronic format + Faster vem: lance of tax revenue to the Govern ment Account; + Electronic reconciliation of all receipts; + Simplified procedure for banks; * Warehousing of Digital Challan Q5. How can payment be done? Ans. Payment can be done by the fol Towing methods: (Through debit of Credit Ledger of the taxpayer maintained on the Com- ‘mon Portals ONLY Tax can 6. Ans, Q7. Ans. be paid. Interest, Penalty and Fees cannot be paid by debit in the credit ledger Tax payers shall be al lowed to take credit of taxes paid on inputs (in- port tak credit) and utilize the same for payment of output tax, However, no input tax eredit on account of CGST shall be utilized towards payment of SGST and vice versa. The credit of IGST would be permit: ted to be utilized for pay ment of IGST, CGST and SCST in that order. Gi) In cash by debit in the Cash Ledger of the taxpay- ‘ermuintained on the Con mon Portal. Money can be deposited in the Cash Led- ger by different modes, namely, E-Payment (Inter: net Banking, Credit Card, Debit Card); RealTime Gross Settlement (RTGS)/ National Electronic Fund Transter_ (NEFT); Over the Counter Payment in branches of Banks Autho- rized to accept deposit of GST. When is payment of taxes to be made by the Supplier? Payment of taxes by the normal taxpayer is to be cone on month- ly basis by the 20th of the suc- ceeding nionth. Cash payments ‘will be first deposited in the Cash Ledger and the taxpayer shall debit the ledger while making, payment in the monthly returns and shall reflect the relevant deb- itentry number in his return. As ‘mentioned earlier, payment can also be debited from the Credit Leder. Payment of taxes for the month of March shall be paid by the 20th of April. Composi- tion tax payers will need to pay tax on quarterly basis. Timing of payment will be from 0000 Hes to i limit for payment of tax can be extended or paid in monthly installments? No, this is not permitted in ease of selFassessed liability. In other cases, competent authority has been empowered to extend the time period or allow payment in installments. (Section 55 ofas Ans. 9. Ans. Qu, Ans. Qu. Ans. Qn Ans, on. Ans. MGI). What happens if the taxable per- son files the return but does not make payment of tax? In such cases, the return is not considered as a valid. return, Section 27 (3) of the MGL prov vides that the return furnished by a taxable person shall not be treated as valid return unless the full tx due as per the said return hhas been paid. It is unly the valid return that would be used for al- owing input tax credit (ITC) to the recipient. In other words, un- Tess the supplier has paid the en tire sell-assessed tax and filed his return and the recipient has filed his return, the ITC of the recipi- ent would not be confirmed, As per section 28, a taxable per~ son who has not firnished a valid return shall not be allowed to uti- lize such evecit till he discharges his self-assessed tax lability Which date is considered as date of deposit of the tax dues- Date of presentation of cheque ‘or Date of payment or Date of credit of amount in the account of government account? Ikis the date of credit to the Gov cemment account. What are E-Ledgers? Flectronie Ledgers or E-Ledgers are statements of casi and input tax ereit in respect of each repis- tered taxpayer. In addition, each taxpayer shall also have an elec: tronic tax liability register. Once a taxpayer is registered on Common, Portal (GSTN), 2 eledgers (Cash & Input Tax Credit) and an electronic tax liability register will be auto- matically opened and displayed ‘onhis dashboard at all times What isa tax liability register? Tax Liability Register will reflect the total tax Hablity ofa taxpayer (after ‘etting) forthe particular month, ‘What is a Cash Ledges? The cash ledger will reflect all deposits made in cash, and TDS/ TCS made on account of the tax- payer. The information will be reflected on real time basis. This ledger can be used for making any payment on account of G What is an ITC Ledger? Input Tax Credit as self-assessed Qu. Ans, 15, Ans. Q16, Ans. eu. Ans, Qs, Ans, in monthly returns will be re- flected in the IIC Ledger. the credit in this ledger can be used to make payment of TAX ONLY and not other amounts such as interest, penalty, fev ete What is the linkage between GSTN and the authorized Banks? There will be real time two way linkage between the GSEN and the Core Banking Solution (CBS) of the Bank. CPIN is automati cally routed to the Bank via elec tronic string for verification and 18 payment and a challan, identification number (CIN) is to automatically sent by the Bank to the Commun Portal confirm: ing payment receipt. No manual infervention will be invelved in the process by any one ineluding, bank cashier or teller or the !ax: payer Can at ‘payer generate challan in multiple sittings? partly il oh os Sad ee rail “pave” te calan force pletion at Inter stages A saved Eininn con be “eatled” betone finalization After the lax poy Nas finalize the callan, he wi enette the chalan, for tse of payment of taxes. the remiter Ur Soe econ of oan mee challan fo his record Can a challan generated online be modified? No. After loxging into GSTN portal far generation of challan, payment particulars have to be fed in by the tax payer or his au: thorized person, He can save the cchallan midway for future upda tion. However once the challan is finalized and CPIN enerated, aw further changes can be made to it by the taxpayer. Is there a validity period of challan? Yes, a challan will be valid for fifteen days aller its generation nd thereafter it will be purged from the System, However, the taxpayer can generate another challan at his convenience, What is a CPIN? PIN stands for Common Portal Identification Number (CPIN) given at the time of generation aw. Ans. 20. 