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CS Executive · Tax Laws and Practice · Levy and Collection of GST

Under Section 32 of the CGST Act, 2017, which statement is correct about collection of tax?

Section 32(1) prohibits a person who is not registered from collecting any amount as tax on any supply of goods or services or both. A registered person may also collect tax only as the Act and rules permit, so choosing any rate is not allowed.

  1. AAn unregistered person may collect tax if the amount is deposited later
  2. BA person who is not a registered person shall not collect any amount by way of tax under the Act on any supplyCorrect
  3. CA registered person may collect tax at any rate he chooses
  4. DOnly supplies of services are covered by the prohibition

Explanation

Section 32(1) bars a non-registered person from collecting any amount by way of tax on any supply of goods or services or both. Section 32(2) also bars registered persons from collecting tax except in accordance with the Act and the rules. So the other options misstate the rule.

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