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CA Intermediate · Taxation · Value of Supply

Sharma Traders, Jaipur, sold goods to Verma Stores, Delhi, for a price of ₹2,00,000 exclusive of GST. The invoice shows that the supplier also charged ₹10,000 as packing charges and ₹6,000 as separately billed insurance for transit, both at the buyer's request. No discount was given. What is the value of supply under Section 15 of the CGST Act?

The value of supply is ₹2,16,000. Packing charges and transit insurance charged by the supplier to the buyer are incidental expenses relating to the supply and must be added to the price under Section 15(2)(c), even when billed separately from the goods.

  1. A₹2,00,000
  2. B₹2,06,000
  3. C₹2,10,000
  4. D₹2,16,000Correct

Explanation

Packing charges and insurance incurred by the supplier in relation to the supply, even if billed separately, are includible in value under Section 15(2)(c). Value = 2,00,000 + 10,000 + 6,000 = ₹2,16,000. Option ₹2,10,000 omits insurance; ₹2,06,000 omits packing.

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