APA

FINAL COURSE – FAST (Part) Paper – 5: INDIRECT TAX LAWS

Test Series – Paper 1
Total No. of Questions in Part I – 10 Maximum Marks – 30
Total No. of Questions in Part II – 6 Maximum Marks – 70
Total No. of Pages - 19
GENERAL INSTRUCTIONS TO CANDIDATES
1. The question paper comprises two parts, Part I and Part II.
2. Part I comprises Multiple Choice Questions (MCQs).
3. Part II comprises questions which require descriptive type answers.
4. Ensure that you receive the question paper relating to both the parts. If you have
not received both, bring it to the notice of the Institute.
5. Answers to MCQs in Part I are to be mentioned in the first page of your answer
copy. Students need to only mention their choice of correct option like (a) or (b) or
so. No explanations or reasonings are required for MCQs.
6. Answers to descriptive questions in Part 2 should be given from the next page of
your answer sheet
7. Student should mention their Name, Batch, Course (CA Inter / Final), Subject
Name, Date of Test and Test Code as given on top of this sheet on the first
page before answering the MCQs.
8. Once the test is complete, student need to scan the answer sheet and make single
pdf file for all the pages and email it to [email protected] and
[email protected] with Subject Line – Answers Sheet for Test (Code) and
Your Name.
9. Duration of the examination is 1.5 hours. You will be required to upload the
answer sheets on the same date / time of test as defined in your live class else the
answer sheet will not be evaluated. In such case you should do a self-evaluation
using the suggested answer which will be posted in the same folder after one day
of the date of test.
10. The FAST examiner team will check the copy and give the marks alongwith
feedbacks for your improvements. We take utmost care in checking however being
subjective in nature the checking may differ from examiner to examiner.
11. Candidate are advised not to cheat and have self-discipline as these tests are
preparing you better for your real exams and hence realistic assessment will help
you take corrective actions at the right time.
12. FAST reserves the right to display any answers or answer sheets or share with
other students for your benefits without any prior written or express consent.
13. You suggestions on the test paper or evaluation or else can be shared at
[email protected]
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PART 1
Division A: Multiple Choice Questions (30 marks)
Write the most appropriate answer to each of the following multiple-choice
questions by choosing one of the four options given. All questions are
compulsory
1. Diwakar (P) Ltd., registered under GST in Delhi, is engaged in trading of
cement as well as providing services by way of renting of commercial
properties. On 2nd January, it received a contract for supply of 1,000 kg
cement from Pakija (P) Ltd., registered under GST in Punjab. Pakija (P) Ltd.
directed Diwakar (P) Ltd. to send the consignment to Gajab & Sons,
registered under GST in Gujarat.

Diwakar (P) Ltd. prepared the consignment on 4th January and dispatched the
same on the next day from its warehouse in Gurugram, Haryana. The invoice
was also issued on 5th January. On 7th January, it received the cheque and
accountant entered the payment in books of accounts. However, he presented
the cheque in bank on 14th January which was credited in the bank
account of the company on 15th January. In the meanwhile, on 10th
January, the rate of tax on cement was reduced from 28% to 18%.

On inspection of said goods, it was found that there is some deficiency in the
quality of goods and therefore, the defective goods were returned to Diwakar
(P) Ltd. Diwakar (P) Ltd. issued credit note for the same on 20th January.

Diwakar (P) Ltd. let out property and received rent for the month of January
from Pakija (P) Ltd. on 10th January. However, as per the contract entered,
the payments should have been received by 7th of every month.
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Based on the facts of the case scenario given above, choose the most
appropriate answer to Q. Nos. 1.1 to 1.4 below: -
1.1 What will be the time of supply and rate of tax to be charged in respect
of supply of 1,000 kg of cement?
(a) 5th January; 28%
(b) 7th January; 28%
(c) 14th January; 18%
(d) 15th January; 18% 2
1.2 In the above case, other facts remaining the same, what will be the time
of supply and rate of tax to be charged if the payment is credited into
bank account on 12th January?
(a) 5th January; 28%
(b) 7th January; 28%
(c) 12th January; 28%
(d) 12th January; 18% 2
1.3 What is the place of supply in respect of transaction between Diwakar
(P) Ltd. and Pakija (P) Ltd., and Pakija (P) Ltd. and Gajab & Sons,
respectively?
(a) Delhi, Punjab
(b) Punjab, Gujarat
(c) Haryana, Punjab
(d) Haryana, Gujarat 2
1.4 Diwakar (P) Ltd. has not issued any invoice in respect of the services
provided by way of renting of commercial properties in the month of
January. What is the last date for issuance of invoice?
(a) 10th January
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(b) 7th January
(c) Either (a) or (b), whichever is earlier.
(d) Either (a) or (b), whichever is later. 2

2. Mr. Veera is a trader of readymade garments and is registered under GST in

the State of Uttar Pradesh. His turnover is ` 1,80,00,000 during the current
financial year. The composition of his turnover is as under-
(a) Intra-State - ` 80,00,000
(b) Inter-State - ` 1,00,00,000 [including exempt supplies of ` 15,00,000]
His inward supplies are as under-
(a) Inter-State - ` 1,00,30,000 [including ` 20,00,000 exclusively used for
exempt supplies]
(b) Intra-State ` 46,00,000 [including ` 15,00,000 exclusively used for
taxable supplies]
Apart from above, Mr. Veera has undertaken following transactions during
the current financial year:
1. He purchased a pick-up van for the purpose of delivery of goods to his
customers for ` 1,70,000.
2. He got his showroom renovated (debited all expenses under repairs
and maintenance) and spent money as under-
Labour charges ` 3,60,000
Architect fees ` 80,000
Wooden flooring ` 4,00,000
Miscellaneous expenses ` 1,62,000
3. He purchased some T-shirts for ` 1,80,000 (taxable under GST). After
one week, he gave them away free to its customers to promote his

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business.
4. He also sold his shares during the year for ` 10 crore and bought a
house from that money.
5. The rates of tax are 9% (CGST), 9% (SGST) and 18% (IGST) on all
inward/ outward supplies.
6. All the amounts given above are exclusive of taxes, wherever
applicable.
7. The opening balance of input tax credit for the relevant tax period of
Mr. Veera is Nil. Subject to the information given above, assume that
all the other conditions necessary for availing ITC have been
fulfilled.
Based on the facts of the case scenario given above, choose the most
appropriate answer to Q. Nos. 2.1 to 2.4 below: -
2.1 Compute value of exempt outward supply (for the purpose of reversal
of ITC) by Mr. Veera during the current financial year.
(a) ` 10,00,000
(b) ` 15,00,000
(c) ` 25,00,000
(d) ` 20,00,000 2
2.2 Which of the following statements is true?
(a) Mr. Veera cannot claim ITC on van purchased for delivery of
goods, expenses incurred on renovation of showroom and T-
shirts distributed free of cost.
(b) Mr. Veera can claim ITC on van purchased for delivery of
goods and T-shirts distributed free of cost, but cannot claim
ITC on expenses incurred on renovation of showroom.

