Chapter 5 - Exemptions From GST

Chapter 5 – Exemptions From GST
Introduction
• Under GST, essential goods/services, i.e., public consumption products/services have been
exempted.
• Items such as unbranded atta/maida/besan, unpacked food grains, milk, eggs, curd, lassi and
fresh vegetables are among the items exempted from GST.
• Further, essential services like health care services, education services, etc. have also been
exempted.
• Exempt Supply is a supply of any goods or services or both:
o Which attracts NIL rate of tax; or
o Which may be wholly exempt from tax; and
o Includes non-taxable supply
Power to Grant Exemption

• Section 11 of the CGST Act has given the power to grant exemption.
• Similarly, Section 6 of the IGST Act has given the power to grant exemption.
• Similarly, State GST laws also contain certain identical provisions regarding granting of
exemption.
• The Central Government or the State Government grants exemption from GST on
recommendations of the Council.
• This exemption is granted by way of a notification.
• Sometimes, the government may issue explanation regarding a certain notification.
o If the clarificatory explanation is issued within a year from the date of notification, the
explanation is deemed to be effective from the date of issue of the notification.
(Retrospective Effect)
o If the clarificatory explanation is issued after a year from the date of notification, the
explanation is deemed to be effective from the date of the explanation. (Prospective
Effect)
• There could be multiple entries in a notification.
• Sometimes, the government issues explanation regarding a certain entry in the notification.
o If the clarificatory explanation is issued within a year from the date of adding the entry,
the explanation is deemed to be effective from the date of the entry (not from the
date of issue of notification). (Retrospective Effect)
o If the clarificatory explanation is issued after a year from the date of adding the entry,
the explanation is deemed to be effective from the date of the explanation.
(Prospective Effect)
Manner of Providing Exemption

• Under GST, there are the following three things – a supply, a supplier, and a recipient.
• Therefore, exemption under GST can be provided in the following ways:
o Exemption to Specified Activities or Transactions (Supply), e.g., renting of residential
dwelling
o Exemption to Specified Suppliers, e.g., services supplied by RBI
o Exemption to Specified Recipients, e.g., services received by Government
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o Exemption to Specified Suppliers and Specified Recipients, e.g., services supplied by
Insurance Regulatory and Development Authority to Insurers.
Goods Exempt from Tax

• Under GST, everyday items used by the common man have been included in the list of
exempted items.
• Items such as unbranded atta/ maida/ besan, unpacked food grains, milk, eggs, curd, lassi and
fresh vegetables are among the items exempted from GST.
• If you wish, you may go through the complete list of goods exempted from GST on CBIC
website – www.cbic.gov.in for knowledge purposes.
• It’s not in our syllabus.
Services Exempt from Tax

• Notification No. 12/2017 Central Tax (Rate) dated 28.06.2017 has exempted various services
wholly from CGST, unless otherwise specified.
• Let’s discuss each of these services.
Charitable Activities
Charitable Activities
Services by Charitable Institutions

Recreational
Services by Import of
Training or Old Age Home
Charitable Entity Services
Coaching
Entry 1 Entry 80 Entry 10 Entry 9D
Services by an entity registered u/s 12AA or 12AB of the Income Tax Act, 1961, by way of “charitable
activities” are exempt.
Meaning of Charitable Activities

The term ‘charitable activities’ mean activities relating to:
1. PUBLIC HEALTH by way of

a. care or counseling of
i. terminally ill persons or persons with severe physical or mental disability;
ii. persons afflicted with HIV or AIDS;
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iii. persons addicted to a dependence-forming substance such as narcotics drugs
or alcohol; or
b. public awareness of preventive health, family planning or prevention of HIV infection;
2. ADVANCEMENT OF RELIGION, spirituality or yoga;
3. ADVANCEMENT OF EDUCATIONAL PROGRAMMES/SKILL DEVELOPMENT relating to,
a. abandoned, orphaned or homeless children;
b. physically or mentally abused and traumatized persons;
c. prisoners; or
d. persons over the age of 65 years residing in a rural area;
4. PRESERVATION OF ENVIRONMENT including watershed, forests & wildlife.
Thus, only those services provided by a charitable and religious trusts [registered under section 12AA
of the Income-tax Act] which fall within the above definition of charitable activities, are eligible for
exemption from GST.
There could be many other services provided by such charitable and religious trusts which are not
covered by the definition of charitable activities and hence, such services would attract GST.
Other Aspects
Service Taxability
1. Grant of advertising rights to a person on the premises of the Taxable
charitable/religious trust or on publications of the trust
2. Granting admission to events, functions, celebrations, shows against admission Taxable
tickets or fee etc.
3. Advancement of any other object of general public utility Taxable
4. Advancement of religion, spirituality, yoga, meditation camp Exempt
5. Residential programmes or camps where the fee charged includes cost of Exempt
lodging and boarding, where the primary and predominant activity, objective
and purpose of such residential programmes or camps is advancement of
religion, spirituality or yoga.
6. Merely providing accommodation or serving food and drinks against Taxable
consideration in any form including donation
7. Activities of holding fitness camps or classes such as those in aerobics, dance, Taxable
music, etc.
8. Services provided by a clinical establishment, an authorised medical Exempt
practitioner, or paramedics of a charitable trust
9. Services provided TO charitable or religious trusts Taxable
10. Service of display of name or placing of name plates of the donor in the Exempt
premises of charitable organisations receiving donations or gifts from individual
donors – if the same is not aimed at giving publicity to the donor in such manner
that it would be an advertising or promotion of his business
11. Service of display of name or placing of name plates of the donor in the Taxable
premises of charitable organisations receiving donations or gifts from individual
donors – if the same is aimed at giving publicity to the donor in such manner
that it would be an advertising or promotion of his business
Recreational Training or Coaching

Services by way of training or coaching in:
1. Recreational activities relating to arts or culture, by an individual, or
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2. Sports by charitable entities registered under section 12AA or 12 AB of the Income Tax Act,
are exempt from tax.
Service Taxability
1. Training or coaching in recreational activities relating to arts or culture by Exempt
Individual
2. Training or coaching in recreational activities in areas other than arts or culture Taxable
by Individual
3. Service of sports activities provided by charitable entity registered under Exempt
section 12AA or 12AB
4. Service other than of sports activities provided by charitable entity registered Taxable
under section 12AA or 12AB
5. Training or coaching related to all forms or arts, culture, or sports, such as, Exempt
dance, music, painting, sculpture making, literary activities, theatre, sports, etc.
Import of Services
Services received from a provider of service located in a non-taxable territory by an entity registered
under Section 12AA or 12AB of the Income Tax Act, 1961 for the purposes of providing charitable
activities are exempt. However, exemption shall not apply to OIDAR services and import sea freight.
Services by Old Age Home

Services by an old age home run by an entity registered under section 12AA or 12 AB of the Income
Tax Act, 1961 to its residents (aged 60 years or more) against consideration upto ₹25,000 per month
per member, provided that the consideration charged is inclusive of charges for boarding, lodging and
maintenance are exempt.
Question 1
MTCT, an entity registered under section 12AB of the Income-Tax Act, 1961, has furnished you the
following details with respect to the activities undertaken by it. You are required to compute its GST
liability from the information given below:
Particulars ₹
Fees charged for yoga camp conducted by the trust 6,00,000
Amount received for advancement of educational programmes relating to abandoned, 10,50,000
orphaned or homeless children
Amount received for renting of commercial property owned by the trust 35,00,000
Payment made for the services received from a service provided located in England, for 10,00,000
the purposes of providing ‘charitable activities’
Amount received for activities relating to preservation of forests and wildlife 12,35,000
Receipts of old age home meant for residents of 60 years or more [consideration per 10,00,000
month per member is ₹5,000 (inclusive of boarding lodging and maintenance)]
Note: GST have been charged separately wherever applicable. Rate of GST is 18%.
Solution
Computation of GST Liability of MTCT

Particulars ₹
Fees charged for yoga camp conducted by the trust (Note 1) -
Amount received for advancement of educational programmes relating to abandoned, -
orphaned or homeless children (Note 1)
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Amount received for renting of commercial property owned by the trust (Note 2) 35,00,000
Payment made for the services received from a service provided located in England, for -
the purposes of providing ‘charitable activities’ (Note 3)
Amount received for activities relating to preservation of forests and wildlife (Note 1) -
Receipts of old age home meant for residents of 60 years or more (Note 4) -
Value of Taxable Supply 35,00,000
Calculation of GST Liability

GST @ 18% on ₹35,00,000 6,30,000
GST under Reverse Charge on Import of Services (Note 3) -
Total GST Liability 6,30,000
Notes:
1. Services provided by a charitable entity registered u/s 12AB of the Income Tax Act, 1961 by
way of charitable activities are exempt from GST. The definition of the term 'Charitable
Activities', inter alia, means activities relating to:
a. advancement of yoga
b. advancement of educational programmes relating to abandoned, orphaned, or
homeless children
c. preservation of environment including watershed, forests, and wildlife.
2. Renting of commercial property owned by trust is taxable under GST.
3. Import of Services by a Charitable Institution for charitable activities are exempt from GST.
Normally, tax is paid on reverse charge by the importer of services; however, since in this case,
this supply is exempt, no tax is required to be paid under Reverse Charge.
4. Services by a charitable institution by way of providing old age homes where the resident is
aged 60 years or more and the rent (including boarding, lodging, and maintenance) per month
per person does not exceed ₹25,000 is exempt from GST.
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Religious Services
Question 2
VHP, an entity registered as religious trust u/s 12AB of the Income-tax Act, 1961, has furnished you the
following details with respect to the activities undertaken by it. You are required to compute its value
of taxable supply from the information given below:
Particulars ₹
Renting of rooms where charges are ₹500 per day 6,00,000
Renting of room where charges are ₹1,500 per day 9,00,000
Rending of community halls where charges are ₹25,000 per day 10,00,000
Renting of kalyanmandapam where charges are ₹5,000 per day 7,50,000
Renting of shops for business where charges are ₹15,000 per month 7,50,000
Solution
Computation of Value of Taxable Supply of VHP

Particulars ₹
Renting of rooms where charges are ₹500 per day -
Renting of room where charges are ₹1,500 per day 9,00,000
Rending of community halls where charges are ₹25,000 per day 10,00,000
Renting of kalyanmandapam where charges are ₹5,000 per day -
Renting of shops for business where charges are ₹5,000 per month -
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Note: Services by a person by way of renting precincts of a religious place meant for general public,
owned or managed by an entity registered as a charitable or religious trust are exempt. However, this
exemption doesn’t apply to:
1. Renting of rooms where charges are ₹1,000 or more per day

2. Renting of premises, community halls, kalyanmandapam or open area, etc., where charges are
₹10,000 ore more per day
3. Renting of shops or other spaces for business/commerce where charges are ₹10,000 or more
per month.
Agricultural Services
Service Taxability
1. Loading, unloading, packing, storage or warehousing of rice Exempt
2. Warehousing of minor forest produce Exempt
3. Services by way of storage/warehousing of cereals, pulses, fruits, nuts & Exempt
vegetables, spices, copra, sugarcane, jaggery, raw vegetable fibres such as
cotton, flax, jute etc., indigo, unmanufactured tobacco, betel leaves, tendu
leaves, coffee & tea
4. Fumigation in a warehouse of agricultural produce Exempt
5. Artificial insemination of livestock (other than horses) Exempt
6. Carrying out an intermediate production process as job work in relation to Exempt
cultivation of plants & rearing of animals [except horses], for food, fibre, fuel,
raw material or other similar products or agricultural produce.
7. Services relating to cultivation of plants & rearing of animals [except horses], Exempt
for food, fibre, fuel, raw material or other similar products or agricultural
produce
8. Agricultural operations directly related to production of any agricultural Exempt
produce including cultivation, harvesting, threshing, plant protection or testing
9. Supply of farm labour Exempt
10. Processes carried out at an agricultural farm including tending, pruning, etc. Exempt
and such like operations which do not alter the essential characteristics of
agricultural produce but make it only marketable for the primary market
11. Renting or leasing of agro machinery or vacant land with/without a structure Exempt
incidental to its use
12. Leasing of vacant land with a green house or a storage shed meant for Exempt
agricultural produce
13. Loading, unloading, packing, storage or warehousing of agricultural produce; Exempt
14. Agricultural extension services (i.e., transmitting latest technical know-how to Exempt
farmers and enhancing farmers’ knowledge about crop techniques to help
them increase productivity)
15. Services by any Agricultural Produce Marketing Committee or Board or services Exempt
provided by a commission agent for sale/purchase of agricultural produce
16. Services mentioned from points 7 to 15 for Rubber, Green Tea, or Coffee Exempt
17. Breeding of Fish (Pisciculture) Exempt
18. Rearing of Silkworms (Sericulture) Exempt
19. Cultivation of Ornamental Flowers (Floriculture), Horticulture, Forestry, etc. Exempt
20. Cleaning of Wheat carried outside farm Exempt
21. Services by Agricultural Produce Marketing Committees (APMC) or Boards by Exempt
provision of facilities like sheds, water, light, electricity, grading facilities, etc.
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22. Services by Agricultural Produce Marketing Committees (APMC) or Boards by Exempt
taking measures for prevention of sale or purchase of agricultural product
below the minimum support price
23. Seed testing, soil testing, animal feed testing, testing of samples from plants or Exempt
animals for pets and disease-causing microbes
24. Services in relation to whole grain pluses, such as whole gram, rajma, etc. Exempt
25. Pre-conditioning, pre-cooling, ripening, waxing, retail packing, labeling of fruits Exempt
and vegetables which do not change or alter the essential characteristics of the
said fruits and vegetables
26. Services by National Centre for Cold Chain Development by way of cold chain Exempt
knowledge dissemination
Service Taxability
1. Loading, unloading, packing, storage or warehousing of black tea, green tea, Taxable
coffee
2. Processing of Sugarcane into Jaggery Taxable
3. Milling of paddy into rice Taxable
4. Processes carried for making the agricultural produce saleable in retail market, Taxable
e.g., grinding, sterilizing, extraction packaging in retail packs of agricultural
products
5. Services for converting potato into potato chips Taxable
6. Services for converting tomato into tomato ketchup Taxable
7. Services by Agricultural Produce Marketing Committees (APMC) or Boards not Taxable
directly related to agriculture, such as renting of shops and other property
8. Services in relation to de-husked or split pulses Taxable
Question 3
“Agro Care Limited” registered under GST furnishes the following details with respect to the activities
undertaken by them in the month of March, 2022:
Particulars ₹
Receipts from supply of farm labour 85,000
Charges for seed testing 65,000
Charges for soil testing of farm land 35,000
Charges for warehousing of potato chips 85,000
Commission received on sale of wheat 75,000
Charges for training of farmers on use of new pesticides and fertilizers developed 10,000
through scientific research
Renting of vacant land to a stud farm 1,85,000
Leasing of vacant land to a cattle farm 83,500
Charges for warehousing of rice 1,50,000
Charges for warehousing of cotton fabrics 2,00,000
Retail packing and labelling of fruits and vegetables 5,00,000
Charges for warehousing of minor forest produce 8,00,000
Charges for warehousing of spices 2,20,000
Charges for fumigation in a warehouse of agricultural produce 2,50,000
Compute the value of taxable supply of ‘Agro Care Limited’ for the month of March, 2022 if all the
above amounts are exclusive of GST.
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Solution
Computation of Value of Taxable Supply

