TYBMS SEM 6 Financial: Indirect Tax (Q.P. April 2023 with Solution)

TYBMS SEM 6

Financial: 

Indirect Tax

(Q.P. April 2023 with Solution)

 Q2 (a) Mr. Manish gives you the following information of his transactions for November 2021. As per provisions related to goods & Services Tax classify the following items as taxable or not taxable.  (08)

SR No.	Particulars	Amount
1	Rent received for machinery in Factory	400000
2	Express Parcel post services	100000
3	A building was let out for Vidya vikas school	700000
4	Interest received from reserve bank of India	10000
5	Houses are let out to an individual for residential purpose	40000
6	Royalty for authorship of books	200000

Solution:

SR No.	Particulars	Taxable	Non-Taxable
1	Rent received for machinery in Factory	400000
2	Express Parcel post services	100000
3	A building was let out for Vidya vikas school		700000
4	Interest received from reserve bank of India		10000
5	Houses are let out to an individual for residential purpose		40000
6	Royalty for authorship of books	200000
	TOTAL	700000	750000

Q2 (b) From the following details calculate the value of supply:        (07)

Particulars	Rs.
Contracted value of supply of goods by Mr. Khan to Mr. Parag	400000
The following expenses were incurred by Mr. Parag on behalf of Mr. Khan:
1. Cost of Packing	15,000
2. Loading Charges	28,000
Other Information: (i) Delivery Charges paid to Mr. Gopi by Mr. Parag on instruction of Mr. Khan	12000
(ii) Additional packing charges paid by Mr. Khan on behalf of Mr. Parag	15000
(iii) Subsidy received from the ABC pvt Ltd.	10000

Solution:

Particulars	Rs.
Value of Supply	400000
Cost Packing	15,000
Loading Charges	28,000
Delivery Charges	12000
Packing Charges	15000
Subsidy	10000
Value of Supply	480000

Q2 (c): Prapti Limited, a trading concern in Mumbai furnishes you with the following information for the financial year 2021-22 Find out whether Prapti Ltd is eligible to opt Composition Scheme.            (08)

SR No.	Particulars	Amount
1	Value of inward supplies on which tax is payable under RCM (GST @5%).	750500
2	Intra state supplies which are wholly exempt under sec 11 of CGST act 2017.	600000
3	Intra state supplies of goods Chargeable at 18% GST.	2050000
4	Intra state supply is made which are chargeable to GST at NIL rate.	400000
5	Intra state supplies of Goods chargeable at 5% GST.	500000

Solution: Calculation of Aggregate Turnover

Particulars	Rs.
Intra State Supply	600000
Intra State Supply	2050000
Intra State Supply	400000
Intra State Supply	500000
Total	3550000

Since Papti LTD aggregate Turnover is Rs. 35,50000 which is less than the threshold limit of 1.5 Crore, Papti Ltd is eligible to opt for composition Scheme.

Calculation of Tax Liability

Particulars	Rs.
CGST @ 0.5% of 3550000	17750
SGST @ 0.5% of 3550000	17750
Total	35500

Value of inward supplies on which tax is payable under RCM is not be included.

Q.2 D) Rajapur Post office provided the following service to person other then Government during the year ending 31-03-2022. Classify the following items as taxable or not taxable.    (07)

Sr No.	Particulars	Amount
1.	Transfer of Money through money orders	650000
2	Pension Payment Service	250000
3	Operation of Saving Account	250000
4	Rural Postal Life Insurance	350000
5	Distribution of Bonds	650000
6	Issuance of Postal orders	450000
7	Collection of Telephone bills	250000

Solution:

Sr No.	Particulars	Taxable	Non-taxable
1.	Transfer of Money through money orders		650000
2	Pension Payment Service		250000
3	Operation of Saving Account		250000
4	Rural Postal Life Insurance	350000
5	Distribution of Bonds	650000
6	Issuance of Postal orders		450000
7	Collection of Telephone bills	250000
	Total	12,50,000	16,00,000

Q.3 A From the following Find out Place of Supply.   (08)

1. Mr. P of Mumbai, sell 15 air conditioners to Q of Pune for delivery at Mr. Q Place of business at Pune.

Ans : Place of Supply: Pune

2. Mr. Pritesh located at Pune place an order to Mr. Kiran of Pune for Instalment of machinery at his factory in Madras.

Ans : Place of Supply: Madras

3. Mr. Nitish Purchase food packets in train Ahmedabad, whereas train is running from Mumbai to Delhi. Food packets were loaded in train in Mumbai.

