1

CA Jasmeet Singh Arora

GST Practice Session 1

Topics Covered: Supply / Time Of Supply / Value Of Supply

Illustration 01
Examine whether the following activities would be treated as supply under GST law?
1) Mr. Sonu from Chandigarh purchased a water cooler from Malhotra Bros. of
Hoshiarpur for 25,000 to donate it to a temple situated in Hoshiarpur. Mr. Sonu
directed Malhotra Bros. to engrave the words on the water cooler- "Donated by
Mr. Sonu from Chandigarh" and dispatch the water cooler directly to the temple.

2) Wesco Ltd, a registered person in Ahmedabad (Gujarat) having head office located
in Singapore, received management consultancy services free of cost from its
head office.
[PYQ Nov 23]
Solution

1) Donations received by the charitable organizations are treated as consideration only

if there exists, quid pro quo, i.e., there is an obligation on part of recipient of the
donation or gift to do anything (supply a service).
Since the name of the donor, Mr. Sonu is displayed in temple as an expression of
gratitude and public recognition of his act of philanthropy and is not aimed at
advertising or promotion of his business, hence, donation of water cooler by Mr.
Sonu to temple is without quid pro quo and is, thus, not a supply under GST law.
However, supply of water cooler by Malhotra Bros. to Mr. Sonu is supply as it is
made for consideration in course or furtherance of business.

2) As per schedule I, in case of import of services by a person from a related person or

from his establishments located outside India, without consideration, in the course
or furtherance of business shall be treated as “supply”.
Hence, services received by Wesco Ltd. qualify as supply even though such services
have been provided free of cost by the head office.

Illustration 02
Gagan Engineering Pvt. Ltd., registered in Haryana, is engaged in providing
maintenance and repair services for heavy steel machinery. For carrying out the repair
work, Gagan Engineering Pvt. Ltd. sends its container trucks equipped with items like
repair equipments, consumables, tools, parts etc. from Haryana workshop to its own
repairing centres (registered under GST law) located in other States across India where
the clients’ machinery are being brought and are being repaired. Discuss the leviability
of GST on the inter-State movement of trucks from the workshop of Gagan Engineering
Pvt. Ltd. in Haryana to its own repairing centres located in other States across India

[MTP Nov 23]

 2
CA Jasmeet Singh Arora

Solution
As per section 25(4) of the CGST Act, 2017, a person who has obtained more than one
registration, whether in one State or Union territory or more than one State or Union
territory shall, in respect of each such registration, be treated as ‘distinct persons’.
Schedule I to the CGST Act specifies situations where activities are to be treated as
supply even if made without consideration. Supply of goods and/or services between
‘distinct persons’ as specified in section 25 of the CGST Act, 2017, when made in the
course or furtherance of business is one such activity included in Schedule I under para
2.
However, as per CBIC circular, the inter-State movement of various modes of
conveyance including, inter alia, trucks, carrying goods or passengers or both or for
repairs and maintenance, between ‘distinct persons’ as specified in section 25(4) of the
CGST Act, 2017, not involving further supply of such conveyance, may be treated
‘neither as a supply of goods nor supply of service’ and therefore, will not be leviable to
IGST. Applicable CGST/SGST/IGST, however, shall be leviable on repairs and
maintenance done for such conveyance
Thus, in the given case, inter-State movement of trucks from the workshop of Gagan
Engineering Pvt. Ltd. located in Haryana to its repair centers located in other States is
‘neither a supply of goods nor supply of service’.

Illustration 03
The goods supplied on hire purchase basis will be treated as supply of services.
Examine the Validity of the statement
[MTP May 23]

Solution
The statement is not correct. Supply of goods on hire purchase shall be treated as
supply of goods as there is transfer of title at a future date.

Illustration 04
Examine the implications of GST on supply of food and beverages at cinema halls.
[RTP May 24]
Solution
Eating joint is a wide term which includes refreshment or eating stalls/ kiosks/ counters
or restaurant at a cinema also.
The cinema operator:
1) may run these refreshment/eating stalls/kiosks/counters/ restaurant themselves
or
2) they may give it on contract to a third party.
The customer may like to avail the services supplied by these refreshment/snack
counters or choose not to avail these services. Further, the cinema operator can also
install vending machines, or supply any other recreational service such as through coin
operated machines etc. which a customer may or may not avail.
It is hereby clarified vide Circular No. 201/13/2023 GST dated 01.08.2023 that:
a) supply of food or beverages in a cinema hall is taxable as ‘restaurant service’ as long
as:
 3
CA Jasmeet Singh Arora

i) the food or beverages are supplied by way of or as part of a service, and

ii) supplied independent of the cinema exhibition service.
b) where the sale of cinema ticket and supply of food and beverages are clubbed
together, and such bundled supply satisfies the test of composite supply, the entire
supply will attract GST at the rate applicable to service of exhibition of cinema, the
principal supply.

