CA Inter Sep 25 Suggested Answers | Taxation
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Table of Contents
CA Inter Sep 25 Suggested Answer Other Subjects Blogs :
Section - A
Case Scenario – I
Sudipto, a resident individual aged 54 years, gifted shares of an Indian company listed on a recognised stock exchange in India, to his friend Shanu to help him financially on 01.04.2024. The gift deed states that the shares will be transferred back to Sudipto in the event of death of Shanu. The FMV of the shares on the date of transfer was ₹ 54,00,000. Shanu received a gross dividend of ₹ 4,50,000 on these shares during the FY 2024-25.
Sudipto is engaged in the business of retail trade as proprietor. During the FY 2021-22 he paid ₹ 25,000 p.m. to his wife, Swati as salary being the marketing in-charge. Swati does not have any professional qualification or experience for the job. This income was clubbed in the hands of Sudipto as per clubbing provisions in the FY 2021-22. Swati started her MBA studies and did not get any salary from 01.04.2022 to 01.12.2024. She completed her MBA (Marketing) course on 01.12.2024 and again joined her husband’s business and started getting ₹ 55,000 p.m. as salary which is as per the market norms.
During the FY 2024-25, Sudipto paid ₹ 54,000 as medical insurance premium by way of an account payee cheque for his senior citizen parents who are non-residents.
Based on the above facts, answer the following multiple choice questions 1 to 3 :
Q1. Assume other incomes of Sudipto and Shanu is ₹ 55 lakhs and ₹ 11 lakhs respectively, which of the following statements is correct in this respect?
(A) Dividend income shall be taxable in the hands of Shanu as clubbing provisions will not apply in this case.
(B) Dividend income shall be clubbed in the hands of Sudipto as this is a case of transfer of asset without adequate consideration.
(C) Dividend income shall be taxable in the hands of Sudipto as his income other than dividend is higher than that of Shanu.
(D) Dividend income is exempt from taxation.
Q2. Which of the following statements is correct as far as clubbing of salary of Swati for the FY 2024-25 is concerned?
(A) Salary of Swati will be taxed in her hands as now she has the required qualification for the job.
(B) Salary of Swati will continue to be clubbed in the hands of Sudipto till the assessing officer is satisfied.
(C) Salary of Swati will be taxed in the hands of Sudipto or Swati whose income before such salary is higher.
(D) As a part of tax planning, Swati has the option to decide in whose hands the salary will be taxable to minimise the overall tax liability.
Q3. What shall be the amount of deduction under section 80D in the hands of Sudipto assuming he has opted out of the default tax regime?
(A) ₹ 25,000
(B) ₹ 54,000
(C) NIL
(D) ₹ 50,000
Case Scenario – II
Reenu, a resident individual aged 48 years, owns 2 flats (A and B) in Hyderabad.
She lives in flat A and gave flat B to her in-laws for their residential purposes. She does not charge any rent from them.
In the month of April 2024, she entered into an agreement to buy flat C from a builder in the same area as her other flats are situated. In the month of September 2024, she took possession of flat C and started spending her weekends there, after paying a token amount of ₹ 11,000 to the builder. However, flat C is still not registered in her name. All the three flats are identical in size and other aspects.
She had one more flat D which was let out at a monthly rent of ₹ 45,000 to Mr. Shubh during the financial year 2021-22 (from 01.04.2021 to 31.03.2022). Mr. Shubh did not pay rent for 3 months. Reenu sold the flat on 31.03.2024.
She owned 5,000 shares of PQR Ltd. (listed on a recognised stock exchange in India), an Indian company which were acquired on 01.02.2022 for ₹ 180 per share.
On 01.01.2025, the company bought 2,000 shares back from her and paid ₹ 420 per share to Reenu.
Based on the above facts, answer the following multiple choice questions 4 to 6:
Q4. Which of the following statements is correct as far as the taxability of income from house property is concerned?
(A) One flat (of her choice) will be treated as self-occupied whereas the other two flats will be treated as deemed to be let out.
(B) Any two flats (of her choice) will be treated as self-occupied whereas the third flat will be treated as deemed to be let out.
(C) Flat A will be treated as self-occupied, flat B will be treated as deemed to be let out and flat C will not have any impact on her income as the flat is not yet registered in her name.
(D) All three flats will be treated as self-occupied.
Q5.Assume Shubh pays the arrear rent to Reenu on 28th June 2024, what shall be the treatment of such rent received if she had to spend ₹ 5,000 for such collection?
