Basic Of GST
FAQ On GST Definitions
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Agriculturist [Section 2(7)]
Q1. Define the term ‘agriculturist’ under CGST Act, 2017.
Ans. As per Section 2(7) of the CGST Act, 2017, “agriculturist” means an individual or a
Hindu Undivided Family who undertakes cultivation of land—
(a) by own labour, or
(b) by the labour of family, or
(c) by servants on wages payable in cash or kind or by hired labour under personal
supervision or the personal supervision of any member of the family.
Q2. Mr. X having 30 acres of land undertakes cultivation with the help of his two sons. Is
Mr. X an agriculturist within the terms of the CGST Act?
Ans. As per Section 2(7) of the CGST Act, the term “agriculturist” means an individual who
undertakes cultivation of land even by the labour of family. Therefore, Mr. X being an
individual and using labour of his two sons for cultivation of land is an agriculturist
within the meaning of the CGST Act, 2017.
Person [Section 2(84)]
Q3. Define the term ‘person’ under the CGST Act?
Ans. As per Section 2(84) of the CGST Act, “person” includes:
(a) an individual;
(b) a Hindu Undivided Family;
(c) a company;
(d) a firm;
(e) a Limited Liability Partnership;(f) an association of persons or a body of individuals, whether incorporated or not, in
India or outside India;
(g) any corporation established by or under any Central Act, State Act or Provincial
Act or a Government company as defined in section 2(45) of the Companies Act,
2013;
(h) any body corporate incorporated by or under the laws of a country outside India;
(i) a co-operative society registered under any law relating to co-operative societies;
(j) a local authority;
(k) Central Government or a State Government;
(l) society as defined under the Societies Registration Act, 1860;
(m) trust; and
(n) every artificial juridical person, not falling within any of the above.
Q4. Define the term ‘taxable person’ under the CGST Act?
Ans. As per Section 2(107) of the CGST Act, “taxable person” means a person who is
registered or liable to be registered under section 22 or section 24.
Casual Taxable Person [Section 2(20)]
Q5. Define the term ‘casual taxable person’ under the CGST Act?
Ans. As per Section 2(20) of the CGST Act, “casual taxable person” means a person who
occasionally undertakes transactions involving supply of goods or services or both in
the course or furtherance of business, whether as principal, agent or in any other
capacity, in a State or a Union territory where he has no fixed place of business.
Business [Section 2(17)]
Q6. Define the term “Business” under the CGST Act, 2017?
Ans. As per Section 2(17) of the CGST Act, business includes:
(a) any trade, commerce, manufacture, profession, vocation, adventure, wager or any
other similar activity, whether or not it is for a pecuniary benefit;
(b) any activity or transaction in connection with or incidental or ancillary to
sub-clause (a);
(c) any activity or transaction in the nature of sub-clause (a), whether or not there is
volume, frequency, continuity or regularity of such transaction;(d) supply or acquisition of goods including capital goods and services in connection
with commencement or closure of business;
(e) provision by a club, association, society, or any such body (for a subscription or
any other consideration) of the facilities or benefits to its members;
(f) admission, for a consideration, of persons to any premises;
(g) services supplied by a person as the holder of an office which has been accepted
by him in the course or furtherance of his trade, profession or vocation;
(h) 1activities of a race club including by way of totalisator or a license to book maker
or activities of a licensed book maker in such club; and;
This has been amended from “services provided by a race club by way of
totalisator or a licence to book maker in such club; and”, to ensure that all
activities related to a race club are included in the definition of business.
Moreover, this amendment has done away the ambiguity, which prevails due to
the term “services”, as definition of “goods” in the CGST Act, 2017 includes
actionable claims.
(i) any activity or transaction undertaken by the Central Government, a State
Government or any local authority in which they are engaged as public authorities.
Place of business [Section 2(85)]
Q7. Define the term “place of business” under the CGST Act, 2017?
Ans. As per Section 2(85) of the CGST Act, 2017, “place of business” includes:
(a) a place from where the business is ordinarily carried on, and includes a
warehouse, a godown or any other place where a taxable person stores his
goods, supplies or receives goods or services or both; or
(b) a place where a taxable person maintains his books of account; or
(c) a place where a taxable person is engaged in business through an agent, by
whatever name called.
Recipient [Section 2(93)]
Q8. Define the term “recipient” under the CGST Act, 2017.