Particulars ₹
Receipts from supply of farm labour -
Charges for seed testing -
Charges for soil testing of farm land -
Charges for warehousing of potato chips 85,000
Commission received on sale of wheat -
Charges for training of farmers on use of new pesticides and fertilizers developed -
through scientific research
Renting of vacant land to a stud farm 1,85,000
Leasing of vacant land to a cattle farm -
Charges for warehousing of rice -
Charges for warehousing of cotton fabrics 2,00,000
Retail packing and labelling of fruits and vegetables -
Charges for warehousing of minor forest produce -
Charges for warehousing of spices 2,20,000
Charges for fumigation in a warehouse of agricultural produce 2,50,000
Question 4
Goutum Das is engaged in providing following services. With the help of information given below,
determine which of the services provided by Goutum Das are exempt from GST:
1. Packaging of the onions purchased from village farmers into small packets of ₹1 kg each, in
Goutum Das warehouse, so that the same can be sold in a nearby city mall.
2. Warehousing of jaggery and tea.
3. Renting of warehouse for storage of agricultural produce
Solution
1. Processes/operations carried out at an agricultural farm on the agricultural produce which do

not alter the essential characteristics of agricultural produce, but make it marketable only for
the primary market are exempt. In the given case, though the packaging of onions does not
alter their essential characteristics, it makes them marketable for retail market and not for the
primary market, and further, such packaging is being done at the warehouse of Goutum Das
and not an agricultural farm. Hence, said services are not exempt.
2. Warehousing of agricultural produce is exempt. Jaggery and Tea are not agricultural produce.
Therefore, the said services are taxable.
3. Services of loading, unloading, packing, storage or warehousing of agricultural produce are
exempt. Thus, warehousing of agricultural produce is exempt. However, in the given case,
services being provided are not warehousing services but renting of immovable property
services. Such services are not exempt.
Question 5 – January, 2021 – 6 Marks
Green Agro Services, a registered person provides the following information relating to its activities
during the month of February, 2022:
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Gross Receipts from ₹
Services relating to rearing of sheep 6,00,000
Services by way of artificial insemination of horses 4,00,000
Processing of sugarcane into jaggery 8,00,000
Milling of paddy into rice 7,50,000
Services by way of fumigation in a warehouse of agricultural produce 1,80,000
All the above receipts are exclusive of GST.
Compute the value of taxable supplies under GST laws for the month of February, 2022.
Solution
Computation of Value of Taxable Supplies

Particulars ₹
Services relating to rearing of sheep (Note 1) -
Services by way of artificial insemination of horses (Note 2) 4,00,000
Processing of sugarcane into jaggery (Note 3) 8,00,000
Milling of paddy into rice (Note 4) 7,50,000
Services by way of fumigation in a warehouse of agricultural produce (Note 5) 1,80,000
Value of Taxable Supplies 21,30,000
Notes:
1. Services related to rearing of all life forms of animals, except horses, for food, etc. are exempt.
2. Services of artificial insemination of animals are exempt, except horses. Therefore, artificial
insemination of horses is taxable.
3. Processes which alter the essential characteristics of agricultural produce are not exempt and
processing of sugarcane into jaggery alters the essential characteristics of sugarcane.
4. Processes which are carried out after the cultivation is over are not considered as intermediate
production processes in relation to cultivation of plants. Milling of paddy into rice is one such
process. Also, it changes the essential characteristics of rice.
5. Services by way of fumigation in a warehouse of agricultural produce are taxable under GST.
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Educational Services
Service Taxability
1. Services provided BY an Educational Institution:
a. to its students, faculty and staff Exempt
b. by way of conduct of entrance examination against consideration in Exempt
form of entrance fee
2. Services provided TO an Educational Institution (providing services by way of
pre-school education & education up to higher secondary school or
equivalent) by way of:
a. transportation of students, faculty and staff Exempt
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b. catering, including any mid-day meals scheme sponsored by the Exempt
Central Government (CG), State Government (SG) or Union Territory
(UT)
c. security/cleaning/house-keeping services performed in such EI Exempt
3. Services provided TO an Educational Institution by way of:
a. services relating to admission to, or conduct of examination by, such Exempt
EI
b. supply of online educational journals or periodicals. Exempt
(This exemption is only applicable to an institution providing services
by way of education as part of a curriculum for obtaining
qualification recognised by any law for time being in force.)
(This exemption is not applicable to an institution providing services
by way of:
▪ pre-school education and education upto higher secondary
school or equivalent; or
▪ education as a part of an approved vocational educational
course.)
4. Education up to higher secondary school Exempt
5. Renting of residential dwelling (boarding) Exempt
6. Modular Employable Skill Course Exempt
7. Services provided by international schools giving certifications like IB Exempt
(equivalent to education upto higher secondary school)
8. Supply of Food to Aanganwadi Exempt
9. Services by Industrial Training Institutes (ITIs) in respect of designated trades Exempt
notified under Apprenticeship Act, 1961 (either Private or Government)
10. Training courses by the Maritime Training Institutes Exempt
11. Services by National Board of Examination by way of conduct of examination Exempt
(including any entrance examination)
12. Educational institutions providing non-recognized qualification with
recognized qualification courses:
a. Artificial Bundling Taxable
(Highest
Rate)
b. Natural Bundling Exempt
13. College Hostel Mess
a. Catering Services provided by Educational Institutions Exempt
b. Catering Services provided by third person in Hostel Mess Taxable
14. Services provided by Indian Institute of Management
a. All long duration programs (one year or more) conferring Exempt
degree/diploma as recommended by Board of Governors as per the
power vested in them under the IIM Act, 2017 including one-year
Post Graduate Programs for Executives
b. All short duration executive development programs or need based Taxable
specially designed programs (less than one year) which are not a
qualification recognized by law
15. Education as part of a curriculum for obtaining a qualification recognized by Exempt
an Indian law
16. Education as part of a curriculum for obtaining a qualification recognized by Taxable
a foreign law
17. Short stay by different persons in furnished flats Taxable
18. Private tuitions Taxable
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19. Fees received from prospective employers for campus interview Taxable
20. Placement services provided to Educational Institutions Taxable
21. Institutes preparing students for Board Exams as well as for Competitive Taxable
Exams
22. Postal Coaching provided by Educational Institutions Taxable
23. Foreign Courses conducted by Private Institutes Taxable
24. Personality Development Institutes Taxable
25. Renting of immovable property to higher secondary school Taxable
26. Renting of immovable property to Commercial coaching centre Taxable
27. Outdoor catering services provided to educational institutions running Taxable
approved vocational courses
28. House-keeping and cleaning services in college providing recognised Taxable
graduation degree
29. Placement services provided to an Educational Institute Taxable
30. Development of course content services provided to an Educational Institute Taxable
31. Training of Staff of Higher Secondary School Taxable
32. Subscription of online educational journals/periodicals Taxable
33. Housekeeping services to coaching institutes Taxable
34. Fee charged for issuance of eligibility certificate for admission or for issuance Exempt
of migration certificate by educational institutions (Important amendment
for May, 2023)
Question 6 – December, 2021 – 6 Marks
AB Ltd., a registered company of Chennai, Tamil Nadu has provided following services for the month
of October, 2022:
Particulars ₹
Services of transportation of students, faculty and staff from home to college and back 2,50,000
to Commerce College, (a private college) providing degree courses in BBA, MBA, B.Com,
M.Com
Online monthly magazine containing question bank and latest updates in law to students 1,00,000
of PQR Law College offering degree courses in LLB and LLM
Housekeeping services to T Coaching Institute 50,000
Security services to N Higher Secondary School 3,25,000
Services of providing breakfast, lunch and dinner to students of ABC Medical College 5,80,000
offering degree courses recognized by law in medical field
All the above amounts are exclusive of GST.
Compute the taxable supplies of AB Ltd. for the month of October 2022 with necessary explanations.
Solution
Computation of Value of Taxable Supplies of AB Ltd.

Particulars ₹
Services of transportation of students, faculty, and staff from home to college and back 2,50,000
to Commerce College (Note 1)
Online monthly magazine containing question bank and latest updates in law to students -
of PQR Law College (Note 2)
Housekeeping services to T Coaching Institute (Note 3) 50,000
Security services to N Higher Secondary School (Note 4) -
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Services of providing breakfast, lunch and dinner to students of ABC Medical College 5,80,000
(Note 5)
Notes:
1. Transportation services provided to an educational institution are exempt only if such

institution provides pre-school education or education up to higher secondary school or
equivalent. Therefore, such supplies are not exempt.
2. Services of supply of online educational journals provided to an educational institution
providing qualification recognized by law are exempt.
3. Housekeeping services to coaching institutes are not exempt.
4. Security services provided to an educational institution providing education up to higher
secondary school are exempt.
5. Catering services provided to an educational institution are exempt only if such institution
provides pre-school education or education up to higher secondary school or equivalent.
Therefore, such supplies are not exempt.
Question 7
Fortune Ltd. (a registered taxable person) provides the following information relating to their services
for the month of November, 2021:
Particulars ₹
Gross Receipts from:
Running a Boarding School (including receipts for providing residential dwelling services 28,00,000
₹12,00,000)
Conducting private tuitions 16,00,000
Education services for obtaining a qualification recognized by law of a foreign country 8,00,000
Conducting modular employable skill course, approved by National Council of 10,00,000
vocational training
Fees from prospective employers for campus interview 6,00,000
Renting of furnished flats for temporary stay to different persons 6,80,000
Compute the value of taxable supply and the amount of GST payable. The above receipts are exclusive
of GST. GST rate = 18%.
Solution
Computation of Value of Taxable Supplies of Fortune Ltd. and GST Liability

Particulars ₹
Running a Boarding School (including residential dwelling services) (Note 1) -
Conducting private tuitions (Note 2) 16,00,000
Education services for obtaining a qualification recognized by law of a foreign country 8,00,000
(Note 3)
Conducting modular employable skill course, approved by National Council of -
vocational training (Note 4)
Fees from prospective employers for campus interview (Note 5) 6,00,000
Renting of furnished flats for temporary stay to different persons (Note 6) 6,80,000
GST @ 18% 6,62,400
Notes:
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1. Running a boarding school is not taxable since education up to higher secondary school is
exempt and renting of residential dwelling is also exempt.
2. Private tuitions are not exempt as they do not lead to grant of a qualification recognised by
law.
3. Education as part of a curriculum for obtaining a qualification recognized by only an Indian law
and not a foreign law is exempt.
4. Modular Employable Skill Course is an approved vocational education course and is exempt.
5. Fees received from prospective employers for campus interview is not covered in exemption.
6. Short stay by different persons in furnished flats is not renting of residential dwelling and thus,
not exempt.
Question 8
Indian Institute of Management furnishes you the following information of its receipts for the month
ending April, 2021:
Particulars ₹
Gross Receipts from:
Students pursuing 2 year full time Post Graduate Programmes in Management 2,50,00,000
Students pursuing fellow programme in management 50,00,000
Participants pursuing short duration (3 months) executive development programme. 25,00,000
(Participation certificates are awarded to participants after completion of
programme)
You are required to compute value of taxable supply and GST liability if applicable rate of GST is 18%.
Solution
Computation of Value of Taxable Supplies and GST Liability

Particulars ₹
Receipts from students pursuing 2 year full time Post Graduate Programmes in
Management (Note 1) -
Receipts from students pursuing fellow programme in management (Note 1) -
Participants pursuing short duration (3 months) executive development programme 25,00,000
Value of Taxable Supplies (Note 3) 25,00,000
GST @ 18% 4,50,000
Notes:
1. All long duration programs (one year or more) conferring degree/diploma as recommended
by Board of Governors as per the power vested in them under the IIM Act, 2017 including one-
year Post Graduate Programs for Executives are exempt.
2. All short duration executive development programs or need based specially designed
programs (less than one year) which are not a qualification recognized by law are taxable.
Question 9
XYZ Ltd. is engaged in providing various services to educational institutions and furnishes you with the
following information for the month of April, 2021. You are required to determine the value of taxable
supply and GST payable thereon if all charges are exclusive of GST. The rate of GST is 18%.
Particulars ₹
CA NISHANT KUMAR 15
Renting of immovable property to higher secondary school 12,00,000
Renting of immovable property to Commercial coaching centre 2,00,000
Transportation services provided to students of higher secondary school 5,00,000
Outdoor catering services provided to educational institutions running approved 5,00,000
vocational courses
Security services provided to pre-nursery school 1,25,000
House-keeping and cleaning services in college providing recognised graduation degree 5,12,500
Conduct of examination of ICAI 10,00,000
Placement services provided to ICSI 12,00,000
Development of course content of ICMA institute 2,00,000
Training of Staff of Higher Secondary School 1,50,000
Receipts by way of subscription of online educational journals/periodicals (₹5,00,000 is 7,50,000
from educational institutions who provide degree recognised by any law and balance
₹2,50,000 from Higher Secondary school)
Solution
Computation of Value of Taxable Supplies and GST Liability

