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CA Intermediate · Taxation · Tax Deduction at Source and Collection of Tax at Source

Kisan Mart, an e-commerce operator, collects the consideration for supplies made through its platform by independent suppliers. In a month, taxable supplies (all intra-State goods) made by supplier Meera Textiles through the platform were Rs 8,00,000, and goods worth Rs 1,50,000 out of these were returned in the same month. What is the total tax (CGST plus SGST) the operator must collect at source under section 52 for this supplier for the month?

The operator must collect Rs 3,250. The base is the net value of taxable supplies, which is Rs 8,00,000 less Rs 1,50,000 of returns, i.e. Rs 6,50,000, and the TCS rate is 0.5% (0.25% CGST plus 0.25% SGST).

  1. ARs 3,250Correct
  2. BRs 4,000
  3. CRs 6,500
  4. DRs 1,625

Explanation

Net value of taxable supplies = 8,00,000 - 1,50,000 returns = Rs 6,50,000. TCS rate is 0.5% (0.25% CGST + 0.25% SGST), so TCS = Rs 3,250. Rs 4,000 ignores the returns, Rs 6,500 uses 1%, and Rs 1,625 is only the CGST half.

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