Ans : Place of Supply: Mumbai

4, Mr. Ashwini of Punjab places an orders to Mr. Anmol of Mumbai for delivery of certain goods Ms Ashwini directs Mr. Anmol to deliver goods to Mr. Rahul in Indore.

Ans : Place of Supply: Punjab

Q3 (B): Determine the time of supply in the following cases of supply of services. (Assuming Tax Payable on Reverse Charge Mechanism): Explain the Provisions relating to Supply of Services under RCM. (07)

Sr. No	Date of payment by Recipient for Supply of Service	Date of Issue of Invoice by the Supplier of Service
1	10/08/2022	29/06/2022
2	10/08/2022	01/06/2022
3	30/06/2022	29/06/2022
4	28/06/2022	01/06/2022
5	26/06/2022	29/06/2022
6	17/06/2022	22/07/2022

Solution:

Sr. No	Date of Issue of Invoice by the Supplier of Service	Date of payment by Recipient for Supply of Service		60 days from date of invoice	TOS
1	29/06/2022	10/08/2022		28/08/2022	10/08/2022
2	01/06/2022	10/08/2022		01/08/2022	01/08/2022
3	29/06/2022	30/06/2022		28/08/2022	30/06/2022
4	01/06/2022	28/06/2022		01/08/2022	01/08/2022
5	29/06/2022	26/06/2022		28/08/2022	26/06/2022
6	22/07/2022	17/06/2022	20/09/2022		17/06/2022

 Q3(c) :Mr. Vikrant Rona supplies goods and services from Bangalore. He states that he is not required to register under GST Laws, Compute the aggregate turnover and advice whether he is liable to get registered. He furnishes the following details as under. (08)

a. Intra-state supplies.

Date of Supply	Tax Rate	Amount
09/06/2022	12%	510000
11/08/2022	5%	230000
04/09/2022	28%	170000
10/10/2022	18%	200000

b. Exempted supplied to the extent of Rs. 90,000 were made in Bangalore.

c. Mr. Vikrant Rona supplied agricultural produce worth Rs:90,000 that was cultivated X by Mr. Pathak to whom wages of Rs.1,000 p.m. were paid and was supervised by Mr. Vikrant Rona's wife.

 Solution:

Sr No.	Particulars	Amount
1.	Intra-state supply	510000
2	Intra-state supply	230000
3	Intra-state supply	170000
4	Intra-state supply	200000
5	Exempted supplied	90,000
	Total	12,00,000

Since the aggregate turnover does not exceeds Rs.4000000 Mr. vikrant is not required to register under GST

Q3(d) Determine Time of Supply in the following cases assuming the GST is payable on Reverse Charge basis (RCM). Write down the Provisions Relating t to time of supply on RCM.

Sr. No	Date of Receipt of Goods	Date of payment by Recipient for Supply of Goods	Date of Issue of Invoice by the Supplier of Goods
1	01/07/2022	10/08/2022	29/06/2022
2	01/07/2022	25/06/2022	29/06/2022
3	01/07/2022	30/07/2022	29/06/2022
4	05/07/2022	28/06/2022	01/06/2022
5	01/07/2022	26/06/2022	29/06/2022
6	01/07/2022	01/08/2022	29/06/2022

Solution:

Sr. No	Date of Issue of Invoice by the Supplier of Goods	Date of Receipt of Goods	Date of payment by Recipient for Supply of Goods	30 days from Invoice	TOS
1	29/06/2022	01/07/2022	10/08/2022	29/07/2022	01/07/2022
2	29/06/2022	01/07/2022	25/06/2022	29/07/2022	25/06/2022
3	29/06/2022	01/07/2022	30/07/2022	29/07/2022	01/07/2022
4	01/06/2022	05/07/2022	28/06/2022	01/07/2022	28/06/2022
5	29/06/2022	01/07/2022	26/06/2022	29/07/2022	26/06/2022
6	29/06/2022	01/07/2022	01/08/2022	29/07/2022	01/07/2022

 

Q4 (A) Mr. Gandhi is registered in the State of Gujarat and provides following details for the month of December. Calculate his net tax liability. 