(A) Nothing shall be taxable in the hands of Reenu as she is not the owner of the flat anymore.
(B) ₹ 1,30,000 shall be taxable in the hands of Reenu as income from other sources in the PY 2024-25 as she is not the owner of the flat anymore.
(C) ₹ 94,500 shall be taxable in the hands of Reenu as income from house property in the PY 2024-25, even if she is not the owner of the flat anymore.
(D) ₹ 89,500 shall be taxable in the hands of Reenu as income from house property in the PY 2024-25, even if she is not the owner of the flat anymore.
Q6. Which of the following statements is correct as far as the taxability of buy-back of shares by PQR Ltd. is concerned? (Cost Inflation Index: FY 2021-22 – 317; FY 2024-25 – 363)
(A) PQR Ltd. shall be liable to pay ₹ 1,95,686 as additional income-tax and the income arising in respect of such buy-back shall be exempt in the hands of Reenu.
(B) ₹ 8,40,000 will be treated as deemed dividend in the hands of Reenu.
(C) ₹ 4,80,000 will be treated as long-term capital gains in the hands of Reenu and it will be taxable at the rate of 12.5% after deducting ₹ 1,25,000 from the LTCG.
(D) ₹ 4,80,000 will be treated as deemed dividend in the hands of Reenu.
Q7. A.P. & Sons HUF is controlled by Amarendra, the Karta of the HUF. Amarendra (an Indian citizen) stays in country T and regularly visits India. During the FY 2024-25, he visited India for 190 days and managed the affairs of the HUF.
During the immediately preceding 5 years, he visited India for 70 days each year and prior to that he was in India for 185 days in every year. Residential status of A.P. & Sons HUF for the assessment year 2025-26 is:
(A) Non-resident because Karta of the HUF is a non-resident.
(B) Resident and ordinarily resident because Karta of the HUF is a resident and ordinarily resident.
(C) Non-resident because control and management of its affairs is partly managed from outside India.
(D) Resident because control and management of its affairs is partly managed from India and not ordinarily resident because the status of the Karta is resident but not ordinarily resident.
Q8. Ravi, an Indian resident, bought an overseas tour package from Kartik, also a resident Indian and a seller of overseas tour programmes, and paid ₹ 7 lakhs as cost. He also remitted ₹ 12 lakhs to USA under Liberalised Remittance Scheme of RBI for the purpose of investment in USA share market via Jones, a resident authorized dealer. What shall be the aggregate amount of tax to be collected at sources from the remittances/payments made by Ravi?
(A) ₹ 1,35,000
(B) ₹ 35,000
(C) ₹ 95,000
(D) ₹ 60,000
Section - B
Case Scenario – III
Raghu Impex Limited, registered in the State of Uttar Pradesh was involved in supplying stationery items pan India basis. The company did not opt for registration under GST. The proper officer of GST based on enquiry finds that the company is liable for registration and he registers it on temporary basis on 21.01.2023.
The company made the following outward supplies of printing materials in the month of February, 2025:
(i) To Telangana State Agriculture Department for an invoice value of ₹ 2,60,400 inclusive of GST @ 5%, delivering at Hyderabad, Telangana State.
(ii) To UPGST, State GST Department for an invoice value of ₹ 2,80,000 inclusive of GST @ 12%, delivering at Noida, in the State of Uttar Pradesh.
(iii) To Delhi Transport Corporation, Government owned transport corporation registered in the Union Territory of Delhi for supply to its Central Stores located in Ghaziabad, in the State of Uttar Pradesh, for an invoice value of ₹ 2,97,360 inclusive of GST @ 18%.
In the month of September, 2024 company found that while issuing invoice to a customer, the company erroneously charged higher value by ₹ 52,000. Such invoice was issued on 31.03.2024. Company issued the credit note on 01.10.2024. The company filed relevant annual return on 15.06.2025 and return for the month of September 2024 and October 2024 were filed on 31.10.2024 & 19.11.2024 respectively.
Based on the facts of the case scenario given above, choose the most appropriate answer for the following question no. 9 to 11 :
Q9. On getting temporary registration, Raghu Impex Limited needs to apply for registration upto __________.
(A) 22.03.2023
(B) 20.02.2023
(C) 21.04.2023
(D) 21.05.2023
Q10. In respect of printing materials supplied in the month of February 2025, the company shall be subjected to a total GST TDS of ₹ ________, ignoring bifurcation as CGST & SGST / IGST.
