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CA-FINAL
INDIRECT TAX
TEST-1, CH-1,2,4,8,9,10,11
Time Allowed: 75 mints Maximum Marks: 40
This question paper consists two parts, Part I and Part II.
Part I consists MCQs and Part II consists questions which require descriptive answers.
Part-I (MCQs)
All MCQs are Compulsory
1. Ms. Rujuta, a skilled grooming service provider, operates her business
without being registered under GST law, as her turnover is below the threshold
limit. Considering her unregistered status, what is the correct scenario regarding
tax collection on the grooming services she provides?
a) Rujuta can collect tax on her grooming services, even though she is not
registered under GST, to ensure compliance with tax regulations.
b) Since Rujuta is not a registered person under GST, she cannot collect any
amount by way of tax on the grooming services she provides.
c) Rujuta is allowed to collect tax on grooming services, but only if her turnover
exceeds the threshold limit set by GST authorities.
d) Even though unregistered, Rujuta must collect a nominal tax on her
grooming services and later remit it to the GST authorities for compliance
2. Raman Associates had its registration canceled on 11th October, and the tax
dues for the July-September quarter were determined by the proper officer on
16th December, amounting to Rs. 50,000. What is the impact of the registration
cancellation on the liability of Raman Associates for the tax dues?
a) The liability is nullified due to registration cancellation.
b) Raman Associates is still liable for the tax dues of Rs. 50,000.
c) The liability is transferred to the proper officer.
d) The liability is suspended until registration is reinstated.
3. Swift Logistics Pvt. Ltd. is a transportation company providing goods carriage
services. The company is involved in transporting various goods. Evaluate the
GST implications on the transportation services provided by Swift Logistics Pvt.
Ltd. based on the exemption criteria.
a) Transportation of all goods by Swift Logistics Pvt. Ltd. is exempt from
GST, regardless of the nature of the goods.
b) Transportation of agricultural produce, milk, salt, food grains, organic
manure, and newspapers by Swift Logistics Pvt. Ltd. is exempt from GST,
but transportation of defence/military equipment and relief materials is
taxable.
c) Transportation of all goods by Swift Logistics Pvt. Ltd. is taxable under
GST, except for agricultural produce, milk, salt, food grains, organic
manure, newspapers, defence/military equipment, and relief materials.
d) Transportation of relief materials meant for victims of natural or man-made
disasters, calamities, accidents, or mishaps by Swift Logistics Pvt. Ltd. is
exempt from GST, but transportation of other goods is taxable.
4. Mr. A, a registered person paying tax under the regular scheme in Delhi, has
not filed Form GSTR-1 for the last two months. Mr. B, from Haryana, a regular
return filer, wants to generate an e-way bill for goods to be supplied to Mr. A.
What is the correct status regarding the e-way bill generation for both Mr. B and
Mr. A?
a) E-way bill generation is unrestricted for both Mr. B and Mr. A, as Mr. B is a
regular return filer, and Mr. A's GSTR-1 filing status does not impact the e-
way bill process.
b) Mr. B can generate an e-way bill for outward movement, but Mr. A is
blocked from generating an e-way bill due to non-filing of Form GSTR-1
for the past 2 months.
c) E-way bill generation is restricted for both Mr. B and Mr. A, as Mr. B's
regular return filing status does not override Mr. A's non-compliance with
GSTR-1 filing.
d) Mr. A can generate an e-way bill for outward supply to Mr. H, and there is
no restriction on Mr. B for generating an e-way bill for outward movement
of goods.
