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A Special Economic Zone (SEZ) is a designated area with clear boundaries that operates as a duty-free zone. It is considered foreign territory with respect to trade activities, customs duties, and tariffs.
Goods imported by a unit or a developer in the SEZ for authorised operations are exempted from the whole of IGST livable under Section 3(7) of the Custom Tariff Act, 1975 vide Notification No. 64/2017- Customs dated 5th July, 2017.
This duty-free import privilege leads to substantial cost savings for their operational activities.
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Deemed exports are subject to taxation just like regular supplies, and deemed exporters do not enjoy the zero-rated supply benefits.
All the supplies notified as deemed export are subject to levy of taxes i.e. such supply can be made on payment of tax and can not be made under a Bond/ LUT.
Then you might have question what will be benefits of deemed export. Since these supplies are treated as exports, it qualifies for refund. Both the supplier and the recipient can submit refund applications.
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As per notification Serial no. 6 of No. 13/2017 –Central Tax (Rate) dated 28.06.2017, whenever GST is leviable on remuneration paid to director, the recipient of the said services i.e. the Company, is liable to discharge the liability of GST on Reverse Charge Mechanism (RCM) basis.
| Particulars | TDS Section | GST Applicability |
| Directors Remuneration | U/s 194J of Income tax Act | Yes, GST is leviable. Company have to discharge the liability of GST through RCM. |
| Directors Remuneration | U/s 192 of Income tax Act | No, GST is not leviable. Then RCM would not apply in this context. |
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As per Circular No. 32/06/2018 GST dated 12.02.2018, Entry No. 5 Clinical establishments are responsible for ensuring that patients receive essential healthcare services and this includes the provision of food. The food can either be prepared within the hospital's own canteens or sourced from external caterers.
When outsourcing these services, it's clear that the suppliers will apply applicable taxes and the hospital won't be eligible for Input Tax Credit (ITC).
Food provided to in-patients based on medical or nutritional recommendations is considered an integral part of the composite supply of healthcare and is not subject to separate taxation. Hence, GST is not applicable.
Food supplies made by a hospital to patients who are not admitted, as well as to their attendants or visitors, are subject to taxation.
| Food Supplied to | GST Applicability |
| In-patients i.e. patients who are admitted to hospital | GST not applicable |
| Visitors or attendants | GST Applicable |
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Circular No: 140/10/2020 – GST dated 10th June 2020 clarify about the GST applicability on Remuneration.
The issue of remuneration to directors has been examined under following two different categories:-
- Leviability of GST on remuneration paid by companies to the independent directors or those directors who are not the employee of the said company
- Leviability of GST on remuneration paid by companies to the directors, who are also an employee of the said company.
GST applicability on remuneration paid by companies to the independent directors or those directors who are not the employee of the said company:
As per Section 149(6) of the Companies Act, 2013, read with Rule 12 of Companies (Share Capital and Debentures) Rules, 2014, Independent directors are individuals who must not have served as an employee, proprietor, or partner of the company in any of the three financial years immediately prior to the financial year in which they are being considered for appointment to the company's board.
Hence, with regards to directors who do not hold employee status within the company, the services they render to the company, for which they receive remuneration as compensation, fall distinctly outside the purview of Schedule III of the CGST Act and are consequently subject to taxation.
Leviability of GST on remuneration paid by companies to the directors, who are also an employee of the said company:
A director, irrespective of name and designation, is also act as an employee & Director’s remuneration which are declared as Salaries in the books of a company and subjected to TDS under Section 192 of the IT Act, are not taxable being consideration for services by an employee to the employer in the course of or in relation to his employment in terms of Schedule III of the CGST Act, 2017.
The remuneration received by an Employee Director, which is disclosed separately in the company's financial statements and is subject to TDS (Tax Deducted at Source) under Section 194J of the Income Tax Act as fees for professional or technical services, should be regarded as compensation for rendering services that fall beyond the purview of Schedule III of the CGST (Central Goods and Services Tax) Act. Consequently, it is liable to taxation.
| Particulars | TDS Section | GST Applicability |
| Directors Remuneration | U/s 194J of Income tax Act | Yes, GST is leviable |
| Directors Remuneration | U/s 192 of Income tax Act | No, GST is not leviable |
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As per Notification No.12/2017-Central Tax (Rate) dated 28th June 2017, entry no 13(b), Renting precincts of a religious place, which is intended for use by the general public and is owned by an entity registered as a charitable or religious trust under Section 12AA of the Income-tax Act, 1961, or a trust or institution registered under sub-clause (v) of clause (23C) of Section 10 of the Income-tax Act, or a body or authority covered under clause (23BBA) of Section 10 of the said Income Tax Act, is exempt from GST, provided that the consideration charged for such renting does not exceed the prescribed ceiling limits as specified in the relevant entry. Thus, this exemption is determined on the basis of amount of consideration charged for such renting.
Interpretation of Exemption of GST on religious ceremony renting of Precincts of a Religious place:
A religious place refers to a location primarily designated for the purpose of engaging in religious activities such as prayers, worship related to a specific faith, meditation, or spiritual practices.
General public
to mean “the body of people at large sufficiently defined by some common quality of public or impersonal nature”.
The term precincts should encompass all immovable property situated in the immediate vicinity and surroundings of the religious place, which is either owned by the religious place itself or managed by the same entity as the religious place. Property managed by the same entity as the religious place can also be regarded as part of the religious place's precincts.
