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GROUP 1 MOCK EXAM
GOODS AND SERVICE TAX
Marks: 50
Time: 1.5 hours
Part -1 (Multiple choice questions)
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.
Total Marks: 15 Marks
Himadri started providing a bouquet of goods and services in the month of April of the
current financial year under the regular scheme in the State of Telangana and obtained
voluntary registration under GST before starting the business.
In the month of April, she availed the services of construction of a godown for the
business from her brother-in-law who was financially dependent on him. She also
availed professional consultancy services in April for her business from her son who is a
well settled Chartered Accountant in Telangana. Himadri did not pay any consideration
for both these services as both of them were her relative/ family member respectively.
In April, she supplied 1,000 packages to Natraj Traders each consisting of a pen holder,
a pen and a pencil box at a single price of ` 150. Rates of GST for pen holder, pen and
pencil box are 5%, 12% and 18% respectively.
She received following payments during the month of May:
- earned ₹ 1,60,000 by providing services as business facilitator to YYZ Bank with respect
to accounts in its urban area branch
- earned ₹ 50,000 by providing services by way of renting of residential dwelling for use as
a boutique to Supriya, an unregistered person.
-received ₹ 70,000 for supply of manpower for cleanliness of roads, public places, architect
services, etc., not involving any supply of goods, to Municipality.
Himadri made supply of taxable Product A during June, details of which are as follows
- Basic price of Product A before TCS under Income-tax Act, 1961– ₹ 45,000
-Tax collected at source under Income-tax Act, 1961 – ₹2,500
- She received a subsidy of ₹ 55,000 from Habitat Foundation Pvt. Ltd. for usage of green
energy and the subsidy was linked to the units of green energy and not the aforesaid
product.
Himadri provides the following information regarding receipt of inward supplies during
July
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- purchased buses (seating capacity of 24 persons) for transportation of her employees
from their residence to office and back. Depreciation is claimed on the GST component
under the Income tax Act, 1961.
- purchased a truck having GST component of ` 1,50,000 for transportation of finished
goods. No depreciation claimed on the GST component under the Income tax Act, 1961.
- availed outdoor catering services for a marketing event organised for her prospective
customers.
All the amounts given above are exclusive of taxes, wherever applicable. Further, all the
supplies referred above are intra-State supplies unless specified otherwise. Conditions
necessary for claiming input tax credit (ITC) have been fulfilled subject to the
information given above. The opening balance of input tax credit for the relevant tax
period of Himadri is Nil.
Based on the facts of the case scenario given above, choose the most appropriate answer
to Q. Nos. 1 to 6 below:-
1. Supply of package made by Himadri to Natraj Traders is a ______________ and is
taxable under GST @ __________.
(a) composite supply; 12%
(b) mixed supply; 18%
(c) composite supply; 18%
(d) mixed supply; 12%
2. Out of payments received by Himadri in month of May, value of exempt supply is _____
. (a) ₹ 50,000
(b) ₹ 70,000
(c) ₹ 1,20,000
(d) ₹ 1,60,000
3. Compute the value of supply under section 15 of the CGST Act, 2017 made by Himadri
in the month of June.
(a) ₹ 45,000
(b) ₹ 47,500
(c) ₹ 48,500
(d) ₹ 51,000
4. Compute the amount of input tax credit that can be claimed by Himadri in July.
(a) ₹ 30,000
(b) ₹ 37,000
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(c) ₹ 1,50,000
(d) ₹ 1,57,000
5. In respect of services availed by Himadri in April, which of the following is a correct
statement?
(a) Godown construction service availed from her brother-in-law free of cost is
considered as a deemed supply.
(b) Professional service availed from her son free of cost is considered as a deemed
supply.
(c) Neither of the two services availed by her is a deemed supply.
(d) Both services availed by her are deemed supply.
6. Out of payments received by Himadri in month of May, the value of supply on which tax
payable by the recipient under reverse charge is _________.
(a) ₹ 50,000
(b) ₹ 70,000
(c) ₹ 1,20,000
(d) ₹ 1,60,000
(6 x 2 Marks = 12 Marks)
7. Kids Bazaar Pvt. Ltd., registered in Maharashtra sells kids clothing via an E commerce
operator Champ.com. Mr. Dhruv placed an order of 10 sets of Ethnic wear in different
colours each costing ₹ 5,000 (GST @18% not included) on 20th October 2024. However, he
returned 2 sets back after 2 days in accordance with the exchange policy of Champ.com.
