Veer Trading Private Limited (VTPL) is a registered entity under GST in Jaipur, Rajasthan. It is engaged in wholesale trading of various sports…

CA Intermediate · Taxation · PYQS · September 2025
Veer Trading Private Limited (VTPL) is a registered entity under GST in Jaipur, Rajasthan. It is engaged in wholesale trading of various sports items. VTPL furnishes the following information regarding its inward supplies during the month of February 2025: S. No. Particulars Amount (Excluding any tax) (₹) (i) As per the policy of the company, the Managing Director (MD) of the company has taken membership of local sports club on behalf of company. The company paid fees monthly. Applicable rate of GST is 6% each of CGST and SGST. 20,000 (ii) Purchased equipment from Original Equipment Manufacturer (OEM) as an Ex-Works (EXW) contract basis on 26th February 2025. As per terms of the contract, the goods are to be delivered by the OEM to transporter on behalf of the recipient, at supplier's (OEM) place of business. The OEM handed over the equipment to transporter on 28th February, 2025 but equipment physically received by VTPL on 2nd March, 2025. Applicable rate of GST is 6% each of CGST and SGST. 10,00,000 (iii) On 5th year of its incorporation, VTPL arranged an event from M/s Daksh Event company for customer's meet. M/s Daksh Event company charges single price of Event charge as 2,50,000 which is inclusive of food charges of 40,000 as per the general trend followed by the industry. Applicable rate of CGST and SGST @ 9% each for event and @ 14% each for food supply. 2,50,000 (iv) Purchased Truck for transport of Goods (Rate of CGST and SGST @ 14% each) Claimed - 2,10,000 (₹ 14,00,000 @ 15%) as depreciation under the Income Tax Act, 1961 14,00,000 Assume all the above transactions are in the course of Intra-State. Subject to information given above, assume that all the other conditions necessary for availing ITC (unless specified otherwise) have been fulfilled and all the suppliers are registered under regular scheme. Determine the amount of Input Tax Credit (ITC) that can be availed by Veer Trading Private Limited (VTPL) for each individual item as well as total eligible ITC for the month of February 2025 by giving necessary explanations for treatment of each item.

Suggested Answer and Working Notes:

Computation of ITC that can be availed by Veer Trading Private Limited (VTPL) for February, 2025 Particulars Amount (₹) ITC of CGST (₹) ITC of SGST (₹) (i) Membership of local sports club [Since membership of club is not obligatory for employer to provide the same under any law, ITC on the same is blocked] 20,000 (ii) Purchase of equipment from Original Equipment Manufacturer (OEM) on Ex-Works (EXW) contract basis [In order to take ITC, goods must have been actually received. In case of ex-works contract, equipment will be considered to have been "received" by the recipient at the time of handing over of said equipment by OEM to the transporter, at OEM'S place of business.] 10,00,000 60,000 [10,00,000 x 6%] 60,000 [10,00,000 x 6%] (iii) Event arrangement inclusive of food supply [Being naturally bundled, supply of event arrangement and food is a composite supply; taxable at the rate applicable to event, being the principal supply. ITC on event arrangement services being used in course or furtherance of business is available. Further, ITC on food used an element of a taxable composite supply is available.] 2,50,000 22,500 [2,50,000 x 9%] 22,500 [2,50,000 x 9%] (iv) Truck purchased for transport of goods [GST paid on truck is available as ITC since depreciation has not been claimed on the GST component.] 14,00,000 1,96,000 [14,00,000 x 14%] 1,96,000 [14,00,000 x 14%] Total eligible ITC 2,78,500 2,78,500

Topics: Paper 3B: Goods and Services Tax

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