Jigar Infra Ltd., a registered supplier under GST in the State of Kerala, is engaged in the construction business. He availed legal services…

Computation of minimum net GST payable in cash by Jigar Infra Ltd. for April Particulars CGST (₹) SGST (₹) IGST (₹) GST payable under forward charge Goods purchased from Taiwan sold in Turkey without bringing into India [Neither treated as supply for goods nor as supply of services.] - - - Transfer of tiles to branch within Kerala [Such transfer is not a supply as the branch has the same GSTIN as that of the head office and thus, is not a distinct person] - - - Inter-State supply of pure labour services for construction of single commercial unit in Bengaluru [Services by way of pure labour contracts of construction of original works pertaining to a single residential unit otherwise than as a part of a residential complex is exempt. Hence, such services in relation to a commercial unit shall be taxable.] 2,70,000 [15,00,000 x 18%] Supply of consignment in territorial waters [Where the supply is in the territorial waters, the place of supply is deemed to be in the coastal State where the nearest point of the appropriate baseline is located. Therefore, place of supply will be in Kerala being nearer to base line and hence, supply will be intra-State supply] 54,000 [6,00,000 x 9%] 54,000 [6,00,000 x 9%] Receipt of advance from customer in Kerala [Tax will be payable only on advance for services. In case of goods, tax is payable at the time of issuance of invoice and not at the time of receipt of advance.] 44,100 [7,00,000 x 70% x 9%] 44,100 [7,00,000 x 70% x 9%] Total output GST 98,100 98,100 2,70,000 Less: Input tax credit [Refer working note below] [CGST credit be first utilized for payment of CGST liability and then for payment of IGST liability in that order. Similarly, SGST credit be first utilized for payment of SGST liability and then for payment of IGST liability in that order. ITC of CGST cannot be utilized for payment of SGST and vice versa.] 98,100 98,100 18,900 (CGST) - - 18,900 (SGST) Net output GST payable in cash [A] Nil Nil 2,32,200 GST payable under reverse charge Tax on legal services is payable under reverse charge by the recipient of service. 63,000 63,000 Tax on remuneration paid to director is payable under reverse charge by the recipient of the service. 54,000 54,000 GST payable in cash under reverse charge [B] [Tax payable under reverse charge, being not an output tax, cannot be set off against ITC and thus, will have to be paid in cash.] 1,17,000 1,17,000 Minimum net GST payable in cash [A] + [B] 1,17,000 1,17,000 2,32,200 Working Note: Computation of ITC available with Jigar Infra Ltd. for April Particulars CGST (₹) SGST (₹) IGST (₹) Goods purchased from Taiwan [No ITC since tax is not payable as goods do not become part of the landmass of the country.] - - - Services of an arbitral tribunal [Services provided by an arbitral tribunal to a business entity with an aggregate turnover up to threshold limit of registration in the previous financial year are exempt from GST. Thus, services provided by the arbitral tribunal to Jigar Infra Ltd., a business entity whose aggregate turnover in the previous financial year exceeds the applicable threshold limit for registration [viz. 20 lakh, being a supplier of goods and services in the State of Kerala] shall be liable to tax. Further, being services used in the course of furtherance of business, ITC shall be available thereon.] 63,000 [7,00,000 x 9%] 63,000 [7,00,000 x 9%] Purchase of materials from Chirag Steels Ltd. [An e-invoice without IRN is not treated as invoice and hence, without a valid document, ITC cannot be claimed on such inputs] - - - Purchase of truck [Motor vehicle used for transportation of goods is eligible for credit. However, since depreciation has been claimed on applicable taxes as well, ITC of tax paid on purchase of such truck cannot be claimed.] - - - Payment of remuneration to independent director based at Cochin [Services provided by employee to employer in the course of his employment are not a supply. However, independent director is not an employee of the company and hence, remuneration paid to him is taxable. Further, being services used in the course of furtherance of business, ITC shall be available thereon.] 54,000 [6,00,000 x 9%] 54,000 [6,00,000 x 9%] Total ITC 1,17,000 1,17,000 X