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CS Professional · Goods and Services Tax (GST) and Corporate Tax Planning · Overview of Goods and Services Tax

Section 11A of the CGST Act, 2017 empowers the Government to direct that tax need not be paid on supplies where a general practice of non-levy or short-levy prevailed. Which condition must be met before the Government issues such a direction?

The Government, being satisfied that a general practice of non-levy or short-levy prevailed, may act only on the recommendation of the Council and by notification in the Official Gazette. No officer order, State legislature approval or single-State limit is required.

  1. AThe direction must be issued on the recommendation of the Council by notification in the Official GazetteCorrect
  2. BThe direction may be issued by the proper officer by an adjudication order
  3. CThe direction requires prior approval of each State Legislature
  4. DThe direction can be issued only where the practice was prevalent in a single State

Explanation

The section requires that the Government be satisfied that a practice was or is generally prevalent regarding levy (including non-levy) and that the supplies were liable to tax or higher tax; it then acts on the Council's recommendation by notification in the Official Gazette. The other options add conditions not found in the text.

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