Illustration 05
Examine the implications of GST on payment of honorarium to the Guest Anchors.
[RTP Nov 23]
Solution
Sansad TV and other TV channels invite guest anchors to participate in their shows and
pay remuneration to them in the form of honorarium.
It is clarified that supply of all goods & services are taxable unless exempt or declared
as ‘neither a supply of goods nor a supply of service’. Services provided by the guest
anchors in lieu of honorarium attract GST liability.
However, guest anchors whose aggregate turnover in a financial year does not exceed
20 lakh (10 lakh in case of specified Special Category States) shall not be liable to take
registration and pay GST.

Illustration 06
List any 5 (Five) activities/transactions specified under Schedule III of the CGST Act, 2017
which shall be neither treated as supply of goods nor as supply of services. Detailed
explanations is not required. [PYQ May 23 & MTP Sep 24]

Solution
Activities or transactions which shall be treated neither as a supply of goods nor a
supply of services are as under:-
(1) Services by an employee to the employer in the course of or in relation to his
employment.
(2) Services by any court or Tribunal established under any law for the time being in
force.
(3) Functions performed by the Members of Parliament, Members of State
Legislature, Members of Panchayats, Members of Municipalities and Members of
other local authorities.
(4) Services of funeral, burial, crematorium or mortuary including transportation of
the deceased.
(5) Sale of land and, subject to paragraph 5(b) of Schedule II, sale of building. (i.e. in
case, where entire consideration for sale of building received after issuance of
completion certificate or after its first occupation, whichever is earlier).

Illustration 06
Happy Constructions Ltd., a registered builder under GST in Bengaluru, Karnataka has
got permission to build five floors from the
Municipal Projects for one of its projects at Suraj Nagar. Aditya Constructions, a
neighboring housing project approached Happy Constructions Limited to discuss
 4
CA Jasmeet Singh Arora

regarding blockage of sun light issue arising out of construction of five floors and asked
it to build only three floors for which 20 lakh was offered as compensation. Happy
Constructions Limited agreed to the offer. It may be noted that Aditya Constructions is
not ready to pay any further amount to Happy Constructions Ltd. in addition to the
amount already agreed.
Briefly explain with correct legal provision whether the above amount received as
compensation is liable to GST or not? And if considered as taxable, then calculate the
total GST payable by Happy Constructions Ltd. Assume the applicable rate of CGST and
SGST is 9% each.
Also state the conditions to be complied with. [RTP May 24]

Solution
Agreeing to obligation to refrain from an act, or to tolerate an act or situation, or to do
an act has been specifically declared to be a supply of service vide para 5(e) of Schedule
II of the CGST Act, 2017 if the same constitutes a supply as per the CGST Act, 2017.
In the given case, Happy Constructions Limited has agreed to build only three floors,
even though it is permitted to construct five floors by the Municipal Authorities, for a
compensation of 20 lakh. This results in supply of service.
The conditions to be complied with for the above supply will be
(a) There must be an expressed or implied agreement or contract must exist.
(b) Consideration must flow in return to this contract/ agreement.
Since Aditya Constructions is not ready to pay any further amount to Happy
Constructions Limited in addition to the amount already agreed, the amount received
20 lakh shall be treated as inclusive of GST and the GST payable will be 20,00,000 x 9/118
= 1,52,542.37 or 1,52,542 (rounded off) as CGST and SGST each.

Illustration 07
LSP Ltd., a registered supplier, sold a machine to Balwant Ltd. It provides the following
information in this regard: -
S. No. Particulars Amount

1. Price of the machine [excluding taxes and other charges 20,000

mentioned at S. Nos. (ii) and (iii)]
2. Third party inspection charges 6,000
[Such charges were payable by LSP Ltd. but the same have been
directly paid by Balwant Ltd. to the inspection agency. These
charges were not recorded in the invoice issued by LSP Ltd.]
3. Freight charges for delivery of the machine 1,000
[LSP Ltd. has agreed to deliver the goods at Balwant Ltd.’s
premises]
4. Subsidy received from the State Government on sale of 5,000
machine under Skill Development
Programme
[Subsidy is directly linked to the price]
 5
CA Jasmeet Singh Arora

5. Discount of 2% is offered to Balwant Ltd. on the price

mentioned at S. No. (i) above and recorded in the invoice

Note: Price of the machine is net of the subsidy received.