Particulars ₹
Renting of immovable property to higher secondary school (Taxable) 12,00,000
Renting of immovable property to Commercial coaching centre (Taxable) 2,00,000
Transportation services provided to students of higher secondary school (Exempt) -
Outdoor catering services provided to educational institutions running approved 5,00,000
vocational courses (Taxable)
Security services provided to pre-nursery school (Exempt) -
House keeping and cleaning services in college providing recognised graduation degree 5,12,500
(Taxable)
Conduct of examination of ICAI (Exempt) -
Placement services provided to ICSI (Taxable) 12,00,000
Development of course content of ICMA institute (Taxable) 2,00,000
Training of Staff of Higher Secondary School (Taxable) 1,50,000
Receipts by way of subscription of online educational journals/periodicals (Taxable) 2,50,000
GST @ 18% 7,58,250
Question 10 – RTP November, 2020
Multiservices Private Ltd., registered in Punjab, is engaged in supplying a variety of services. Its
turnover was ₹35 lakh in the preceding financial year. It has provided the following information for the
month of April:
Particulars ₹
Fee for the coaching provided to students for competitive exams. The coaching centre is 6,24,000
run by Multiservices Private Ltd. in Punjab (Intra-State transaction)
Receipts for services provided in relation to conduct of examination in Pureit University, 19,200
Delhi (providing education recognized by Indian law), being an inter-state transaction
Amount received for transportation of students and faculty from their residence to Lotus 24,000
Public School – a higher secondary school – and back (Intra-state transaction)
Amount received for providing the security and housekeeping services in Dhaani Public 36,000
School – a pre-school (Intra-state transaction)
CA NISHANT KUMAR 16
Note: Rates of CGST, SGST and IGST are 9%, 9%, and 18% respectively. All the amounts given above
are exclusive of taxes. Compute the total GST liability of Multiservices Private Ltd. for the month of
April.
Solution
Computation of Net GST Liability of Multiservices Private Ltd. for the Month of April
Value of CGST SGST IGST
Particulars
Supply @ 9% @ 9% @ 18%
Fee for the coaching provided to students for competitive 6,24,000 56,160 56,160 -
exams (Note 1)
Services towards conduct of examination in Pureit 19,200 - - -
University, Delhi (Note 2)
Services of transportation of students and faculty from 24,000 - - -
their residence to Lotus Public School and back (Note 3)
Security and housekeeping services in Dhaani Public 36,000 - - -
School (Note 4)
Total GST Liability 56,160 56,160
Notes:
1. Coaching centre run by Multiservices Private Ltd. is not an educational institution since
competitive exam coaching does not lead to grant of a qualification recognized by law.
Therefore, fee received for coaching provided at such coaching centre is taxable.
2. Since Pureit University provides qualification recongized by law, it is an educational institution
and services provided to an educational institution, in relation to conduct of examination by
such institution are exempt from GST.
3. Since Lotus Public School provides education up to higher secondary school, it is an educational
institution and services of transportation of students, faculty and staff provided to an
educational institution are exempt.
4. Since Dhaani Public School provides pre-school education, it is an educational institution.
Security and housekeeping services provided within the premises of an educational institution
are exempt.
Health Care Services

Particulars Taxability
1. Health care services by a clinical establishment, an authorized medical Exempt
practitioner, or para-medics
(This exemption is not available to the services provided by clinical
establishment by way of providing room [other than Intensive Care Unit
(ICU)/Critical Care Unit (CCU)/Intensive Cardiac Care Unit (ICCU)/Neo Natal
Intensive Care Unit (NICU)] having room charges exceeding ₹5,000 per day to a
person receiving health care services)
2. Palliative care for terminally ill patients at patients’ home (Palliative care is Exempt
given to improve the quality of life of patients who have a serious or life-
threatening disease, but the goal of such care is not to cure the disease)
3. Services provided by cord blood bank unit of the nursing home by way of Exempt
preservation of stem cells
4. Ambulance services to transport critically ill patients from various locations to Exempt
nursing home
5. Naturopathy treatments. Such treatment is a recognized system of medicine in Exempt
terms of section 2(h) of the Clinical Establishments Act, 2010
CA NISHANT KUMAR 17
6. Plastic surgery to restore anatomy of a child affected due to an accident Exempt
7. Mortuary Services Exempt
8. Food supplied by the hospital canteen to the in-patients as advised by the Exempt
doctor/nutritionists
9. Treatment or Disposal of Bio-medical waste by operators of the common bio- Exempt
medical waste treatment facility
10. Health care of animals/birds by a veterinary clinic Exempt
11. Rehabilitation, Therapy or Counselling by rehabilitation professionals Exempt
recognized under the Rehabilitation Council of India Act, 1992
12. Rent on rooms provided to in-patients Exempt
13. Consultation fees paid by hospitals to senior doctors/consultants/technicians Exempt
14. Hair transplant services Taxable
15. Hospitals charge the patients, say, ₹10,000/- and pay to the Exempt
consultants/technicians only ₹7,500/- and keep the balance for providing
ancillary services which include nursing care, infrastructure facilities, paramedic
care, emergency services, checking of temperature, weight, blood pressure,
etc. Is GST applicable on such money retained by the hospitals?
16. Pranic healing treatments. Such treatment is not a recognized system of Taxable
medicine in terms of Section 2(h) of the Clinical Establishments Act, 2010
17. Supplies of food by a hospital to patients (not admitted) or their attendants or Taxable
visitors
18. Services in form of Assisted Reproductive Technology (ART)/In virto fertilization Exempt
(IVF)
Question 11 – MTP May, 2020
Balaji Hospital, a clinical establishment located in Tirupati, is specialized in cardiac treatment. The
hospital has its own canteen – Healthy Foods. The canteen serves the food and drink to the in-patients
as advised by the doctors/nutritionists of the hospital. Apart from this, other patients (who are not
admitted) or attendants or visitors of the in-patients also take food and drink from the canteen.
Examine whether supply of food and drink/catering services to the in-patients and other patients (who
are not admitted) or attendants or visitors of the in-patients is exempt from GST.
Solution
Services by way of health care services provided by a clinical establishment, an authorized medial
practitioner or para-medics are exempt from GST. In this regard, CBIC has clarified that food supplied
by the hospital canteen to the in-patients as advised by the doctor/nutritionists is a part of composite
supply of healthcare services and is not separately taxable. Thus, it is exempt from GST. However, other
supplies of food by a hospital to patients (not admitted) or their attendants or visitors are taxable. In
view of the same, GST is exempt on the food supplied by Healthy Foods to the in-patients as advised
by doctors/nutritionists while other supplies of food by it to patients (not admitted) or
attendants/visitors of the in-patients is taxable.
Question 12
Well-Being Nursing Home has received the following amounts in the month of November in lieu of
various services rendered by it in the same month. You are required to determine its GST liability for
November from the details furnished below:
CA NISHANT KUMAR 18
Particulars ₹ in lakhs
Palliative care for terminally ill patients at patients’ home (Palliative care is given to 30
improve the quality of life of patients who have a serious or life-threatening disease,
but the goal of such care is not to cure the disease)
Renting of rooms of nursing home for providing health care services (Room rent is 75
₹7,500 per day)
Renting of rooms of nursing home for providing health care services (Room rent is 50
₹5,000 per day)
Receipts from patients admitted in Intensive Care Unit (Rental charges is ₹10,000 per 85
day)
Services provided by cord blood bank unit of the nursing home by way of preservation 24
of stem cells
Hair transplant services 100
Ambulance services to transport critically ill patients from various locations to nursing 12
home
Naturopathy treatments. Such treatment is a recognized system of medicine in terms 80
of section 2(h) of the Clinical Establishments Act, 2010
Plastic surgery to restore anatomy of a child affected due to an accident 30
Pranic healing treatments. Such treatment is not a recognized system of medicine in 120
terms of Section 2(h) of the Clinical Establishments Act, 2010
Mortuary Services 10
Note: All the amounts given above are exclusive of GST. Rate of GST is 18%.
Solution
Computation of Value of Taxable Supply and GST Liability

₹ in
Particulars
lakhs
Palliative care for terminally ill patients at patients' home (Note 1) -
Renting of rooms of nursing home for providing health care services (Room rent is ₹7,500 75.00
per day) (Note 2)
Renting of rooms of nursing home for providing health care services (Room rent is ₹5,000 -
per day) (Note 2)
Receipts from patients admitted in Intensive care unit (Rental charges is ₹10,000 per day) -
(Note 2)
Services provided by cord blood bank by way of preservation of stem cells (Note 3) 24.00
Hair transplant services (Note 4) 100.00
Ambulance services to transport critically ill patients from various locations to nursing -
home (Note 5)
Naturopathy treatments (Note 6) -
Plastic surgery to restore anatomy of a child affected due to an accident (Note 7) -
Pranic healing treatments (Note 8) 120.00
Mortuary Services (Note 9) -
Value of Taxable Supply 319.00
GST Payable @ 18% 57.42
Notes:
1. Health care services provided by, inter alia, a clinical establishment in any recognized system
of medicines in India is exempt from GST. It is immaterial whether health care service is
provided at the clinical establishment or at the home of the patient or at any other place. Thus,
palliative care for terminally ill patients at patients' home is eligible for exemption.
CA NISHANT KUMAR 19
2. Exemption in respect of healthcare services shall not apply to the services provided by clinical
establishment by way of providing room [other than Intensive Care Unit (ICU)/Critical Care
Unit (CCU)/Intensive Cardiac Care Unit (ICCU)/Neo Natal Intensive Care Unit (NICU)] having
room charges exceeding ₹5,000 per day to a person receiving health care services.
3. Services provided by cord blood banks by way of preservation of stem cells or any other service
in relation to such preservation are liable to GST.
4. Hair transplant services are specifically excluded from the health care services, and thus are
not eligible for exemption.
5. Ambulance services to transport critically ill patients from various locations to nursing home
are eligible for exemption.
6. Since naturopathy is a recognized system of medicine in terms of Section 2(h) of the Clinical
Establishments Act, 2010, it would be eligible for exemption.
7. Plastic surgery to restore anatomy of a child affected due to an accident will be eligible for
exemption.
8. Since pranic healing treatment is not a recognized system of medicine in terms of Section 2(h)
of the Clinical Establishments Act, 2010, it would not be eligible for exemption.
9. Mortuary services are covered under negative list under Schedule II of CGST Act, 2017. Hence,
the same are not liable to GST.
Services Provided BY Government

Service Taxability
1. Services by Government Authority in relation to Municipality functions Exempt
2. Services by Government Authority in relation to Panchayat functions Exempt
3. Services by Department of Posts (Speed Post, Express Parcel Post, Life Taxable
Insurance, Agency) to anyone other than Government
4. Services in relation to aircraft or vessel inside or outside the precincts of a port Taxable
or airport
5. Transport of goods or passengers Taxable
6. Any service other than the above three provided to business entities Taxable
7. Services by Department of Posts (Basic Mail Services, i.e., postal services, post Exempt
card, inland letter, book post and ordinary post (envelopes weighing less than
10 grams) to meet the universal postal obligations
8. Services by way of ordinary post (envelopes weighing 10 grams or more), Taxable
registered post, speed post, express parcel post, life insurance, and agency
services provided to a person other than the Government or Union Territory
(In respect of these services, the Department of Posts is liable to pay tax without
application of reverse charge)
9. Services by Department of Posts (Transfer of money through money orders, Exempt
operation of savings accounts, issue of postal orders, pension payments and
other services)
10. Services by Department of Posts – Distribution of Mutual Funds, Bonds, Taxable
Passport Applications, collection of telephone and electricity bills on
commission basis
11. Services by Police or Security Agencies of Government to private business Taxable
entities
12. General Insurance Policies provided by a State Government to employees of
State Government/Police Personnel, employees of Electricity Department or
students of colleges/private schools, etc.?
a. If premium is paid by State Government Exempt
CA NISHANT KUMAR 20
b. If premium is paid by employees, students, etc. Exempt
13. Services provided by Government/UT/Local Authority to a Business Entity (with Exempt
aggregate turnover below the threshold limit for registration) (except services
mentioned in points 3, 4, 5)
14. When government provides services by way of renting of immovable property Taxable
to business entity (even if the aggregate turnover of the entity is below the
threshold limit for registration)
15. Services provided by Government/Local Authority to another Exempt
Government/Local Authority (except services mentioned in points 3, 4, 5)
16. Services provided by Government/UT/Local Authority where consideration ≤ Exempt
₹5,000 (except services mentioned in points 3, 4, 5)
17. Old Age Homes run by Government where residents are aged 60 years or more Exempt
and consideration (including boarding, lodging, maintenance) is ≤ ₹25,000
18. Services by the Department of Posts by way of post card, inland letter, book Exempt
post and ordinary post (envelopes weighing less than 10 grams)
19. Services by Government/UT/Local Authority to their undertakings or PSUs by Exempt
way of guaranteeing the loans taken by them
20. Services in relation to Registration required under any law Exempt
21. Services by way of testing, calibration, safety check or certification relating to Exempt
protection or safety of workers, consumers, or public at large, including fire
license
22. Services to individuals by way of issuance of passport, visa, driving license, birth Exempt
certificate, death certificate
23. Granting national permit to a goods carriage to operate throughout Exempt
India/contiguous states
24. Fines, liquidated damages collected for non-performance of contract Exempt
25. Fines, penalties imposed for violation of statute, byelaws, rules or regulations Exempt
26. Assignment of right to use natural resources to an individual farmer for
agricultural purposes
a. To an individual farmer for agricultural purposes Exempt
b. To companies (including PSUs) for exploration of natural resources, for Taxable
which consideration is received in the form of annual license fee, lease
charges, royalty, etc.
27. Services by way of deputing officers after office hours or on holidays for Exempt
inspection or container stuffing or such other duties in relation to import export
cargo, where the consideration to these officers is “Merchant Overtime
Charges”
28. Services by a State Government to Excess Royalty Collection Contractor (ERCC) Exempt
by way of assigning the right to collect royalty on behalf of the State
Government on the mineral dispatched by the mining lease holders
Question 13
The Karnataka Cricket Association, Bangalore requests the Commissioner of Police, Bangalore to
provide security in and around the Cricket Stadium for the purpose of conducting the cricket match.
The commissioner of police arranges the required security for a consideration. It is liable to GST?
Solution
CA NISHANT KUMAR 21
In this case, services of providing security by the police personnel are not exempt. As the services are
provided by the Government, Karnataka Cricket Association is liable to pay the tax on the amount of
consideration paid under reverse charge mechanism.
Question 14
Public Works Department of Karnataka entered into an agreement with M/s ABC, a construction
company for construction of office complex for certain amount of consideration. In the agreement
dated 10-07-2021, it was agreed by both the parties that M/s ABC shall complete the construction
work and handover the project on or before 31-12-2021. It was further agreed that any breach of the
terms of contract by either party would give right to the other party to claim for damages or penalty.
M/s ABC did not complete the construction and handover the project by the specified date, i.e., on or
before 31-12-2021. As per the contract, the department asked for damages/penalty from M/s ABC and
threatened to go to the court if not paid. M/s ABC paid an amount of ₹10,000 to the department for
non-performance of contract. Is GST liable on this transaction?
Solution
Services provided by the Central Government, State Government, Union Territory or Local Authority
by way of tolerating non-performance of a contract for which consideration in the form of fines or
liquidated damages is payable to the Central Government, State Government, Union Territory, or local
authority under such contract are exempt.
Therefore, in the present case, the amount paid to the department is exempted from payment of tax.
Question 15
Lakhanpur Post Office provided the following services to persons other than Government for the
month of March, 2022, all charges are exclusive of GST:
Particulars ₹
Services by way of post card 1,00,000
Services by way of ordinary post (envelopes weighing less than 10 grams) 2,50,000
Services by way of ordinary post (envelopes weighing exceeding 10 grams) 4,00,000
Services by way of registered post (envelopes weighing less than 10 grams) 5,50,000
Transfer of money through money orders 5,00,000
Operation of savings accounts 1,50,000
Rural postal life insurance services 2,00,000
Distribution of mutual funds, bonds and passport applications 5,00,000
Issuance of postal orders 3,00,000
Collection of telephone and electricity bills 1,00,000
Pension payment services 50,000
Speed post services 5,00,000
Express parcel post services 2,00,000
Compute the value of supply.
Solution

Particulars ₹
CA NISHANT KUMAR 22
Post Card Services (Exempt) -
Services by way of ordinary post (envelopes weighing less than 10 grams) (Exempt) -
Services by way of ordinary post (envelopes weighing exceeding 10 grams) 4,00,000
Services by way of registered post (envelopes weighing less than 10 grams) 5,50,000
Transfer of money through money orders (Exempt) -
Operation of savings accounts (Exempt) -
Rural postal life insurance services (Taxable) 2,00,000
Distribution of mutual funds, bonds and passport applications (Taxable) 5,00,000
Issuance of postal orders (Exempt) -
Collection of telephone and electricity bills (Taxable) 1,00,000
Pension payment services (Exempt) -
Speed post services (Taxable) 5,00,000
Express parcel post services (Taxable) 2,00,000
Question 16 – May, 2022 – 5 Marks
“Under the GST law, taxes on taxable services supplied by the Central Government or the State
Government to a business entity in India are payable by the recipient of services”.
State the exceptions of the above statement.
Solution
Tax on the following services supplied by the Central Government or State Government to a business
entity in India is payable by the supplier of services:
1. Services by renting of immovable property provided to an unregistered business entity.