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(c) Mr. Veera can claim ITC on van purchased for delivery of
goods, expenses incurred on renovation of showroom and T-
shirts distributed free of cost.
(d) Mr. Veera can claim ITC on van purchased for delivery of
goods and expenses incurred on renovation of showroom, but
cannot claim ITC on T-shirts distributed free of cost. 2
2.3 Calculate the amount of input tax credit credited to electronic credit
ledger of Mr. Veera (ignore individual heads of CGST/SGST/IGST).
(a) ` 24,84,360
(b) ` 22,73,400
(c) ` 23,04,000
(d) ` 24,53,760 2
2.4 Compute the amount of common credit as per the CGST Rules, 2017.
(a) ` 20,03,400
(b) ` 22,14,360
(c) ` 20,34,000
(d) ` 21,83,760 2

3. M/s Dhoom Furniture Mart, located and registered under GST in the State
of Chhattisgarh, sells furniture from its showroom to M/s Lucky Dhaba
(located and registered under GST in the State of Jharkhand). M/s Lucky
Dhaba requested to deliver the furniture to Mr. Pyare Lal at Patna, Bihar.
M/s Dhoom Furniture Mart sends the furniture with a proper e-way bill to
Patna through a transporter who made the delivery to Mr. Pyare Lal.
Determine the place of supply of furniture sold by M/s Dhoom Furniture
Mart to M/s Lucky Dhaba in the above case.

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(a) Chhattisgarh
(b) Jharkhand
(c) Bihar
(d) Either Jharkhand or Bihar, at the option of the recipient 2

4. An appeal to the High Court can be filed under the CGST Act, 2017 in the
following cases:
(i) By a person aggrieved against the order passed by the State bench of
the Appellate Tribunal
(ii) By a person aggrieved against the order passed by the Principal Bench
of the Appellate Tribunal
(iii) For a matter involving substantial question of law

Choose the most appropriate option.

(a) (i) and (ii)
(b) (i) and (iii)
(c) (ii) and (iii)
(d) (i), (ii) and (iii) 2

5. George Ltd., India, has received an order for supply of services amounting
to $ 5,00,000 from a US based client. George Ltd., India is unable to supply
the entire services from India and asks Harry Inc., Mexico (who is not an
establishment of George Ltd.) to supply a part of the services, i.e. 40% of
the total contract value to the US client. George Ltd. raised the invoice for
entire value of $ 5,00,000, but the US client paid $ 3,00,000 to George Ltd.
and $ 2,00,000 directly to Harry Inc., Mexico which is approved by a
special order of RBI. George Ltd. also paid IGST@ 18% on the services
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imported from Harry Inc. Mexico. Assuming all the conditions of section
2(6) of the IGST Act, 2017 are fulfilled, determine the value of export of
services assuming that the amounts given above are exclusive of GST.

(a) $ 3,00,000

(b) $ 5,00,000

(c) $ 3,90,000

(d) $ 5,90,000 2

6. Which of the following statements is/are not correct for ‘similar’ goods’ for
valuation purposes under the Customs Act, 1962?
(i) Similar goods although not alike in all respects, have like
characteristics and like component materials which enable them to
perform the same functions and to be commercially interchangeable
with the goods being valued having regard to the quality, reputation
and the existence of trade mark.
(ii) Similar goods must necessarily be produced in the country in which
goods being valued were produced.
(iii) Similar goods must always be produced by the same person who
produced the goods being valued.

(a) (i) and (ii)

(b) Only (iii)

(c) (i) and (iii)

(d) (ii) and (iii) 2

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7. What is the export Performance required to become 3 star Status Holder?
(a) 3 Million USD
(b) 200 Million USD
(c) 50 Million USD
(d) 15 Million USD 1

8. Which of the following is covered u/s 9(5) where ECO liable to pay tax?
(a) Makeup artist service from UrbanClap
(b) Registered hotel giving room booking service from OYO
(c) Registered Taxi driver giving Cab service through UBER
(d) Restaurant service supplied by eating joint (declared tariff for
accommodation is 7800/day per unit) 2

9. What will be the rate of tax and nature of supply of a service if the same is
not determinable at the time of receipt of advance?
(a) 12%, inter-State supply
(b) 12%, intra-State supply
(c) 18%, inter-State supply
(d) 18%, intra-State supply 1

10. Registration provisions for commission agent under APMC act

requires……..
(a) Registration required as he is agent and compulsory registration u/s 24
(b) Depends on his turnover. If 20 lakh threshold limit exceeded,
registration would be required
(c) No registration required
(d) Registration required if interstate supply made 2
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PART B
Descriptive Questions (70 marks)

Question paper comprises of 6 questions. Answer Question No. 1 which is

compulsory and any 4 out of the remaining 5 questions:
Q.1 All-in-One Store’ is a retail chain of departmental store having presence in
almost all metro cities across India. Both exempted as well as taxable goods
are sold in such Stores. The Stores operate in rented properties. All-in-One
Stores pay GST under regular scheme. In Mumbai, the Store operates in a
rented complex, a part of which is used by the owner of the Store for
personal residential purpose. All-in-One Store, Mumbai furnishes following
details for a month:
(i) Aggregate value of various items sold in the Store:
Taxable items – ` 42,00,000
Items exempted vide a notification – ` 12,00,000
Items not leviable to GST – ` 3,00,000
(ii) Mumbai Store transfers to another All-in-One Store located in Goa
certain taxable items for the purpose of distributing the same as free
samples. The value declared in the invoice for such items is `
5,00,000. Such items are sold in the Mumbai Store at ` 8,00,000.
(iii) Aggregate value of various items procured for being sold in the Store:
Taxable items – ` 55,00,000
Items exempted vide a notification – ` 15,00,000
Items not leviable to GST – ` 5,00,000
(iv) Freight paid to goods transport agency (GTA) for inward
transportation of taxable items – ` 1,00,000

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(v) Freight paid to GTA for inward transportation of exempted items – `
80,000
(vi) Freight paid to GTA for inward transportation of non-taxable items - `
20,000
(vii) Monthly rent payable for the complex – ` 5,50,000 (one third of total
space available is used for personal residential purpose).
(viii) Activity of packing the items and putting the label of the Store along
with the sale price has been outsourced. Amount paid for packing of
all the items – ` 2,50,000
(ix) Salary paid to the regular staff at the Store – ` 2,00,000
(x) GST paid on inputs used for personal purpose – ` 5,000
(xi) GST paid on rent a cab services availed for transportation of
employees,(not obligatory under any law) – ` 4,000
(xii) GST paid on items given as free samples – ` 4,000

Given the above available facts, you are required to compute the following:
A. Input tax credit (ITC) credited to the Electronic Credit Ledger
B. Common Credit
C. ITC attributable towards exempt supplies out of common credit
D. Eligible ITC out of common credit
E. Net GST payable from Electronic Cash Ledger for the month if
opening balance of ITC is nil.

Note:
(1) Wherever applicable, GST under reverse charge is payable @ 5% by All-in-
One Stores. Rate of GST in all other cases is 18% (Ignore CGST, SGST or
IGST for the sake of simplicity).
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(2) All the inward supplies are procured from registered suppliers.

(3) Wherever applicable, the amounts given are exclusive of taxes.