Determine the value of taxable supply made by LSP Ltd. to Balwant Ltd.
[MTP May 24]
Solution
Computation of value of taxable supply made by M/s. LSP to Balwant Ltd.
Particulars Amount

Price of the machine 20,000

[Since the price linked subsidy is received from the State Government,
the same is not includible in the value of supply]
Third party inspection charges 6,000
[Any amount that the supplier is liable to pay in relation to the supply
but has been incurred by the recipient and not included in the price
actually paid or payable for the goods, is includible in the value of
supply]
Freight charges for delivery of the machine 1,000
[Since arranging freight is the liability of supplier, it is a case of
composite supply and thus, freight charges are added in the value of
principal supply.]
Total 27,000
Less: Discount @ 2% on 20,000 being price charged to Balwant Ltd. 400
[Discount given before or at the time of supply if duly recorded in the
invoice is deductible from the value of supply]
Value of taxable supply 26,600

Illustration 08
Shri Krishna Pvt. Ltd., a registered supplier, furnishes the following information relating
to goods sold by it to Shri Balram Pvt. Ltd.-
S. No. Particulars Amount

1. Price of the goods [excluding taxes and other charges 1,00,000

mentioned at S. Nos. (iii), (v) and (vi)]
2. Municipal tax 2,000
3. Inspection charges 15,000
4. Subsidy received from Shri Ram Trust 50,000
[Subsidy is directly linked to the goods supplied]
 6
CA Jasmeet Singh Arora

5. Late fees for delayed payment inclusive of GST 1,000

[Shri Balram Pvt. Ltd. paid the late fees. However, these
charges were ultimately waived by Shri Krishna Pvt. Ltd. and
the amount was refunded to Shri Balram Pvt. Ltd. during the
same month]
6. Weighment charges 2,000
[Such charges were paid by Shri Balram Pvt. Ltd. to Radhe Pvt.
Ltd. on behalf of Shri Krishna Pvt. Ltd.]
Note: Price of the goods is net of the subsidy received.
Determine the value of taxable supply made by Shri Krishna Pvt. Ltd. to Shri Balram Pvt.
Ltd.
[MTP Nov 23]
Solution
Computation of value of taxable supply made by Shri Krishna Pvt. Ltd. to Shri Balram
Pvt. Ltd.
Particulars Amount

Price of the goods 1,00,000

Municipal tax 2,000
[Includible in the value as per section 15(2)(a) of the CGST Act, 2017]
Inspection charges 15,000
[Any amount charged for anything done by the supplier in respect of
the supply of goods at the time of/before delivery of goods is includible
in the value as per section 15(2)(c) of the CGST Act, 2017]
Subsidy received from Shri Ram Trust 50,000
[Since the subsidy is received from a non-Government body and directly
linked to the supply, the same is includible in the value in terms of
section 15(2)(e) of the CGST Act, 2017]
Late fees for delayed payment Nil
[Not includible since the same is waived off]
Weighment charges paid to Radhe Pvt. Ltd. on behalf of Shri Krishna Pvt. 2,000
Ltd.
[Any amount that the supplier is liable to pay in relation to the supply
but has been incurred by the recipient and not included in the price
actually paid or payable for the goods, is includible in the value of
supply in terms of section 15(2)(b) of the CGST Act, 2017]
Value of taxable supply 1,69,000

Illustration 09
Red Pepper Ltd., Delhi, a registered supplier, manufactures taxable goods. It provides
the following details of taxable inter-State supply made by it during the month of
March.
 7
CA Jasmeet Singh Arora

S. No. Particulars Amount

1. List price of taxable goods supplied inter-State (exclusive of taxes) 15,00,000
2. Subsidy received from the Central Government for supply of 2,10,000
taxable goods to Government School (exclusively related to
supply of goods included at S. No. 1)