2. Services by the Department of Posts.
3. Services in relation to an aircraft or a vessel, inside or outside the precincts of a port or an
airport.
4. Services of transport of goods or passengers.
Question 17
With reference to the provisions of CGST Act, 2017, examine whether GST is leviable in the following
situations:
1. Government of Rajasthan has provided services to ABC Ltd. of Rajasthan in the month of
November, 2022 for a consideration of ₹50,000. The turnover of ABC Ltd. in Financial Year
2019-20 was ₹18,00,000.
2. Government of Rajasthan has provided services to XYZ Ltd. in the month of November, 2022
for a consideration of ₹5,000. The turnover of XYZ Ltd. in Financial Year 2019-20 was
₹28,00,000.
3. Jaipur Municipal Corporation has awarded a contract for construction of road to PQR Ltd. It
failed to perform the contract and paid liquidated damages amounting to ₹50,00,000 in
accordance with the terms of contract.
4. XYZ Ltd. has applied for registration under Companies Act, 2013 to Registrar of companies
Rajasthan and has paid registration fees of ₹13,85,510.
CA NISHANT KUMAR 23
5. Delhi Government has charged ₹50,00,000 from Agro Care Ltd. for allocation of natural
resources for agricultural purposes in the month of November, 2022.
6. XYZ Ltd. has paid to Customs department ₹50,000 on account of Merchant Overtime Charges
for deputing officers after office hours or on holidays for inspection or container stuffing or
such other duties in relation to import export cargo.
7. XYZ Ltd. has made an upfront payment of ₹80,00,000 to Bihar Government on account of
assignment of right to use minerals in the State of Bihar.
Solution
1. Services provided by the Central Government, State Government, Union territory or local
authority to a business entity with an aggregate turnover of up to such amount in the
preceding financial year as makes it eligible for exemption from registration under the CGST
Act, 2017 are exempt. Since the aggregate turnover of ABC Ltd. in preceding financial year
does not exceed ₹20 lakhs, it is exempt from obtaining registration. Hence, no GST shall be
levied on services provided by Government of Rajasthan to ABC Ltd.
2. Services provided by Central Government, State Government, Union territory or a local
authority where the consideration for such services does not exceed ₹5,000 are exempt.
Hence, on said services no GST shall be levied.
authority by way of tolerating non-performance of a contract for which consideration in the
form of fines or liquidated damages is payable to the Central Government, State Government,
Union territory or local authority under such contract are exempt. Hence, no GST shall be
payable on liquidated damages of ₹50,00,000 paid by PQR Ltd. to Jaipur municipal corporation.
authority by way of registration required under any law for the time being in force are exempt.
Hence, no GST shall be levied on fees paid for incorporation by XYZ Ltd.
5. Services by way of allocation of natural resources to an individual farmer for the purposes of
agriculture have been exempted. Such allocations/auctions to categories of persons other
than individual farmers would be leviable to GST. Hence, Agro Care Ltd. will be liable to pay
GST on ₹50,00,000 under reverse charge basis.
6. Services provided by the Central Government, State Government, Union territory by way of
deputing officer after office hours or on holidays for inspection or container stuffing or such
other duties in relation to import export cargo on payment of Merchant Overtime Charges are
exempt from GST. Hence, no GST shall be levied on such charges.
7. XYZ Ltd. will be liable to pay GST on assignment of right to use minerals in the State of Bihar.
Services Provided TO Government/Union Territory/Local Authority

Services Taxability
1. Pure Services (excluding works contract service or other composite supplies Exempt
involving supply of any goods) in relation to Panchayat Functions/Municipal
Functions
2. Supply by a Government Entity (See Note 2) to Government/UT/LA in the form Exempt
of Grants
3. By Fair Price Shops by way of sale of food grains, kerosene, sugar, edible oil, etc. Exempt
4. Services provide under any insurance scheme for which total premium is paid Exempt
by the Government
5. By GST Network Exempt
CA NISHANT KUMAR 24
6. Services provided under any training programme for which 75% or more of the Exempt
total expenditure is borne by the Government
7. Services provided any institutions/NGOs under the central scheme of Exempt
“Scholarships for students with Disabilities” where the total expenditure is
borne by the Government
8. Composite supplies involving supplies on any goods
a. Value of goods ≤ 25% of value of supply Exempt
b. Value of goods > 25% of value of supply Taxable
9. Sanitation and conservancy services supplied to Army and other Central and Taxable
State Government departments
10. Works Contract Services Taxable
Notes:
1. A statutory body, corporation or an authority created by the Parliament, or a State Legislature

is neither “Government” nor a “Local Authority”.
2. Government Entity means a body set up by an Act of Parliament or State Legislature or by any
Government, where 90% or more participation by way of equity or control is of the
government.
Question 17
A business entity supplies manpower for cleanliness of roads, public places, architect services,
consulting engineer services, advisory services to the government in relation to municipality functions.
It is liable to GST?
Solution
Since these are pure services, i.e., without involvement of any goods, it is exempt from GST.
Question 18
A governmental authority awards the work of maintenance of streetlights in a Municipal area to an

agency which involves replacement of defunct lights and other spares apart from maintenance. Is it
liable to GST?
Solution
Pure services (excluding works contract service or other composite supplies involving supply of any
goods) provided to the Central Government, State Government or Union Territory, or Local Authority
by an entity in relation to any function entrusted to a Panchayat or a Municipality are exempt. In the
present case, the scope of service involves maintenance work and supply of goods, which falls under
the works contract services. The exemption is provided to services which involve only supply of services
and not for works contract services.
Construction Services
Services Taxability
1. Services provided by way of pure labour contracts of construction, erection, Exempt
commissioning, installation, completion, fitting out, repair, maintenance,
renovation, or alteration of a civil structure or any other original works
CA NISHANT KUMAR 25
pertaining to the beneficiary-led individual house construction or enhancement
under the Housing for All (Urban) Mission or Pradhan Mantri Awas Yojna (Note
1)
2. Services by Electricity Distribution Utilities for extending electricity distribution Exempt
network upto the tube well of the farmer or agriculturalist for agricultural use
3. Pure labour contract pertaining to a single residential unit (not being a part of Exempt
a residential complex)
4. Transfer of Development Rights of Floor Space Index for construction of Exempt
residential apartments by a promoter in a project, intended for sale to a buyer,
wholly or partly (except where the entire consideration is received after the
issuance of completion certificate) (Note 2)
5. Upfront amount (called as premium, salami, cost, price, development charges Exempt
or by any other name) payable in respect of services by way of granting long
term lease of 30 years or more for construction of residential apartments
(except where the entire consideration is received after the issuance of
completion certificate) (Note 3)
Notes:
1. Beneficiary-Led Construction (BLC) refers to the central government providing financial

assistance up to ₹1.5 lakh to beneficiaries belonging to the Economically Weaker Sections
(EWS) category (having annual income ≤ ₹3,00,000) for either construction of houses or
upgradation of their existing houses.
2. TDR or FSI (including additional FSI) by promoter to builder:
a. Amount of Exemption = GST Payable on TDR or FSI (including additional FSI) or both
for construction of the project × (Carpet area of the residential apartments in the
project) ÷ (Total carpet area of the residential and commercial apartments in the
project.
b. Conditions
i. Promoter is liable to pay GST on RCM basis on unsold flats.
ii. Maximum amount of tax payable
1. In case of affordable residential apartments = 0.5%
2. Others = 2.5%
iii. Time of Payment of tax: Date of completion or first occupation, whichever is
earlier.
3. Long Term Lease
a. Amount of Exemption: GST payable on upfront amount (called as premium, salami,
cost, price, development charges or by any other name) payable for long term lease
of land for construction of the project × (Carpet area of the residential apartments in
the project) ÷ (Total carpet area of the residential and commercial apartments in the
project)
b. Conditions
i. Promoter is liable to pay GST on RCM basis on unsold flats.
ii. Maximum amount of tax payable
1. In case of affordable residential apartments = 0.5%
2. Others = 2.5%
iii. Time of Payment of tax: Date of issue of completion certificate, or first
occupation, whichever is earlier.
CA NISHANT KUMAR 26
Passenger Transport Services
Service Taxability
1. Transport of passengers with or without accompanied belongings by air in Exempt
economy class, embarking from or terminating in an airport located in the state
of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland,
Sikkim, or at Bagdogra located in West Bengal
2. Transport of passengers with or without accompanied belongings by non- Exempt
airconditioned contract carriage for transportation of passengers
3. Non-AC Stage carriage Exempt
4. Services mentioned in points 2 and 3 above provided through an e-commerce Taxable
operator, and notified u/s 9(5) of the CGST Act, 2017
5. Transportation taking place over pre-determined route on a pre-determined Exempt
schedule in non-air-conditioned contract carriage
Therefore, engagement of non-air-conditioned contract carriages by firms for
transportation of their employees to and from work is exempt.
6. Services provided to the Central Government by way of transport of passengers Exempt
with or without accompanied belongings, by air, embarking from or terminating
at a regional connectivity scheme (RCS) airport, against consideration in the
form of viability gap funding (See Note 1)
7. By railways (other than in first class or AC coach) (only if not provided through Exempt
e-commerce operator)
8. By metro, monorail or tramway (only if not provided through e-commerce Exempt
operator)
9. By inland waterways, including national waterways (only if not provided Exempt
through e-commerce operator)
10. By public transport (other than predominantly for tourism purpose) in a vessel Exempt
between places located in India (only if not provided through e-commerce
operator)
11. By metered cabs or auto rikshaws (including e rikshaws) (only if not provided Exempt
through e-commerce operator)
12. By Non-airconditioned contract carriage for transportation of passengers Taxable
through e-commerce operator
13. By radio taxi Taxable
14. For tourism, conducted tour, charter, or hire Taxable
15. Non-AC Stage carriage through e-commerce operator Taxable
16. AC Stage carriage Taxable
17. By railways in first class or AC coach (only if not provided through e-commerce Taxable
operator)
18. By leisure or charter vessels or a cruise ship Taxable
19. By ropeway, cable car, aerial tramway Taxable
Notes:
1. There are a lot of under serviced air routes in India. UDAN (Ude Desh ka Aam Nagrik) is a
regional airport development program of the Government of India and part of the Regional
Connectivity Scheme (RCS) of upgrading under-serviced air routes. Its goal is to make air travel
affordable and improve economic development in India. For this, the Government has tied up
with a lot of private players. This is known as Public Private Partnership (PPP). The private
sector takes care of the construction part, and the public sector provides for the money, called
the viability gap funding.
CA NISHANT KUMAR 27
2. The value of any taxable service includes the taxes levied by any government on any passenger
travelling by air, as only taxes levied under GST law are excluded. Hence, passenger taxes shall
form part of taxable value of supply.
Question 19
Compute value of taxable supply of transport of passengers by air from the following data relating to
sums received exclusive of GST for the month ending 31-03-2023:
1. Passengers embarking at Arunachal Pradesh: ₹55 lakh (out of the said sum ₹15 lakh relates to
other than economy class)
2. Passengers where journey terminated at Assam: ₹45 lakh (out of the said sum, ₹5 lakh relates
to other than economy class)
3. Amount charged from passengers for flights starting from Sydney to Delhi: ₹25 lakh (out of the
said sum, ₹15 lakh relates to other than economy class).
4. Amount charged from passengers for flights starting from Delhi to Sydney (economy class):
₹34 lakh (including passenger taxes levied by government and shown separately on ticket: ₹10
lakh)
5. Amount charged from passengers for flights starting from Delhi to Sydney (business class): ₹10
lakh (including passenger taxes levied by government and shown separately on ticket: ₹3 lakh)
Compute the value of taxable supply and GST thereon if rate of GST is 12% in case of business class
and 5% in other class.
Solution
Computation of Taxable Value of Supply and GST Payable

Taxable
Particulars Value Rate GST
Passengers embarking at Arunachal Pradesh (Note 1) 15,00,000 12% 1,80,000
Passengers where journey terminated at Assam (Note 1) 5,00,000 12% 60,000
Amount charged from passengers for flights starting from
Sydney to Delhi (Note 2) 25,00,000 - Not Taxable
Amount charged from passengers for flights starting from Delhi
to Sydney (Note 3) 34,00,000 5% 1,70,000
Amount charged from passengers for flights starting from Delhi
to Sydney (business class) (Note 2) 10,00,000 12% 1,20,000
Total value of taxable supply and total GST payable 89,00,000 5,30,000
Notes:
1. Economy class is exempt from tax. Business Class is liable to GST.