5. Unraveling the complexities of Tax Deduction at Source (TDS) in the context
of inter-state transactions, let's navigate a scenario involving Mr. W, the
supplier, and Mr. X, the recipient. Mr. W, with GSTIN 8901WXYZ, supplies
goods from State A to Mr. X, located in State B. The supply is an intra-state
supply, and Central tax and State tax of State B would be levied. However, the
transfer of TDS (Central tax + State tax of State B) to the cash ledger of Mr. W
(Central tax + State tax of State A) is challenging. Hence, TDS would not be
deducted in such cases. Understanding the challenges in transferring TDS
between different states, analyze the following statement and choose the correct
option:
a) TDS should be deducted, and Mr. W is responsible for managing the
transfer between states.
b) TDS is not applicable when the supplier and place of supply are in different
states from that of the recipient.
c) Mr. W can deduct TDS only for Central tax, not for State tax.
d) TDS is applicable, but Mr. W should manually calculate and transfer the
State tax component to his cash ledger.
(1×5 = 5 Marks)
Part-II (Descriptive Answers)
All Questions are Compulsory
Q-1 Rishabh Enterprises, situated in Hyderabad (Telangana), discloses its
financial details for the fiscal year to determine the aggregate turnover for
registration under the CGST Act:
Amount
Particulars (Rs.)
(i) Sale of petrol, subject to VAT by the Telangana Government. 1,50,000
(ii) Supply of processed goods, post job completion, dispatched
directly by the principal from Rishabh Enterprises ' premises,
with the principal declaring Rishabh Enterprises ' location as its
additional place of business. 4,20,000
(iii) Export of goods to France. 8,00,000
(iv) Supply to its own additional place of business in Telangana. 6,80,000
(v) Outward supply of services on which GST is to be paid by 1,80,000
the recipient under reverse charge.
The amounts mentioned above are exclusive of GST. Determine the aggregate
turnover of Rishabh Enterprises for the purpose of registration under the CGST
Act. Provide detailed reasons for the treatment of various items in the aggregate
turnover computation.
(5 Marks)
Q-2 M/s Sapphire Enterprises, an Indian company engaged in the manufacturing
and supply of precious gemstones, provided the following tax-related information
for Examine the taxes to be paid for the month of July. The company operates in
multiple states and is registered under the Goods and Services Tax (GST) regime.
Tax Information:
Particulars IGST CGST SGST
(Rs.) (Rs.) (Rs.)
Output tax payable 14,80,000 28,40,000 28,40,000
Tax payable under reverse charge 40,000 1,50,000 1,50,000
Balance in Electronic Credit 26,60,000 18,40,000 18,40,000
Ledger
Additional Information:
The output tax reported under the IGST column pertains to the month of
February, which was not paid for the said period.
The input tax credit available in the Electronic Credit Ledger pertains to the
input tax on purchases made during the month of July, with no opening balance
from the previous tax period. It furnishes return on monthly basis.
(8 Marks)
Q-3 Divine Haven Foundation, a trust registered under section 12AB of the
Income-tax Act, 1961.Divine Haven Foundation provides the following
information regarding the supply of its services for the month of September:
Particulars Amount
Renting of residential dwelling for use as a residence to Mr. Arjun,
an unregistered person 20,00,000
Renting of rooms for devotees (Charges per day Rs.1,000) 8,00,000
Renting of Kalyanamandapam (Charges per day Rs.20,000) 15,00,000
Renting of community halls and open space (Charges per day 12,50,000
Rs.10,000)
Renting of shops for business (Charges per month Rs.15,000) 6,75,000
Renting of shops for business (Charges per month Rs.18,000) 9,00,000
Compute the GST liability of Divine Haven Foundation for the month of
September, assuming that the provided amounts are exclusive of GST, and the
applicable GST rate is 18%.
Note: The rooms/ Kalyanamandapam/ halls/ open space/ shops owned by the
trust are located within the precincts of a religious place, meant for general public,
owned by the trust.
(6 Marks)
Q-4 M/s TechnoCool Appliances Pvt. Ltd., a recognized supplier of refrigeration
equipment, is tasked with dispatching a shipment of refrigerator components from
Mumbai (Maharashtra) to address warranty replacements at various client sites in
Karnataka. The declared value of the consignment specified in the delivery
challan accompanying the goods is Rs.90,000. TechnoCool Appliances Pvt. Ltd.
asserts that since the transportation of goods to Karnataka is instigated by reasons
other than a regular supply, the generation of an e-way bill is not obligatory in this
instance.
