Amaze Ltd., Delhi, a registered supplier, manufacturing machineries has made a taxable supply of machinery during the month of March. It furnished…

CA Intermediate · Taxation · MTP · May 2025
Amaze Ltd., Delhi, a registered supplier, manufacturing machineries has made a taxable supply of machinery during the month of March. It furnished the following details for each such machinery supplied: - S. No. Particulars Amount (₹) (i) List price of machinery (exclusive of taxes) 10,00,000 (ii) Subsidy received from the Central Government for supply of machinery to Government School (exclusively related to supply of machinery included at S. No. 1) 2,10,000 (iii) Subsidy received from an NGO for supply of machinery to an old age home (exclusively related to supply of goods included at S. No. 1) 2,00,000 (iv) Tax levied by Municipal Authority 2,50,000 (v) Packing charges 1,25,000 Additional information:- The list price of the machinery is after considering the two subsidies received. However, the other charges/taxes/fee are charged to the customers over and above the list price. Further, the company has provided the following information pertaining to purchases made/services availed by it in respect of supply of said machinery during the month of March: (i) Raw material (to be received in the month of April) ₹ 8,50,000 (ii) Membership of a club availed for employees working in the factory (not obligatory to be provided under any law) ₹ 4,00,000 (iii) Inputs to be received in 6 lots, out of which 1st lot was received during the month - 3,50,000 (iv) Trucks used for transport of raw material - 1,50,000 (v) Capital goods (out of 3 items, invoice for 2 items is missing and GST paid on those items is 2,82,000):3,50,000 Note: (i) Rates of CGST, SGST and IGST are 9%, 9% and 18% respectively. (ii) All inward and outward supplies are exclusive of taxes, wherever applicable. (iii) All the conditions necessary for availing the ITC have been fulfilled, subject to the information given above. (iv) All inward and outward supplies are inter-State supplies. Compute the net GST payable in cash, by Amaze Ltd. for the month of March.

Suggested Answer and Working Notes:

Computation of net GST payable in cash Particulars Value of supply (₹) CGST @ 9% (₹) SGST @ 9% (₹) IGST @ 18% (₹) Supply of machinery [Refer Working Note] 15,75,000 2,83,500 Less: ITC available 2,18,000 Net GST payable in cash 65,500 Note: IGST is payable on the inter-State transactions. Computation of total value of taxable supply made by Amaze Ltd. during the month of March Particulars Amount (₹) List price of the machinery 10,00,000 Subsidy amounting to 2,10,000 received from the Central Government Nil [Since the subsidy is received from the Government, the same is not includible in the value in terms of section 15(2)(e) of the CGST Act, 2017] Subsidy received from NGO 2,00,000 [Since the subsidy is received from a non-Government body and directly linked to the supply, the same is includible in the value in terms of section 15(2)(e) of the CGST Act, 2017] Tax levied by the Municipal Authority 2,50,000 [Includible in the value as per section 15(2)(a) of the CGST Act, 2017] Packing charges 1,25,000 [Being incidental expenses, the same are includible in the value as per section 15(2)(c) of the CGST Act, 2017] Total value of taxable supplies 15,75,000 Computation of ITC that can be availed by Amaze Ltd. for the month of March. Particulars ITC (₹) (i) Raw Material Nil [ITC not available as raw material is not received in March] (ii) Membership of a club availed for employees working in the factory (not obligatory to be provided under any law) Nil [ITC is blocked in terms of section 17(5) of the CGST Act, 2017] (iii) Inputs to be received in 6 lots, out of which 1st lot was received during the month Nil [In case of goods received in lots, ITC can be taken only upon receipt of the last lot] (iv) Trucks used for transport of raw material 1,50,000 [ITC of GST paid on motor vehicles used for transportation of goods is allowed unconditionally] (v) Capital goods 68,000 [ITC can be availed only on the basis of a valid document (invoice). Thus, GST paid on items for which invoice is missing, i.e.2,82,000, is not available.] Total ITC 2,18,000

Topics: Paper 3B: Goods and Services Tax

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