(A) 5,000
(B) NIL
(C) 5,040
(D) 10,040
Q11. What is the maximum time limit available for declaring the details of the such credit note in the GST return with respect of said transaction?
(A) 31.10.2024
(B) 30.11.2024
(C) 19.11.2024
(D) 15.06.2025
Case Scenario – IV
Mahadev Housing Society (MHS) is registered under GST in Lucknow, Uttar Pradesh. The society has in all 200 flats and 20 shops as under:
|
Block |
Type |
Units (nos.) |
|
A |
3BHK Flats |
50 |
|
B |
4BHK Flats |
50 |
|
C |
3BHK Flats |
50 |
|
D |
4BHK Flats |
50 |
|
E |
Shops |
10 |
|
F |
Shops |
10 |
The society received/paid the following amounts in the month of January, 2025:
|
S. No. |
Particulars |
Amount for each unit of a 3BHK flat (₹) |
Amount for each unit of a 4BHK flat (₹) |
|
1 |
Maintenance charges collected (including property tax ₹ 1,000 for a 3BHK flat and ₹ 1,500 for a 4BHK flat collected on behalf of the Municipal Corporation) |
8,000 |
10,000 |
Additional information:
(i) Maintenance charges collected from each shop is ₹ 7,000 during the month.
(ii) Interest ₹ 75,000 received on fixed deposit with a nationalised bank.
(iii) 4 generators each costing ₹ 1,00,000 were purchased from a registered supplier for power backup of the blocks, of which 2 were installed for 3BHK blocks and 2 for 4BHK blocks. The amount capitalised in the books but no depreciation charged.
(iv) Pipes and other sanitary fittings costing ₹ 25,000 were purchased for Block A from a registered supplier and debited in the Profit and Loss account.
(v) 3 members own 2 units (flats) each of the 3BHK type.
(vi) All inward and outward supplies are Intra-State supplies.
(vii) Ignore the effect of common credit, if any.
Assume that all conditions necessary for claiming Input Tax Credit (ITC) were complied with and not claimed any depreciation on any assets.
All the figures given are exclusive of GST wherever applicable.
Assume rate of CGST @ 9%, SGST @ 9% and IGST @ 18% on all inward and outward supplies wherever applicable.
Based on the facts of the case scenario given above, choose the most appropriate answer for the following question no. 12 to 14:
Q12. The total value of exempted outward supply of the society for the month of January, 2025 is:
(A) ₹ 10,90,000
(B) ₹ 11,65,000
(C) ₹ 10,25,000
(D) ₹ 7,75,000
Q13. The amount of Input Tax Credit (ITC) that the society can avail for the month of January, 2025 is:
(A) ₹ 18,000 CGST and ₹ 18,000 SGST
(B) ₹ 2,250 CGST and ₹ 2,250 SGST
(C) ₹ 36,000 CGST and ₹ 36,000 SGST
(D) ₹ 38,250 CGST and ₹ 38,250 SGST
Q14. The gross GST liability (before reduction of ITC) for the month of January, 2025 is:
(A) ₹ 89,100 CGST and ₹ 89,100 SGST
(B) ₹ 76,500 CGST and ₹ 76,500 SGST
(C) ₹ 1,02,600 CGST and ₹ 1,02,600 SGST
(D) ₹ 1,52,100 CGST and ₹ 1,52,100 SGST
Q15. Nilanchol Chamber of Commerce organised a business summit. Safal Private Limited, a registered manufacturer of readymade garments, sponsored the summit and paid a sponsorship fee of ₹ 1,50,000 to Nilanchol Chamber of Commerce. Mr. Godbole, an independent director of Safal Private Limited, provided the taxable services worth ₹ 40,000 to the Safal Private Limited in the capacity of director in this regard.
The total value on which Safal Private Limited is liable to pay GST (as per provision applicable till 28th February 2025) is _______.
(A) ₹ 1,90,000
(B) ₹ 1,50,000
(C) ₹ 40,000
(D) NIL
Q16. Mr. Anant an unregistered person rented his commercial building to M/s ABC and Co., a registered partnership firm under GST in the state of Tamil Nadu. For the month of November, 2024 the firm paid rent (by NEFT) on 29th November, 2024 whereas the invoice was issued by Mr. Anant in advance on 25th November, 2024.
The time of supply for the purpose of payment of GST for the above transaction will be ________ if payment entered in the books of firm on 29th November, 2024.