Determine the value of supply on which Champ.com should collect TCS from Kids Bazaar
Pvt. Ltd.
(a) ₹ 40,000
(b) ₹ 59,000
(c) ₹ 50,000
(d) ₹ 47,200
(2 Marks)
8. Miss Gyati, a jeweller registered under GST in Mumbai, wants to sell her jewellery in a
Trade Expo held in Delhi. Which of the following statements is false in his case?
(a) She needs to get registration in Delhi as casual taxable person.
(b) She needs to pay advance tax on estimated tax liability.
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(c) She needs to mandatorily have a place of business in Delhi.
(d) She needs to file GSTR-1/ IFF and GSTR-3B for Delhi GSTIN for the month or
quarter, as the case may be, when she gets registered in Delhi.
(1 Mark)
PART 2 DESCRIPTIVE QUESTION
1. (a) Miss Shreya, proprietor of M/s. Happy Enterprise, a registered supplier of taxable
goods and services in the state of West Bengal, pays GST under regular scheme. It is
not eligible for any threshold exemption. It provided the following information for the
month of December:
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2. World Fashions, a registered supplier of designer outfits in Delhi, decides to exhibit its
products in a Fashion Show being organised at Hotel Green India, Delhi on 4th
January. For the occasion, it gets the service by way of makeover of its models from
Glamour Beauty Services Ltd., Mayur Vihar, on 4th January, for which a consideration
of ` 5,00,000 (excluding GST) has been charged. Glamour Beauty Services Ltd. issued a
duly signed tax invoice on 10th February showing the lumpsum amount of ` 5,90,000
inclusive of CGST and SGST @ 9% each for the services provided. Answer the
following questions:
(i) Examine whether the tax invoice has been issued within the time limit
prescribed under law.
(ii) Tax consultant of World Fashions objected to the invoice raised suggesting that
the amount of tax charged in respect of the taxable 274 supply should be shown
separately in the invoice raised by Glamour Beauty Services Ltd. However,
Glamour Beauty Services Ltd. contended that there is no mandatory
requirement of showing tax component separately in the invoice. You are
required to examine the validity of the objection raised by tax consultant of
World Fashions.
(5 Marks)
3. As per the CGST Act 2017, Vishnu Limited was not mandatorily required to get
registered, however it opted for voluntary registration and applied for registration on
12thFebruary 2024. Registration certificate has been granted by the Department on
24th February 2024, Vishnu Limited is not engaged in making inter-State outward
taxable supplies. The CGST and SGST liability for the month of February, 2024 is ₹
31,000 each. Vishnu Limited provides the following information of goods held in stock
on 23rd February 2024:
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The amounts mentioned above are exclusive of GST. You are required to determine the
eligible ITC available and amount of net minimum GST to be paid in cash by Vishnu
Limited for the month of February 2024.
(5 Marks)
4. Examine the following independent cases and determine the place of supply:
(1) Mr. Joy, an unregistered person of Kolkata, West Bengal sends a courier through
Kolkata, West Bengal based Mohan Courier Agency to his sister in Mumbai,
Maharashtra.
(2) Mr. Nitin, an unregistered person, resides at Rewa, Madhya Pradesh books a two
way air journey ticket from Prayagraj, Uttar Pradesh to Jaipur, Rajasthan on 6
September and back. He leaves Prayagraj on 11 September in a morning flight and
land in Jaipur the same day. He leaves Jaipur on 15 September in a late night flight
and lands in Prayagraj the next day.
(3) Rimjhim Pvt. Ltd, located at Lucknow, Uttar Pradesh, purchases a manufacturing
machine from Manav Steel Industries Ltd., located at Jaipur, Rajasthan, for being
installed in its factory located at Haridwar, Uttarakhand.
(5 Marks)
5. Mr. Shubh, director of Star Company Private Limited, provided service to the
company for remuneration of ₹ 1,25,000. Briefly answer whether GST is applicable in
the below mentioned independent cases? If yes, who is liable to pay GST?
(i) Mr. Shubh is an independent director of Star Company Private Limited and
not an employee of the company.
(ii) Mr. Shubh is an executive director, i.e. an employee of Star Company Private
Limited. Out of total remuneration amounting to ₹ 1,25,000, ₹ 60,000 has been
declared as salaries in the books of Star Company Private Limited and
subjected to TDS under section 192 of the Income-Tax Act (IT Act). However,
₹65,000 has been declared separately other than salaries in the Star Company
Private Limited’s accounts and subjected to TDS under section 194J of the IT
Act as professional services.
(5 Marks)
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