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In this Article you will Learn :-
What is E-way bill?
- What is E-Way Bill?
- When is it mandatory to make E-Way Bill?
- What will be the consignment value?
- When will E-way bill have to be generated, even if the consignment value is not more than Rs 50000/-.
- Who can generate E-way bill?
- How to generate E-way bill?
- What is the validity of E-way bill?
- How can the validity of E-way bill be extended?
- When can E-way bill be cancelled?
- Can the transporter also issue e-way bill?
- In which cases can E-way bill be blocked?
- What will be the impact on the taxpayer if the e-way bill is blocked?
- How can E-way bill be unblocked?
- How much penalty can be imposed on non-generation of E-way bill?
E-way bill is a document in which movement of goods is indicated. Before the movement of goods, the supplier gives intimation of the movement of goods to the government in the form of E-way bill. E-way bill is carried by the transporter during movement of goods.
When is it mandatory to make E-Way Bill?
If the value of your consignment is Rs. If it is more than Rs 50,000, then you have to inform the government about this movement through E-way bill.
Movement of goods can happen due to all these reasons-
- The reason for movement may be supply.
- The reason for movement can also be other than supply.
Example-1:- Mr. ABC has two branches in Madhya Pradesh, one in Indore and the other in Bhopal. If the stock is being transferred from Indore branch to Bhopal branch, even if it is not supplied. But, if there is movement of goods, then E-way bill will have to be made.
Example-2:- Like you are sending goods to your job worker. Even if there is no supply, it is necessary to prepare E-way bill.
- It is necessary to prepare E-way bill even in case of sales return. Even if goods are being returned, it is necessary to have E-way bill with it.
- If inward supplies are from an unregistered person, then in this case also E-way bill has to be generated.
What will be the consignment value?
As you know that E-way bill is liable for consignment value of more than Rs 50,000/-. Consignment value is determined according to Section-15. Consignment value includes taxable value of supply and GST. Tax free supply is not considered to determine consignment value. For Example:- If you include both taxable supply and exempted supply in the same invoice, then you have to take only taxable value and tax for consignment value.
| Particulars | Amount |
| Taxable Value | Rs.40000/- |
| Tax free Value | Rs.6000/- |
| GST | Rs.7200/- |
| Total | Rs.53200/- |
| Consignment Value | Rs.47200/-(40000+7200) |
Example : Suppose the value of your invoice is Rs.53200/-, taxable value is Rs.40000/-, value of tax free goods is Rs.6000/- and GST is Rs.7200/-.
| Particulars | Amount |
| Taxable Value | Rs.40000/- |
| Tax free Value | Rs.6000/- |
| GST | Rs.7200/- |
| Total | Rs.53200/- |
| Consignment Value | Rs.47200/-(40000+7200) |
In this case you do not need to make E-way bill, because the consignment value is Rs.47,200, which is Rs. Does not exceed Rs 50000/- when E-way bill Will have to be made, even if the consignment value is not more than Rs 50000/-.
In some cases, you have to make mandatory E-way bill on the movement of goods, even if the consignment value does not exceed Rs.50,000/-.
Let us understand these cases-
- If the principal is transferring inter state goods to the job worker then no matter what the value is, making E-way bill is mandatory.
- If you are transferring handicraft goods inter state and you are exempted from taking GST registration according to section 24, then making E-way bill is mandatory in this case.
When is it not mandatory to generate e-way bill?
If you are transferring the goods from your place to the transporter's place for further transportation, the distance of which is less than 50 kilometers and is within a state or union territory, then in that case you will get the details of conveyance in Part –B. No need to fill.
Similarly, if the transporter is transferring goods from his business place to the consignee's place, the distance of which is less than 50 km, then in that case it is not necessary to update the details of conveyance in the E-way bill.
Who can generate E-way bill?
E-way bill can be generated by
- Supplier
- Registered person
- Unregistered person
- Receiver, if goods are sent by unregistered person to registered recipient
- Transporter
Keep in mind that even if you are a composition dealer, you have to generate E-way bill.
How to generate e-way bill?
E-way bill has to be generated from E-way bill website https://ewaybillgst.gov.in.
There are two parts of E-way bill.