(4) Subject to the information given above, assume that all the other conditions
necessary for availing ITC have been fulfilled. 14

Q.2

(A) Vividh Pvt. Ltd. is a supplier of goods and services at Bangalore, registered
in the State of Karnataka, having turnover of ` 200 lakh in the last financial
year. It has furnished the following information for the month of June.Shiva
Medical Centre, a Multi-speciality

Particulars Amount (`)

Excluding GST
Services provided by way of a labour contract for 13,00,000
repairing a single residential unit otherwise than as a part
of residential complex
Fee received from students of a competitive exam training 5,40,000
academy run by Vividh Pvt. Ltd.
4 buses each with a seating capacity of 72 passengers 6,00,000
given on hire to State Transport Undertaking
Rent paid to Local Municipal Corporation for premises 2,50,000
taken on rent for competitive exam training academy
Goods transport services received from GTA, tax is 1,80,000
payable on such services @ 12%

Compute gross GST liability (ignoring ITC provisions) of Vividh Pvt. Ltd.
for the month of June assuming that the above amounts are exclusive of GST

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and rate of GST, wherever applicable, is 18% unless otherwise mentioned. 9

(B) Compute the total customs duty and integrated tax payable under Customs
law on an imported machine, based on the following information:
Particulars USD ($)
Cost of the machine at the factory of the exporter 20,000
Transport charges from the factory of exporter to the port 800
for shipment
Handling charges paid for loading the machine in the ship 50
Freight charges from exporting country to India 5,000
Buying commission paid by the importer 100
Rupees (₹)
Lighter age charges paid by the importer at port of importation 12,000
Freight incurred from port of entry to Inland Container depot 60,000
Ship demurrage charges paid at port of importation 24,000
20th January (Rate BCD 20%; Exchange rate as notified by Date of bill
CBIC ₹ 70 per US $) of entry
25th March (Rate of BCD 10%; Exchange rate as notified by Date of entry
CBIC ₹ 75 per US $) inward

Integrated tax rate 12% (ignore GST compensation cess) 5

Q.3
(A) In the case of transactions at (i) and (ii) below, determine whether the
amounts received are liable to GST. Briefly explain the applicable statutory
provisions in support of your conclusions.
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(i) ABC Ltd., a registered bank, recovered cheque discounting 2 charges
of ₹5,250 from a customer C & Co.
(ii) T Ltd., A dealer in air conditioners, supplies each unit at a list 2 price
of₹30,000 per unit. He also has an EMI scheme where the customer
can take delivery of air conditioner on a monthly EMI of ₹10,500
payable in three installments. T Ltd. Charges ₹600 extra for any
delay in payment of monthly installments and this amount was
recovered from customer Venkat for delay in payment of his 2nd
installment.
(iii) M/s Aerospace Airlines, having registered place of business in
Mumbai under GST, issued a ticket from London to Delhi to Mr Ajit
Khanna, a resident of Agra, UP who is not registered under the GST.
Determine the ‘place of supply’ with supporting notes related to legal
provisions.
(1 + 2 + 2 Marks)

(B) Examine whether the suppliers are eligible for composition levy under
section 10 in the following independent cases in the beginning of the
current financial year.
(a) Technology Enterprises, registered in Jalandhar, Punjab, is engaged
in manufacturing and supplying computer systems. Its aggregate
turnover in the preceding financial year is ` 125 lakh. Technology
Enterprises supplies the computer systems manufactured by it within
the State of Punjab only. With a view to expand its business
operations, it will also start providing the repairing services of

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computer systems in Punjab in the current financial year.

(b) M/s. Siddharth & Sons, registered in Delhi, owns a restaurant ‘Tasty
Foods’ with a turnover of ` 112 lakh in the preceding financial year.
In view of the growing customer demand, it will also start intra-State
trading of juices in Delhi.

(c) Sitaram Associates, registered in Sikkim, is engaged in running a

restaurant chain ‘Veg Kitchen’ in the State. It has a turnover of ` 73
lakh in the preceding financial year. In the current financial year, it
decides to shut down the food chain owing to huge losses being
incurred in the said business. Instead, it will start providing intra-
State architect services.

(d) Deepti Services Ltd., registered in Uttarakhand, is exclusively

providing intra-State hair styling services. It has turnover of ` 34 lakh
in the preceding financial year.
Will your answer be different, if Deepti Services Ltd. also start intra-
State supply of beauty products alongwith providing hair styling
services in the current financial year? 5

(C) After visiting USA for a month, Mrs. and Mr. X (Indian residents aged 40
and 45 years respectively) brought to India a laptop computer valued at `
80,000, used personal effects valued at` 90,000 and a personal computer
for` 52,000. What is the customs duty payable? Ignore Agriculture
infrastructure and development cess. 5
Q.4

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(A) Examine the taxes to be paid for the month of July on the basis of below
information furnished by M/s Zinc & Co.:

Particulars IGST (`) CGST (`) SGST (`)

Output tax payable 14,75,000 28,34,000 28,34,000

Tax payable under 36,000 1,44,000 1,44,000

reverse charge

Balance in Electronic 26,52,000 18,32,000 18,32,000

Credit Ledger

Output tax reported under IGST column pertains to the month of February,
which was not paid for the said period. Also, note that input tax credit
available in Electronic Credit Ledger pertains to input tax on purchases
made during the month of July and no opening balance exists from previous
tax period. It furnishes return on monthly basis. 5

(B) (i) Pari & Sons is an unregistered dealer of taxable supplies in Kerala.
On 10th August, aggregate turnover of Pari & Sons exceeded `
20,00,000. The firm applied for registration on 27th August and was
granted the registration certificate on 1st September. Under CGST
Rules, 2017, you are required to advise Pari & Sons as to what is the
effective date of registration in its case. It has also sought your
advice regarding period for issuance of revised tax invoices.

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(ii) Easy Coupons Ltd. sells coupons that are redeemable against
specified luxury food products at retail outlets. Each coupon is sold
for value of ₹900 but is redeemable for supplies worth ₹1000. What
is the value of supply of such coupon under GST law?
(2 + 2 Marks)

(C) Determine the customs duty payable under the Customs Tariff Act, 1975
including the safeguard duty of 30% under section 8B of the said Act with
the following details available on hand:

Particulars Amount (`)

Excluding
GST
Assessable value of Sodium Nitrite imported from a Rs. 30,00,000
developing country from 26thOctober, 2020 to
25th October, 2021 (both days inclusive)
Share of imports of Sodium Nitrite from the developing 4%
country against total imports of Sodium Nitrite to India
Basic custom duty 10%
Integrated tax 12%
Social welfare surcharge 10%

Note: Ignore GST compensation cess and Agriculture infrastructure and

development cess. 5

Q.5

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(A) Sharat & Co. self-assessed its tax liability as ` 90,000 for the month of
April, but failed to make the payment. Subsequently the Department
initiated penal proceedings against Sharat & Co. for recovery of penalty
under section 73 of the CGST Act, 2017 for failure to pay GST and
th
issued show cause notice on 10 August which was received by Sharat
th
& Co. on 14 August. Sharat & Co. deposited the tax along with interest
th
on 25 August and informed the department on the same day. Department
is contending that he is liable to pay a penalty of ` 45,000 (i.e. 50% of `
90000).
Examine the correctness of the stand taken by the Department with
reference to the provisions of the CGST Act. 5

(B) Beauty Cosmetics Ltd. has multiple wholesale outlets of cosmetic products
in Mumbai, Maharashtra. It receives an order for cosmetics worth
₹1,20,000 (inclusive of GST leviable @ 18%) from Prasannaa, owner of a
retail cosmetic store in Delhi. While checking the stock, it is found that
order worth ₹55,000 can be fulfilled from the company’s Dadar
(Mumbai) store and remaining goods worth ₹65,000 can be sent from its
Malad (Mumbai) store. Both the stores are instructed to issue separate
invoices for the goods sent to Prasannaa. The goods are transported to
Prasannaa in Delhi, in a single conveyance owned by Radhey Transporters.

