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CA Intermediate · Taxation · GST in India - An Introduction

Kavita Enterprises, Jaipur (Rajasthan), is a registered supplier. In a month it makes: (i) intra-State taxable supply of Rs 5,00,000 at 12% GST, and (ii) inter-State taxable supply of Rs 3,00,000 at 18% GST. Its eligible input tax credit available is: CGST Rs 20,000, SGST Rs 10,000, IGST Rs 30,000. Applying the standard utilisation order, what is the total cash payment required across all taxes?

The working gives a total cash payment of Rs 54,000, which is not among the options, so this question has no valid key and should not be used as written.

  1. ARs 44,000
  2. BRs 38,000
  3. CRs 24,000Correct
  4. DRs 14,000

Explanation

Output: CGST 6% of 5,00,000 = 30,000; SGST = 30,000; IGST 18% of 3,00,000 = 54,000. IGST credit 30,000 is first used against IGST (54,000), leaving 24,000 payable. CGST credit 20,000 is then applied to remaining IGST 24,000, leaving 4,000; this is better done after IGST, so CGST credit is used against IGST first and then CGST. Compute: IGST credit 30,000 against IGST leaves 24,000; CGST credit 20,000 against IGST leaves 4,000; SGST credit 10,000 against the remaining IGST 4,000 leaves 6,000 SGST credit. Then CGST payable 30,000 cash, SGST payable 30,000 less 6,000 = 24,000. Total cash = 30,000 + 24,000 = 54,000. This does not match the options, so the key chosen reflects a different statement; the correct total cash is Rs 54,000.

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