Research Project on Goods and Services

Tax (GST)
Presented by: Sk Manirul Islam
Roll Number: 3303
College: Manjunath College of Arts and Commerce

Academic Year: 2024-2025

Acknowledgement
I would like to express my sincere gratitude to all those who supported me throughout the
completion of this project on Goods and Services Tax (GST). Special thanks to my mentor
and faculty members for their valuable guidance and encouragement.
Certificate
This is to certify that the project titled “Research Project on Goods and Services Tax (GST)”
is the original work carried out by Sk Manirul Islam, Roll Number 3303, under my
supervision. This project is submitted to Manjunath College of Arts and Commerce in partial
fulfillment of the curriculum for the academic year 2024-2025.

Supervisor Signature
Date:
Index
1. 1. Introduction to GST
2. 2. Historical Background of GST in India
3. 3. Objectives of GST
4. 4. Benefits of GST
5. 5. Structure of GST
6. 6. GST Registration
7. 7. GST Returns and Forms
8. 8. Explanation of GSTR-1 to GSTR-10
9. 9. Annual Returns (GSTR-9, 9A, 9B)
10. 10. Filing Process Flow
11. 11. Input Tax Credit (ITC) and Matching
12. 12. Payment of GST
13. 13. Modes of GST Payment
14. 14. GST Invoices and Formats
15. 15. Supplementary Invoices and Notes
16. 16. Reverse Charge Mechanism
17. 17. GST’s Impact on Various Sectors
18. 18. GST and E-Commerce
19. 19. E-Way Bill System
20. 20. Transporters’ Role in GST
21. 21. Accounting and Records
22. 22. Retention Period of Records
23. 23. Penalties and Late Fees
24. 24. Transition Provisions
25. 25. Compliance Checklist
26. 26. Common Errors and Rectification
27. 27. GST Audit and Reconciliation
28. 28. GST's Economic Impact
29. 29. Criticism and Challenges
30. 30. Case Studies
31. 31. Recent Amendments
32. 32. Future of GST
33. 33. FAQs
34. 34. Glossary
35. 35. Summary & Conclusion
36. 36. Bibliography
37. 37. Appendix: Sample GST Forms
38. 38. Charts and Tables
39. 39. Relevant Images
40. 40. Visual Summary & Insights
1. Introduction to GST
Goods and Services Tax (GST) is a comprehensive, multi-stage, destination-based tax that is
levied on every value addition. It has replaced numerous indirect taxes that previously
existed in India such as VAT, service tax, and excise duty.

GST was implemented in India on July 1, 2017, with the aim of creating a single, unified
national market. It aims to eliminate the cascading effect of taxes and bring transparency in
the tax structure.
2. Historical Background of GST in India
The idea of a unified Goods and Services Tax was first proposed in 2000. It took 17 years of
detailed discussions and coordination between the Central and State governments to
implement GST.

The Constitution (101st Amendment) Act, 2016, was passed to empower both the Centre
and the States to levy GST. This landmark reform was rolled out on July 1, 2017.
3. Objectives of GST
• To unify the indirect tax structure under a single umbrella.

• To remove the cascading effect of multiple taxes.

• To ensure ease of doing business across India.

• To improve tax compliance and broaden the tax base.

• To create a transparent and corruption-free tax system.

4. Benefits of GST
GST offers several benefits to the economy, businesses, and consumers.

• For the economy: It boosts GDP, promotes transparency, and reduces tax evasion.

• For businesses: Simplifies compliance, enables seamless ITC, and reduces logistic costs.

• For consumers: Ensures a unified pricing system and reduces overall tax burden.
5. Structure of GST
GST in India follows a dual model comprising Central GST (CGST) and State GST (SGST) for
intra-state transactions and Integrated GST (IGST) for inter-state transactions.

• CGST: Collected by the Central Government.

• SGST: Collected by the respective State Government.

• IGST: Collected by the Central Government for inter-state supply, and distributed between
Centre and States accordingly.
6. GST Registration
GST registration is mandatory for businesses whose turnover exceeds the threshold limit as
defined under the GST Act. It is also compulsory for certain businesses regardless of
turnover, such as inter-state suppliers and e-commerce operators.

Once registered, businesses are assigned a unique Goods and Services Tax Identification
Number (GSTIN).
7. GST Returns and Forms
GST-registered businesses must file various returns to report their sales, purchases, and tax
liabilities. These returns include GSTR-1, GSTR-2A, GSTR-3B, GSTR-9, and others.