You are required to advise Beauty Cosmetics Ltd. With regard to

issuance of e-way bill(s). 4
(C) (i) ‘X’, an importer, (other than 100% EOU, STP unit, EHTP unit)
imported some goods and deposited them in the warehouse on 12th
April. These goods were re-exported without payment of duty on
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15th August. With reference to the Customs Act, 1962, discuss
whether any interest under section 61 of the Customs Act, 1962 is
payable by ‘X’? 3

(ii) Comment on the validity of the following statements:

(a) Goods, other than capital goods, intended for use in any hundred
per cent export-oriented undertaking, can be warehoused only
till the expiry of five years.
(b) Interest free period of ninety (90) days under section 61(2) in
respect of warehoused goods (not intended for being used in
100% EOU) commences from the date on which an into-bond
bill of entry in respect of such goods is presented. 2

Q. 6
(A) With reference to Section 90 of the CGST Act, 2017, briefly discuss the
liability of the partners of a firm to pay tax. 4

(B) Describe the modes of recovery of taxes available u/s section 79 of CGST
Act, 2017 5
(C) With reference to the provisions of section 121 of the CGST Act, 2017,
specify the orders against which no appeals can be filed 5

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FINAL COURSE – FAST (Part) Paper – 5: INDIRECT TAX LAWS

Test Series – Paper 1
Total No. of Questions in Part I – 10 Maximum Marks – 30
Total No. of Questions in Part II – 6 Maximum Marks – 70
Total No. of Pages - 28
GENERAL INSTRUCTIONS TO CANDIDATES
1. The question paper comprises two parts, Part I and Part II.
2. Part I comprises Multiple Choice Questions (MCQs).
3. Part II comprises questions which require descriptive type answers.
4. Ensure that you receive the question paper relating to both the parts. If you have
not received both, bring it to the notice of the Institute.
5. Answers to MCQs in Part I are to be mentioned in the first page of your answer
copy. Students need to only mention their choice of correct option like (a) or (b) or
so. No explanations or reasonings are required for MCQs.
6. Answers to descriptive questions in Part 2 should be given from the next page of
your answer sheet
7. Student should mention their Name, Batch, Course (CA Inter / Final), Subject
Name, Date of Test and Test Code as given on top of this sheet on the first
page before answering the MCQs.
8. Once the test is complete, student need to scan the answer sheet and make single
pdf file for all the pages and email it to [email protected] and
[email protected] with Subject Line – Answers Sheet for Test (Code) and
Your Name.
9. Duration of the examination is 1.5 hours. You will be required to upload the
answer sheets on the same date / time of test as defined in your live class else the
answer sheet will not be evaluated. In such case you should do a self-evaluation
using the suggested answer which will be posted in the same folder after one day
of the date of test.
10. The FAST examiner team will check the copy and give the marks alongwith
feedbacks for your improvements. We take utmost care in checking however being
subjective in nature the checking may differ from examiner to examiner.
11. Candidate are advised not to cheat and have self-discipline as these tests are
preparing you better for your real exams and hence realistic assessment will help
you take corrective actions at the right time.
12. FAST reserves the right to display any answers or answer sheets or share with
other students for your benefits without any prior written or express consent.
13. You suggestions on the test paper or evaluation or else can be shared at
[email protected]
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PART 1
SUGGESTED ANSWERS

1.1 (a) 5th January; 28%

1.2 (a) 5th January; 28%
1.3 (b) Punjab, Gujarat
1.4 (b) 7th January
2.1 (c) ` 25,00,000
2.2 (d) Mr. Veera can claim ITC on van purchased for delivery of goods and
expenses incurred on renovation of showroom, but cannot claim ITC
on T-shirts distributed free of cost.
2.3 (a) ` 24,84,360
2.4 (b) ` 22,14,360
3. (b) Jharkhand
4. (b) (i) and (iii)
5. (b) $ 5,00,000
6. (b) Only (iii)
7. (c) 50 Million USD
8. (c) Registered Taxi driver giving Cab service through UBER
9. (c) 18%, inter-State supply
10. (c) No registration required

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PART 2
SUGGESTED ANSWERS

Q.1 Computation of ITC credited to Electronic Credit Ledger

A. As per rule 42, the ITC in respect of inputs or input services being partly
used for the purposes of business and partly for other purposes, or partly
used for effecting taxable supplies and partly for effecting exempt
supplies, shall be attributed to the purposes of business or for effecting
taxable supplies.
ITC credited to the electronic credit ledger of registered person [‘C 1’] is
calculated as under- C1 = T - (T1+T2+T3)
Where
T = Total input tax involved on inputs and input services in a tax
period.
T1 = Input tax attributable to inputs and input services intended to be
used exclusively for non-business purposes
T2 = Input tax attributable to inputs and input services intended to be
used exclusively for effecting exempt supplies
T3 = Input tax in respect of inputs and input services on which credit
is blocked under section 17(5)

Computation of total input tax involved [T]

Particulars (`)
GST paid on taxable items [` 55,00,000 x 18%] 9,90,000
Items exempted vide a notification [Since exempted, no Nil
GST is paid]

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Items not leviable to tax [Since non-taxable, no GST is paid] Nil
GST paid under reverse charge on freight paid to GTA for 5,000
inward transportation of taxable items - [` 1,00,000 x 5%]
GST paid under reverse charge on freight paid to GTA for 4,000
inward transportation of exempted items - [` 80,000 x 5%]
GST paid under reverse charge on freight paid to GTA for 1,000
inward transportation of non-taxable items - [` 20,000 x
5%]
GST paid on monthly rent - [` 5,50,000 x 18%] 99,000
GST paid on packing charges [` 2,50,000 x 18%] 45,000
Salary paid to staff at the Store Nil
[Services by an employee to the employer in the course of
or in relation to his employment is not a supply in terms of
para 1 of the Schedule III and hence, no GST is payable
thereon].
GST paid on inputs used for personal purpose 5,000
GST paid on rent a cab services availed for business 4,000
purpose
GST paid on items given as free samples 4,000
Total input tax involved during the month [T] 11,57,000

Computation of T1, T2, T3

Particulars (`)
GST paid on monthly rent attributable to personal purposes 33,000
[1/3 of ` 99,000]