21. Ans. Q2. of challan. It isa 14 digit unique number to identify the challon ‘As stated above, the CPIN. re mains valid or a period of 1S favs, What ig,a CIN and what is its CIN stands for Challan Ident fication Nembwr. Itis 0-17 digit number thats H-cigitCPIN ples 3-digit Bank Code, CIN is gener wed by the authorized banks/ Reserve Banka India (RBD when payment is actually received by Such authorized banks or RBLankt credited jn the relevant govern- ment account held with them. It isan indication that the payment hhas been realized and credited to the appropriate govemment ac. count. CIN is communicated by the authorized bank to taxpayer as well as to GSTN. What is the sequence of payment if tax where thal taxpayer has abilities “for previous months alse? Section 35) prescribes an order of payment where the taxpayer has ta laity beyond the eur rent return period, In sucha sit tion, the order of payment to be followed. is First selfasosted tax and nterest fr the previous period? VovreaterslPssessed tax and interest for the current Period; and thereafter any other mounts payable including any Confiemed demands under see tion St This sequence has to be anata followed What is an EFPB? E-FPD stands (or Electronic Focal Point Branch. These are branches oof authorized banks which are authorized % collect payment of GST. Fach authorized bank will nominate only’ one branch as its E-FPB for pan India Transactions, ‘The E-FPR will have to open ac counts under each major head for all governments, Total 38 ac ‘counts (one each for CGST, IGST and one vach for SGST for each State/UT Govt.) will have to be ‘opened. Any amount received by such F-FPR towards GST will be credited (0 the appropriate ac count held by such E-FPB. For NEFT/RTGS Transactions, RBL will act as E-FPB, What is TDS?23, 125. TDS stands for Tax Deducted at Source (TDS). As per section 37, this provision is meant for Government and Government undertakings and other notified entities making contractual pay ments in excess of Rs. 10 Lakhs to suppliers. While making such payment, the concerned Govern: ment/authority shall deduct 1% of the total payable amount and remit it into the appropriate GST account How will the Supplier account for this TDS while filing his re- tum? Any amount shown as TDS will be reflected in the electronic cash ledger of the concerned supplier: He can utilize this amount to- wards discharging his. liability towards tay, interest fees and any other amount. How will the TDS Deductor ac. count for such TDS? TDS Deduetor ayill account for such TDS in thé following ways: 1. Such deductors needs to compulsorily _regis- lered under section 19 read with Schedule IIT of MGL 2. They need to remit such TDS collected by the 10th day of the month succeed ing the month in which ‘TDS was collected and re ported! in GSTR 7. The amount deposited as TDS will be reflected in the electronic cash ledger of the supplier. 4. They need to issue cer tificate of such TDS to the deductee within 3 days of deducting TDS failing which fees of Rs. 100 per day subject to maximum of Rs, 5000/- will be payable by stich deductor What is Tax Collected at Source (rcs)? ‘This provision is applicable only for E-Commerce Operator un- der section 43C of MGL. Every E-Commerce Operator needs 10 withhold a percentage (to be no: tified later on the recommenda- tion of the GST Council) of the amount which is due from him to the supplier at the time of mak- tual payment to the suppl Such withheld amount is to be deposited by such E-Commerce Operator to the appropriate GST secount by the 10th of the month, The amount deposited as FCS sill be reflected nthe electronic eash ledger of the sup: plie 26. Is th tration of credit nthe GSTN por- tal for the GST payment? Ans. Ye The taxpayer. would be O- cr made a turnaround of sorts after a gap of two months as total ship- ments sho! up 9B per cent to 67,779 tonnes in Octo- ber on higher demand for rapeseed meal and castor seed meal, industry body SEA said today for India. The country had shipped 34,168 tonnes of oilmeal, used as an animal feed, in October last year According to data released by the Solvent Extractors ssociation of India, the oilmeal exports have re- vived after two months. Exports had come in at 63,123 tonnes in August and 96,223 tonnes in September this year, but the growth was muted in year-on-year terms In October 2016, rapeseed meal export rose to 2 30 Unlike the year-ago period, there Was castor seed meal shipments to 720 tonnes, from tonnes in the year-ago period. South Korea and Vietnam are the top two destina- , tions for export of oilmeal required to pre-register his credit carl, from which the tax payment is intended, with the Common Portal maintained on GSTN. GSTN may abo attempt fo put ina system with banks in xetting the credit eard verified by taking a confirmation from the credit card! service provider. The payments using credit cards can therefore be allowed without any monetary limit to facilitate ease tof doing business, Se CBFea = iE we S Oiimeal Exports Zoom 98% in October the ‘tune of 31,025 tonnes October this year. How- ever, export of soyabean meal fell to 3,177 tonnes, from 4,237 tonnes, while shipment of rice bran too declined to 9,343, tonnes from 26,852 tonnes in the said period, Mumbai-based SEA said ina statement. extraction During April-October this fiscal, imeal exports dropped 29 per cent 54,147 tonnes as against 7,83,565 tonnes in the year-ago period. to The fall in exports was “due to availability of oilseeds for crushing and continuous disparity in exporting oilmeals in the interna- tional market”, it noted. lesser South Korea and Vietnam are the top two destinations for export of oilmeal for India. [BL