Ans. As per Section 2(93) of the CGST Act, 2017, “recipient” of supply of goods or services
or both, means—
(a) where a consideration is payable for the supply of goods or services or both, the
person who is liable to pay that consideration;(b) where no consideration is payable for the supply of goods, the person to whom
the goods are delivered or made available, or to whom possession or use of the
goods is given or made available; and
(c) where no consideration is payable for the supply of a service, the person to
whom the service is rendered.
Consideration [Section 2(31)]
Q9. What is “Consideration” in relation to the supply of goods or services or both?
Ans. As per Section 2(31) of CGST Act, 2017 “consideration” in relation to the supply of
goods or services or both includes–
(a) any payment made or to be made, whether in money or otherwise, in respect of,
in response to, or for the inducement of, the supply of goods or services or both,
whether by the recipient or by any other person but shall not include any subsidy
given by the Central Government or a State Government;
(b) the monetary value of any act or forbearance, in respect of, in response to, or for
the inducement of, the supply of goods or services or both, whether by the
recipient or by any other person but shall not include any subsidy given by the
Central Government or a State Government:
Provided that a deposit given in respect of the supply of goods or services or both shall
not be considered as payment made for such supply unless the supplier applies such
deposit as consideration for the said supply.
Q10. Can the deposit given in respect of the supply of goods or services or both be
considered as payment made for such supply?
Ans. As per Section 2(31) of CGST Act, 2017, the deposit given in respect of the supply of
goods or services or both shall not be considered as payment made for such supply
unless the supplier applies such deposit as consideration for the said supply
.
Q11. Does subsidy given by the Central Government or a State Government form part of
consideration?
Ans. As per Section 2(31) of the CGST Act, 2017, the term consideration does not include
any subsidy given by the Central Government or a State Government.
Taxable Supply [Section 2(108)]
Q12. Define the term “taxable supply” under the CGST Act, 2017?
Ans. As per Section 2(108) of the CGST Act, 2017, “taxable supply” means a supply of
goods or services or both which is leviable to tax under this Act.
Non–Taxable Supply [Section 2(78)]
Q13. Whether a supply of goods or services or both not leviable to tax under CGST Act, 2017
or Integrated Goods and Service Tax Act, 2017 (“the IGST Act, 2017” or “the IGST
Act”) constitutes to be a non-taxable supply?
Ans. As per Section 2(78) of the CGST Act, 2017, “non-taxable supply” means a supply of
goods or services or both which is not leviable to tax under the CGST Act or under the
IGST Act.
Exempt Supply [Section 2(47)]
Q14. What is exempt supply?
Ans. As per Section 2(47) of the CGST Act, 2017, “Exempt supply” means supply of any
goods or services or both which attracts nil rate of tax or which may be wholly exempt
from tax under Section 11 of CGST Act, 2017, or under Section 6 of the IGST Act, and
includes non-taxable supply.
Aggregate Turnover [Section 2(6)]
Q15. What is aggregate turnover?
Ans. As per Section 2(6) of the CGST Act, “aggregate turnover” means the aggregate value
of all taxable supplies (excluding the value of inward supplies on which tax is payable
by a person on reverse charge basis), exempt supplies, exports of goods or services or
both and inter-State supplies of persons having the same Permanent Account Number,
to be computed on all India basis but excludes central tax, State tax, Union territory tax,
integrated tax and cess.
Q16. What does the definition aggregate turnover excludes?
Ans. The definition of aggregate turnover excludes:
(a) Central Tax
(b) State Tax
(c) Union Territory Tax
(d) Integrated tax
(e) Cess
(f) Inward supplies on which tax is payable by a person on reverse charge basis.
Q17. A Ltd. is a registered person in Telangana State and also has GST registration in
Karnataka and Maharashtra. How to compute the aggregate turnover?
Ans. As per the Section 2(6) of CGST Act, 2017, aggregate turnover of persons having the
same PAN shall be computed on all India basis that is for persons having registration in
multiple States, aggregate turnover shall be computed as a sum of turnovers of all
these registrations. Therefore, the Aggregate turnover of A Ltd. will be sum of turnovers
of all the three States (i.e.) Telangana, Maharashtra and Karnataka.
Goods [Section 2(52)]
Q18. What are Goods?
Ans. As per Section 2(52) of the CGST Act, 2017, “goods” means every kind of movable
property other than money and securities but includes actionable claim, growing crops,
grass and things attached to or forming part of the land which are agreed to be severed
before supply or under a contract of supply.