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GST paid on inputs used for personal purpose 5,000
Input tax exclusively attributable to non-business 38,000
purposes [T1]
GST paid under reverse charge on freight paid to GTA for 4,000
inward transportation of exempted items
[As per section 2(47), exempt supply means, inter alia,
supply which may be wholly exempt from tax by way of a
notification issued under section 11. Hence, input service of
inward transportation of exempt items is exclusively used
for effecting exempt supplies.]
GST paid under reverse charge on freight paid to GTA for 1,000
inward transportation of non-taxable items
[Exempt supply includes non-taxable supply in terms of
section 2(47). Hence, input service of inward transportation
of non-taxable items is exclusively used for effecting
exempt supplies.]
Input tax exclusively attributable to exempt supplies [T2] 5,000
GST paid on rent a cab services availed for business 4,000
purpose [ITC on rent a cab service is blocked under section
17(5)(b)(i) as the same is not used by All-in-One Store for
providing the rent a cab service or as part of a taxable
composite or mixed supply.
GST paid on items given as free samples [ITC on goods 4,000
inter alia, disposed of by way of free samples is blocked
under section 17(5)(h)].
Input tax for which credit is blocked under section 17(5) 8,000

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[T3] **

**Since GST paid on inputs used for personal purposes has been considered
while computing T1, the same has not been considered again in
computing T3.
ITC credited to the electronic credit ledger
C1 = T - (T1+T2+T3)
= ` 11,57,000 – (` 38,000 + ` 5,000 + ` 8,000) = ` 11,06,000

B. Computation of Common Credit

C2 = C1 - T4
where C2 = Common Credit
T4 = Input tax credit attributable to inputs and input services intended to be
used exclusively for effecting taxable supplies
Computation of T4,
Particulars (`)
GST paid on taxable items 9,90,000
GST paid under reverse charge on freight paid to GTA for 5,000
inward transportation of taxable items
Input tax exclusively attributable to taxable supplies [T4] 9,95,000
Common Credit C2 = C1 - T4
=` 11,06,000 – ` 9,95,000 = ` 1,11,000

C. Computation of ITC attributable towards exempt supplies out of

common credit
ITC attributable towards exempt supplies is denoted as ‘D1’ and calculated

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as-
D1 = (E ÷ F) x C2
where,
‘E’ is the aggregate value of exempt supplies during the tax period, and
‘F’ is the total turnover in the State of the registered person during the tax
period
Aggregate value of exempt supplies during the month
= ` 15,00,000 (` 12,00,000 + `3,00,000)
Total turnover in the State during the tax period
= ` 65,00,000 (` 42,00,000 + ` 12,00,000 + `3,00,000 + ` 8,00,000)

Note: Transfer of items to Store located in Goa is inter-State supply in

terms of section 7 of the IGST Act, 2017 and hence includible in the total
turnover. Such supply is to be valued as per rule 28. However, the value
declared in the invoice cannot be adopted as the value since the recipient
Store at Goa is not entitled for full credit because the goods are to be
distributed as free samples, ITC on which is blocked. Therefore, open
market value of such goods, which is the value of such goods sold in
Mumbai Store, is taken as the value of items transferred to Goa Store.
D1 = (15,00,000 ÷ 65,00,000) x 1,11,000
= ` 25,615 (rounded off)

D. Computation of Eligible ITC out of common credit

Eligible ITC attributed for effecting taxable supplies is denoted as ‘C3’,
where-
C3 = C2 - D1
= ` 1,11,000 - ` 25,615
= ` 85,385
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E. Computation of Net GST liability for the month

Particulars GST (`)
GST liability under forward charge
Taxable items sold in the store [` 42,00,000 x 18%] 7,56,000
Taxable items transferred to Goa Store [` 8,00,000 x 18%] 1,44,000
Total output tax liability under forward charge 9,00,000
Less: ITC credited to the electronic ledger 10,80,385
ITC carried forward to the next month (1,80,385)
Net GST payable [A] Nil
GST liability under reverse charge
Freight paid to GTA for inward transportation of taxable 5,000
items [` 1,00,000 x 5%]
Freight paid to GTA for inward transportation of exempted 4,000
items [`80,000 x 5%]
Freight paid to GTA for inward transportation of non- 1,000
taxable items [`20,000 x 5%]
Total tax liability under reverse charge [B] 10,000
Net GST liability to be paid in cash [A] + [B] 10,000
As per section 49(4), amount available in the electronic
credit ledger may be used for making payment towards
output tax. However, tax payable under reverse charge is
not an output tax in terms of section 2(82). Therefore, tax
payable under reverse charge cannot be set off against the
ITC and thus, will have to be paid in cash.

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Note: While computing net GST liability, ITC credited to the electronic
ledger can alternatively be computed as follows:

Particulars (`)
GST paid on taxable items [` 55,00,000 x 18%] 9,90,000
Items exempted vide a notification [Since exempted, no Nil
GST is paid]
Items not leviable to tax [Since non-taxable, no GST is Nil
paid]
GST paid under reverse charge on freight paid to GTA for 5,000
inward transportation of taxable items [` 1,00,000 x 5%]
GST paid under reverse charge on freight paid to GTA for Nil
inward transportation of exempted items [` 80,000 x 5%]
[As per section 2(47), exempt supply means, inter alia,
supply which may be wholly exempt from tax by way of a
notification issued under section 11. Hence, input service of
inward transportation of exempt items is exclusively used
for effecting exempt supplies. Input tax exclusively
attributable to exempt supplies is to be excluded]
GST paid under reverse charge on freight paid to GTA for Nil
inward transportation of non-taxable items [` 20,000 x 5%]
[Exempt supply includes non-taxable supply in terms of
section 2(47). Hence, input service of inward transportation
of non-taxable items is exclusively used for effecting
exempt supplies. Input tax exclusively attributable to

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exempt supplies is to be excluded]
GST paid on monthly rent – for business purposes 66,000
[(` 5,50,000 x 18%) – 1/3 of [(` 5,50,000 x 18%)]

GST paid on packing charges [` 2,50,000 x 18%] 45,000

Salary paid to staff at the Store Nil

[Services by an employee to the employer in the course of
or in relation to his employment is not a supply in terms of
para 1 of the Schedule III to CGST Act and hence, no GST
is payable thereon]
GST paid on inputs used for personal purpose Nil
[ITC on goods or services or both used for personal
consumption is blocked under section 17(5)(g)]
GST paid on rent a cab services availed for business Nil
purpose
[ITC on rent a cab service is blocked under section
17(5)(b)(i) as the same is not used by All-in-One Store for
providing the rent a cab service or as part of a taxable
composite or mixed supply.]
GST paid on items given as free samples Nil
[ITC on goods inter alia, disposed of by way of free
samples is blocked under section 17(5)(h)]
Total ITC credited to the electronic ledger 11,06,000
Less: ITC reversal [ITC of common credit, attributable (25,615)
to exempt supplies]
Net ITC available for credit 10,80,385