Part A and Part B
Part –A :- The registered person who moves the goods is required to file Part A of the E-way bill before starting the movement of goods. In Part A, it is important to mention the transporter ID or vehicle number along with the invoice details. After Part A of the e-way bill is filed, no modification can be made in it. On filing Part A of the E-way bill, you will generate a unique number which will be valid for 72 hours to update Part B of the E-way bill.
Part –B :- After Part-A is filed by the supplier or receiver, Part-B is filed by the transporter. As long as the time limit of E-way bill has not expired, there is no limit on the number of times it can be updated. But keep in mind that the actual movement of the vehicle should match the description of the described vehicle.
When an unregistered transporter enrolls himself on the e-way bill portal, he is issued a Transporter ID. With the help of this Transporter ID he can issue E-way bill anytime.
The transporter can update Part B of the e-way bill. The reason for this could be anything like transferring the goods from another vehicle if the vehicle breaks down or more than one transporter is involved in taking the consignment to the end consignee.
What is the validity of e-way bill?
As soon as the E-way bill is generated, the system tells the validity period of the E-way bill according to the approximate distance. Movement of goods done after the validity of e-way bill is over is called illegal.
The validity of E-way bill remains as follows:
| Sl. No | Distance | Validity Period |
| 1 | Upto 200 Km | One Day |
| 2 | For Every 200 km and part thereof thereafter | One additional day |
| 3 | Upto 20 Km | One Day (over Dimensional Cargo) |
| 4 | For Every 20 km and part thereof thereafter | One additional day (over Dimensional Cargo) |
How can the validity of e-way bill be extended?
The validity of E-way bill can be extended up to 8 hours before the E-way bill expires or 8 hours after the E-way bill expires.
Only the transporter can extend the validity.
When can E-way bill be cancelled?
Due to some mistakes you may have to cancel the E-way bill. Unless you cancel the old E-way bill related to the same invoice, you cannot issue a new E-way bill. The supplier or receiver or transporter who has created the E-way bill can cancel it within 24 hours. But if the e-way bill has been verified in transit by the concerned officer, then it cannot be cancelled.
Transporter can also issue e-way bill
The transporter of the vehicle by which the goods are being transported also has the right to issue e-way bill. But, this is required only when e-Way Bill has not been issued by the supplier and receiver of the goods.
E-commerce operator or courier company can also issue e-way bill on behalf of the consignor with his consent.
Goods can also be sent by public transport, but in such a case, the responsibility of issuing e-way bill will be solely on the consignor sending the goods or the consignee receiving the goods.
Liability of unregistered person to generate E-way bill
An unregistered person also needs to issue an e-Way Bill if he sends goods worth more than Rs 50,000/-. However, when an unregistered person supplies to a registered person, then in this case the registered receiver has to fulfill all the compliances.
Reject E-way bill
One option on the E-way bill portal is that if the recipient has not received the consignment or the wrong E-way bill has been generated by the supplier/recipient, then you can reject that E-way bill. Other party can reject the E-way bill within 72 hours of E-way bill generation. If it is not rejected within 72 hours then it will be considered accepted.
When can E-way bill be blocked:-
If the taxpayer does not file FORM GSTR-3B / FORM CMP-08 for two consecutive month/quarter (as the case may be) i.e. two tax periods, then the e-way bill generation will be blocked, meaning the taxpayer e-way will not be able to generate bill.
Example: If a registered person has not filed return for January'23 & February'23. Meaning, if he has been defaulting in return filing for 2 consecutive months, then in such a case the E-way bill generation facility will be blocked.
What will be the impact on Taxpayer if E-way bill is blocked:-
The person whose e-way bill is blocked can neither supply the goods anywhere nor receive them from anyone else. This will have a huge impact on your business, because you will neither be able to sell nor buy.
To generate e-way bill, GSTIN of such blocked taxpayer cannot be used.
If goods are moved without generating e-way bill, the authority can impose fine or seize/detain the goods. If your goods are seized/detained, they will be released only after paying the penalty.
How can E-way bill be unblocked:-
When the taxpayer files Form GSTR-3B / Form CMP-08 or his default period of return filing is less than 2 tax periods, then automatically his e-way bill gets unblocked on the next day.
