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CMA Intermediate · Direct and Indirect Taxation · Levy and Collection of CGST and IGST

Under the CGST Act, 2017, which statement about tax collection by persons is correct?

A person who is not a registered person cannot collect any amount by way of tax under the CGST Act on any supply of goods or services. Even registered persons may collect tax only in accordance with the Act and its rules.

  1. AAn unregistered person may collect tax if the amount is deposited later with the Government
  2. BA registered person may collect tax at any rate he considers appropriate
  3. CA person who is not a registered person shall not collect any amount by way of tax under the Act on any supplyCorrect
  4. DAn unregistered person may collect tax only on supplies of services

Explanation

Section 32(1) prohibits a person who is not registered from collecting any amount by way of tax in respect of any supply. Section 32(2) also bars registered persons from collecting tax except as per the Act and rules, so charging any rate they like is wrong.

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