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CMA Final · Indirect Tax Laws and Practice · Valuation under GST

A manufacturer sells the same specified goods in State X in packs declaring an RSP of Rs 236 and in State Y in packs declaring an RSP of Rs 354, with 18% as the only applicable tax. Under Rule 31D, the correct valuation approach is:

When different packages carry different RSPs for different areas, each RSP governs goods meant for its own area. State X value is 236 minus Rs 36 tax, which is Rs 200, and State Y value is 354 minus Rs 54 tax, which is Rs 300.

  1. AUse Rs 354 for all supplies, being the maximum RSP
  2. BUse the average RSP of Rs 295 for all supplies
  3. CUse each RSP for goods intended to be sold in the area to which that RSP relates, giving Rs 200 in State X and Rs 300 in State YCorrect
  4. DUse Rs 236 for all supplies, being the lower RSP

Explanation

Explanation (e) provides that where different RSPs are declared on different packages for different areas, each RSP applies to goods intended for that area. X: 236 - (236x18/118 = 36) = 200. Y: 354 - 54 = 300. The maximum-price rule applies only when one package shows several prices.

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