In light of the scenario presented, critically analyze the technical validity of
TechnoCool Appliances Pvt. Ltd.'s claim regarding the mandatory generation of
an e-way bill. Provide your insights based on applicable rules and regulations, and
consider the implications of the Goods and Services Tax (GST) framework.
(5 Marks)
Q-5 M/s Omni Services, a partnership concern and a registered supplier under
GST, is engaged in providing various services under one roof. It is engaged in
paying tax under regular scheme under GST law. The concern provides the
following information pertaining to supply made/input services availed by it
during the month of March:
Particulars Rs.
(i) Provided Direct Selling Agent service to XYZ Bank Ltd. 5,00,000
Provided security services (by way of supply of security
(ii) personnel) to PQR Pvt. Ltd., a registered person under GST 70,000
Provided security services (by way of supply of security
(iii) personnel) to PSR Trust, an unregistered person under GST 1,00,000
Provided renting of motor vehicle for transportation of
(iv) passengers to Amaze Tours Ltd. and value of supply 80,000
included cost of fuel
Provided renting of motor vehicle for transportation of
(v) passengers to Priti & Co., CA firm and value of supply 50,000
included cost of fuel
Availed representational service from PB and Co., a law
(vi) firm towards a Consumer Court case 60,000
Determine the GST liability of M/s Omni Services for the month of March by
giving necessary explanations for treatment of various items. Rates of GST for
both inward and outward supply is CGST/SGST@ 9% each except renting a
vehicle, for which CGST/SGST @ 2.5% each is applicable. M/s Omni Services
commenced its business from February. All the supplies are intra-State only.
Ignore the provisions relating to input tax credit.
(6 Marks)
Q-6 Mrs. Ananya, a registered supplier based in Udaipur (Rajasthan), carried out
diverse supplies in the month of January. The details of her transactions are as
follows:
(i) Mrs. Ananya sold a laptop along with a laptop bag to a customer in Mumbai
for Rs. 60,000 (exclusive of GST).
(ii) Mrs. Ananya supplied 9,000 kits (each priced at Rs. 50) to shyam Fancy
Store in Kota (Rajasthan), amounting to Rs. 6,00,000 (exclusive of GST). Each
kit contains 1 hair oil, 1 beauty soap, and 1 hair comb.
(iii) On the occasion of her birthday, Mrs. Ananya distributed 100 kits for free to
unrelated customers in Jaipur. Each kit contains 1 hair oil and 1 beauty soap,
with a cost of Rs. 40 per kit. Input tax credit has not been claimed on the items
in the kit.
(iv) Mrs. Ananya provided event management services at no cost to her brother
(wholly dependent on her) for his son’s marriage function in Indore (Madhya
Pradesh). The cost of providing these services is ₹ 70,000.
(v) Mrs. Ananya rented out 1,200 chairs and 90 coolers to Function Garden in
Ajmer (Rajasthan) for Rs. 3,50,000 (exclusive of GST). The amount includes
transportation costs from Mrs. Ananya's godown in Jaipur to Function Garden in
Ajmer. As Mrs. Ananya is not a Goods Transport Agency (GTA), the
transportation services provided are exempt.
Assume rates of GST to be as under:
S. No. Particulars Rate of GST
1. Laptop 18%
2. Laptop bag 28%
3. Hair oil 18%
4. Beauty soap 28%
5. Hair comb 12%
6. Event management service 5%
7. Service of renting of chairs and coolers 12%
8. Transportation service 5%
From the above information, examine each of the above supplies made by Mrs.
Ananya for the month of January and determine the rate of GST applicable on
the same.
(5 Marks)