3. Subsidy received from an NGO for supply of taxable goods to an 50,000

old age home (exclusively related to supply of goods included at S.
No. 1)
4. Tax levied by Municipal Authority 20,000
5. Packing charges 15,000
6. Late fee paid by the recipient of supply for delayed payment of 6,000
consideration (Recipient has agreed to pay 6,000 in lump sum and
no additional amount is payable by him over and above such
amount)
The list price of the goods is net of the two subsidies received. However, the other
charges/taxes/fee are charged to the customers over and above the list price.
Calculate the total value of taxable supplies made by Red Pepper Ltd. during the month
of March. Rate of IGST is 18%.
[MTP Nov 23]
Solution
Computation of total value of taxable supplies made by Red Pepper Ltd. during the
month of March
Particulars Amount
List price of the goods 15,00,000
Subsidy amounting to 2,10,000 received from the Central Government NIL
[Since the subsidy is received from the Government, the same is not
includible in the value in terms of section 15(2)(e) of the CGST Act,
2017]
Subsidy received from NGO 50,000
[Since the subsidy is received from a non-Government body and
directly linked to the supply, the same is includible in the value in
terms of section 15(2)(e) of the CGST Act, 2017]
Tax levied by the Municipal Authority 20,000
[Includible in the value as per section 15(2)(a) of the CGST Act, 2017]
Packing charges 15,000
[Being incidental expenses, the same are includible in the value as per
section 15(2)(c) of the CGST Act, 2017]
Late fees paid by recipient of supply for delayed payment 5,085
[Includible in the value as per section 15(2)(d) of the CGST Act, 2017 - As
the amount of interest received is a lump sum amount, the same has
 8
CA Jasmeet Singh Arora

to be taken as inclusive of GST] [ 6,000 x 100/118] rounded off

Total value of taxable supplies 15,90,085

Illustration 10
Guru Enterprises (Delhi), a registered taxpayer, made a taxable supply to Y Ltd. (Delhi).
The details of the said supply are as follows:
Particulars Amount
Price of the goods (excluding any tax or discounts) 10,00,000
Tax levied by the Municipal Authority 10,000
Subsidy received from Jiva Enterprises Pvt Ltd. (The price above is 1,00,000
after consideration of such subsidy amount)
Amount incurred by Y Ltd. for post delivery inspection. (Charges 5,000
incurred post receipt of goods by Y Ltd.)
In respect of above supply, Guru Enterprises had procured some raw material from X
Ltd., for which it owed Rs.25,000. The said amount was directly paid by Y Ltd. to X Ltd.
and was not included in the price of goods of 10,00,000 mentioned above.
The payment of consideration for above supply was delayed by Y Ltd. Hence, an interest
amount of Rs. 20,000 (in lumpsum) was also charged by Guru Enterprises.
The applicable tax rates are - CGST - 6%, SGST - 6% and IGST - 12%. You are required to
determine the taxable value as well as the applicable tax liability for the said supply
transaction.
[MTP May 23 & MTP Sep 24]
Solution
Computation of taxable value and tax liability
Particulars Amount

Price of goods (exclusive of tax and discounts) 10,00,000

Add: Tax levied by Municipal Authority 10,000
[Tax other than GST, if charged separately, are includible in the value.]
Add: Subsidy received from Jiva Enterprises Pvt. Ltd. 1,00,000
[Subsidy provided by non-Government bodies and which is directly linked
to the price is includible.]
Add: Post-delivery inspection charges -
[Anything done by the supplier in respect of the supply of goods after the
delivery of goods is not includible in value.]
Add: Amount directly paid by Y Ltd. to X Ltd. 25,000
[Liability of the supplier, in relation to the supply being valued, if
discharged by the recipient of supply and not included in the price, is
includible in the value.]
 9
CA Jasmeet Singh Arora

Add: Interest 17,857

[Interest for delayed payment of consideration is includible in the value.
Since interest is received in lumpsum, amount is inclusive of GST [20,000 x
100/112] (rounded off).]
Value of taxable supply 11,52,857
CGST @ 6% 69,171
SGST @ 6% 69,171

Illustration 11
Gulati Ltd., a registered supplier in Mumbai (Maharashtra), has supplied goods to Mridul
Traders and Kalu Motors Ltd. located in Ahmedabad (Gujarat) and Pune (Maharashtra)
respectively. Gulati Ltd. has furnished the following details for the current month:
S. No. Particulars Mridul Traders Kalu Motors
Ltd.
(i) Price of the goods (excluding GST) 10,000 30,000
(ii) Packing charges 500
(iii) Commission 500
(iv) Weighment charges 2,000
(v) Discount for prompt payment 1,000
(recorded in the invoice)
Items given in points (ii) to (v) have not been considered while arriving at price of the
goods given in point (i) above.
Compute the GST liability [CGST & SGST or IGST, as the case may be] of Gulati Ltd. for
the given month. Assume the rates of taxes to be as under:
Particulars Rate of tax

Central tax (CGST) 9%

State Tax (SGST) 9%
Integrated tax (IGST) 18%
Make suitable assumptions, wherever necessary. [MTP May 24 & RTP Nov 21]
Solution
Computation of GST liability
S. Particulars Mridul Kalu Motors
No. Traders Ltd.