(A) 25th January, 2025
(B) 25th November, 2024
(C) 26th December, 2024
(D) 29th November, 2024
Mr. Ram, a resident individual aged 58 years, is engaged in the manufacturing of textile items. Statement of Profit and Loss shows a net profit (after depreciation but before tax) of ₹ 52,00,000 for the financial year ended 31st March, 2025 after debiting/crediting the following items :
(i) Depreciation as per Income-tax Rules : ₹ 28,00,000 including additional depreciation on new plant & machinery ₹ 1,50,000.
(ii) Interest amounting to ₹ 2,10,000 for short payment of advance tax as per section 234B relating to the assessment year 2024-25.
(iii) ₹ 3,50,000 paid to a contractor for carrying out whitewash work at factory premises. Tax was not deducted at source on this payment and the contractor did not file his return of income for the relevant PY.
(iv) Contribution to Prime Minister National Relief Fund - ₹ 3,00,000 paid by way of cheque.
(v) Expenditure towards advertising charges in a brochure of a political party registered under section 29A of Representation of People Act, 1951 - ₹ 40,000 paid by way of cheque.
(vi) Interest on term loans obtained from a co-operative bank not paid before the due date of filing of return of income ₹ 2,60,000.
(vii) Contribution towards pension scheme of employees ₹ 1,50,000. The eligible salary and dearness allowance for the pension scheme referred to in section 80CCD is ₹ 10,00,000.
(viii) Industrial power tariff concession of ₹ 2,50,000 received from the Central Government.
(ix) Interest from banks on fixed deposits (gross) ₹ 1,50,000.
(x) Cash gift from father ₹ 90,000.
Additional Information :
(i) Expenditure pertaining to previous financial year (FY 2023-24) was allowed on due basis, but paid in current financial year in cash on 18.01.2025 : ₹ 35,000.
(ii) Audit fee for the previous year 2023-24 : ₹ 75,000. TDS deducted but not deposited in the relevant previous year. However, TDS was deposited on 31.12.2024.
You are required to compute the total income and tax liability of Mr. Ram under both the taxation regimes (normal as well as under section 115BAC) and suggest the one which is more beneficial to him. Ram prepares his accounts on mercantile basis.
Cost Inflation Index for FY 2021-22 : 317, FY 2024-25 : 363.
Swetha, a citizen of India, is a chartered accountant. She is a working partner in Swetha and Varun Associates, which was set up in Chennai, India. She visits foreign country A quite often and provides accounting services to corporates there in her individual capacity. In country A, she is not subject to any income tax. The details of her income for the financial year 2024-25 is as follows:
(i) Remuneration from her CA firm in India (amount received in India) – ₹ 16 lakhs (Deductible while computing the income of the firm).
(ii) Income received from providing accounting services in country A (received in a bank account in country A) – ₹ 5 lakhs.
(iii) Dividend (from companies incorporated in country A and received in a bank account in country A) – ₹ 8 lakhs.
(iv) Income from a business in country A which was set up in country A but is controlled from Chennai, India (received in country A) – ₹ 7 lakhs.
Ascertain her residential status (briefly explaining relevant provisions) along with the taxability of income for the assessment year 2025-26 in the following independent situations:
(i) She did not visit India during the FY 2024-25.
(ii) She visits and stays in India for 200 days every year since the 12 preceding previous years including FY 2024-25.
(iii) She did not visit India during the previous year 2024-25 and her income from profession in India is ₹ 4 lakhs for the financial year 2024-25, instead of ₹ 16 lakhs.
Aryan, a resident individual engaged in the retail trade of auto parts through various stores across Delhi-NCR, had total turnover of ₹ 15 crores during the financial year 2023-24. The following data is furnished relating to the financial year ended 31-3-2025:
(i) He purchased goods for ₹ 105 lakhs (excluding GST @ 18%) on 21.05.2024 from Diva LLP, a limited liability partnership firm resident in India. Out of these purchases, goods worth ₹ 5 lakhs (excluding GST) were returned on 20.07.2024 due to quality issues for which Diva LLP refunded the money on 20.02.2025. Assume that the turnover of Diva LLP during the financial year 2023-24 was ₹ 8 crores.
(ii) Aryan paid ₹ 77,000 every month to Mr. Kulveer, a resident individual for providing catering services in his shop under a contract.
Discuss the TDS/TCS implications in respect of the above-mentioned transactions assuming PAN of all the concerned parties are available.
