M/s. Bright Consultancy Services, a GST registered firm in Lucknow (U.P.), provides taxable consultancy services and also trades in office…

CA Intermediate · Taxation · MTP · January 2026
M/s. Bright Consultancy Services, a GST registered firm in Lucknow (U.P.), provides taxable consultancy services and also trades in office equipment. It furnishes the following details for the month of November : a. Provided consultancy services to Alpha Ltd., registered in Lucknow, U.P. for 5,00,000. b. Provided consultancy services to Beta Ltd. registered in Delhi for 3,00,000. c. Sold office equipment worth - 7,50,000 to a registered dealer in Kanpur, U.P. d. Advance of 50,000 received from a client in U.P. for IT support services to be rendered in December . e. Purchased computers worth - 2,00,000 from a registered supplier in Delhi. f. Paid annual membership fee of 60,000 to a recreation club for directors. g. Paid office rent of 1,00,000 to a registered landlord in U.P. (Invoice reflected in GSTR-2B). h. Purchased a car with a seating capacity of 5 persons for director's use for 10,00,000 (exclusive of GST @ 28%). i. Purchased a delivery van for 12,00,000 for transportation of office equipment. No depreciation claimed on GST component. (Exclusive of GST @ 28%) j. Availed legal consultancy services from Mr. Pranay, an individual advocate based in Lucknow, for a client recovery case for 50,000. Notes: i. Opening ITC balance: Nil. ii. All amounts given are exclusive of GST unless otherwise specified. iii. Rate of GST: Goods – 9% CGST, 9% SGST, 18% IGST; Services – 9% CGST, 9% SGST, 18% IGST (unless specified otherwise). iv. Conditions for availing ITC are satisfied, subject to restrictions under GST law. v. Mr. Pranay's turnover in the preceding financial year was 25 lakh. Compute the Net GST payable in cash by M/s. Bright Consultancy Services for November.

Suggested Answer and Working Notes:

Computation of minimum net GST payable in cash by M/s. Bright Consultancy Services for the month of November Particulars Value (₹) CGST (₹) SGST (₹) IGST (₹) GST payable under forward charge Consultancy services to Alpha Ltd. (U.P.) 5,00,000 45,000 [5,00,000 x 9%] 45,000 [5,00,000 x 9%] - Consultancy services to Beta Ltd. (Delhi) 3,00,000 - - 54,000 [3,00,000 x 9%] Sale of office equipment to Kanpur dealer (U.P.) 7,50,000 67,500 [7,50,000 x 9%] 67,500 [7,50,000 x 9%] - Advance received for consultancy services (intra-state, tax payable on advance for services) 50,000 4,500 [50,000 x 9%] 4,500 [50,000 x 9%] - Total output tax 1,17,000 1,17,000 54,000 Less: ITC utilized 1,81,500 1,81,500 36,000 Net GST payable [A] Nil Nil 18,000 Legal services availed [B] [Tax on legal services availed by a business entity from an advocate is payable under reverse charge. Further, tax payable under reverse charge cannot be set off against ITC and thus, reverse charge has to be paid in cash since the tax payable under reverse charge is not an output tax.] 50,000 4,500 [50,000 x 9%] 4,500 [50,000 x 9%] Minimum net GST payable in cash [A] + [B] 4,500 4,500 18,000 Working Note: Computation of ITC available Particulars Value (₹) CGST (₹) SGST (₹) IGST (₹) Purchase of computers (Delhi) [ITC of goods used in the course/furtherance of business is available. Further, it is a inter-state supply, so IGST will be applicable] 2,00,000 - - 36,000 [2,00,000 x 18%] Club membership fee [ITC is not available, since it is blocked under the CGST Act, 2017.] 60,000 Nil Nil - Office Rent [ITC of services used in the course/ furtherance of business is available] 1,00,000 9,000 [1,00,000 x 9%] 9,000 [1,00,000 x 9%] - Purchase Car [ITC for purchase of motor vehicles for transportation of persons having approved seating capacity of not more than thirteen persons is blocked under CGST Act, 2017.] 10,00,000 Nil Nil - Purchase of Delivery van [ITC will be available, since the van is used in the course/ furtherance of business] 12,00,000 1,68,000 [12,00,000 x 14%] 1,68,000 [12,00,000 x 14%] - Legal Services Availed from Mr. Pranay [ITC of services used in the course/ furtherance of business is available] 50,000 4,500 [50,000 x 9%] 4,500 [50,000 x 9%] - Total 1,81,500 1,81,500 36,000

Topics: Paper 3B: Goods and Services Tax

Open in Interactive Practice Hub · Full Practice Hub · Chapter Weightage · More in this subject

Related Questions in this Topic