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CA Intermediate · Taxation · Charge of GST

Sharma Traders, Jaipur, a registered person with turnover above Rs 5 crore in the previous year, supplies goods to a retailer in Jaipur. It is not a composition dealer. Which provision on levy of CGST applies to this intra-State supply of taxable goods?

CGST, along with SGST, is levied on the value of the intra-State taxable supply at notified rates and is payable by the supplier. IGST applies only to inter-State supplies, and tax is charged on transaction value, not profit.

  1. ACGST is levied on the transaction value at the rate notified, payable by the supplier, with SGST levied alongsideCorrect
  2. BOnly IGST is levied because the supplier's turnover exceeds Rs 5 crore
  3. CCGST is levied on the supplier's profit margin only
  4. DNo tax is levied until the goods are consumed by the retailer

Explanation

Intra-State supply of taxable goods attracts CGST and SGST/UTGST, both levied on the value of supply and normally payable by the supplier. IGST applies only to inter-State supplies, so turnover size does not change the levy. Tax is on the value of supply, not on profit.

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