Mr. Mani, a resident individual aged about 45 years, acquired a plot of land in March 2002 for ₹ 12,25,000 and paid stamp duty of ₹ 1,00,000 on registry of the land. He sold this land on 10th October 2024 for ₹ 80,00,000. The stamp duty valuation assessed by sub-registrar was ₹ 83,50,000. Advise Mani about which option of computation of capital gains is most suitable for him as far as his tax liability is concerned on the assumption that he has no other income chargeable to tax and has not opted out of the provision of section 115BAC.
Cost Inflation Index for various financial years are as under :
Prabhu, a resident individual aged 45 years, is employed with a private limited company as HR manager, on a basic salary of ₹ 80,000 p.m. He has been provided with the following other benefits :
(i) A rent-free unfurnished accommodation (owned by the company) in Mumbai from 01.05.2024. However, he occupied the accommodation only from 01.12.2024. The company had bought this house in the financial year 2023-24 at a cost of ₹ 2 crores.
(ii) A mobile phone for his personal use on 01.04.2024. The cost of the phone was ₹ 90,000. The company also gives him a telephone allowance amounting to ₹ 1,000 p.m. to cover his mobile phone bill. During the FY 2024-25, his aggregate mobile phone bill was ₹ 15,000.
(iii) Company had purchased a car on 01.07.2022 for ₹ 10 lakhs. This car is sold to Prabhu on 01.08.2024 for ₹ 2,50,000.
(iv) He was allowed to use the video camera and laptop belonging to the company from 01.04.2024. The company had purchased these assets for ₹ 50,000 and ₹ 2,00,000 respectively on 01.04.2022.
Compute the taxable salary of Prabhu assuming he has opted out of default tax regime.
Cost Inflation Index:
Surbhi, a resident individual aged 35 years, is a working partner in two firms (A and B) engaged in the retail business of garments. She provides the following details of her income/losses for the year ended 31st March 2025 :
(i) Remuneration received as a partner from partnership firm “A” - ₹ 9.7 lakhs (Deductible while computing the income of the firm).
(ii) Loss from intra-day trading in shares of Indian companies listed on a recognised stock exchange (no delivery of shares was taken) - ₹ 4 lakhs.
(iii) Income from the activity of owning and maintaining race horses - ₹ 7 lakhs.
(iv) Long-term capital gains on sale of property (computed as per the provisions of the Income-tax Act) - ₹ 9.2 lakhs.
(v) Interest paid on loan taken for repair of self-occupied house property - ₹ 1.2 lakhs.
(vi) Amount received as advance towards sale of a shop which was later forfeited as the buyer could not comply with the conditions specified in agreement of sale - ₹ 5 lakhs.
(vii) Share of loss from partnership firm “B” - ₹ 1.1 lakhs.
(viii) Loss on betting - ₹ 0.20 lakhs.
(ix) Interest on fixed deposit (gross) - ₹ 0.80 lakhs. The fixed deposit of ₹ 10 lakhs was gifted to her by her father-in-law on 01.04.2024.
Following are the losses brought forward:
(i) Long term capital loss on sale of unlisted shares (pertaining to AY 2024-25) - ₹ 3.8 lakhs.
(ii) Loss from the activity of owning and maintaining race horse (pertaining to AY 2024-25) - ₹ 25,000.
Compute gross total income of Surbhi for assessment year 2025-26 under appropriate heads of income and the amount of loss that can/cannot be carried forward assuming that she has opted out of default tax regime. Will your answer be different in case she does not opt out from default tax regime. There is no need to compute the tax payable under any of the regimes.
Specify the persons who are not required to pay advance tax as per the provisions of the Income-tax Act.
State, with appropriate reasons, whether the following statements are “true” or “false”.
(i) An income-tax return can be revised only once.
(ii) Updated return under section 139(8A) cannot not be filed if original return is a loss return under section 139(3).