Example: Suppose you have the liability of filing monthly return and you have not filed GSTR-3B for April-2023 and May-2023, then due to this your e-way bill has been blocked. So in this case, if you file the return of April-2023, then the default period will be less than 2 months and this will unblock your e-way bill.
How much penalty can be imposed on non-generation of E-way bill?
If the E-way bill has not been generated or has not been generated as per the rules, then penalty may be imposed on you.
According to section 122 of CGST Act, if movement of goods is done without E-way bill, then Rs. A penalty of Rs 10000/- or the amount of tax evaded, whichever is higher, can be imposed.
If movement of goods takes place without E-way bill, then in such a case both the goods and the vehicle carrying the goods can be detained or confiscated.
In cases where goods and vehicle have been detained or seized, the penalty for realization of goods and vehicle will be:
- Where the owner of the goods comes forward for payment of such penalty :
Where the owner of goods (suo moto) comes forward voluntarily and pays the penalty, in that case 200% of tax payable on such goods.
And
In case of exempted goods, 2% of value of goods or Rs.25000, whichever is less, will have to be paid.
- where the owner of the goods does not come forward for payment of such penalty :
Where the owner of goods himself does not come forward, then 50% of value of goods or 200% of tax payable, whichever is higher.
And
In case of exempted goods, 5% of value of goods or Rs.25000 whichever is less will have to be paid.
- The goods and conveyance will be released only after giving security of the amount of penalty to be paid.
There is a penalty for making wrong e-way bill, although CBIC has issued a Circular No. 64/38/2018-GST dated 14-09-2018, it has been made clear that if all the documents along with the movement of goods are accompanied by E-way bill, then in these cases you will not be penalized: -
(a) If there is a spelling mistake in the name of the consignor or consignee, although the GST number is correct.
(b) In the E-way bill, the address of both the consignor and the consignee is correct, but there is a mistake in the pin code, although that mistake is such that the validity of the E-way bill is not being extended, then penalty will not be imposed.
(c) There is a mistake in the address of the consignee, but the locality & other details of the consignee are correct.
(d) There is a mistake in one or two digits of the document number mentioned in the E-way bill.
(e) There is an error in 4 or 6 digits of HSN, although the first 2 digits are correct and the specified rate of tax is also correct.
(f) There is a mistake in one or two digits or characters of the vehicle number.
In all these cases, according to section 125, CGST is Rs. 500 & SGST Rs. A penalty of Rs 500 may be imposed. If IGST is charged then a penalty of Rs.1,000/- will be imposed.
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/APP.
How will get credit for the GST charged on purchasing plant and machinery?
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When any capital goods are used in manufacturing both exempt and taxable products, then according to the provisions of the Act, input tax credit is apportioned on the basis of taxable & exempt turnover of each month and life of capital assets goes. According to GST provisions, the life of capital assets is 60 months (5 years). Now we will try to understand with an example how the apportionment of ITC will be done. Suppose you purchase plant & machinery at Rs. GST charged is Rs 60,000/-. You will avail this ITC fully. After this Rs. 60,000/- will be divided over 60 months. Rs. 60,000 ÷ 60 = Rs. 1000 ITC per month. Now suppose your total sales of that month is Rs. 10,00,000 out of which taxable sales Rs. 7,00,000/- and exempt sales Rs. 3,00,000/- ITC to be reversed = 1000*3,00,000/10,00,000 = 300 This month you will have to reserve ITC of Rs.300 and you will have to do this calculation every month because you do not know how much sales your product will have taxable and exempt in the next month. Apart from this, there can be another doubt that the GST rate charged on the machinery purchased will be 18% and the GST rate on Rice sales is 5%, so will the unused ITC be refunded? In this case you will not get refund of unused ITC. In the case of inverted duty structure, refund is available when the rate of input goods is higher than the rate of output goods, but in the case of capital goods, the benefit of this provision is not available. |
| Grounds of our opinion:-