Scope of Exemption
| Eligible Person | What is exempt | Exemption Limit |
| Any Person | Renting of Precincts of a religious place meant for general public. | The exemption mentioned in clause (b) will not be applicable under the following circumstances:
1. When rooms are rented for Rs. 1,000 or more per day. 2. When premises, community halls, kalian mandapam, open areas, etc., are rented, and the charges are Rs. 10,000 or more per day. 3. When shops intended for business and commerce are rented, and the charges are Rs. 10,000 or more per month. |
Example: Godavari Trust, a religious trust registered under section 12AB of the Income Tax Act, owns and manages a temple in their locality. They rent out commercial shops located within the temple's precincts for a monthly rent of Rs.11,000 per shop. It's important to note that the consideration received in this case is subject to GST, as the exemption from GST applies only when the consideration for such services is less than Rs. 10,000 per month.
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As per Notification No.12/2017-Central Tax (Rate) dated 28th June 2017, entry no 13(a), it can be inferred that the amount charged, by whatever name called, for the conduct of any religious ceremony is exempt from GST. Religious ceremonies encompass life-cycle rituals, which may include special religious pujas. These rituals are conducted by individuals who hold the authority granted by these religious texts. Such ceremonies are particularly prominent during significant life events such as birth, marriage and death.
A religious place refers to a location primarily designated for the purpose of engaging in religious activities such as prayers, worship related to a specific faith, meditation, or spiritual practices.
Example: Gopaldas Sharma, a priest charges Rs. 35000 for conducting a religious ceremony on the marriage of Mr. Anand verma. Services provided by any individual or entity in the form of conducting religious ceremonies are exempt from Goods and Services Tax (GST).
Disclaimer:-The information available on this website/ App is solely for informational purposes. We make no representation or warranties of any kind, express or implied about the accuracy, reliability, with respect to information and material or video available on website/APP, any reliance you place on such information is therefore strictly at your own risk. We are not liable for any consequence of any action taken by you relying on the material/information provided on this website.
In GST scenario, change in the rate of tax are frequently change. Due to this, there may be situations where in GST rate are different at the time of actual supply of goods and different at the time of receipt of payment.
In this article, we will discuss implication of these rate change on the time of supply and consequently the tax rate applicable to the tax payer.
As per Section 14 Change in rate of tax in respect of supply of goods or services - Notwithstanding anything contained in section 12 or section 13 the time of supply, where there is a change in the rate of tax in respect of goods or services or both, shall be determined in the following manner, namely:-
Time of supply in case of change in rate of tax.
| Supply | Issue of invoice | Receipt of payment | Time of supply |
| Before | Before | After | Date of issue of invoice. |
| Before | After | Before | Date of receipt of payment. |
| Before | After | After | Date of issue of invoice or date of receipt of payment, whichever is earlier. |
| After | After | Before | Date of issue of invoice. |
| After | Before | After | Date of receipt of payment. |
| After | Before | Before | Date of issue of invoice or date of receipt of payment, whichever is earlier. |
Disclaimer:-The information available on this website/ App is solely for informational purposes. We make no representation or warranties of any kind, express or implied about the accuracy, reliability, with respect to information and material or video available on website/APP, any reliance you place on such information is therefore strictly at your own risk. We are not liable for any consequence of any action taken by you relying on the material/information provided on this website.
Time of supply is very important to determine the liability of GST , on the basis of which tax liability is determined when GST is to be paid .
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Advance in case of Supply of Goods : -
Notification no. According to 66/2017- Central Tax , where goods are to be supplied by the supplier , in respect of which any advance amount is received , then in such a case there is no need to pay GST on receipt of advance amount .
The liability to pay GST will arise only when the goods are actually being supplied ( Invoice has been issued ) .
But if a person has opted for the Composition Scheme , then he will not get the benefit of the notification mentioned above . Meaning, if advance amount is received by the composition dealer , then GST liability arises on receipt of advance amount .
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Advance in case of supply of service:-
If advance amount is received in respect of supply of service , then liability to pay GST arises when the advance amount is received .
Note :
But if an amount up to Rs 1000 is received , then in such a case the service provider has the option to pay the GST either at the time of receiving the advance or when the service is actually being provided.
What The amount of GST paid on advance Will
the ITC recipient get it at the same time ?
On advance amount ITC will not be available to the recipient after paying GST . ITC will be available to the recipient when the service is actually provided to the recipient by the supplier . And the information of that supply in GST Return Has been furnished .
advance amount declared in GST return ?
On receipt of advance amount by the supplier , Details of advance amount received will have to be declared in Part –11A of GSTR –1 . If advance amount has been received from different persons , then there will be no need to mention them separately , the total cumulative amount will be declared together .
But the advance amount received in respect of Inter-state supply and Intra - state supply will be segregated separately .
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Circular No. 72/46/2018-GST dated 26.10.2018 has clarified such situation.
In this case, the ITC availed by the manufacturer at the time of return of goods will have to be reversed. It does not matter how much ITC was availed on that product at the time of manufacturing, it has to be ignored.
We understand this with an example:-
Let us assume that the manufacturer had availed ITC of Rs 10,000 on that product at the time of manufacturing the goods. When the goods were returned, a fresh invoice was issued and GST of Rs 15,000 was charged on those goods and the manufacturer availed ITC on it.
In that case, whenever the goods are being destroyed, the ITC of Rs 15,000 will have to be reversed and not the ITC of Rs 10,000. It does not matter how much ITC was availed on that product at the time of manufacturing, it has to be ignored.