Q19. Mr. A has a farm where he undertakes the activity of growing paddy. Does this activity
fall under the definition of goods under the CGST Act?
Ans. Yes, growing crops fall under the definition of goods according to Section 2(52) of the
CGST Act, 2017.
Capital Goods [Section 2(19)]
Q20. What are capital goods?
Ans. As per Section 2(19)“capital goods” means goods, the value of which is capitalised in
the books of account of the person claiming the input tax credit and which are used or
intended to be used in the course or furtherance of business.
Services [Section 2(102)]
Q21. What are Services?
Ans. As per Section 2(102) of the CGST Act, 2017, “services” means anything other than
goods, money and securities but includes activities relating to the use of money or its
conversion by cash or by any other mode, from one form, currency or denomination, to
another form, currency or denomination for which a separate consideration is charged.
Further, services includes facilitating or arranging transactions in securities , if some
service charge.
India [Section 2(56)]
Q22. Define India under the CGST Act?
Ans. As per Section 2(56) of the CGST Act, 2017, “India” means the territory of India as
referred to in article 1 of the Constitution, its territorial waters, seabed and sub-soil
underlying such waters, continental shelf, exclusive economic zone or any other
maritime zone as referred to in the Territorial Waters, Continental Shelf, Exclusive
Economic Zone and other Maritime Zones Act, 1976, and the air space above its
territory and territorial waters.
Deemed Exports [Section 2(39)]
Q23. What are deemed exports?
Ans. As per Section 2(39) of the CGST Act, “deemed exports” means such supplies of goods
as may be notified under Section 147 of CGST Act, 2017.
Section 147 of the CGST Act states that the Government may, on the recommendations
of the Council, notify certain supplies of goods as deemed exports, where goods
supplied do not leave India, and payment for such supplies is received either in Indian
rupees or in convertible foreign exchange, if such goods are manufactured in India.
Notification No. 48/2017-Central Tax dated 18th October, 2017, hereby notifies the
supply of goods listed below as deemed exportsSl.
No Description of supply
1 Supply of goods by a registered person against Advance Authorisation
2 Supply of capital goods by a registered person against Export Promotion
Capital Goods Authorisation
3 Supply of goods by a registered person to Export Oriented Unit
4 Supply of gold by a bank or Public Sector Undertaking specified in the
Notification No. 50/2017-Customs, dated the 30-06-2017 (as amended)
against Advance Authorisation
✓ It is pertinent to note here that Export Oriented Unit (EOU) refers to
• Export Oriented Unit (EOU)
• Electronic Hardware Technology Park Unit (EHTP) or
• Software Technology Park Unit (STP) or
• Bio-Technology Park Unit (BTP).
[The Government vide Circular No. 14/14 /2017 – GST dated 6.11.2017, has es or service fees or documentation fees or broking charges or such like
fees or charges are charged in relation to transactions in securities, the same would be
a consideration for provision of service and chargeable to GST.
issued detailed guidelines on the procedure to be adopted for Supply of goods to
EOU, EHTP, STP and BTP]
✓ Further, it is imperative to state here that, The Foreign Trade Policy (2015-2020)
in terms of Para 7.02 has provided a list of Supply which are Deemed Supplies
under the FTP.
However, only the aforesaid four supplies have been covered under Deemed Export
under GST. Therefore, other Deemed Export under FTP but not covered above are
liable for GST. However, the recipient is eligible to take Input Tax Credit of the tax paid
by the Supplier subject to restrictions / blocking of credits as per Section 16, 17 of the
CGST Act and Rules there under.
Works Contract [Section 2(119)]
Q24. Define the term “works contact” under the CGST Act, 2017?
Ans. As per Section 2(119) of the CGST Act, 2017, “works contract” means a contract for
building, construction, fabrication, completion, erection, installation, fitting out,
improvement, modification, repair, maintenance, renovation, alteration or
commissioning of any immovable property wherein transfer of property in goods
(whether as goods or in some other form) is involved in the execution of such contract.
Job Work [Section 2(68)]
Q25. Define Job work?
Ans. As per Section 2(68) of the CGST Act, 2017, “job work” means any treatment or
process undertaken by a person on goods belonging to another registered person and
the expression “job worker” shall be construed accordingly.