1. Price of goods 10,000 30,000

2. Add: Packing charges (Note-1) 500
3. Add: Commission (Note-1) 500
4. Add: Weighment charges (Note-1) - 2,000
 10
CA Jasmeet Singh Arora

5. Less: Discount for prompt payment

(Note-2) - 1,000
Value of taxable supply 11,000 31,000
IGST payable @ 18% (Note-3) 1,980
CGST payable @ 9% (Note-4) 2,790
SGST payable @ 9% (Note-4) 2,790
Notes:
1. Incidental expenses, including commission and packing, charged by supplier to
recipient of supply is includible in the value of supply. Weighment charges are also
incidental expenses, hence includible in the value of supply [Section 15 of the CGST
Act, 2017].
2. Since discount is known at the time of supply, it is deductible from the value in terms
of section 15 of the CGST Act, 2017.
3. Section 10 of the IGST Act, 2017 provides that where the supply
involves movement of goods, the place of supply of such goods shall be the location
of the goods at the time at which the movement of goods terminates for delivery to
the recipient. Thus, place of supply is Gujarat.
Further, where the location of the supplier and the place of supply are in two
different States, supply of goods shall be treated as a supply of goods in the course
of inter-State trade or commerce. Since supply made to Mridul Traders is an inter-
State supply, IGST is payable.

Illustration 12
From the following information provided by M/s Sasta Bazaar. Determine the time of
supply for the purpose of payment of GST:
(i) It issued coupon on 20.06.2023, worth 2,000 redeemable against purchase of
specific plastic items. This coupon was redeemed on 31.07.2023.
(ii) It issued coupon on 01.08.2023 worth 3,000 which is redeemable against purchase
of any item. This coupon was redeemed on 18.08.2023.
(iii) It received interest of 10,000 for late payment from a customer on 11.11.2023 for
supply of goods which was originally made on 24.06.2023.
[RTP May 24]

Solution
As per section 12(4) of the CGST Act, 2017, the time of supply of vouchers exchangeable
for goods is-
1. Date of issue of the voucher, if the supply that it covers is
identifiable at that point, or
2. Date of redemption of the voucher in other cases.
(a) In the given case, supply can be identified at the time of purchase of the
coupons. Therefore, the time of supply of the coupons is the date of their
issue i.e. 20.06.2023.
 11
CA Jasmeet Singh Arora

(b) In the given case, supply cannot be identified at the time of purchase of the
coupons. Therefore, the time of supply of the coupons is the date of their
redemption i.e. 18.08.2023.
Section 12(6) of the CGST Act, 2017 prescribes that time of supply in case of addition in
value on account of interest/ late fee/penalty for delayed payment of consideration for
goods is the date on which the supplier receives such addition in value. Therefore, time
of supply in the given case is 11.11.2023

Illustration 13
1) An order is placed to T & Co;, Sholapur on 18th August, 2021 for supply of fabrics to
make garments. Company delivered the fabrics on 4th September, 2021 and after
completion of the order issued the invoice on 15th September, 2021. The payment
against the same was received on 30th September, 2021. Determine the time of
supply for the purpose of payment under CGST Act, 2017 with your explanations.
2) HM Industries Ltd. engaged the services of a transporter for road transport of a
consignment on 20th May, 2021. However, the consignment could not be sent
immediately on account of a strike in the factory, and instead was sent on 20th July
2021. Invoice was received from the transporter on 20th June 2021 and payment was
made on 25th August 2021. What is the time of supply of the transporter’s service?
[PYQ Nov 2021]
Solution
1) The time of supply of goods (where movement of goods involve) (fabric) for the
purpose of payment of tax is the date of issue of invoice or the last date when the
invoice ought to have been issued. Further, a registered person is required to issue a
tax invoice before or at the time of delivery of goods or making available thereof to
the recipient. Thus, in the given case, time of supply is 4th September, 2021.
2) Alternative 1: Assuming that services of transportation of goods by road have been
provided by a GTA which has not paid GST @ 12%; i.e. GST is payable @ 5%.
Tax on supply of transportation of goods by road services provided by a Goods
Transport Agency (GTA) to a body corporate is payable under reverse charge by
such body corporate. Time of supply of services taxable under reverse charge is
earliest of:-
i) date of making payment, or
ii) 61st day from the date of issue of invoice by supplier
Thus, in the given case, time of supply is earlier of (a) 25th August or (b) 20th
August 2021 (61st day from 20th June). Thus, in the given case, time of supply 20th
August 2021

Alternative 2: Assuming that services of transportation of goods by road have been

provided by a GTA which has paid GST @ 12%.
Thus, GST is payable under forward charge. The time of supply of services in case where
the invoice is issued within 30 days of provision of service is the earlier of date of
invoice or date of receipt of payment.
Thus, in the given case, time of supply is 20th June, 2021.