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Q.2
(A) Computation of gross GST liability of Vividh Pvt. Ltd.
Particulars Value of GST @
supply(`) 18% (`)
Services provided by way of labour contracts for 13,00,000 2,34,000
repairing a single residential unit otherwise than
as a part of residential complex
[Services by way of pure labour contracts of
construction, erection, commissioning, or
installation of original works pertaining to a
single residential unit otherwise than as a part of a
residential complex are exempt vide exemption
notification. Labour contracts for repairing, are
thus, taxable.]
Fee received from students of competitive exam 5,40,000 97,200
training academy
[Fee received from students of competitive exam
training academy is taxable as it is not an
educational institution since competitive exam
training does not lead to grant of a recognized
qualification]
Buses each with seating capacity of 72 passengers 6,00,000 Nil
given on hire to State Transport Undertaking
[Services by way of giving on hire to a state
transport undertaking (STU), a motor vehicle

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meant to carry more than 12 passengers, are
exempt from GST vide exemption notification.]
Services on which tax is payable under reverse
charge:
Rent paid to Local Municipal Corporation 2,50,000 45,000
[GST is payable under reverse charge in case of
renting of immovable property services supplied
by a local authority to a registered person.]
GTA services availed 1,80,000 Nil
[Since GTA is paying tax @ 12%, tax is payable
under forward charge by GTA only and not by
Vividh Pvt. Ltd.]
Gross GST payable 3,76,200

(B) Computation of customs duty and integrated tax payable on the

imported goods
Particulars US $
Cost of the machine at the factory 20,000
Transport charges up to port 800
Handling charges at the port 50
FOB 20,850
FOB value in Indian rupees @ ` 70/- per $ [Note 1] 14,59,500
Freight charges up to India [US $ 5,000 x ` 70] 3,50,000
Lighterage charges paid by the importer [Note 2] 12,000
Ship demurrage charges on chartered vessels [Note 2] 24,000
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Insurance charges @ 1.125% of FOB [Note 3] 16,419.38
CIF 18,61,919.38
Add: Basic customs duty @ 10% [Note 4] [a] 1,86,192
Add: Social Welfare surcharge @ 10% [b] 18,619.20
Total 20,66,730.58
Add: Integrated tax @ 12% of ` 20,66,730.58 [c] [Note 5] 2,48,007.67
Total custom duty and integrated tax payable 4,52,819
[(a) +(b) + (c)] rounded off

Notes:
(1) Rate of exchange notified by CBIC on the date of presentation of bill
of entry is considered [Explanation to section 14 of the Customs
Act, 1962].
(2) Cost of transport of the imported goods includes ship demurrage
charges and lighterage charges [Explanation to Rule 10(2) of
Customs Valuation (Determination of Value of Imported Goods)
Rules, 2007].
(3) Insurance charges is included @ 1.125% of FOB value of goods
[Third proviso to rule 10(2) of Customs Valuation (Determination of
Value of Imported Goods) Rules, 2007].
(4) Rate of duty is the rate prevalent on the date of presentation of bill of
entry or the rate prevalent on the date of entry inwards, whichever
is later [Section 15 of the Customs Act, 1962].
(5) Integrated tax is levied on the sum total of the assessable value of the
imported goods, customs duties and applicable Social welfare
surcharge.
(6) Buying commission is not included in the assessable value [Rule
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10(1)(a) (i) of Customs Valuation (Determination of Value of
Imported Goods) Rules, 2007].
(7) Freight incurred from port of entry to Inland Container depot is not
includible in assessable value [Rule 10(2)(a) of Customs Valuation
(Determination of Value of Imported Goods) Rules, 2007].

Q.3
(A) (i) Cheque discounting is exempt from GST only to the extent
consideration is represented by way of discount. Any charges other
than discount is not exempt from GST. Thus, charges recovered on
cheque discounting by ABC Ltd. are liable to GST.
Note: In the above answer, it has been assumed that the cheque
discounting charges are the service charges collected over and above
discount. However, it is also possible to assume that the said charges
represent the discount amount. In that case, said charges will be
exempt from GST.

(ii) Service of extending deposits, loans or advances in so far as the

consideration is represented by way of interest is exempt. Extra
charges recovered for delay in payment of 2nd monthly instalment is
taxable and is includible in the value of supply of the air conditioner.

(iii) The place of supply of passenger transportation service to Mr. Ajit

Khanna –an unregistered person – is London, i.e. the place where he
embarked on the conveyance for a continuous journey.

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(B) As per section 10(1), the following registered persons, whose aggregate
turnover in the preceding financial year did not exceed `1.5 crore, may opt
to pay tax under composition levy:
(i) Manufacturer,
(ii) Persons engaged in making supplies referred to in clause (b) of
paragraph 6 of Schedule II (restaurant services), and
(iii) Any other supplier eligible for composition levy.
The composition scheme under sub-sections (1) and (2) of section 10 can
essentially be availed in respect of goods and only one service namely,
restaurant service. However, the scheme permits supply of other marginal
services for a specified value along with the supply of goods and restaurant
service, as the case may be. Such marginal services can be supplied for a
value up to 10% of the turnover in the preceding year or `5 lakh, whichever
is higher. Further, the registered person should not be engaged in making
any inter-State outward supplies of goods. Furthermore, newly inserted
section 10(2A) provides an option to a registered person, who is not eligible
to pay tax under section 10(1) and 10(2), of paying tax @ 6% (CGST-3%
and SGST/UTGST-3%) provided his aggregate turnover in the preceding
financial year is upto ` 50 lakh. Said person can pay tax @ 6% of the
turnover in State or turnover in Union territory up to an aggregate turnover
of ` 50 lakh, subject to specified conditions. One of such conditions is that
the registered person should not be engaged in making any inter-State
outward supplies of goods or services.
In view of the above-mentioned provisions, the answer to the given
independent cases is as under:-

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The turnover limit for being eligible for composition scheme under under
sub-sections (1) and (2) of section 10 for Jalandhar (Punjab) is `1.5 crore in
the preceding financial year. Thus, Technology Enterprises can opt for said
composition scheme as its aggregate turnover is less than `1.5 crore in the
preceding financial year and it is making intra-State supplies. Further, since
the registered person opting for composition scheme can also supply
services (other than restaurant services) for a value up to 10% of the
turnover in the preceding year or `5 lakh, whichever is higher. Thus,
Technology Enterprises can supply repair services up to a value of `12.5
lakh [10% of ?125 lakh] in the current financial year.
In the given case:-
(i) the turnover in the preceding year is less than the eligible turnover
limit under composition scheme under sub-sections (1) and (2) of
section 10 for Delhi, i.e. `1.5 crore.
(ii) the supplier is engaged in providing restaurant service which is an
eligible supply under said composition scheme.
(iii) the supplier wants to engage in trading of goods which is also an
eligible supply under said composition scheme.
Thus, M/s. Siddharth & Sons is eligible for composition scheme under sub-
sections (1) and (2) of section 10.
(a) The turnover limit for being eligible for composition scheme under
sub-sections (1) and (2) of section 10 for Sikkim is `75 lakh in the
preceding financial year. However, a registered person who is
exclusively engaged in supplying services other than restaurant
services are not eligible for said composition scheme. Thus, Sitaram
Associates cannot opt for composition scheme under sub-sections (1)