Section 17(1) & 17(2) of CGST: Apportionment of credit and blocked credits.- (1) Where the goods or services or both are used by the registered person partly for the purpose of any business and partly for other purposes, the amount of credit shall be restricted to so much of the input tax as is attributable to the purposes of his business. (2) Where the goods or services or both are used by the registered person partly for effecting taxable supplies including zero-rated supplies under this Act or under the Integrated Goods and Services Tax Act and partly for effecting exempt supplies under the said Acts, the amount of credit shall be restricted to so much of the input tax as is attributable to the said taxable supplies including zero-rated supplies. Rule 43 (1) . Manner of determination of input tax credit in respect of capital goods and reversal thereof in certain cases.- (1) Subject to the provisions of sub-section (3) of section 16, the input tax credit in respect of capital goods, which attract the provisions of sub-sections (1) and (2) of section 17, being partly used for the purposes of business and partly for other purposes, or partly used for effecting taxable supplies including zero rated supplies and partly for effecting exempt supplies, shall be attributed to the purposes of business or for effecting taxable supplies in the following manner, namely,- (a) the amount of input tax in respect of capital goods used or intended to be used exclusively for non-business purposes or used or intended to be used exclusively for effecting exempt supplies shall be indicated in FORM GSTR-3B and shall not be credited to his electronic credit ledger; (b) the amount of input tax in respect of capital goods used or intended to be used exclusively for effecting supplies other than exempted supplies but including zero-rated supplies shall be indicated in FORM GSTR-3B and shall be credited to the electronic credit ledger; (c) the amount of input tax in respect of capital goods not covered under clauses (a) and (b), denoted as 'A', being the amount of tax as reflected on the invoice, shall credit directly to the electronic credit ledger and the validity of the useful life of such goods shall extend up to five years from the date of the invoice for such goods: Section 54(3) : Refund of tax. (3) Subject to the provisions of sub-section (10), a registered person may claim refund of any unutilised input tax credit at the end of any tax period: Provided that no refund of unutilised input tax credit shall be allowed in cases other than- (i) zero rated supplies made without payment of tax; (ii) where the credit has accumulated on account of rate of tax on inputs being higher than the rate of tax on output supplies (other than nil rated or fully exempt supplies), except supplies of goods or services or both as may be notified by the Government on the recommendations of the Council: |
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/APP.
Before the introduction of GST, higher tax rates were charged on sale of second hand vehicles. The old vehicles were taxed with same rate were applicable on new vehicles and due to this effective rate of tax on old vehicles goes upto 43%, which was very costly affair on the purchase of old vehicles.Big Relief provided on Sale of Old and Used Vehicles through Notification No. 8/2018 Central Tax (Rate) dated 25th January, 2018
According to this notification GST Rate on Old & used Vehicles :
Below rates are only applicable when ITC is not availed while purchasing vehicles :-
| S.No. | Chapter, Heading, Sub- heading or Tariff item | Description of Goods | Rate |
| 1. | 8703 | LPG or CNG, engine capacity of 1200 cc or more and of length of 4000 mm or more. | 18% |
| 2. | 8703 | Diesel driven motor vehicles of engine capacity of 1500 cc or more and of length of 4000 mm | 18% |
| 3 | 8703 | Engine capacity exceeding 1500 cc, popularly known as Sports Utility Vehicles (SUVs) including utility vehicles. | 18% |
| 4. | 87 | All Old and used Vehicles other than those mentioned from S. No. 1 to S.No.3 | 12% |
Cess: Cess is not levied on the sale of old vehicle, it has been declared Nil rate by “notification 01/2018-Compensation (Rate) dated 25th January 2018”.
Important Note: If ITC has been availed then you will not get the benefit of the concessional rate mentioned in the above notifications and GST will also be charged on the sales amount. Moreover, the GST rate mentioned above will be charged on the margin amount (Sales value-purchase value) and not on the sale value.
According to Margin scheme {Rule 32(5)}, taxable value of second hand goods is calculated, the person who deals in second hand goods has to pay GST only on the margin amount (sale amount less purchase amount) and If the sale amount is less than the purchase amount then in this case the margin amount will be Nil and no GST amount will be charged.
Example: 1
Suppose, you buy an old SUV car above 1500 CC for Rs. It was purchased for Rs.8,00,000 and on which no ITC has been availed and you sold that car for Rs.8,50,000/-.
So in this case your value of supply on which GST will be charged will be Rs.50,000/- (8,50,000-8,00,000).