2. Place of embarkation is Sydney, viz. outside India; hence, place of supply of service is Sydney,
viz. outside India, therefore, it is not chargeable to tax in India.
3. Passenger taxes levied by Government even if shown separately on ticket shall form part of
taxable value of supply as per provisions of section 15.
Question 20
M/s PQR Ltd. is engaged in providing service of transportation of passengers by following modes in the
month of November:
1. Service of transportation of passengers by vessels in National Waterways: ₹30,00,000
CA NISHANT KUMAR 28
2. Service of transportation of passenger by Air-conditioned stage carriage: ₹25,00,000
3. Service of transportation of passenger by non-air-conditioned stage carriage: ₹25,00,000
4. Service of transportation of passengers by contract carriage for tourism: ₹20,00,000
5. Service of transportation of passenger for Mumbai to Chennai port in a vessel and such service
is not for tourism purpose: ₹10,00,000
6. Service of transportation of passenger in a metered cab: ₹35,00,000
7. Service of transportation of passengers in radio taxis: ₹10,00,000
8. Service of transportation of passengers in non-air-conditioned contract carriages: ₹10,00,000
9. Service of transportation of passengers in air-conditioned contract carriages: ₹15,00,000
Compute the value of taxable supply if all charges are exclusive of GST.
Solution

Particulars ₹
Service of transportation of passengers by vessels in National Waterways (national
waterways are included in the definition of inland waterways) -
Service of transportation of passenger by Air-conditioned stage carriage 25,00,000
Service of transportation of passenger by non-air-conditioned stage carriage -
Service of transportation of passengers by contract carriage for tourism 20,00,000
Service of transportation of passenger for Mumbai to Chennai port in a vessel (being
a public transport in a vessel sailing in India and not for tourism) -
Service of transportation of passenger in a metered cab -
Service of transportation of passengers in radio taxis 10,00,000
Service of transportation of passengers in non-air-conditioned contract carriages -
Service of transportation of passengers in air-conditioned contract carriages 15,00,000
Goods Transportation Services

Service Taxability
1. By road Exempt
2. By a goods transport agency Taxable
3. By a courier agency Taxable
4. By inland waterways Exempt
5. By Express Cargo Service (Door-to-door transportation of goods making special Taxable
arrangements for speedy transportation and timely delivery of goods)
6. By Angadia (It is kind of a courier service which undertakes delivery of Taxable
documents, goods, or articles received from a customer to another person for
a consideration)
7. Transportation of goods by an aircraft from a place outside India upto the Exempt
customs station of clearance in India
8. Transportation of goods by an aircraft from customs station of clearance in
India to a place outside India:
a. Upto 30-09-2022 Exempt
b. After 30-09-2022 Taxable
9. Transportation of goods by a vessel from customs station of clearance in India
to a place outside India:
a. Upto 30-09-2022 Exempt
b. After 30-09-2022 Taxable
CA NISHANT KUMAR 29
10. Satellite launch services supplied by Indian Space Research Organisation, Antrix Exempt
Corporation Limited, or New Space India Limited
11. Transportation of the following goods by rail or vessel: Exempt
a. Relief materials meant for victims of natural or man-made disasters,
calamities, accidents, or mishap;
b. Defence or military equipment;
c. Newspaper or magazines registered with the Registrar of Newspapers;
d. Railway equipment or materials;
e. Agricultural produce;
f. Milk, salt and food grain including flours, pulses, and rice; and
g. Organic manure
12. Services provided by Goods Transport Agency by way of transport in a goods Exempt
carriage of: (See Note)
a. Agricultural produce
b. Goods, where consideration charged for the transportation of goods on
a consignment transported in a single carriage ≤ ₹1,500
c. Goods, where consideration charged for transportation of all such
goods for a single consignee ≤ ₹750
d. Milk, salt, and food grain including flour, pulses, and rice
e. Organic manure
f. Newspaper or magazines registered with the Registrar of Newspapers
g. Relief materials meant for victims of natural or man-made disasters,
calamities, accidents, or mishaps; or
h. Defence or military equipment
13. Individual truck/tempo operators who do not issue any consignment note Exempt
14. Time sensitive transportation of goods by road in a goods carriage by a GTA Exempt
shall be classified as GTA and not under courier service, if:
a. The entire transportation of goods is by road; and
b. The person transporting the goods issues a consignment note.
15. Transport of minerals from mining pit head to railway siding, beneficiation Taxable
plant, etc. by vehicles deployed with driver for a specific duration of time
16. Services provided by GTA to an unregistered person Exempt
17. Services provided by GTA to Persons Registered only for TDS Exempt
18. Transport of postal mails and postal bags Taxable
19. Transport of household effects Taxable
20. Transport of petroleum products Taxable
21. Transport of tea Taxable
22. Transport of sugar Taxable
23. Transport of alcoholic beverages Taxable
24. Transport of baled cotton Taxable
Note: Goods transport agency
1. Goods transport agency means any person who:

a. Provides service in relation to transport of goods by road; and
b. Issues consignment note, by whatever name called.
Thus, it can be seen that issuance of a consignment note is the essential condition for a supplier
of service to be considered as a GTA. If such a consignment note is not issued by the
transporter, the service provided will not come within the ambit of GTA.
2. If a consignment note is issued, it indicates that the lien on the goods has been transferred (to
the transporter) and the transporter becomes responsible for the goods till its safe delivery to
CA NISHANT KUMAR 30
the consignee. It is only the services of such GTA, who assumes agency functions, that is being
brought into the GST net.
3. Taxation in case of a GTA has already been discussed in Chapter 3 – Charge of GST.
Question 21
Compute Value of taxable supply and GST liability for transport of goods by rail by Indian railway within
India (all sums exclusive of all taxes) (the information relates to the month of November, 2021):
1. Transport of postal mails and postal bags: ₹55,00,000

2. Transport of household effects: ₹50,00,000
3. Transport of petroleum products: ₹25,00,000
4. Transport of relief materials to flood affected areas: ₹25,00,000
5. Transport of railway equipments: ₹25,00,000
6. Transport of newspapers and magazines registered with registrar of newspapers: ₹15,00,000
7. Transport of milk: ₹15,00,000
8. Transport of tea: ₹10,00,000
9. Transport of sugar: ₹25,00,000
10. Transport of alcoholic beverages: ₹7,00,000
11. Transport of defence and military equipment: ₹40,00,000
12. Transport of organic manure: ₹90,00,000
13. Transport of baled cotton: ₹25,00,000
14. Transport of other goods: ₹50,00,00,000
Applicable GST rate: 5%.
Solution

Particulars ₹
Transport of postal mails and postal bags 55,00,000
Transport of household effects 50,00,000
Transport of petroleum products 25,00,000
Transport of relief materials to flood affected areas -
Transport of railway equipments 25,00,000
Transport of newspapers and magazines registered with registrar of newspapers -
Transport of milk -
Transport of tea 10,00,000
Transport of sugar 25,00,000
Transport of alcoholic beverages 7,00,000
Transport of defence and military equipment -
Transport of organic manure -
Transport of baled cotton 25,00,000
Transport of other goods 50,00,00,000
Value of Taxable Supply 52,22,00,000
GST @ 5% 2,61,10,000
Question 22
Calculate the value of taxable supply of XYZ Transport Company engaged in the business of transport
of goods by road for the month of April, 2022. Give reasons for taxability or exemption of each item.
CA NISHANT KUMAR 31
Suitable assumptions may be made wherever required. XYZ transport company avails ITC. GST is
leviable @ 12%.
Particulars ₹
Total freight charges received by ‘XYZ’ transport company 13,50,000
Freight charges received for transporting fruits 1,25,000
Freight collected for transporting small consignment for persons who paid less than 75,000
₹750 for each consignment
Freight collected for transporting goods in small vehicles for persons who paid less than 1,50,000
₹1,500 per trip
Solution

Particulars ₹
Total Freight Received 13,50,000
Less: Transportation of Fruits (Note 1) 1,25,000
Less: Transportation of small consignments (Note 2) -
Less: Transportation of goods in small vehicles (Note 3) - 1,25,000
Total Value of Taxable Supply 12,25,000
GST @ 12% 1,47,000
Notes:
1. Services provided by Goods Transport Agency by way of transport in a goods carriage of

agricultural produce are exempt.
2. Services provided by Goods Transport Agency by way of transport in a goods carriage of goods,
where consideration charged for transportation of all such goods for a single consignee ≤ ₹750
are liable to GST.
where consideration charged for the transportation of goods on a consignment transported in
a single carriage ≤ ₹1,500 are liable to GST.
Question 23
Calculate the value of taxable supply of XYZ Transport Company engaged in the business of transport
of goods by road for the month of April, 2022. Give reasons for taxability or exemption of each item.
Suitable assumptions may be made wherever required. XYZ transport company avails ITC. GST is
leviable @ 12%.
Particulars ₹
Total freight charges received by ‘XYZ’ transport company 25,00,000
Freight charges received from Government department registered only for the purpose 2,00,000
of tax deduction at source
Freight charges received from unregistered persons for transportation of their 50,000
household goods
Freight collected for transporting goods in small vehicles for persons who paid less than 1,50,000
₹1,500 per trip
Solution
CA NISHANT KUMAR 32
Particulars ₹
Total Freight Received 25,00,000
Less: Received from Government (Note 1) 2,00,000
Less: Received from Unregistered Persons (Note 2) 50,000
Less: Transportation of goods in small vehicles (Note 3) - 2,50,000
GST @ 12% 2,70,000
Notes:
1. Services provided by a Goods Transport Agency to Persons Registered only for the purpose of
tax deduction at source are exempt.
2. Services provided by GTA to an unregistered person are exempt.
where consideration charged for the transportation of goods on a consignment transported in
a single carriage ≤ ₹1,500 are liable to GST.
Banking and Financial Services

Services Taxability
1. Services BY Reserve Bank of India Exempt
2. Services TO Reserve Bank of India Taxable
3. Services of extending deposits, loans or advances in so far as the consideration Exempt
is represented by way of interest or discount (other than interest involved in
credit card services)
4. Services of sale and purchase of foreign currency amongst banks or authorised Exempt
dealers of foreign exchange or amongst banks and such dealers
5. Fixed deposits or savings deposits or any other such deposits in a bank or a Exempt
financial institution for which return is received by way of interest
6. Providing a loan or overdraft facility or a credit limit facility in consideration for Exempt
payment of interest
7. Mortgages or loans with a collateral security to the extent that the Exempt
consideration for advancing such loans or advances is represented by way of
interest
8. Corporate deposits to the extent that the consideration for advancing such Exempt
loans or advances is represented by way of interest or discount
9. Service charges or administrative charges or entry charges collected over and Taxable
above interest on loan, advance or a deposit
10. Service charges or service fees or documentation fees or broking charges for Taxable
such like fees or charges are charged on a derivative/future contract/forward
contract/invoice or cheque discounting
11. Interest/delayed payment charges for delay in payment of brokerage Exempt
amount/settlement obligations/margin trading facility
12. Interest charged on outstanding credit card balances Taxable
13. Services provided by a banking company to Basic Saving Bank Deposit (BSBD) Exempt
account holders under Pradhan Matri Jan Dhan Yojna
14. Services by an acquiring bank to any person in relation to settlement of an Exempt
amount upto ₹2,000 in a single transaction transacted through credit card,
charge card or other payment card service (Note)
15. Services by an intermediary of financial services located in a multi services SEZ Exempt
with International Financial Services Centre (IFSC) status to a customer located
CA NISHANT KUMAR 33
outside India for international financial services in currencies other than Indian
Rupees (INR)
Note: When you go to a shop and make payment by your credit card, the shop keeper’s bank receives
the payment. Your bank is known as the issuing bank, i.e., the bank that issued you the credit card. The
shop keeper’s bank is known as the acquiring bank, i.e., the bank that acquires that payment from your
bank account.
Question 24
With reference to the CGST Act, 2017, discuss the taxability of following activities relating to a bank:
1. Bank extended housing loan of ₹50,00,000 to Mr. A

2. Bank received ₹50,000 as loan processing fee from Mr. A
3. Bank received ₹6,00,000 as interest on loan from Mr. A
Solution
In accordance with the provisions of the CGST Act, 2017, the taxability of activities is as follows:
1. The same is a transaction in money, therefore, it is not regarded as service.

2. The loan processing fees received by bank will be liable for GST @ 18%. Hence, GST liability =
18% × ₹50,000 = ₹9,000
3. ₹6,00,000 received as interest on loan will not be liable to GST as the same is exempt.
M/s Apna Bank Limited, a Scheduled Commercial Bank has furnished the following details for the
month of August, 2021:
Particulars Amount in ₹ in crores

(Excluding GST)
Extended Housing Loan to its customers 100
Processing fees collected from its customers on sanction of loan 20
Commission collected from its customers on bank guarantee 30
Interest income on credit card issued by the bank 40
Interest received on housing loan extended by the bank 25
Minimum balance charges collected from current account and 1
saving account holder
Compute the value of taxable supply. Give reasons with suitable assumptions.
Solution

Particulars ₹
Extended Housing Loan to its customers (Note 1) -
Processing fees collected from its customers on sanction of loan (Note 2) 20
Commission collected from its customers on bank guarantee (Note 2) 30
Interest income on credit card issued by the bank (Note 3) 40
Interest received on housing loan extended by the bank (Note 4) -
Minimum balance charges collected from current account and saving account holder (Note 2) 1
Total value of Taxable Supply 91
Notes:
CA NISHANT KUMAR 34
1. It is a transaction in money and does not come under the ambit of service.
2. Since it represents taxable consideration, the same will be liable to GST.
3. Credit card interest is specifically excluded from exemption; therefore, it is liable to GST.
4. Interest on loan is not liable to GST since it is exempt.
Life Insurance Services

Service Taxability
1. Services of life insurance business provided by way of annuity under the Exempt
National Pension System regulated by the Pension Fund Regulatory and
Development Authority of India under the Pension Fund Regulatory and
Development Authority Act, 2013
2. Services of life insurance business provided or agreed to be provided by the Exempt
Army, Naval and Air Force Group Insurance Funds to members of the Army,
Navy and Air Force, respectively, under the Group Insurance Schemes of Central
Government
3. Services of life insurance provided or agreed to be provided by the Naval Group Exempt
Insurance Fund to the personnel of Coast Guard under the Group Insurance
Schemes of the Central Government
4. Services of life insurance provided or agreed to be provided by the Central Exempt
Armed Police Forces (under Ministry of Home Affairs) Group Insurance Funds
to their members under the Group Insurance Schemes of the concerned Central
Armed Police Force
5. Services of life insurance business provided under the following schemes: Exempt
a. Janashree Bima Yojana
b. Aam Aadmi Bima Yojana
c. Life micro-insurance product as approved by the Insurance Regulatory
and Development Authority, having maximum amount of cover of
₹2,00,000
d. Varishtha Pension Bima Yojana
e. Pradhan Mantri Jeevan Jyoti Bima Yojana
f. Pradhan Mantri Jan Dhan Yojana
g. Pradhan Mantri Vaya Vandan Yojana
Services Provided by Specified Bodies

Service Taxability
1. Services by the Employees’ State Insurance Corporation to persons governed Exempt
under the Employees’ State Insurance Act, 1948
2. Services provided by the Employees Provident Fund Organisation to the Exempt
persons governed under the Employees Provident Funds and the Miscellaneous
Provisions Act, 1952
3. Services by Coal Mines Provident Fund Organisation to persons governed by the Exempt
Coal Mines Provident Fund and Miscellaneous Provisions Act, 1948
4. Services by National Pension Scheme (NPS) Trust to its members against Exempt
consideration in the form of administrative fee
5. Services provided by the Insurance Regulatory and Development Authority of Exempt
India to insurers under the Insurance Regulatory and Development Authority of
India Act, 1999
6. Services provided by the Securities and Exchange Board of India set up under Exempt
the Securities and Exchange board of India Act, 1992 by way of protecting the
CA NISHANT KUMAR 35
interests of investors in securities and to promote the development of, and to
regulate, the securities market
General Insurance Services