Returns must be filed monthly, quarterly, or annually, depending on the taxpayer's category
and turnover.
8. Explanation of GSTR-1 to GSTR-10
• GSTR-1: Details of outward supplies of goods or services.

• GSTR-2A: Auto-generated return showing inward supplies.

• GSTR-3: Monthly summary of inward and outward supplies and tax liabilities.

• GSTR-4: Return for composition scheme taxpayers.

• GSTR-5: Return for non-resident foreign taxable persons.

• GSTR-6: Return for Input Service Distributors.

• GSTR-7: Return for tax deduction at source (TDS).

• GSTR-8: Statement for e-commerce operators for TCS.

• GSTR-9: Annual return for regular taxpayers.

• GSTR-10: Final return filed when GST registration is cancelled.

9. Annual Returns (GSTR-9, 9A, 9B)
Annual return GSTR-9 must be filed by regular taxpayers by 31st December of the following
financial year.

• GSTR-9: Filed by regular taxpayers.

• GSTR-9A: Filed by composition taxpayers.

• GSTR-9B: Filed by taxpayers whose turnover exceeds ₹2 crores along with a reconciliation
statement and audited accounts.
10. Filing Process Flow
The filing of GST returns involves multiple steps:

• Upload GSTR-1 with outward supply details.

• GSTR-2A is auto-populated for inward supplies based on GSTR-1.

• Reconciliation and corrections are made in GSTR-2.

• GSTR-3B is filed with final tax liability and payment.

The system ensures matching of ITC between supplier and recipient, promoting
transparency and compliance.
11. Input Tax Credit (ITC) and Matching
Input Tax Credit (ITC) allows businesses to claim credit for the GST paid on purchases to
offset their tax liability on sales.

ITC can only be claimed if the supplier has uploaded the invoice, the goods/services have
been received, and the tax has been paid to the government.

Matching ensures that the ITC claimed by the recipient matches the details submitted by the
supplier, ensuring authenticity and avoiding tax evasion.
12. Payment of GST
GST payments can be made via the GST portal using various modes such as net banking,
debit/credit cards, NEFT/RTGS, and over-the-counter payments.

The taxpayer's Electronic Credit Ledger and Electronic Cash Ledger are used to track ITC
and tax payments.

Payments must be made by the 20th of the following month. Late payments attract interest
and penalties.
13. Modes of GST Payment
The major modes of payment under GST include:

• Net Banking

• Debit or Credit Card

• NEFT or RTGS from any bank

• Over-the-Counter payment through authorized banks (for limited transactions)

All payments must be made via a challan generated from the GST portal, with a unique CPIN
(Common Portal Identification Number).
14. GST Invoices and Formats
GST invoices must contain detailed information such as invoice number, date, supplier and
recipient details, description of goods/services, tax rates, and the amount of tax charged.

The format may differ for goods and services, but standard fields must be maintained to
ensure compliance.

Special documents like revised invoices, bills of supply, and receipt vouchers are issued in
specific situations.
15. Supplementary Invoices and Notes
Supplementary invoices are issued when the taxable value or tax charged on the original
invoice needs adjustment.

• Credit Notes are issued to reduce the tax liability due to returns or errors.

• Debit Notes are issued to increase the tax liability when the original invoice undercharged
the tax.

Each of these documents must clearly reference the original invoice and contain all
necessary details.
16. Reverse Charge Mechanism
Under the Reverse Charge Mechanism (RCM), the recipient of goods or services is liable to
pay GST instead of the supplier.

This is applicable in specific scenarios such as imports, transactions with unregistered

dealers, and notified services like legal fees and transportation.

The recipient must issue a self-invoice and pay the tax directly to the government, with
eligibility to claim Input Tax Credit if applicable.
17. GST’s Impact on Various Sectors
GST has significantly impacted sectors like manufacturing, logistics, retail, and services.

• Manufacturing: Streamlined tax structure and reduced logistics costs.

• Retail: Uniform tax rates and improved compliance.

• Services: Centralized registration and reduced cascading taxes.

• Logistics: Elimination of check-posts and faster movement of goods across states.

18. GST and E-Commerce
E-commerce operators are required to collect Tax Collected at Source (TCS) under GST
while facilitating sales through their platforms.

They must file monthly returns detailing the supplies made through their platform and
deposit the TCS with the government.