GST =50,000* 18% = Rs. 9000/-
Example: 2
Suppose you buy an SUV car above 1500 CC for Rs. 8,00,000, on which no ITC has been availed and an expense of Rs.10,000/- has been incurred on its repair and maintenance. Then you sold that car for Rs.8,50,000/-.
According to CGST Rules, only the purchase price is reduced from the sale price to calculate the value of supply. So in such a case, the expense of repair & maintenance has to be ignored. But ITC of the GST charged on expenses will be available. For example, if out of expenses of Rs.10,000/-, expenses of Rs.7000/- are done through a registered person, then Rs. ITC of that amount will be available on GST charged on Rs. 7000/-.
So in this case your value of supply on which GST will be charged will be Rs.50,000/- (8,50,000-8,00,000).
GST=50,000*18%=Rs.9000/-
Reference:
Notification No. 8/2018 -Central Tax (Rate) dated 25th January, 2018
In exercise of the powers conferred by sub-section (1) of section 11 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on being satisfied that it is necessary in the public interest to do, on the recommendations of the Council, hereby exempts the central tax on intra-state supplies of goods, the description of which is specified in column (3) of the Table below, falling under the tariff item, sub-heading, heading or Chapter as specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), as are given in corresponding entry in column (2), from so much tax as specified in Schedule IV of Notification No. 1/2017 -Central Tax (Rate), as is in excess of the amount calculated at the rate specified in the corresponding entry in column (4), of the said Table, on the value that represent margin of the supplier, on supply of such goods.
| S. No. | Chapter, Heading, Sub- heading or
Tariff item |
Description of Goods |
Rate |
| (1) | (2) | (3) | (4) |
| 1. | 8703 | Old and used, petrol Liquefied petroleum gases (LPG) or compressed natural gas (CNG) driven motor vehicles of engine capacity of 1200 cc or more and of length of 4000 mm or more.
Explanation. - For the purposes of this entry, the specification of the motor vehicle shall be determined as per the Motor Vehicles Act, 1988 (59 of 1988) and the rules made there under. |
9% |
| 2. | 8703 | Old and used, diesel driven motor vehicles of engine capacity of 1500 cc or more and of length of 4000 mm
Explanation. - For the purposes of this entry, the specification of the motor vehicle shall be determined as per the Motor Vehicles Act, 1988 (59 of 1988) and the rules made there under. |
9% |
| 3 | 8703 | Old and used motor vehicles of engine capacity exceeding 1500 cc, popularly known as Sports Utility Vehicles (SUVs) including utility vehicles.
Explanation. - For the purposes of this entry, SUV includes a motor vehicle of length exceeding 4000 mm and having ground clearance of 170 mm. and above. |
9% |
| 4. | 87 | All Old and used Vehicles other than those mentioned from S. No. 1 to S.No.3 | 6% |
Explanation –For the purposes of this notification, -
- In case of a registered person who has claimed depreciation under section 32 of the Income-Tax Act,1961(43 of 1961) on the said goods, the value that represents the margin of the supplier shall be the difference between the consideration received for supply of such goods and the depreciated value of such goods on the date of supply, and where the margin of such supply is negative, it shall be ignored; and
- In any other case, the value that represents the margin of supplier shall be, the difference between the selling price and the purchase price and where such margin is negative, it shall be
2.This notification shall not apply, if the supplier of such goods has availed input tax credit as defined in clause (63) of section 2 of the Central Goods and Services Tax Act, 2017, CENVAT as defined in CENVAT Credit Rules, 2004 or the input tax credit of Value Added Tax or any other taxes paid, on such goods.
Notification 01/2018-Compensession (Rate) dated 25th January 2018
In exercise of the powers conferred by sub-section (2) of section 8 of the Goods and Services Tax (Compensation to States) Act, 2017 (15 of 2017), the Central Government, on the recommendations of the Council, hereby makes the following amendments in the notification of the Government of India, in the Ministry of Finance (Department of Revenue), No. 1/2017-Compensation Cess (Rate), dated the 28th June, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 720 (E), dated the 28th June, 2017, namely,-
In the said notification, in the Schedule, -
- After No. 42 and the entries relating thereto, the following serial numbers and the entries shall be inserted
(1) (2) (3) (4) 42A. 87 All old and used motor vehicles Explanation: Nothing contained in this entry shall apply if the supplier of such goods has availed input tax credit as defined in clause (63) of section 2 of the Central Goods and Services Tax Act, 2017, CENVAT credit as defined in CENVAT Credit Rules, 2004, or the input tax credit of Value Added Tax or any other taxes paid on such vehicles.