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and (2) of section 10.
However, the benefit of composition scheme under section 10(2A) is
available in case of a registered person who is not eligible to pay tax
under sub-sections (1) and (2) of section 10 provided its aggregate
turnover in the preceding financial year does not exceed `50 lakh.
Thus, in view of the above-mentioned provisions, Sitaram Associates
cannot avail the benefit of composition scheme under section 10(2A)
also as its aggregate turnover in the preceding financial year is more
than `50 lakh.
(b) A service provider can opt for the composition scheme under sub-
sections (1) and (2) of section 10 only if he is engaged in supply of
restaurant services. Said scheme permits supply of marginal services
for a specified value, but only when the same are supplied along with
goods and/ or restaurant service.
Since Deepti Services Ltd.is exclusively engaged in supply of services
other than restaurant services, it is not eligible for composition
scheme sub-sections (1) and (2) of section 10 even though its turnover
in the preceding year is less than `75 lakh, the eligible turnover limit
for Uttarakhand.
However, since Deepti Services Ltd. is not eligible to opt for
composition scheme under sub- sections (1) and (2) of section 10 and
its aggregate turnover in the preceding financial year does not exceed
`50 lakh, Deepti Services Ltd.is entitled to avail benefit of
composition scheme under section 10(2A) in the current financial
year.
Further, the answer will remain the same even if Deepti Services Ltd.
also start supplying beauty products alongwith providing hair styling
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services in the current financial year since it fulfils the conditions laid
down for availing the benefit of composition scheme under section
10(2A) of the CGST Act. It can avail the benefit of composition
scheme under section 10(2A) till the time its aggregate turnover in the
current year doesn't exceed `50 lakh.

(C) (1) As per Baggage Rules, 2016, an Indian resident arriving from any
country other than Nepal, Bhutan or Myanmar is allowed duty free
clearance of-
(i) Used personal effects and travel souvenirs without any value
limit.
(ii) Articles [other than certain specified articles] upto a value of
`50,000 carried as accompanied baggage [General duty-free
baggage allowance].
Further, such general duty-free baggage allowance of a passenger
cannot be pooled with the general duty free baggage allowance of any
other passenger.
(2) One laptop computer when imported into India by a passenger of the
age of 18 years or above (other than member of crew) as baggageis
exempt from whole of the customs duty [Notification No. 11/2004
Cus. Dated 08.01.2004].
(3) Accordingly, there will be no customs duty on used personal effects
(worth ` 90,000) of Mrs. and Mr. X and laptop computer brought by
them will be exempt from duty. Duty payable on personal computer
after exhausting the duty free baggage allowance will be ` 52,000 –
`50,000 = `2,000. Effective rate of duty for baggage =38.5%
[including social welfare surcharge @ 10%]. Therefore, total customs
duty = `770

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Q.4

(A) Payment of taxes is governed as per the provisions laid in section 49

read with section 49A and 49B of CGST Act, 2017 along with rule 88A of
CGST Rules, 2017

Also, section 49(8) of CGST Act, stipulates that every taxable person shall
discharge his tax and other dues under this Act or the rules made thereunder
in the following order, namely:

(a) self-assessed tax, and other dues related to returns of previous tax
periods;

(b) self-assessed tax, and other dues related to the return of the current tax
period;

(c) any other amount payable under this Act or the rules made thereunder
including the demand determined under section 73 or section 74;”

As per the above provisions, self-assessed tax of previous tax period

i.e. February shall be paid first and later self-assessed tax of current tax
period i.e. July shall be paid.

Payment of taxes under forward charge

Particulars IGST CGST SGST
Balance in electronic credit ledger for 26,52,000 18,32,000 18,32,000
utilization
Output tax payable for July 14,75,000 28,34,000 28,34,000
Less: Utilization of input tax credit:
a. IGST [Refer Note1] 14,75,000 5,88,500 5,88,500

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b. CGST 0 18,32,000 0
c. SGST 0 0 18,32,000
Amount payable through electronic Nil 4,13,500 4,13,500
cash ledger

Total amount payable through electronic cash ledger

Particular IGST CGST SGST
Amount payable thorough Nill 4,13,500 4,13,500
Electronic cash ledger under
forward charge
Amount payable through 36,000 1,44,000 1,44,000
electronic cash ledger under
reverse charge [Refer Note-2]
Total amount payable through 36,000 5,57,500 557,500
electronic cash ledger

Notes:-

1 After utilization of IGST credit towards output IGST liability,

balance has been utilized equally amongst CGST & SGST

2 Input tax credit cannot be utilized for discharging tax liability

under reverse charge basis, thus payable vide electronic cash
ledger.

Since, M/s Zinc & Co., have defaulted in payment of taxes for the month
of February and the same has been paid during July, interest is payable
as per the provisions of section 50 of the CGST Act, 2017
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(B) (i) Section 22(1) provides that every supplier is liable to be registered
under this Act in the State or Union territory, other than special
category States, from where he makes a taxable supply of goods or
services or both, if his aggregate turnover in a financial year exceeds
the threshold limit.

Section 25(1) provides that a supplier whose aggregate turnover in a

financial year exceeds the threshold limit in a State/UT is liable to
apply for registration within 30 days from the date of becoming liable
to registration (i.e., the date of crossing the threshold limit).

Where the application is submitted within the said period, the

effective date of registration is the date on which the person becomes
liable to registration vide rule 10(2); otherwise it is the date of grant
of registration in terms of rule 10(3).

In the given case, since Pari & Sons have applied for registration on
27th August which is within 30 days from the date of becoming liable
to registration (10th August), its effective date of registration is 10th
August. Further, every registered person who has been granted
registration with effect from a date earlier than the date of issuance of
registration certificate to him, may issue revised tax invoices in
respect of taxable supplies effected during this period within one
month from the date of issuance of registration certificate [Section
31(3)(a) read with rule 53(2)]31.

In view of the same, Pari & Sons may issue revised tax invoices
against the invoices already issued during the period between
effective date of registration (10th August) and the date of issuance of

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registration certificate (1st September), on or before 1st October.

(ii) In terms of rule 32(6) relating to valuation, the value of a coupon is

equal to the money value of the goods redeemable against it.
Therefore, though the coupon is sold for ` 900, its value is ` 1000.

(C) Computer of customs duty and integrated tax payable there on

Particular Amount (`)

Assessable value of sodium nitrite imported 30,00,000

Add: Basic custom duty @ 10% (`30,00,00010%) 3,00,000

Safeguard duty @ 30% on `30,00,000 [safeguard duty 9,00,000

is impossible in the give case since share of imports of
sodium nitrite form the developing country is more
than 3% of the total imports of sodium nitrite into
India (Provision to section 8B(2) of the Customs Tariff
Act, 19750)]

Social welfare surcharge @ 10%  `3,00,000 30,000

Total 42,30,000

Integrated tax (`42,30,000x`12%)[Note] 5,07,600

Total customs duty payable 17,37,600

(`3,00,000 + `9,00,000 + `30,000 + `5,07,600

Note it has been clarified by DGFT vide Guidance note that value of
calculation of integrated tax shall also include safeguard duty amount .