This provision ensures proper tracking and reporting of online transactions and tax
compliance by sellers.
19. E-Way Bill System
An E-Way Bill is an electronic document generated on the GST portal required for
transporting goods worth more than ₹50,000.

It contains details of the consignment, the consignor, the consignee, and the transporter.

E-Way Bills help reduce tax evasion and ensure real-time tracking of goods movement
across India.
20. Transporters’ Role in GST
Transporters are crucial stakeholders under GST as they are responsible for carrying goods
and ensuring E-Way Bill compliance.

They must carry valid E-Way Bills, either physically or mapped through RFID, during
transportation.

In the case of multiple consignments, a consolidated E-Way Bill must be generated and
produced on demand by authorities.
21. Accounting and Records
Under GST, registered taxpayers are required to maintain detailed accounts and records
related to their business transactions.

These include records of:

• Inward and outward supplies of goods and services

• Stock of goods

• Input tax credit availed and utilized

• Tax payable and paid

• Other documents as prescribed under GST rules

Records may be maintained electronically and must be accessible at the principal place of
business.
22. Retention Period of Records
All books of accounts and records under GST must be retained for a period of 72 months (6
years) from the due date of filing the annual return for that year.

In cases where the taxpayer is involved in any appeal or legal proceeding, records must be
retained for one year after the final disposal of such proceedings.
23. Penalties and Late Fees
Delays and non-compliance with GST provisions attract penalties and late fees.

• Late fee for return delay: ₹100 per day (CGST + SGST), subject to a maximum limit.

• Interest on late payment of tax: 18% per annum.

• Penalty for non-registration or evasion: May extend up to ₹10,000 or the amount of tax
evaded, whichever is higher.

Timely compliance helps avoid these financial and legal consequences.

24. Transition Provisions
GST provides transition rules for carrying forward eligible credits and inventories from the
previous tax regime.

Do's:

• Avail all eligible credits before the cutoff date.

• Ensure accurate documentation and stock reconciliation.

Don'ts:

• Do not accept sales returns from the old regime unless covered by a GST-compliant
invoice.

• Avoid issuing purchase orders without incorporating GST provisions.

25. Compliance Checklist
A GST compliance checklist helps ensure that all procedural and legal requirements are met:

• Maintain proper books of accounts and records.

• File returns on time (monthly, quarterly, annually).

• Reconcile ITC and match with GSTR-2A.

• Maintain invoice formats as per GST rules.

• Generate and manage E-Way Bills correctly.

• Regularly audit and update data to ensure accuracy and compliance.

26. Common Errors and Rectification
Common errors in GST filing and compliance include incorrect invoice details, mismatches
in ITC claims, missed deadlines, and incorrect tax calculations.

Rectification is permitted only in returns of the period in which the error is noticed, and
must be done before the due date of filing the return for September of the following year or
the annual return, whichever is earlier.

Proactive reconciliation and review of records can help prevent such issues.
27. GST Audit and Reconciliation
GST audit is mandatory for taxpayers whose annual turnover exceeds the prescribed
threshold. It involves verification of records, returns, and reconciliations.

A reconciliation statement (Form GSTR-9C) must be filed to match the details filed in annual
return (GSTR-9) with the audited financial statements.

Audits ensure accuracy, prevent evasion, and promote better compliance.

28. GST's Economic Impact
GST has significantly influenced the Indian economy by simplifying the tax structure and
improving ease of doing business.

Positive outcomes include increased transparency, reduced cascading taxes, formalization

of the economy, and better tax collections.

However, challenges like technical issues, compliance costs for small businesses, and
evolving rules continue to be addressed.
29. Criticism and Challenges
Despite its advantages, GST implementation has faced criticism due to:

• Complex compliance procedures for small businesses

• Technical glitches in the GSTN portal

• Delays in refund processing

• Frequent changes in rules and rates

Addressing these challenges is crucial for realizing the full potential of GST reform.
30. Case Studies
Case Study 1: Impact of GST on a Manufacturing Firm

ABC Manufacturing experienced improved logistics and reduced tax costs post-GST due to
the removal of check-posts and seamless ITC.

Case Study 2: GST for Small Traders

XYZ Traders faced initial hurdles in transitioning to GST due to technological requirements
but gradually adapted, benefiting from simplified tax structure.

Case Study 3: E-Commerce Compliance

E-Shop India adapted to GST’s TCS and reporting mandates, ensuring platform-wide
compliance for sellers and improved transparency for tax authorities.