NIL - in No. 43, for the entry in column (2), the entry “8702 or 8703”, shall be substituted;
Note: The principal notification No.1/2017-Compensation Cess (Rate) dated the 28th June, 2017 was published in the Gazette of India, Extraordinary, Part II, Section 3, Subsection (i), vide number G.S.R. 720(E), dated the 28th June, 2017 and last amended vide notification No. 6/2017-, Compensation Cess (Rate) dated the 13th October, 2017, published vide number G.S.R.1282(E), dated the 13th October, 2017.
FAQs (Frequently Asked Questions) :-
Q : What is the GST rate applicable to old vehicles/used vehicles under the Margin Scheme? Any notifications issued by the department for the same?
A : GST Rate is old vehicles/ used vehicles is defined through Notification No. 8/2018 -Central Tax (Rate) dated 25th January, 2018
Q : How to calculate the GST on sale of second hand car?
A : GST on second hand car is calculated according to Margin scheme {Rule 32(5)}. According to this rule, the person who deals in second hand car has to pay GST only on the margin amount (sale amount less purchase amount) and if the sale amount is less than the purchase amount then, in this case, the margin amount will be nil and no GST amount will be charged.
Q : Is there a specific GST rate for the sale of old commercial vehicles ?
A : GST Rate on commercial vehicles will be the same as explained above (Notification No. 8/2018 -Central Tax (Rate) dated 25th January, 2018).
Q : Is cess applicable on the sale of old vehicles, is there any notification?
A : Cess is not levied on the sale of the old vehicle, it has been declared Nil rate by “notification 01/2018-Compensation (Rate) dated 25th January 2018.
Q : Is there any specific conditions for using the Margin Scheme on sale of old vehicles?
A : Yes, the Margin scheme will not apply in the case of ITC (input tax credit availed).
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/APP.
Date : 24-04-2023
How to Charge GST on Second hand goods?
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We will understand about the second hand goods. According to Margin scheme {Rule 32(5)}, taxable value of second hand goods is calculated, the person who deals in second hand goods has to pay GST only on the margin amount (sale amount less purchase amount) and If the sale amount is less than the purchase amount then in this case the margin amount will be Nil and no GST amount will be charged. You cannot transfer ITC on selling second hand goods, which means the person to whom you sell your goods will not be able to avail input tax credit. For eg. ABC sold second hand goods to XYZ and also charged GST on it. So in this case XYZ will not get credit of GST, because XYZ has purchased goods in Margin scheme.
How to calculate the value of supply in Margin scheme and how GST is charged and how the invoice is drafted, we will try to understand with an example – If sale amount more than purchase amount :- Suppose you deal in sale-purchase of second hand mobile items. You have purchased a mobile from unregistered person of Rs.25,000/-, now you sold that mobile for Rs.30,000/-. So in this case your value of supply on which GST will be charged will be Rs.5,000/- (30,000-25,000). There will be no impact of the original purchase price from GST point of view. He has to be ignored. Example-2 If sale amount less than purchase amount :- If you sell the mobile of example -1 for Rs.20,000/-, that is, you sell it at less than the purchase price, then you will ignore the negative value (Rs. 5,000/-) (20,000 - 25,000) and this But there will be no GST charge. Example -3 Suppose you purchased an old refrigerator from an unregistered person for Rs.10,000/- and spent Rs.5,000/- on its repair & maintenance. After that the refrigerator was sold for Rs.18,000/- According to CGST Rules, only the purchase price is reduced from the sale price to calculate the value of supply. So in such a case the expense of repair & maintenance has to be ignored. But ITC of the GST charged on expenses will be available. For example, if expenses of Rs.3000/- out of expenses of Rs.5000/- are done through a registered person, then Rs. ITC of that amount will be available on GST charged on Rs. 3000/-. value of supply : Rs.8000/- (18,000-10,000). In this case Rs. GST will be charged on Rs 8000/- Second Hand Goods पर GST की rate क्या होगी ? In the GST Act (except motor vehicles), there is no difference between New Goods and Second Hand Goods, the GST rate will be applicable on used goods as if they are new goods. You will have to charge the rate according to the HSN Code of your product. For example, if the tax rate on new mobile is 18%, then the rate charged on old mobile will also be 18%. In how many ways can you issue Invoice:- Product-Second hand Mobile Sale price-Rs.1,00,000/- Purchase price –Rs.90,000/- QTY-100 pec (1)