Q26. A Ltd. manufactures marble floors which he sends to B Ltd. for polishing. Does this
activity account for job-work?
Ans. Yes, this activity accounts for job-work as polishing is the treatment undertaken for the
goods belonging to another registered person (A Ltd.). Here, B Ltd. is the job worker.
Local Authority [Section 2(69)]
Q27. What is location of supplier of services?
Ans. As per Section 2(69) of the CGST Act, 2017, “local authority” means,—
(a) a “Panchayat” as defined in clause (d) of article 243 of the Constitution;
(b) a “Municipality” as defined in clause (e) of article 243P of the Constitution;(c) a Municipal Committee, a Zilla Parishad, a District Board, and any other
authority legally entitled to, or entrusted by the Central Government or any State
Government with the control or management of a municipal or local fund;
(d) a Cantonment Board as defined in section 3 of the Cantonments Act, 2006;
(e) a Regional Council or a District Council constituted under the Sixth Schedule to
the Constitution;
(f) a Development Board constituted under article 371 and article 371J3 of the
Constitution; or
(g) a Regional Council constituted under article 371A of the Constitution.
Location of Recipient of Services [Section 2(70)]
Q28. What is the location of recipient of services?
Ans. As per Section 2(70) of the CGST Act, 2017, “location of the recipient of services”
means,—
(a) where a supply is received at a place of business for which the registration has
been obtained, the location of such place of business;
(b) where a supply is received at a place other than the place of business for which
registration has been obtained (a fixed establishment elsewhere), the location of
such fixed establishment;
(c) where a supply is received at more than one establishment, whether the place of
business or fixed establishment, the location of the establishment most directly
concerned with the receipt of the supply; and
(d) in absence of such places, the location of the usual place of residence of the
recipient.
Location of Supplier of Services [Section 2(71)]
Q29. What is location of supplier of services?
Ans. As per Section 2(71) of the CGST Act, 2017, “location of the supplier of services”
means,—
(a) where a supply is made from a place of business for which the registration has
been obtained, the location of such place of business;(b) where a supply is made from a place other than the place of business for which
registration has been obtained (a fixed establishment elsewhere), the location of
such fixed establishment;
(c) where a supply is made from more than one establishment, whether the place of
business or fixed establishment, the location of the establishment most directly
concerned with the provisions of the supply; and
(d) in absence of such places, the location of the usual place of residence of the
supplier.
Administration
Officers under this Act (Section 3)
Q30. List the class of officers that the Government can appoint, by notification, under the
CGST Act, 2017.
Ans. The Government shall, by notification, appoint the following classes of officers for the
purposes of this Act, namely:–
(a) Principal Chief Commissioners of Central Tax or Principal Directors General of
Central Tax,
(b) Chief Commissioners of Central Tax or Directors General of Central Tax,
(c) Principal Commissioners of Central Tax or Principal Additional Directors General
of Central Tax,
(d) Commissioners of Central Tax or Additional Directors General of Central Tax,
(e) Additional Commissioners of Central Tax or Additional Directors of Central Tax,
(f) Joint Commissioners of Central Tax or Joint Directors of Central Tax,
(g) Deputy Commissioners of Central Tax or Deputy Directors of Central Tax,
(h) Assistant Commissioners of Central Tax or Assistant Directors of Central Tax,
and
(i) any other class of officers as it may deem fit:
Provided that the officers appointed under the Central Excise Act, 1944 shall be
deemed to be the officers appointed under the provisions of this Act
In this regard, Government has issued following notifications-
(i) Notification No. 2/2017-Central Tax, dated 19-Jun-2017 to appoint Central Tax
officers and assign their jurisdiction.(ii) Notification No. 14/ 2017-Central Tax, dated 1-Jul-2017 to appoint the officers in
the Directorate General of Goods and Services Tax Intelligence, Directorate
General of Goods and Services Tax and Directorate General of Audit.
Authorization of officers of State tax or Union territory tax as proper
officer in certain circumstances (Section 6)
Q31. Whether proceedings for rectification, appeal and revision, of any order passed by an
officer appointed under CGST Act can lie before an officer appointed under the SGST
Act?
Ans. As per Section 6(3) of the CGST Act, any proceedings for rectification, appeal and
revision, wherever applicable, of any order passed by an officer appointed under the
CGST Act shall not lie before an officer appointed under the SGST Act or UTGST Act.