1. Services of general insurance business provided under the following schemes are exempt:
a. Hut Insurance Sheme
b. Cattle Insurance under Swarnajayanti Gram Swarozgar Yojana (earlier known as
Integrated Rural Development Programme)
c. Scheme for Insurance of Tribals
d. Janata Personal Accident Policy and Gramin Accident Policy
e. Group Personal Accident Policy for Self-Employed Women
f. Agricultural Pumpset and Failed Well Insurance
g. Premia collected on export credit insurance
h. Restructured Weather Based Crop Insurance Schemes (RWCIS), approved by the
Government of India and implemented by the Ministry of Agriculture
i. Jan Arogya Bima Policy
j. Pradhan Mantri Fasal Bima Yojana (PMFBY)
k. Pilot Scheme on Seed Crop Insurance
l. Central Sector Scheme on Cattle Insurance
m. Universal Health Insurance Scheme
n. Rashtriya Swasthya Bima Yojana
o. Coconut Palm Insurance Scheme
p. Pradhan Mantri Suraksha Bima Yojana
q. Niramaya Health Insurance Scheme implemented by the Trust constituted under the
provisions of the National Trust for the Welfare of Persons with Autism, Cerebral Palsy,
Mental Retardation and Multiple Disabilities Act, 1999
r. Bangla Shasya Bima
2. Services by way of reinsurance are exempt.
Pension Schemes
1. Services by way of collection of contribution under the Atal Pension Yojana are exempt.
2. Services by way of collection of contribution under any pension scheme of the State
Governments are exempt.
Note: In the pension schemes, the subscribers need to contribute certain amount at regular intervals.
This contribution gets collected in the Pension Accounts.
Business Facilitator/Correspondent
Services Taxability
1. Services by a business facilitator or a business correspondent (See Note) to a Exempt
banking company with respect to accounts in its rural area branch
2. Services by any person as an intermediary to a business facilitator or a business Exempt
correspondent with respect to services mentioned above
3. Services by a business facilitator or a business correspondent to an insurance Exempt
company in a rural area
Note: In many rural areas, there are either no banks or the number of banks is very less. In order to
counter this problem and ensure greater financial inclusion, the Reserve Bank of India (RBI) introduced
the Business Correspondents and Business Facilitator Model through guidelines in 2006 allowing banks
CA NISHANT KUMAR 36
to employ two categories of intermediaries – known as Business Facilitators (BFs) and Business
Correspondents (BCs). These BCs/BFs help villagers to open bank accounts and provide other banking
services to them. They act as an intermediary between the bank and its customers. Banks, in turn, pay
commission/fee to the BCs/BFs.
Leasing Services
Upfront amount (called as premium, salami, cost, price, development charges or by any other name)
payable in respect of service by way of granting of long term lease (of 30 years, or more) of industrial
plots for development of infrastructure for financial business, provided by the State Government
Industrial Development Corporations or Undertakings or by any other entity having 20% or more
ownership of Central Government, State Government, Union Territory to the industrial units or the
developers in any industrial or financial business area is exempt.
Clarifications:
1. Even if the upfront amount is paid in instalments, the exemption shall be available.
2. Location charges or preferential location charges (PLC) paid upfront in addition to the lease
premium for long term lease of land constitute part of upfront amount charged for long term
lease of land are therefore exempt from tax.
Legal Services
Services Taxability
1. Services provided by an Arbitral Tribunal to: Exempt
a. Any person other than a business entity; or
b. A business entity not liable to get registered; or
c. The Central Government, State Government, Union Territory, Local
Authority, Governmental Authority or Government Entity
2. Services provided by a partnership firm of advocates or an individual as an Exempt
advocate, other than senior advocate, by way of legal services to:
a. An advocate or partnership firm of advocates providing legal services
b. Any person other than a business entity; or
c. A business entity not liable to get registered; or
d. The Central Government, State Government, Union Territory, Local
3. Services provided by a senior advocate by way of legal services to: Exempt
a. Any person other than a business entity; or
b. A business entity not liable to get registered; or
c. The Central Government, State Government, Union Territory, Local
Notes:
1. We’ve already discussed that GST on services provided by an individual advocate (including a
senior advocate) or a firm of advocates by way of legal services, directly or indirectly to any
business entity located in the taxable territory is to be paid by such business entity on reverse
charge basis.
2. Similarly, GST on services supplied by an arbitral tribunal to a business entity has to be paid by
such business entity on reverse charge basis.
3. Also, in case of legal services including representational services provided by an advocate
including a senior advocate to a business entity, GST is required to be paid by the recipient of
the service under reverse charge mechanism, i.e., the business entity.
CA NISHANT KUMAR 37
Question 26
Mr. Abhishek, an advocate, has rendered the following services in the month of October, 2021:
1. Representing Mr. Archit in his divorce case before High Court

2. Representing Mr. Aniket, an architect by profession, in relation to his GST liability [Turnover of
Mr. Aniket in the financial year 2020-21 was ₹25 lakh]
3. Legal consultancy given to Sunil Associates, a partnership firm of advocates [Turnover of
services of Sunil Associates in the financial year 2020-21 was ₹28 lakh]
Examine whether GST is payable on each of the above services assuming Mr. Abhishek to be:
1. An advocate other than a senior advocate

2. A senior advocate in terms of Section 16 of the Advocates Act, 1961.
Solution
When Mr. Abhishek is an Advocate Other Than a Senior Advocate
1. Service of representing Mr. Archit in his divorce case will be exempt as Mr. Archit is not a
business entity.
2. Since the turnover of Mr. Aniket, a business entity, is more than ₹20 lakhs in the preceding
financial year, he is liable to get registered. Services by an individual advocate to a business
entity liable to be registered are liable to GST.
3. Legal consultancy provided by an advocate to partnership firm of advocates is exempt from
GST.
When Mr. Abhishek is a Senior Advocate
1. Service of representing Mr. Archit in his divorce case will be exempt as Mr. Archit is not a
business entity.
2. Since the turnover of Mr. Aniket, a business entity, is more than ₹20 lakhs in the preceding
financial year, he is liable to get registered. Services by an individual advocate to a business
entity liable to be registered are liable to GST.
3. Services provided by a Senior Advocate to a partnership firm of advocates is not specifically
exempt. Also, the turnover of this firm of advocates exceeds ₹20 lakhs in the preceding
financial year, therefore, this firm is liable to get registered. Hence, services provided by a
senior advocate to such firm of advocates will be liable to GST.
Sponsorship of Sports
Services by way of sponsorship of sporting events organised by the following are exempt:
1. National sports federation, or its affiliated federations, where the participating teams or
individuals represent any district, state, zone, or country
2. Association of Indian Universities, Inter-University Sports Board, School Games Federation of
India, All India Sports Council for the Deaf, Paralympic Committee of India or Special Olympics
Bharat;
3. Central Civil Services Cultural and Sports Board
4. Indian Olympic Association, as part of national games
5. Under Panchayat Yuva Kreeda Aur Khel Abhiyaan Scheme
CA NISHANT KUMAR 38
Skill Development Services
Services Taxability
1. Services provided by: Exempt
a. The National Skill Development Corporation set up by the Government
of India;
b. A Sector Skill Council approved by the National Skill Development
Corporation;
c. An assessment agency approved by the Sector Skill Council or the
National Skill Development Corporation;
d. A training partner approved by the National Skill Development
Corporation or the Sector Skill Council
in relation to:
a. The National Skill Development Programme implemented by the
National Skill Development Corporation; or
b. A Vocational Skill Development Course under the National Skill
Certification and Monetary Reward Scheme; or
c. Any other Scheme implemented by the National Skill Development
Corporation
2. Services of assessing bodies empanelled centrally by the Directorate General of Exempt
Training, Ministry of Skill Development and Entrepreneurship by way of
assessments under the Skill Development Initiative Scheme.
3. Services provided by training providers (Project implementation agencies) Exempt
under Deen Dayal Upadhyaya Grameen Kaushalaya Yojana implemented by the
Ministry of Rural Development, Government of India by way of offering skill or
vocational training courses certified by the National Council for Vocational
Training
Performance By Artist
Service Taxability
1. Services by an artist by way of performance in folk or classical art forms of Exempt
music, dance, or theatre, if the consideration charged for such performance ≤
₹1,50,000
2. Services by way of training or coaching in recreational activities relating to arts, Exempt
culture, or sports
3. Services by an artist as a brand ambassador by way of performance in folk or Taxable
classical art forms of music, dance, or theatre, even if the consideration charged
for such performance ≤ ₹1,50,000
4. Services by an artist by way of performance of western music or dance, modern Taxable
theatres, performance of actors in films or television serials
5. Activities of artists in still art forms, such as painting, sculpture making, etc. Taxable
Note: Brand Ambassador means a person engaged for promotion or marketing of a brand of goods,
service, property or actionable claim, event or endorsement of name, including a trade name, logo or
house mark of any person.
Question 27
Mr. Rajkumar, a performing artist, provides the following information relating to December, 2022.
Receipts from:
Particulars ₹
Performing classical dance 98,000
CA NISHANT KUMAR 39
Performing in television serial 2,80,000
Services as brand ambassador 12,00,000
Coaching in recreational activities relating to arts 2,10,000
Activities in sculpture making 3,10,000
Performing western dance 90,000
Determine the value of taxable supply and GST payable by Mr. Rajkumar for December, 2022. GST @
18% has been charged separately, wherever applicable.
Solution

Particulars ₹
Performing classical dance (Note 1) -
Performing in television serial (Note 2) 2,80,000
Services as brand ambassador (Note 1) 12,00,000
Coaching in recreational activities relating to arts (Note 3) -
Activities in sculpture making (Note 4) 3,10,000
Performing western dance (Note 2) 90,000
GST @ 18% 3,38,400
Notes:
1. Services by an artist by way of performance in folk or classical art forms of music, dance, or
theatre, if the consideration charged for such performance ≤ ₹1,50,000 are exempt. However,
if such services are provided by an artist as a brand ambassador, the exemption is not available.
2. Services by an artist by way of performance of western music or dance, modern theatres,
performance of actors in films or television serials are taxable.
3. Services by way of training or coaching in recreational activities relating to arts, culture, or
sports are exempt.
4. Activities of artists in still art forms, such as painting, sculpture making, etc. are taxable.
Question 28 – July, 2021 – 5 Marks
XYZ Pvt. Ltd. manufactures beauty soap with the brand name “Forever Beauty”. XYZ Pvt. Ltd. has
organised a concert to promote its brand. Ms. Alia, its brand ambassador, who is a leading film actress,
has given a classical dance performance in the said concert. The proceeds of the concert are ₹1,25,000.
1. Explain with relevant provisions of GST, whether Ms. Alia will be required to pay any GST.
2. What will be the answer if the proceeds of the concert are donated to a charitable
organisation?
Solution
1. Services by an artist by way of a performance in classical art forms of, inter alia, dance, are
exempt from GST, if the consideration charged for such performance is not more than
₹1,50,000. However, such exemption is not available in respect of service provided by such
artist as a brand ambassador. Since Ms. Alia is the brand ambassador of ‘Forever Beauty’ soap
manufactured by XYZ Pvt. Ltd., the services rendered by her by way of a classical dance
performance in the concert organized by XYZ Pvt. Ltd. to promote its brand will not be eligible
for the above-mentioned exemption and thus, be liable to GST.
CA NISHANT KUMAR 40
2. Even if the proceeds of the concert will be donated to a charitable organization, she will be
liable to GST.
Right to Admission to Various Events

Services Taxability
1. Services by way of admission to a museum, national park, wildlife sanctuary, Exempt
tiger reserve or zoo
2. Services by way of admission to a protected monument so declared under the Exempt
Ancient Monuments and Archaeological Sites and Remains Act, 1958 or any of
the State Acts, for the time being in force
3. Services by way of right to admission to: Exempt
a. Circus, dance, or theatrical performance including drama or ballet;
b. Award function, concert, pageant, musical performance or any sporting
event other than a recognized sporting event;
c. Recognized sporting event;
d. Planetarium,
Where the consideration for right to admission to the events or places
mentioned above is ≤ ₹500 per person
4. Entry to casinos Taxable
5. Services of Betting/Gambling provided by casinos Taxable
6. Elephant/Camel joy ride Taxable
Services by Unincorporated Body or Non-Profit Entity

Services Taxability
1. Services by an unincorporated body or a non-profit entity registered under any Exempt
law for the time being in force, to its own members by way of reimbursement
of charges or share of contribution:
a. As a trade union
b. For the provision of carrying out any activity which is exempt from the
levy of Goods and Service Tax; or
c. Up to an amount of ₹7,500 per month per member for sourcing of
goods or services from a third person for the common use of its
members in a housing society or a residential complex
2. Services provided by a Housing Society to its members Taxable
3. Services by an RWA (having turnover ≤ ₹20 lakh in the preceding financial year) Exempt
to its members for consideration (maintenance charges) upto ₹7,500 per
month per member
4. Services by an RWA (having turnover ≤ ₹20 lakh in the preceding financial year) Exempt
to its members for consideration (maintenance charges) more than ₹7,500 per
month per member
5. Services by an RWA (having turnover more than ₹20 lakh in the preceding Exempt
financial year) to its members for consideration (maintenance charges) upto
₹7,500 per month per member
6. Services by an RWA (having turnover more than ₹20 lakh in the preceding Taxable
financial year) to its members for consideration (maintenance charges) more
than ₹7,500 per month per member
7. Services provided by an unincorporated body or a non-profit entity registered Exempt
under any law for the time being in force, engaged in:
a. Activities relating to the welfare of industrial or agricultural labour or
farmers; or
CA NISHANT KUMAR 41
b. Promotion of trade, commerce, industry, agriculture, art, science,
literature, culture, sports, education, social welfare, charitable
activities and protection of environment
to its own members against consideration in the form of membership fee upto
an amount of ₹1,000 per member per year.
Notes:
1. RWAs are entitled to take ITC of GST paid by them on capital goods (generators, water pumps,
lawn furniture, etc.), goods (taps, pipes, other sanitary/hardware fillings etc.) and input
services such as repair and maintenance services.
2. If a person owns two or more residential apartments in a housing society or a residential
complex, he shall be treated to be a member of the RWA for each residential apartment owned
by him separately. The ceiling of ₹7,500 per month per member shall be applied separately for
each residential apartment owned by him. For example, if a person owns two residential
apartments in a residential complex and pays ₹15,000 per month as maintenance charges
towards maintenance of each apartment to RWA (₹7,500 per month in respect of each
residential apartment), the exemption from GST shall be available to each apartment.
3. If the maintenance charges exceed ₹7,500 per month per member, then the entire
consideration is liable to GST, and not just the difference.
Question 29
The Resident Welfare Association (RWA) of Blue Heaven Housing Society in Delhi provides the
following information with respect to the various amounts received by it in the month of November,
2022:
Particulars ₹
Monthly subscription collected from member families (₹10,000 each from 100 families) 10,00,000
Electricity charges levied by State Electricity Board on the members of RWA (The same 3,50,000
was collected from members and remitted to the Board on behalf of members)
Electricity charges levied by State Electricity Board on the RWA in respect of electricity 4,32,400
consumed for common use of lifts and lights in common area (Bill was raised in the
name of RWA. RWA collected the said charges by apportioning them equally among 100
families and then, remitted the same to the Board)
Proceeds from sale of entry tickets to a musical performance conducted by the RWA in 40,000
the park of Blue Heaven Housing Society (Where the consideration for admission is not
more than ₹500 per person)
Other services to non-members 2,92,000
Compute the value of taxable supply and GST liability of RWA of Blue Heaven Housing Society for the
month of November, 2022. It does not avail threshold exemption.
Notes:
1. All the above amounts are exclusive of GST.