* Note to be mentioned in invoice : Pre-owned mobile phones are second hand goods fully/partly exempted under rule 32(5) of CGST Rules, 2017. (2)
*Margin= (sale price less purchase price) *Note to be mentioned in invoice: We declare that this invoice shows the actual price of the goods described and that all particulars are true and correct. Valuation of Second Hand Goods: As per Rule 32(5) of the CGST Rules, 2017 (3)
If you do not want to show your margin to the buyer, then you can issue the invoice in this way. Note to be mentioned in invoice : GST on Taxable value is being duily deposited with the Government on this transaction in terms of Rule 32 (5) of CGST Rules, 2017. Calculation of total Invoice Value (including Taxes)*
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Grounds of our view:-
Section/ rules Involve – Rule-32(5) of CGST Rules, 2017 (Margin scheme)
Where a taxable supply is provided by a person dealing in buying and selling of second hand goods i.e., used goods as such or after such minor processing which does not change the nature of the goods and where no input tax credit has been availed on the purchase of such goods, the value of supply shall be the difference between the selling price and the purchase price and where the value of such supply is negative, it shall be ignored:
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/APP.
As per Section-16 of IGST Act, "zero rated supply" means any of the following supplies of goods or services or both, namely: -
- Export of goods or services or both; or
- Supply of goods or services or both to a Special Economic Zone developer or a Special Economic Zone unit.
Note :
If any goods/ services are exempted payment of tax, it can not be said that it is zero rated supply.
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According to Section 54 of CGST Act, any person claiming refund of any tax and interest may make an application before the expiry of two years from the relevant date in prescribed form (GST RFD-01) & prescribed manner.
| Reason for claiming GST Refund | Relevant Date |
| Goods are exported by sea or air | Date on which the ship or the aircraft leaves India |
| Goods are exported by land | Date on which such goods pass the frontier |
| Supply of goods regarded as deemed exports | Date on which the return relating to such deemed exports is furnished |
| Zero-rated supply of goods or services or both to a Special Economic Zone developer or a Special Economic Zone unit | Due date for furnishing of return under section 39 in respect of such supplies |
| Services exported out of India | Receipt of payment in convertible foreign exchange (or in Indian rupees wherever permitted by RBI) |
| Services exported out of India (in case of advance received) | Date of issue of invoice |
| Tax becomes refundable as a consequence of judgment, decree, order or direction of the Appellate Authority, Appellate Tribunal or any court | Date of communication of such judgment, decree, order or direction
|
| In the case of refund of unutilised input tax credit under clause (ii) of the first proviso to sub-section (3) | Due date for furnishing of return under section 39 for the period in which such claim for refund arises |
| Where tax is paid provisionally | Date of adjustment of tax after the final assessment |
| Person, other than the supplier | Date of receipt of goods or services or both by such person |
| In any other case | Date of payment of tax |
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/APP.
Compulsory registration in certain cases
Mandatory GST Registration for Businesses regardless of Annual Turnover" means that certain businesses are required to register for Goods and Services Tax (GST) regardless of the amount of their annual turnover.
In other words, their obligation to register for GST is not determined by their annual sales or revenue; instead, they must register due to other specific criteria or characteristics, such as the nature of their business or their involvement in certain transactions.
These businesses are mandated to comply with GST regulations and fulfill their tax-related obligations, irrespective of their annual financial performance.
