IntelliGST

1: If I have multiple manufacturing units in a State/UT, do I have to register all my companies separately or as a group?

You shall be granted a single registration in the State/UT. However, you have the option to take separate registration for each of your business verticals (as defined in section 2(18) of the CGST Act, 2017) in the State/UT.

2: A registered person is sending semi-cooked food from his manufacturing unit at Gurgaon to his branch in Delhi. Is he required to pay any tax?

In accordance with the provisions of section 25(4) of the CGST Act, 2017, branches in different States are considered as distinct persons. Further, as per Schedule I, this constitutes supply made in the course or furtherance of business between distinct persons even if made without consideration. As it is an inter-State supply, the registered person is required to pay IGST.

3: A registered person is supplying manufactured food products to another person. Transportation charges are required to be paid by the supplier but are actually paid by the recipient. Whether this transportation charges would be added in the supply value?

If the supplier is liable to pay any amount in relation to a supply, such amount would be a part of transaction value, even if the same has been paid by the recipient. In this case, the transportation charges shall be added to the value of supply.

4: A registered person is a manufacturer of taxable food items. His factory is in rental premises. Whether this person is eligible to claim ITC on tax charged on the rental amount?

Yes, the person is eligible to claim ITC of tax charged on the rental amount.

5: Whether the supplier can reduce the tax elements against goods returned to him?

Yes, the person is eligible to reduce the tax liability by issuing credit notes to his recipient for such returned goods subject to the condition that the recipient reduces the claim of ITC to that extent if ITC was availed by him. (Credit Note must bear reference of original invoice No.)

6: What will be the rate of tax on cold drinks (non- alcoholic beverages) and ice cream when served in non-AC Restaurant along with food ?

The rate of tax shall be 12 %. In the event of the supply being made in an AC restaurant, the rate of tax shall be 18%. If the restaurant was availing compoistion scheme (can do so only if ice cream is not manufactured by the restaurant), the rate of tax shall be 5% of the aggregate turnover.

7: The supplier has sold machinery for hotel industry on 28-06-2017. The purchaser has received the invoice and machinery on 05-07-2017. Whether ITC of Duty / VAT paid ( under the existing law ) on machinery can be allowed to be claimed?

No. Such credit is not admissible in case of machinery, being capital goods. As per Section 140 ( 5 ) of the CGST Act, 2017, credit of eligible duties and taxes in respect of only inputs / input services in transit during transition from Pre-GST to Post-GST is allowable. This is subject to the condition that the tax on such supply is paid under the existing law and the recipient records this receipt in his books of accounts within thirty days of the appointed day.

8: Is Atta / Maida/ Besan supplied in bulk liable to tax under GST?

Outward supply of these goods if effected without registered brand name is exempt under GST. However , if the outward supply is made under a registered brand name and put up in unit container then it would be liable to tax @ 5%.

9: Caterpillar is a restaurant cum bar in Kolkata. It has successfully migrated to GST. While the first floor area of the restaurant is air conditioned and supplies food as well as liquor, the ground floor serves only food and is non-air-conditioned. Cater pillar wants to know,–

(i) Whether they will charge GST @ 12% on supplies made from ground floor or 18%?
Tax will have to be charged @ 18% irrespective of from where the supply is made, first floor or second floor. If any part of the establishment has a facility of air conditioning then the rate will be 18% for all supplies from the restaurant.

(ii) Whether they can raise one tax invoice for both food and liquor or not?
Tax invoice has to be issued for supply of food, while for liquor a bill of supply has to be issued or any invoice as may be required under the provisions of local VAT or sales tax law of the concerned State.

(iii) What will the rate of tax to be charged for supplies of food made from their takeaway counter?
Tax has to be charged @18% on supplies of food made from their takeaway counter.

(iv) Can they claim ITC of CGST and SGST paid on crockery items to be used in the restaurant?
Yes, they can claim ITC of CGST and SGST paid on crockery items to be used in the restaurant. It may be stated that they are entitled to the credit of even IGST paid where such goods are procured from outside the State against a tax invoice.

(v) Whether they will be eligible for ITC on crockery items purchased locally in the month of March, 2017 paying VAT of Rs. 72,500/-. The goods have been shown as business assets.
If the State VAT law allowed ITC on such goods, the credit was available on the date of purchase. Section 140(1) of the SGST Act, 2017 allows them to carry forward the credit on account of VAT.

(vi) Whether they can opt for composition (last year their turnover was more than rupees one Crore)?
No. they are not eligible for composition levy as they are also supplying liquor.

(vii) Can they issue separate series of tax invoices for their supplies from first floor, ground floor and takeaway counter?
In accordance with the provisions of Rule 46(b) of the CGST Rules, 2017 the tax invoice need to be serially numbered not exceeding sixteen characters, in one or multiple series. As such, they can issue different series of tax invoices as stated but it must conform to the requirements as given in the said rule.