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CA Intermediate · Taxation · Supply under GST

Gupta Sons, Delhi, a registered dealer, imports a machine and then sells it in India. Separately, Ishaan Ltd, Mumbai, receives consulting services from a Singapore firm, and Ishaan Ltd is registered and uses the services for its business. Which statement is correct under the IGST Act, 2017 and CGST Act?

Import of services for consideration is a supply under GST, whether or not in the course of business, so the Mumbai company's consulting service from Singapore is taxable. The recipient pays IGST under reverse charge, since the supplier is outside India.

  1. AImport of services for a consideration by Ishaan Ltd is a supply even though the supplier is outside India, subject to taxability under reverse chargeCorrect
  2. BImport of services is a supply only if received from a related person
  3. CImport of services is outside GST as the supplier is outside India
  4. DImport of services is a supply only if the recipient is unregistered

Explanation

Import of services for a consideration, whether or not in the course or furtherance of business, is a supply under CGST. The recipient pays IGST under reverse charge, as the supplier is outside India. The option saying it is outside GST ignores this provision.

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