Illustration 14
Champak Ltd. availed legal services from a firm of advocates . The firm issues invoice
 12
CA Jasmeet Singh Arora

for the services to Champak Ltd. on 17th Feb. However, Champak Ltd. was not happy
with the services provided by the firm as its legal case was not handled by firm in a
professional manner and it resulted in the company losing the case. The company
delayed the payment to the firm and finally made the payment on 03rd Nov.
Determine the time of supply of legal services provided by the firm of advocates to
Champak Ltd. [MTP Sep 2024]

Solution
Tax on services supplied by a firm of advocates by way of legal services to any business
entity is payable under reverse charge by such firm of advocates. Time of supply of
services that are taxable under reverse charge to earliest of the following two dates in
terms of section 13(3) of CGST Act, 2017 :
(a) Date of Payment i.e. 03rd November
(b) 61st day from the date of issue of invoice i.e. 19th April
The date of payment comes subsequent to the 61st day from the issue of invoice by the
supplier of service. Therefore, the 61st day from the date of supplier’s invoice has to be
taken as the time of supply.
This fixes 19th April as the time of supply

MCQ Questions :-

1. Which of the following is a supply under GST law?

a) D received a life time achievement award from the Government for contribution
to the cause of homeless
b) P gave a machine of value ₹ 1 lakh to Q. T, a financial consultant and a debtor of
Q, provided advisory services worth ₹ 1 lakh to P on the directions of T.
c) D received subsidy of R 5 lakh from Government of Karnataka for purchase of
equipment
d) D received a refundable security deposit of ₹ 5 lakh from F to whom D gave a
commercial complex on rent

2. Q is an employee of P Ltd. He received gifts from P Ltd. (not forming part of

employment contract) of a sculpture of ₹ 30,000 in value on 1 March and a leather
jacket of ₹ 25,000 in value on 20th of next month. Determine the value of supply

a) Nil
b) 30,000
c) 25,000
d) 55,000

3. Roshan sent goods from his factory to his showroom without consideration. In
which of the following situations, will this activity be treated as a supply?

a) Factory and showroom are in Gujarat. Both are unregistered.

 13
CA Jasmeet Singh Arora

b) Factory and showroom are in Gujarat. Single registration in Gujarat.

c) Factory is in Gujarat and showroom is in Maharashtra. Both are unregistered.
d) Factory is in Gujarat and showroom is in Maharashtra. Both are registered.

4. D of Delhi received management consulting services from B of Brazil, in connection

with his business. In which of the following cases, there does not arise a supply
under GST?

a) B is the son of D and D paid ₹ 1 lakh

b) B is the daughter of D and D did not pay anything
c) B is the niece of D and D did not pay anything
d) B is the father of D (dependent on D) and D did not pay anything

5. Sunder transferred his business to Ram as a going concern on 1 October on which

date Sunder ceased to be a taxable person. Goods of value ₹ 10 lakh formed part of
assets of his business as on 30 September. The value was ₹ 9 lakh as on 15
September when the agreement to transfer the business was entered into.
Determine the value of deemed supply by Sunder in this case

a) 10 lakh
b) 9 lakh
c) Nil
d) 9.5 lakh

6. Z provided technical consultancy to Oberoi Hotels for which he received ₹ 5 lakh in

cheque. Z also agreed not to provide similar consultancy to any other hotel chain for
a period of 3 years. Against this agreement, Z received ₹ 1 lakh in bank draft and ₹ 1
lakh worth of complimentary vouchers usable at any of the Oberoi Hotels across
India. Determine whether these activities are in the nature of supply of goods or
supply of services and also the consideration therefore