2. Wherever applicable, the time of supply falls in the month of November, 2022
3. Rate of GST = 18%
Solution

Particulars ₹
Monthly subscription collected from member families (Note 1) 10,00,000
Electricity charges levied by State Electricity Board on the members of RWA (Note 2) -
CA NISHANT KUMAR 42
Electricity charges levied by State Electricity Board on the RWA in respect of electricity 4,32,400
consumed for common use of lifts and lights in common area (Note 3)
Sale of entry tickets to a musical performance conducted by the RWA (Note 4) -
Other services to non-members 2,92,000
GST @ 18% 3,10,392
Notes:
1. If per month per member contribution of any or some members of an RWA exceeds ₹7,500,
entire contribution of such members whose per month contribution exceeds ₹7,500 would be
ineligible for the exemption. GST would then be leviable on the aggregate amount of monthly
contribution of such members.
2. Services provided by an RWA in the name of its members, acting as a "pure agent" of its
members, are excluded from the value of taxable supply available for the purposes of
exemption.
3. In the case of electricity bills issued in the name of RWA, in respect of electricity consumed for
common use of lifts and lights in common area, etc., the exclusion from the value of taxable
supply would not be available, since there is no agent involved in these transactions.
4. Entry to entertainment events where the consideration for admission is not more than ₹500
per person is exempt.
Question 30 – January, 2021 – 4 Marks
Satya Sai Residents Welfare Association, a registered person under GST has 30 members each paying
₹8,000 as maintenance charges per month for sourcing of goods and services from third persons for
common use of its members.
The Association purchased a water pump for ₹59,000 (inclusive of GST of ₹9,000) and availed input
services for ₹23,600 (inclusive of GST of ₹3,600) for common use of its members during February 2022.
Compute the total GST payable, if any, by Satya Sai Residents Welfare Association, for February 2022.
GST rate is 18%.
All transactions are intra-State. There is no opening ITC and all conditions for ITC are fulfilled.
Solution
Computation of GST Payable

Particulars ₹
Maintenance Charges Received (₹8,000 × 30) (Note 1) 2,40,000
GST Payable @ 18% 43,200
Less: Input Tax Credit (Note 2)
Less: GST Paid on Water Pump 9,000
Less: GST Paid on Input Services 3,600 12,600
Net GST Payable 30,600
Notes:
1. Services by RWA to its members for sourcing of goods or services from a third person for the
common use of its members in a housing society are exempt provided the share of
contribution per month per member is upto ₹7,500. Otherwise, entire amount is taxable.
CA NISHANT KUMAR 43
2. Residents Welfare Association is entitled to take ITC of GST paid by them on capital goods,
goods, and input services, used by it for making supplies to its members and use such ITC for
discharge of GST liability on such supplies where the amount charged for such supplies is more
than ₹7,500 per month per member. Thus, Satya Sai Residents Welfare Association can avail
ITC of GST paid on water pump purchased and input services availed.
Other Exempt Services

Services Taxability
1. Services by way of transfer of a going concern, as a whole or an independent Exempt
part thereof
2. Supply of services associated with transit cargo to Nepal and Bhutan Exempt
(landlocked countries) (See Note 1)
It is also clarified that movement of empty containers from Nepal and Bhutan,
after delivery of goods there, is a service associated with the transit cargo to
Nepal and Bhutan and is therefore covered by exemption.
3. Services by way of renting of residential dwelling for use as residence, except Exempt
where the residential dwelling is rented to a registered person
4. Services by way of renting of residential dwelling to a registered person, for Taxable
use as a residence
Note: This is taxable under RCM.
5. Services by a hotel, inn, guest house, club or campsite, by whatever name Exempt
called, for residential or lodging purposes, having value of supply of a unit of
accommodation ≤ ₹1,000 per day
6. Services by way of giving on hire: Exempt
a. To a state transport undertaking, a motor vehicle meant to carry more
than 12 passengers, or
b. To a local authority, an Electrically operated vehicle meant to carry
more than 12 passengers, or
c. To a goods transport agency, a means of transportation of goods, or
d. Motor vehicle for transport of students, faculty and staff, to a person
providing services of transportation of students, faculty, and staff to an
educational institution providing services by way of pre-school
education and education upto higher secondary school or equivalent
7. Services by way of access to a road or a bridge on payment of toll charges Exempt
8. Overloading charges at toll plazas Exempt
9. Additional toll fees collected in the form of higher toll charges from vehicles Exempt
not having fastag
10. Commission on toll receipts Taxable
11. Service by way of access to a road or a bridge on payment of annuity Exempt
12. Service by way of construction of road where considerations are received in Taxable
deferred payment (annuity)
13. Transmission or distribution of electricity by an electricity transmission or Exempt
distribution utility
14. Services by an electricity transmission or distribution utility such as: Taxable
a. Application fee for releasing connection of electricity
b. Rental charges against metering equipment
c. Testing fee for meters, transformers, capacitors, etc.
d. Labour charges from customers for shifting of meters or shifting of
service lines
e. Charges for duplicate bill
CA NISHANT KUMAR 44
15. Services provided by an incubatee up to a total turnover of ₹50,00,000 in a Exempt
financial year subject to the following conditions:
a. The total turnover had not exceeded ₹50 lakh during the preceding
financial year; and
b. A period of 3 years has not elapsed from the date of entering into an
agreement as an incubatee (See Note 2)
16. Services by way of licensing, registration and analysis or testing of food samples Exempt
supplied by the Food Safety and Standards Authority of India (FSSAI) to Food
Business Operators
17. Taxable services, provided or to be provided, by a Technology Business Exempt
Incubator or a Science and Technology Entrepreneurship Park recognised by
the National Science and Technology Entrepreneurship Development Board
(NSTEDB) of the Department of Science and Technology, Government of India
or bio-incubators recognised by the Biotechnology Industry Research
Assistance Council, under the Department of Biotechnology, Government of
India
18. Services by way of collecting or providing news by an independent journalist, Exempt
Press Trust of India or United News of India
19. Services of public libraries by way of lending of books, publications or any other Exempt
knowledge-enhancing content or material
20. Services by an organiser to any person in respect of a business exhibition held Exempt
outside India
21. Tour operator service, which is performed partly in India and partly outside Exempt
India, supplied by a tour operator to a foreign tourist, to the extent of the
value of the tour operator service which is performed outside India.
Value of services performed outside India: Value of tour operator service
performed outside India shall be lower of the following:
a. Total consideration charged for the entire tour × Number of days for
which the tour is performed outside India ÷ Total number of days
comprising the tour, or
b. 50% of the total consideration charged for the entire tour
In making the above calculations, any duration of time equal to or exceeding
12 hours shall be considered as one full day and any duration of time less than
12 hours shall be taken as half a day.
“Foreign Tourist” means a person not normally resident in India, who enters
India for a stay of not more than six months for legitimate non-immigrant
purposes.
22. Services by way of slaughtering of animals Exempt
23. Services by a foreign diplomatic mission located in India Exempt
24. Services by way of providing information under the Right to Information Act, Exempt
2005
25. Services provided to a recognised sports body by: Exempt
a. An individual as a player, referee, umpire, coach or team manager for
participation in a sporting event organised by a recognised sports body
b. Another recognised sports body
26. Services in relation to sports by individuals such as selectors, commentators, Taxable
curators, technical experts
27. Services provided by and to Federation Internationale de Football Association Exempt
(FIFA) and its subsidiaries directly or indirectly related to any of the events
under FIFA U-17 Women’s World Cup 2020 to be hosted in India whenever
rescheduled.
CA NISHANT KUMAR 45
28. Services provided by and to Asian Football Confederation (AFC) and its Exempt
subsidiaries directly or indirectly related to any of the events under AFC
Women’s Asia Cup 2022 to be hosted in India
29. Services by way of right to admission to the events organised under FIFA U-17 Exempt
Women’s World Cup 2020, whenever rescheduled
30. Services by way of right to admission to the events organised under AFC Exempt
Women’s Asia Cup 2022
31. Services by way of public conveniences such as provision of facilities of Exempt
bathroom, washrooms, lavatories, urinal or toilets
Notes:
1. A landlocked country is a country that does not have territory connected to an ocean.
2. Incubatee means an entrepreneur located within the premises of a Technology Business
Incubator or Science and Technology Entrepreneurship Park recognised by the National
Science and Technology Entrepreneurship Development Board (NSTEDB) of the Department
of Science and Technology, Government of India and who has entered into an agreement with
the Technology Business Incubator or the Science and Technology Entrepreneurship Park to
enable himself to develop and produce hi-tech and innovative products.
Question 31
M/s PQR Properties registered under GST as taxable person is engaged in the business of renting
various immovable properties owned by it. During the month ending 31-03-2023, it collected a rent of
₹6,70,000. The said sum includes rent from:
1. Vacant land used for agriculture: ₹50,000

2. Land used for Appu Circus: ₹80,000
3. Houses let to individuals for residential purposes to unregistered persons: ₹70,000
4. Houses let to registered persons for residential purposes: ₹1,70,000
5. Commercial Building let to M/s Elegant Hotel: ₹60,000
6. Vacant land, given on lease to M/s ABC Ltd. for construction of building at a later stage to be
used for furtherance of business or commerce: ₹40,000
7. Premises let to a temple trust: ₹40,000
8. Premises let to a coaching centre: ₹80,000
9. Building let to a theatre: ₹80,000
Compute the amount of GST payable by the firm, assuming that the rent is exclusive of GST, if any,
applicable in each case. Rate of GST = 18%. Make suitable assumptions.
Solution

Particulars ₹
Total Rent Received 6,70,000
Less: Vacant land used for agriculture (Exempt) 50,000
Less: Land used for Appu Circus (Taxable) -
Less: Houses let to individuals being unregistered person 70,000
Less: Houses let to registered person for residential purposes (Taxable under 1,70,000
RCM)
Less: Commercial Building let to M/s Elegant Hotel (Taxable) -
Less: Vacant land, given on lease to M/s ABC Ltd. for construction of building -
at a later stage to be used for furtherance of business or commerce
CA NISHANT KUMAR 46
(Taxable)
Less: Premises let to a temple trust (Taxable) -
Less: Premises let to a coaching centre (Taxable) -
Less: Building let to a theatre (Taxable) - 2,90,000
Taxable Value of Supply 3,80,000
GST @ 18% 68,400
Question 32
Compute taxable value of supply and GST from following sums received by M/s Road Maintenance Ltd.
(exclusive of GST):
1. Toll receipts from Highway of Jaipur to Chomu: ₹8,000 lakhs

2. Commission earned on toll receipts: ₹75 lakhs
The rate of GST is 18%.
Solution
Toll receipts are exempt from GST. However, commission thereon is liable to GST.
Taxable value of supply = ₹75,00,000. GST @ 18% = 18% × ₹75,00,000 = ₹13,50,000
Question 33
A tour operator provides a tour operator service to a foreign tourist as follows:
1. 3 days in India, 2 days in Nepal; Consideration charged for the entire tour: ₹1,00,000
2. 2 days in India, 3 nights in Nepal; Consideration charged for the entire tour: ₹1,00,000
3. 2.5 days in India, 3 days in Nepal; Consideration charged for the entire tour: ₹1,00,000
Calculate the amount of taxable value in each of the above cases.
Solution
1. Exemption: ₹40,000 (₹1,00,000 × 2 ÷ 5) or, ₹50,000 (50% × ₹1,00,000) whichever is less, i.e.,
₹40,000. Therefore, taxable value = ₹60,000.
2. Exemption: ₹60,000 (₹1,00,000 × 3 ÷ 5) or, ₹50,000 (50% × ₹1,00,000) whichever is less, i.e.,
3. Exemption: ₹54,545 (₹1,00,000 × 3 ÷ 5.5) or, ₹50,000 (50% × ₹1,00,000) whichever is less, i.e.,
Question 34
Mr. X, a famous cricketer furnishes you with the following information of the various receipts for the
month of September 2022. You are required to determine his GST liability if all the amounts are
exclusive of GST.
1. Receipts from Sports Authority of India for participation in recognized sport: ₹50,00,000
2. Receipts from franchisee of Indian Premiere League (not a recognised sports body): ₹75,00,000
3. Receipts from acting as a brand ambassador for corporate client: ₹22,00,000
CA NISHANT KUMAR 47
4. Receipts of sports training academy to coach young players: ₹15,00,000
Rate of GST = 18%.
Solution

Particulars ₹
Receipts from Sports Authority of India for participation in recognized sport (Exempt) -
Receipts from franchisee of Indian Premiere League (not a recognised sports body) 75,00,000
Receipts from acting as a brand ambassador for corporate client 22,00,000
Receipts of sports training academy to coach young players (Note) 15,00,000
Value of Taxable Supply 1,12,00,000
GST @ 18% 20,16,000
Note: Sports training by charitable entities is exempt. Since sports training academy is not a charitable
entity, it is taxable.
Question 35
An individual acts as a referee in a football match organised by Sports Authority of India. He has also
acted as a referee in another charity football match organised by a local sports club, in lieu of a lump
sum payment. Discuss whether he is required to pay any GST.
Solution
Services provided to recognised sports body by an individual, inter alia, as a referee in sporting event
organised by recognised sports body is exempt from GST.
Since in the first case, the football match is organised by Sports Authority of India, which is a recognised
sports body, services provided by the individual as a referee in such football match will be exempt.
However, when he acts as a referee in a charity football match organised by a local sports club, he
would not be entitled to aforementioned exemption as a local sports club is not a recognised sports
body and thus, GST will be payable in this case.
Question 36
Educators Ltd., providing educational services, furnishes you with the following information for the
various services provided by it. It has collected an aggregate sum of ₹25,00,000 during the month
ended 30-09-2022 as under:
1. Receipts of ‘Gyan Sagar’ an industrial training institute (ITI) affiliated to the National Council
for Vocational Training (NCVT): ₹1,20,000
2. Receipts of ‘Edu Care’ a vocational education provided affiliated to Sector Skill Council formed
under National Skill Development Corporation (NSDC): ₹1,80,000
3. Receipts of ‘Abhigyan Skill Centre’ an industrial training centre (ITC) affiliated to the State
Council for Vocational Training, Rajasthan: ₹2,00,000
4. Receipts of ‘Mission’, an institute, registered with Directorate General of Employment and
Training (DGET), Union Ministry of Labour and Employment, running a Modular Employable
Skill Course (MESC) approved by the National Council of Vocational Training: ₹1,00,000
CA NISHANT KUMAR 48
5. Receipts of ‘Scinart’ a Commercial coaching institute providing commercial coaching in the
field of arts and science: ₹80,000 (no certificate was issued on completion of training)
6. Receipts of ‘Commerce Concepts’, a commercial coaching institute providing coaching in the
field of commerce: ₹1,20,000 (a certificate was awarded to each trainee after completion of
the training)
7. Receipts of Gurukul school providing education upto higher secondary: ₹6,00,000
8. Receipts of ‘Play Kids’ school providing education upto primary level: ₹11,00,000 (such receipts
includes receipts from renting of premises to commercial coaching centre: ₹3,00,000)
Compute the value of taxable supply and GST payable thereon. All amounts are exclusive of GST. Rate
of GST is 18%.
Solution

