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CA Intermediate · Taxation · Charge of GST

Ramesh, a registered person in Jaipur, supplies goods to unregistered customers in Jaipur. His aggregate turnover in the preceding year was Rs 1.2 crore, and he has not opted for the composition scheme. In the current year he supplies taxable goods worth Rs 8,00,000 (excluding tax) at 5% GST. Which statement about the levy is correct?

Tax of Rs 40,000 is payable as CGST 2.5% and SGST 2.5%. GST is charged on every taxable supply whether or not the buyer is registered, and a supply within Rajasthan is intra-State, so IGST does not apply.

  1. ATax is payable at 5% (CGST 2.5% plus SGST 2.5%), amounting to Rs 40,000Correct
  2. BTax is payable only on supplies to registered persons
  3. CNo tax is payable since customers are unregistered
  4. DTax of Rs 40,000 is payable as IGST

Explanation

GST is levied on all taxable supplies irrespective of whether the recipient is registered. The supply is intra-State, so 5% splits into CGST 2.5% and SGST 2.5%: 8,00,000 x 5% = Rs 40,000. IGST is wrong as the supply is within Rajasthan.

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