a) Supply of goods; 7 lakh

b) Supply of services; 6 lakh
c) Supply of services; 7 lakh
d) Not a supply

7. Surabhi was employed with C Ltd. till 31.12.2023. She received the following from C
Ltd. upon leaving employment: Gratuity and leave encashment of ₹ 15 lakh as per
terms of employment, ₹ 20 lakh under a non-compete agreement as per which
Surabhi will not join any employer in the same industry as C Ltd. for a period of 5
years. C Ltd. also gifted a laptop of ₹ 75,000 in value to Surabhi on 15.12.2023 in
appreciation of her contribution to the company (this was not part of the terms of
employment contract). Surabhi provided consulting services to C Ltd. in the month
of January 2024 for which she was paid ₹ 2 lakh. She also joined D Ltd. on 15.2.2024
as an independent director on account of which she was paid a remuneration of ₹
50,000. Determine the amounts comprised in these activities/transactions which
 14
CA Jasmeet Singh Arora

can be classified as a supply under GST?

a) Nil
b) 23,25,000
c) 22,50,000
d) 2,50,000

8. Kamal has let out a shop to Ketan on a monthly rent of ₹ 50,000. He additionally
recovers.₹ 5,000 towards the house tax levied by the local authority. Kamal
undertook minor repairs to the house in respect of which Ketan paid ₹ 10,000
directly ‘to the contractor. The rent agreement stipulates a late fees of ₹ 1,000 if the
rent due for a month is not paid by 10th of the next month. For the relevant month,
Ketan became liable to pay the late fees but it was waived off by Kamal. Calculate
the value of supply. All amounts are exclusive of GST.

a) 66,000
b) 55,000
c) 65,000
d) 60,000

9. Bharat sold an air conditioner to Sharad for a net price of ₹ 40,000 after making
adjustment of following: Festival discount of ₹ 2,000, packing charges ₹ 500 and
freight ₹ 600. Bharat undertook to deliver the air conditioner to the doorstep of
Sharad. After delivery, Sharad paid ₹ 1,000 to the technician for installation. Sharad
took a consumer loan from Gold NBFC for purchase of the air conditioner. He repaid
the loan after a period of six months along with interest of ₹ 3,000. Calculate the
value of supply of air conditioner. Amounts are exclusive of GST.

a) 40,000
b) 41,100
c) 44,000
d) 39,100

10. G Ltd. sold an industrial equipment to J Ltd. whose MRP was ₹ 5,00,000. Delivery
was on ex-factory basis. G Ltd. incurred testing and packing expenses of R 10,000
which was charged additionally. J Ltd. got the equipment collected from the
warehouse of G Ltd. and incurred ₹ 15,000 towards freight and K 2,000 on account of
loading and unloading. As per the terms, 20% payment was to be made upon
delivery and the balance within 45 days. While J Ltd. made 20% payment on delivery,
it paid the balance after 50 days due to which it had to pay ₹ 5,000 as late fees. The
amount of MRP stated above is after adjustment of subsidy from the State
Government of ₹ 1,00,000. G Ltd. sold the equipment to J Ltd. at a 10% trade discount
which was recorded in the invoice. Calculate the value of supply. Amounts are
exclusive of GST

a) 4,60,000
 15
CA Jasmeet Singh Arora

b) 4,82,000
c) 4,55,000
d) 4,65,000

11. J Ltd. sold 100 units of goods to K Ltd. on 1.6.2023 at a price of K 1,000 per unit and
issued invoice. At the time of supply, it was agreed to provide a 5% discount if
payment is made within 45 days of supply. In view of an urgent need of funds, J Ltd.
announced an additional discount of 7% if the payment was made within 15 days of
supply. This announcement was made on 10.6.2023 in response to which K Ltd. made
the payment on 12.6.2023 and availed 12% discount. K Ltd. did not avail ITC. Calculate
the value of supply

a) 1,00,000
b) 95,000
c) 88,000
d) None of the above

12. B Ltd. supplied goods of value ₹ 50 lakh to C Ltd. during the calendar year 2023.
Considering the stellar performance by C Ltd., B Ltd. announced a special discount
of 5% on all purchases made by C Ltd. during 2023. The announcement was made on
15.2.2024 once the annual performance data for all the dealers was collated. B Ltd.
issued a credit note for the same. Calculate the value of supply made by B Ltd. to C
Ltd. during the year 2023.

