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CA Intermediate · Taxation · Supply under GST

Kapoor Enterprises, Delhi, purchased a laptop for use in its office and sold it after three years to a dealer, claiming it was not a supply because it was a capital asset and not stock-in-trade. Kapoor is registered and sells only readymade garments. The laptop sale is:

The sale is a supply of goods because it is made for consideration in the course or furtherance of business. Sale of a business capital asset such as a laptop falls within that wording, even if the firm does not trade in laptops or sells at a loss.

  1. ANot a supply because the firm does not deal in laptops
  2. BNot a supply because it is an asset sold, not part of regular business
  3. CA supply because business assets sold are within the course or furtherance of business, and Schedule II treats it as supply of goodsCorrect
  4. DA supply only if sold at more than the original purchase price

Explanation

Supply covers anything done in the course or furtherance of business, including sale of capital assets used in the business. Disposal of business assets is therefore a supply of goods, taxable unless exempt or ITC-blocked treatment applies. The firm's line of trade or profit on sale is irrelevant.

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