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Q.5
(A) Due date for payment of tax for the month of April is 20th May. As per
section 73 of the CGST Act, 2017, where self-assessed tax is not paid within
30 days from due date of payment of such tax, penalty equivalent to 10% of
tax or ` 10,000, whichever is higher, is payable. Thus, option to pay tax
within 30 days of issuance of SCN to avoid penalty, is not available in case
of self-assessed tax.
Since in the given case, Sharat & Co. has not paid the self-assessed tax
within 30 days of due date [i.e. 20th May], penalty equivalent to:
(i) 10% of tax, viz., ` 9,000 (10% of ` 90,000) or
(ii) ` 10,000,
whichever is higher, is payable by him. Thus, penalty payable is ` 10,000.
Hence, the stand taken by the Department that penalty will be levied on
Sharat & Co. is correct, but the amount of penalty of ` 45,000 is not correct.

(B) Beauty Cosmetics Ltd. would be required to prepare two separate e-way
bills since each invoice value exceeds ` 50,000 and each invoice is
considered as one consignment for the purpose of generating e-way bills.

The FAQs on E-way Bill issued by CBIC clarify that if multiple invoices are
issued by the supplier to one recipient, that is, for movement of goods of
more than one invoice of same consignor and consignee, multiple e-way
bills have to be generated. In other words, for each invoice, one e-way
bill has to be generated, irrespective of the fact whether same or different
consignors or consignees are involved. Multiple invoices cannot be
clubbed to generate one e-way bill. However, after generating all these e-
way bills, one consolidated e-way bill can be prepared for transportation
purpose, if goods are going in one vehicle.
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(C) (i) As per section 61(2) of the Customs Act, 1962, if goods (belonging to
importer other than 100% EOU, STP unit, EHTP unit) remain in a
warehouse beyond a period of 90 days from the date on which the
order under section 60(1) is made, interest is payable @ 15% on the
amount of duty payable at the time of clearance of the goods, for the
period from the expiry of the said 90 days till the date of payment of
duty on the warehoused goods.
In Pratibha Processors v. UOI 1996 (88) ELT 12 (SC), the Apex Court
has held that when goods at the time of removal from warehouse are
wholly exempted from payment of duty, the liability to pay interest
cannot be saddled on a non-existing duty. Liability to pay interest
under section 61(2) of the Customs Act is solely dependent upon the
eligibility or actual liability to pay duty. In case the liability to pay
duty is nil, then, the interest will also be nil.
Therefore, since in this case the goods have been re-exported without
payment of duty, no interest is payable by ‘X’.

(ii) (a) Invalid. Goods, other than capital goods, intended to be used in
a 100% EOU/ STP unit/ EHTP unit can be warehoused till the
consumption or clearance of such goods from the warehouse.
Further, capital goods intended to be used in a 100% EOU can
also be warehoused till the clearance of such goods from the
warehouse.
(b) Invalid. As per section 61, if goods (not intended for being
used in 100% EOU, STP unit, EHTP unit) remain in a
warehouse beyond a period of 90 days from the date on which

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the order permitting deposit of goods in a warehouse under
section 60(1) is made, interest is payable @ 15% on the amount
of duty payable at the time of clearance of the goods, for the
period from the expiry of the said 90 days till the date of
payment of duty on the warehoused goods.
In other words, the relevant date for determining the
commencement of the period of 90 days is the date of order
made under section 60 permitting removal of goods from the
customs station for deposit in a warehouse, and not the date on
which into-bond bill of entry in respect of such goods is
presented.

Q.6
(A) Where any firm is liable to pay any tax, interest or penalty under GST law,
the firm and each of the partners of the firm shall, jointly and severally, be
liable for such payment.
Where any partner retires from the firm, he or the firm, shall intimate the
date of retirement of the said partner to the Commissioner by a notice in that
behalf in writing.
Where intimation is given within 1 month from the date of retirement, such
partner shall be liable to pay tax, interest or penalty due up to the date of his
retirement whether determined or not, on that date.
However, if no such intimation is given within 1 month from the date of
retirement, the liability of such partner shall continue until the date on which
such intimation is received by the Commissioner.

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(B) Where any amount payable by a person to the Government under any of the
provisions of this Act or the rules made thereunder is not paid, the proper
officer shall proceed to recover the amount by one or more of the following
modes, namely:
(i) Recovery by deduction from any money owed: The proper officer
may deduct or may require any other specified

officer to deduct the amount so payable from any money owing to

such person [referred as ‘defaulter’] which may be under the control
of the proper officer or such other specified officer

(ii) Recovery by sale of goods under the control of proper officer: The
proper officer may recover or may require any other specified officer
to recover the amount so payable from a defaulter by detaining and
selling any goods [through a process of auction, including e-auction]
belonging to such person which are under the control of the proper
officer or such other specified officer.

(iii) Garnishee proceedings - Recovery from a third person: The proper

officer may, by a notice in prescribed form, in
writing, require any other person:
 from whom money is due/may become due to such person or
 who holds/may subsequently hold money for/on account of
such person to pay to the Government
 either forthwith upon the money becoming due or being held, or
 within the time specified in the notice not being before the
money becomes due or is held,
so much of the money as is sufficient to pay the amount due from
such person or the whole of the money when it is equal to or less than
that amount

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(iv) Recovery by sale of movable/immovable property

(v) Recovery as arrears of land revenue: The proper officer may

prepare a certificate in prescribed form signed by him specifying the
amount due from such person and send it to the Collector of the
district in which such person owns any property or resides or carries
on his business or to any officer authorised by the Government and
the said Collector or the said officer, on receipt of such certificate,
shall proceed to recover from such person the amount specified
thereunder as if it were an arrear of land revenue.

(vi) Recovery as fine imposed by Magistrate: Notwithstanding anything

contained in the Code of Criminal Procedure, 1973, the proper officer
may file an application to the appropriate Magistrate in prescribed
form to recover from the person concerned the amount specified
thereunder and such Magistrate shall proceed to recover from such
person amount specified thereunder as if it were a fine imposed by
him.

(vii) Recovery through execution of a decree, etc.: Where any amount is

payable to the defaulter in the execution of a decree of a Civil Court
for the payment of money or for sale in the enforcement of a mortgage
or charge, the proper officer shall send a request to the said court and
the court shall, subject to the provisions of the Code of Civil
Procedure, 1908, execute the attached decree, and credit the net
proceeds for settlement of the amount recoverable.

(viii) Recovery through surety: Where any person has become surety for
the amount due by the defaulter, he may be proceeded against under
this Chapter as if he were the defaulter
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(ix) Recovery from company in liquidation: Where the company is
under liquidation as specified in section 88, the Commissioner shall
notify the liquidator for the recovery of any amount representing tax,
interest, penalty or any other amount due under the Act in prescribed
form.

(C) Section 121 lays down that no appeals whatsoever can be filed against the
following orders:-

(a) an order of the Commissioner or other authority empowered to

direct transfer of proceedings from one officer to another officer;

(b) an order pertaining to the seizure or retention of books of

account, register and other documents; or

(c) an order sanctioning prosecution under the Act; or

(d) an order passed under section 80 (payment of tax in instalments).

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