a) 45,00,000
b) 47,50,000
c) 50,00,000
d) None of the above

13. Q Ltd. sold a machine to V Ltd. for ₹ 10,00,000. In addition, it charged the following
amounts from V Ltd.: Municipal taxes on such sale amounting to ₹ 1,000 and packing
charges ₹ 5,000. It collected ₹ 1,000 as TCS under the Income Tax Act and deposited
it in the account of the Central Government. Under the agreement, Q Ltd. was to
deliver the machine to the warehouse of V Ltd. However, V Ltd. made payment of ₹
10,000 directly to the goods transport agency (Q Ltd. had not included this amount
in the price). Q Ltd. provided a trade discount of 5% on the list price at the time of
supply. Rate of GST is 18%. Calculate the value of supply

a) 10,00,000
b) 9,66,000
c) 9,67,000
d) 9,50,000

14. Johar sold furniture to Vrinda for a price of ₹ 10,000 (exclusive of taxes and
discount) on 15.5.2023 and issued invoice. He incurred testing expenses of R 1,000
which he charged additionally. Few days later, he discovered that Vrinda is a friend
 16
CA Jasmeet Singh Arora

of one of his relatives. Hence, he offered a special discount of ₹ 4,000 to Vrinda on

25.5.2023 as a goodwill gesture and refunded the said amount. Calculate the value of
supply. Rate of GST is 12%.

a) 10,000
b) 7,000
c) 11,000
d) 8,260

15. C Ltd. sells goods of list price K 10,000 per unit and gives a general trade discount of
10%. It announced on 15.9.2023 that it would provide an additional discount of 5% on
list price for all purchases made during October 2023 if they exceed 100 units. Upon
finalization of purchase data in November 2023, the purchases made by D Ltd. from
C Ltd. were calculated at 120 units Calculate the value of supply made by C Ltd. to D
Ltd.. D Ltd. has reversed the ITC attributable to the additional discount.

a) 10,00,000
b) 10,80,000
c) 11,40,000
d) 10,20,000

16. Mohit Goods Transport Agency transported goods of Q Ltd. from Mumbai to Pune.
The truck departed from Mumbai on 5 August and reached Pune on 6 August. Mohit
GTA issued the invoice on 10 August. Q Ltd. made entry of the payment in its books
of account on 14 August which got debited in its bank account on 16 August. Mohit
received the payment on 17 August. Tax is payable under reverse charge. Determine
the time of supply.

a) 10 August
b) 14 August
c) 6 August
d) 10 October

17. Raju availed tax preparation services from TaxPoint, an online tax services portal.
The service was provided on 1 May. Raju made a payment of ₹ 25,000 on 15 May. As a
part of customer loyalty program, TaxPoint issued a voucher on 20 May which could
be used by Raju to avail tax advisory services for himself or his family. Raju
redeemed the voucher for availing tax advisory service for his spouse on 10 June.
Determine the time of supply in respect of the supply of voucher

a) 15 May
b) 20 May
c) 10 June
d) No tax liability as time of supply indeterminable

18. As part of the New Year Bumper Offer, Big Mall issued a gift voucher on purchase of
goods worth ₹ 1 lakh. The gift voucher could be redeemed for purchase of any
 17
CA Jasmeet Singh Arora

product from the Mall. Rakhi purchased goods worth ₹ 1.5 lakh on 10 November.
Consequently, she was issued the voucher on 15 November. She redeemed the
voucher against purchase of garments on 15 December. Determine the time of
supply in respect of the supply of voucher

a) 10 November
b) 15 November
c) 15 December
d) None of the above

19. Mangal supplied goods to Bhagat for a consideration of ₹ 2 lakh. He dispatched the
goods from his warehouse on 15 October and issued the invoice on 25 October. The
goods were delivered to Bhagat on 28 October. As per the agreement, the payment
was to be made within 15 days of delivery of goods, failing which a late fees would
be levied at the rate of ₹ 200 per day of delay. Bhagat made the payment, along with
late fees, on 22 November through net banking which was credited in the bank
account of Mangal on the same day. Determine the time of supply

a) 15 October for 2,02,000

b) 15 October for 2,00,000; 22 November for 2,000
c) 22 November for 2,02,000
d) 25 October for 2,00,000; 22 November for 2,000

20. C Ltd. supplied goods to D Ltd. on 15 April for which the invoice was issued on 20
April for ₹ 1 lakh. Due date of payment is 30 April. D Ltd. wishes to make the
payment on 31 May. However, as per the terms of the contract, it will have to pay
interest of ₹ 5,000 for delay in payment. D Ltd. pays ₹ 1 lakh on 31 May. It delays the
payment of interest which is finally waived off by C Ltd. on 15 July after
negotiations. Determine the time of supply in respect of the amount of interest.

a) Interest is exempt from tax

b) Interest is not taxable as it is waived off
c) 31 May
d) 15 July