Particulars ₹
Total Receipts 25,00,000
Less:
Receipts of ‘Gyan Sagar’ an industrial training institute (ITI) affiliated to 1,20,000
the National Council for Vocational Training (Exempt)
Receipts of ‘Edu Care’ a vocational education provided affiliated to Sector 1,80,000
Skill Council formed under National Skill Development Corporation
(NSDC) (Exempt)
Receipts of ‘Abhigyan Skill Centre’ an industrial training centre (ITC) 2,00,000
affiliated to the State Council for Vocational Training, Rajasthan (Exempt)
Receipts of ‘Mission’, an institute, registered with Directorate General of 1,00,000
Employment and Training (DGET), Union Ministry of Labour and
Employment, running a Modular Employable Skill Course (MESC)
approved by the National Council of Vocational Training (Exempt)
Receipts of ‘Scinart’ a Commercial coaching institute providing -
commercial coaching in the field of arts and science (no certificate was
issued on completion of training) (Taxable)
Receipts of ‘Commerce Concepts’, a commercial coaching institute -
providing coaching in the field of commerce (a certificate was awarded to
each trainee after completion of the training) (Taxable)
Receipts of Gurukul school providing education upto higher secondary 6,00,000
(Exempt)
Receipts of ‘Play Kids’ school providing education upto primary level 8,00,000 20,00,000
(₹11,00,000 – ₹3,00,000)
GST @ 18% 90,000
Question 37
Determine taxable value of supply under GST law with respect to each of the following independent
services provided by the registered persons:
Particulars Gross Amount

Charged (₹)
Fees charged for yoga camp conducted by a charitable trust 2,25,000
Amount charged by business correspondent for the services provided to the 1,25,000
rural branch of a bank with respect to Savings Bank Accounts
CA NISHANT KUMAR 49
Amount charged by cord blood bank for preservation of stem cells 4,50,000
Amount charged for service provided by commentator to a recognized sports 4,25,000
body
Solution

Particulars ₹
Fees charged for yoga camp conducted by a charitable trust (Note 1) -
Amount charged by business correspondent for the services provided to the rural branch -
of a bank with respect to Savings Bank Accounts (Note 2)
Amount charged by cord blood bank for preservation of stem cells (Note 3) 4,50,000
Amount charged for service provided by commentator to a recognized sports body (Note 4,25,000
4)
Notes:
1. Services by an entity registered under section 12AA of the Income-tax Act, 1961 by way of
charitable activities are exempt from GST. The activities relating to advancement of yoga are
included in the definition of charitable activities. So, such activities are exempt from GST.
2. Services by business facilitator or a business correspondent to a banking company with respect
to accounts in its rural area branch have been exempted from GST.
3. Services provided by cord blood banks by way of preservation of stem cells or any other service
in relation to such preservation are liable to GST.
4. Services provided to a recognized sports body only by an individual as a player, referee,
umpire, coach or team manager for participation in a sporting event organised by a recognised
sports body are exempt from GST. Thus, services provided by commentators are liable to GST.
Question 38
State with reasons whether the following are liable to Goods and Services Tax:
1. Services by way of training or coaching in recreational activities relating to arts or culture.

2. Services provided by a player to a franchisee which is not a recognised sports body.
3. Pre-school education and education up to higher secondary school or equivalent.
4. Services by a veterinary clinic in relation to health care of animals or birds.
5. Services by way of public conveniences such as provision of facilities of washrooms.
Solution
1. Exempt: Services by way of training or coaching in recreational activities relating to arts or

culture are not liable to GST as it is specifically exempt.
2. Taxable: Service of a player to a franchisee which is not a recognized sports body is taxable.
3. Exempt: Pre-school education and education up to higher secondary school or equivalent is
not liable to GST as it is specifically exempt.
4. Exempt: Services by a veterinary clinic in relation to health care of animals or birds is not liable
to GST as it is specifically exempt.
5. Exempt: Services by way of public conveniences such as provision of facilities of washrooms
are not liable to GST as they are specifically exempt.
CA NISHANT KUMAR 50
Examine whether GST is exempted on the following independent supply of services:
1. Teja & Co., a tour operator, provides services to a foreign tourist for tour conducted to Jammu
Kashmir and receives a sum of ₹3,00,000.
2. Ms. Poorva acts as a Team Manager for Indian Sports League (ISL), a recognized sports body,
for a Tennis tournament organised by Multi brand retail company and received a remuneration
of ₹2,00,000.
Solution
1. Liable to GST: Yes, Teja & Co. will be liable to pay GST. Services provided by a tour operator to
a foreign tourist in relation to a tour conducted wholly outside India are exempt. In this case,
tour is conducted in Jammu & Kashmir and the IGST Act applies to the whole of India including
Jammu and Kashmir, hence exemption will not operate.
2. Liable to GST: Services provided to a recognised sports body by an individual as a plyer, referee,
umpire, coach or team manager for participation in a sporting event organised by a recognised
sports body are exempt. Since multi brand retail company is not a recognised sports body
hence exemption will not be available. Thus, the said services will be liable to GST.
Question 40 – November, 2018 – 3 Marks
Decide with reason whether the following independent services are exempt from CGST Act, 2017:
1. M/s Fast Trans, a goods transport agency, transported relief materials meant for victims of
Kerela floods being a natural disaster, by road from Delhi to Ernakulam, for a Limited Co.
2. Keyan Enterprises, an event organiser, provided services to Breathing Wall Ltd. by way of
organising business exhibition at Pragati Maidan in New Delhi as part of Make in India
initiative.
Solution
1. Exempt: Services provided by a goods transport agency, by way of transport of goods carriage
of relief materials meant for victims of natural or man-made disasters, calamities, accidents,
or mishap are exempt from tax.
2. Taxable: Services by an organiser to any person in respect of a business exhibition held outside
India are exempt. Since the business exhibition is held in India, hence the said services shall be
liable to GST.
Question 41 – RTP November, 2018
Examine whether GST is payable in the following independent supply of services:
1. Indiana Engineering College, a recognised educational institution, has conducted an entrance

test examination for various courses run by it and charged entrance fees from the applicants.
2. Ramfal Lalaji, an agriculturalist, has stored sugarcane in warehouse. He has taken fumigation
services in the said warehouse from Gupta Pest Control Co. for which he paid the consideration
of ₹6,000.
CA NISHANT KUMAR 51
Solution
1. Exempt from GST: Services provided by an educational institution by way of conduct of

entrance examination against consideration in the form of entrance fee are exempt from GST.
Since, in the given case, services provided by Indiana Engineering College, an educational
institution, are by way of conduct of entrance examination against entry fee, the same is
exempt, and thus, GST is not payable in this case.
2. Liable to GST: Services by way of fumigation in a warehouse of agricultural produce are liable
to GST.
Question 42 – MTP May, 2018
Examine whether GST is payable in the following independent cases:
1. Ekta Charitable Trust, registered under section 10(23C)(v) of the Income-tax Act manages a
temple in Rohini, Delhi. It has given on rent a Community Hall, located within temple premises,
to public for celebration of Teej Mela. Rent charged is ₹9,500.
2. ST Ltd. has given on hire five trucks to Titu transporters of Delhi (a goods transport agency) for
transporting goods in Central and West Delhi. The hiring charges for the trucks or ₹7,500 per
truck per day.
Solution
1. Exempt: Renting of community Hall by Ekta Charitable trust is exempt from GST, as rent is less
than ₹10,000 per day. The exemption notification no. 12/2017 has exempted the said service
wholly from GST.
The said notification provides exemption to Services by a person, inter alia, by way of renting
of precincts of a religious place meant for general public, owned or managed by an entity
registered as a trust or an institution under section 10(23C)(v) of the income tax act. However,
this exemption does not apply where renting charges of premises, community halls,
Kalyanmandapam and open area at ₹10,000 or more per day.
2. Exempt: GST is not payable in case of hiring of trucks to Titu transporters. The exemption
notification number 12/2017 provides exemption to services by way of giving on hire, inter-
alia to a goods transport agency a means of transportation of goods.
Question 43 – RTP May, 2019
Examine whether supply of food and drink in following independent cases is exempt from GST:
1. “Smart Kids” is a play school located in Delhi. Smart Kids has outsourced the catering services
for supply of food and drink in the canteen of Playschool to BTV caterers, Delhi for
consideration of ₹8,00,000 per annum.
2. Wellness Hospital, a clinical establishment located in Tirupati, is specialised in diabetic
treatment. The hospital has its own canteen - tasty foods. The canteen serves the food and
drink to the in-patients as advised by the doctors/nutritionist of the hospitals. Apart from this,
other patients (who are not admitted) or attendants or visitors of the in-patients also take food
and drink from the canteen.
Solution
CA NISHANT KUMAR 52
1. Exempt from GST: Services provided to an educational institution providing services by way of
preschool education and education up to higher secondary school or equivalent, by way of
catering is exempt from GST. Thus, in the given case, services provided by BTV caterers to
Smart Kids are exempt from GST.
2. Exempt/Taxable: Services by way of healthcare services provided by a clinical establishment,
an authorised medical practitioner or paramedics are exempt from GST.
In this regard, CBIC has clarified that food supplied by the hospital canteen to the in-patients
as advised by the doctors/nutritionists is a part of composite supply of healthcare services and
is not separately taxable. Thus, it is exempt from GST. However, other supplies of food by a
hospital to patients (not admitted) or their attendants or visitors or taxable.
In view of the same, GST is exempt on the food supplied by Tasty Foods to the in-patients as
advised by the doctors/nutritionists while other supplies of food by it to patients (not
admitted) or attendants/visitors of the in-patients is taxable.
Decide with reason whether the following independent services are exempt under CGST Act, 2017:
1. Gokul Residents' Welfare Association received ₹9,000 per month as contribution from each
member for sourcing of goods and services from third persons for common use of its members.
2. Mr. Vikalp, a performing artist, has received ₹1,58,000 from performance of classical dance
and ₹90,000 from acting in TV Serial during the month of June 2023.
Solution
1. Service by an unincorporated body or a non-profit entity registered under any law for the time
being in force, to its own members by way of reimbursement of charges or share of
contribution up to an amount of ₹7,500 per month per member for sourcing of goods or
services from a third person for the common use of its members in a housing Society or
residential complex is exempt from tax.
In this case, the monthly bill is ₹9,000 and the same is on account of services were common
use of its members. Hence exemption of ₹7,500 shall not be available and GST will be payable
on entire amount of ₹9,000.
2. The activities by performing artist in folk or classical art forms of music, dance or theatre are
exempt if consideration does not exceed ₹1,50,000. However, if consideration from such
activities exceeds ₹1,50,000 entire consideration, subject of GST.
Further, all other activities by an artist and other art forms, e.g., western music or dance,
Modern theatres, performance of actors in films of television series would be taxable.
Similarly, activities of artists in still art forms, e.g., painting, sculpture, making etc are taxable.
Thus, ₹1,58,000 received by Mr Vikalp from performing classical dance and ₹90,000 from
acting in TV serial will be liable to GST.
CA NISHANT KUMAR 53

Chapter 5 - Exemptions From GST

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Chapter 5 - Exemptions From GST

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Chapter 5 – Exemptions From GST

Power to Grant Exemption

Manner of Providing Exemption

Goods Exempt from Tax

Services Exempt from Tax

Services by Charitable Institutions

Entry 1 Entry 80 Entry 10 Entry 9D

Meaning of Charitable Activities

1. PUBLIC HEALTH by way of

Recreational Training or Coaching

1. Recreational activities relating to arts or culture, by an individual, or

are exempt from tax.

Services by Old Age Home

Computation of GST Liability of MTCT

Calculation of GST Liability

Computation of Value of Taxable Supply of VHP

1. Renting of rooms where charges are ₹1,000 or more per day

Computation of Value of Taxable Supply

1. Processes/operations carried out at an agricultural farm on the agricultural produce which do

Question 5 – January, 2021 – 6 Marks

Computation of Value of Taxable Supplies

Question 6 – December, 2021 – 6 Marks

Computation of Value of Taxable Supplies of AB Ltd.

1. Transportation services provided to an educational institution are exempt only if such

Computation of Value of Taxable Supplies of Fortune Ltd. and GST Liability

Computation of Value of Taxable Supplies and GST Liability

Computation of Value of Taxable Supplies and GST Liability

Question 10 – RTP November, 2020

Health Care Services

Question 11 – MTP May, 2020

Computation of Value of Taxable Supply and GST Liability

Services Provided BY Government

Computation of Value of Taxable Supply

Question 16 – May, 2022 – 5 Marks

State the exceptions of the above statement.

1. Services by renting of immovable property provided to an unregistered business entity.

Services Provided TO Government/Union Territory/Local Authority

1. A statutory body, corporation or an authority created by the Parliament, or a State Legislature

A governmental authority awards the work of maintenance of streetlights in a Municipal area to an

1. Beneficiary-Led Construction (BLC) refers to the central government providing financial

Computation of Taxable Value of Supply and GST Payable

1. Economy class is exempt from tax. Business Class is liable to GST.

1. Service of transportation of passengers by vessels in National Waterways: ₹30,00,000

Computation of Value of Taxable Supply

Goods Transportation Services

1. Goods transport agency means any person who:

1. Transport of postal mails and postal bags: ₹55,00,000

Applicable GST rate: 5%.

Computation of Value of Taxable Supply and GST Liability

Computation of Value of Taxable Supply and GST Liability

1. Services provided by Goods Transport Agency by way of transport in a goods carriage of

Banking and Financial Services

1. Bank extended housing loan of ₹50,00,000 to Mr. A

1. The same is a transaction in money, therefore, it is not regarded as service.

Question 25 – May, 2019 – 6 Marks

Particulars Amount in ₹ in crores

Computation of Value of Taxable Supply

Life Insurance Services

Services Provided by Specified Bodies