Opening balance in Electronic Credit Ledger as on 1st December: (08)

1. IGST-NIL

2. CGST-2500

3. SGST-2400

SR No.	Transactions during the month	Amount
1	Sold goods @ 12% GST to Mr. Modi in Surat.	100000
2	Sold goods @ 5% GST to Mr. Kumar in Rajkot,	200000
3	Purchased goods @ 18% GST from Ahmedabad.	50000
4	Purchased goods @ 5% GST from Baroda.	7000

Solution:

Calculation of tax on supply

Particulars	IGST	CGST	SGST
Sold goods @ 12% GST to Mr. Modi in Surat.		6000	6000
Sold goods @ 5% GST to Mr. Kumar in Rajkot,		5000	5000
Total		11000	11000

Calculation of ITC

Particulars	IGST	CGST	SGST
Purchased goods @ 18% GST from Ahmedabad.		4500	4500
Purchased goods @ 5% GST from Baroda.		1750	1750
Total		6250	6250

Calculation of net tax liability

Particulars	IGST	CGST	SGST
Tax on Supply		11000	11000
Less: Opening balance		500	400
Less: Tax on ITC		6250	6250
Total		4250	4350

Q4(B) You are required to calculate, ITC available for the month of January, 2022.

SR No.	Particulars	Amount
1	Repairs to Plant & Machinery	45000
2	Goods used during testing of New batch of Finished goods	75000
3	Plant & Machinery purchased. (Depreciation on Full Value Including GST)	105000
4	Raw Materials Purchased under composition scheme	15000
5	White Washing of Factory Building	60000
6	Goods stolen from warehouse	90000
7	Goods destroyed during fire	30000

Solution:

Particulars	Amount
Repairs to Plant & Machinery	45000
Goods used during testing of New batch of Finished goods	75000
White Washing of Factory Building	60000
Total	180000

Q4 (c): M/s Veera Associates registered in state of Uttar Pradesh provides following details for the month of May. Calculate its net tax liability for the month of May As business commenced on 14th May, there is no Opening Balance in Electronic Credit Ledger.

Transaction during the Month

Particulars	Amount
Sold Goods @ 12% GST in Meerut, UP	175000
Sold Goods @ 5% GST in Bareily, UP	250000
Sold Goods @28% GST in Mathura, UP	425000
Sold Goods 18% GST in Agra, UP	500000
Intra State Supply Purchased goods @18% GST from Mumbai, Maharashtra	630000
Provided Services @5% GST in Indore, MP	480000
Availed Services @ 12% GST from Kanpur, UP	700000
Availed Services @ 28% GST from Patana, Bihar	90000

Excess credit of IGST to be utilized against CGST & SGST in the ratio 70:30

Solution:

 Calculation of Tax on Supply

Particulars	IGST	CGST	SGST
Sold Goods @ 12% GST in Meerut, UP		10500	10500
Sold Goods @ 5% GST in Bareily, UP		6250	6250
Sold Goods @28% GST in Mathura, UP		59500	59500
Sold Goods 18% GST in Agra, UP		45000	45000
Provided Services @5% GST in Indore, MP	24000
Total	24000	121250	121250

Calculation of ITC

Intra State Supply Purchased goods @18% GST from Mumbai, Maharashtra	113400
Availed Services @ 12% GST from Kanpur, UP		42000	42000
Availed Services @ 28% GST from Patana, Bihar	25200
Total	138600	42000	42000

Calculation of Tax Liability / Excess credit:

Particulars	IGST	CGST	SGST
Tax of Supply	24000	121250	121250
Less: Tax on ITC	138600	42000	42000
Total	(114600)	79250	79250
Less: Adjust Excess credit (70:30)	114600	(80220)	(34380)
Net liability	Nil	(970)	44870