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CA Intermediate · Taxation · Exemptions from GST

Vidya Prakash Ltd., a registered supplier, made the following supplies in a month: (a) sale of fresh milk, Rs 2,00,000; (b) sale of packaged UHT milk, Rs 1,50,000; (c) sale of curd, pre-packed and labelled, Rs 80,000; (d) sale of unbranded natural honey, Rs 60,000. The company asks which supplies are wholly exempt as goods. Identify the correct set under the goods exemption notification (pre-packaged and labelled curd is taxable).

Fresh milk, UHT milk and unbranded natural honey are exempt, while pre-packaged and labelled curd is taxable. So supplies (a), (b) and (d) are exempt and only supply (c) is taxable. UHT milk is specifically covered within the milk exemption.

  1. A(a), (b) and (d) are exempt; (c) is taxableCorrect
  2. B(a) and (d) are exempt; (b) and (c) are taxable
  3. C(a), (b) and (c) are exempt; (d) is taxable
  4. DAll four are exempt

Explanation

Fresh milk (pasteurised or not) and UHT milk are both exempt under the goods notification. Unbranded natural honey is exempt. Curd that is pre-packaged and labelled is taxable. So (a), (b), (d) exempt and (c) taxable; the wrongly narrow option treats UHT milk as taxable.

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