As per Section-24 of CGST Act, notwithstanding anything contained in sub-section (1) of section 22, the following categories of persons shall be required to be registered under this Act :-
- Any casual taxable person
- Any Input Service Distributor (ISD)
- Agents or suppliers of goods via an e-commerce portal
- Inter- State Goods and Services suppliers Any Non- resident taxable entity
- Those who are liable to pay tax due to the reverse-charge mechanism.
- TDS/TCS deductor
- Online data access/ Retrieval service provider
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.
List of GST State Code:
| State Name | State Code |
| Jammu & Kashmir | 1 |
| Himachal Pradesh | 2 |
| Punjab | 3 |
| Chandigarh | 4 |
| Uttarakhand | 5 |
| Haryana | 6 |
| Delhi | 7 |
| Rajasthan | 8 |
| Uttar Pradesh | 9 |
| Bihar | 10 |
| Sikkim | 11 |
| Arunachal Pradesh | 12 |
| Nagaland | 13 |
| Manipur | 14 |
| Mizoram | 15 |
| Tripura | 16 |
| Meghalaya | 17 |
| Assam | 18 |
| West Bengal | 19 |
| Jharkhand | 20 |
| Orissa | 21 |
| Chhattisgarh | 22 |
| Madhya Pradesh | 23 |
| Gujarat | 24 |
| Daman & Diu | 25 |
| Dadra & Nagar Haveli | 26 |
| Maharashtra | 27 |
| Andhra Pradesh (Old) | 28 |
| Karnataka | 29 |
| Goa | 30 |
| Lakshadweep | 31 |
| Kerala | 32 |
| Tamil Nadu | 33 |
| Puducherry | 34 |
| Andaman & Nicobar Islands | 35 |
| Telangana | 36 |
| Andhra Pradesh (New) | 37 |
| Ladakh | 38 |
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/APP.
- Circular No. 22/22/2017-GST Dated 21.12.2017 provides clarity on the matter in case of supply by artists through galleries, there is no consideration flowing from the gallery to the artist when the art works are sent to the gallery for exhibition and therefore, the same is not a supply. It is only when the buyer selects a particular art work displayed at the gallery, that the actual supply takes place and applicable GST would be payable at the time of such supply.
- The supplier shall issue a delivery challan for the initial transportation of goods where such transportation is for reasons other than by way of supply. Further, sub-rule (3) of the said rule provides that the said delivery challan shall be declared as specified in rule 138 of the said Rules. It is also seen that sub-rule (4) of rule 55 of the said Rules provides that where the goods being transported are for the purpose of supply to the recipient but the tax invoice could not be issued at the time of removal of goods for the purpose of supply, the supplier shall issue a tax invoice after delivery of goods.
- A combined reading of the above provisions indicates that the art work for supply on approval basis can be moved from the place of business of the registered person (artist) to another place within the same State or to a place outside the State on a delivery challan along with the e-way bill wherever applicable and the invoice may be issued at the time of actual supply of art work.
- It is also clarified that the supplies of the art work from one State to another State will be inter-State supplies and attract integrated tax in terms of section 5 of the Integrated Goods and Services Tax Act, 2017.
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.
When a person becomes liable to registration after his turnover crosses the threshold limit, he may apply for registration within 30 days of so becoming liable. Thus, there can be a gap in time between the point at which they become liable for registration and the issuance of their registration certificate. In this interim period, the individual may have conducted outward supplies, which means they made such supplies after becoming liable for registration but before receiving the registration certificate.
To facilitate registered individuals in reporting their taxable supplies made from the time they became liable for registration until they were granted registration, and to enable the recipients to claim Input Tax Credit (ITC) on these supplies, they have the option to issue revised tax invoices for the invoices previously issued during this period. This can be done within one month from the date of receiving the registration certificate, as per Section 31(3)(a) read with rule 53 of CGST Rules.
Further, Section 40 of CGST Act provides that registered person shall declare his outward supplies made during said period in the first return furnished by him after grant of registration.
For example :
Mr. X becomes liable for registration on July 25, 2023. He applies for registration on August 20, 2023, and the registration certificate is issued on September 10, 2023. When the taxpayer files their first return, they must include information regarding the outward supplies made between July 25, 2023, and September 10, 2023, in that return. Additionally, they are required to issue revised tax invoices for the sales conducted during this specified period.