Mr. Karan, a registered supplier in Kochi (Kerala State) has provided the following information of supply received/made during the month of February, 2025:
|
S. No. |
Particulars |
Amount (₹) |
|
(i) |
On 5th February 2025 Supplied goods to Jaara Enterprises, an unregistered partnership firm in Bikaner, Rajasthan. Discount of 10% offered to Jaara Enterprises on this invoice price of ₹ 2,00,000 as per pre agreement but not recorded in the invoice. Discount given for this invoice by way of credit note on 28th February 2025. |
2,00,000 |
|
(ii) |
Made a supply of machinery to Cool & Co. registered in the State of Kerala. The machinery was installed at Factory site of Cool & Co. in the State of Tamil Nadu as per agreement. |
6,00,000 |
|
(iii) |
Provided supply of online educational journals on monthly basis to St. Peters High School, situated in the State of Kerala. |
25,000 |
|
(iv) |
Provided renting of his own commercial property situated at Thrissur (Kerala) to Safe Volt Limited of Kerala, in which he is an independent director. |
70,000 |
|
(v) |
Supplied a consignment of Office uniform to Rasool Tea Estate situated at Munnar (Kerala). |
2,00,000 |
|
(vi) |
Payment made to Mr. Manish, a contractor of Bengaluru for construction of staff quarters within the factory premises at Kochi. Staff quarters capitalised in the books and no depreciation charged. |
1,25,000 |
Additional Information (for Mr. Karan’s GST case):
(i) During the month, supply for ₹ 13,000 was made against redemption of food coupons issued during December 2024 for use against specific Pizza available in a food court run by Mr. Karan in Kochi. Coupons were valid till 28.02.2025.
(ii) In respect of supply made to Munnar, being a hill station, local levy of Green tax of ₹ 10,000 was charged by Mr. Karan in the invoice made to Rasool Tea Estate.
(iii) Mr. Karan was advised by his accountant that since he is a director in the company to whom he let out his property, GST is to be paid by the company under Reverse Charge Mechanism (RCM).
(iv) Assume rate of CGST, SGST and IGST are 9%, 9% and 18% respectively for both inward and outward supplies of goods and services, except where otherwise provided.
(v) All the amount given above in the table are exclusive of GST and Green Tax or any other tax wherever applicable.
(vi) Subject to the information given above, conditions for availing ITC have been complied with.
(vii) All the inward and outward supplies to be considered in the course of Intra-State except where information provided to determine the Place of supply.
(viii) Assume all the inward supplies used for the taxable outward supplies only.
(ix) There was opening balance of Input Tax Credit (ITC) of ₹ 1,50,000 of IGST and ₹ 30,000 of CGST and Nil of SGST.
From the information given above, you are required to compute the net minimum GST liability payable in cash after deduction of ITC by Mr. Karan for the month of February 2025.
Note: Correct relevant legal provision and individual tax amount (if any) for each item should form part of your answer.
M/s. ABC Corporation Pvt. Ltd., a registered dealer of Mumbai furnishes you following information for the month of February 2025 :
|
S. No. |
Particulars |
Amount (₹) |
|
(i) |
Intra-State Sale of Taxable goods (₹ 50,000 was received as advance in January, 2025. Out of this ₹ 2,00,000) |
2,00,000 |
|
(ii) |
Provided accommodation Services in Mumbai with charges per person per month of ₹ 18,000. (The accommodation is supplied for a minimum continuous period of 99 days) (Intra-State transaction) |
2,34,000 |
|
(iii) |
Received for services by way of pure labour contracts for repairing a single residential unit otherwise than as a part of residential complex (It is Intra-State transaction) |
50,000 |
|
(iv) |
Professional fees paid for taxable service to Ms. Udan Mehta located in a non-taxable territory (It amounts to Inter-State transaction) |
70,000 |
Other Information:
(i) Turnover of M/s. ABC Corporation Pvt. Ltd … (text cut in your image, likely continues on the next page).
(ii) All the amounts given above are exclusive of GST.
Compute the GST liability of M/s. ABC Corporation Pvt. Ltd. for the month of February 2025. Assume the rates of CGST @ 9%, SGST @ 9% and IGST @ 18%.
Note: Correct legal provision and individual tax amount (if any) for each item should form part of your answer.
Veer Trading Private Limited (VTPL) is a registered entity under GST in Jaipur, Rajasthan. It is engaged in wholesale trading of various sports items. VTPL furnishes the following information regarding its inward supplies during the month of February 2025:
|
S. No. |
Particulars |
Amount (Excluding any tax) (₹) |
|
(i) |
As per the policy of the company, the Managing Director (MD) of the company has taken membership of local sports club on behalf of company. The company paid fees monthly. Applicable rate of GST is 6% each of CGST and SGST. |
20,000 |
|
(ii) |
Purchased equipment from Original Equipment Manufacturer (OEM) as an Ex-Works (EXW) contract basis on 26th February 2025. As per terms of the contract, the goods are to be delivered by the OEM to transporter on behalf of the recipient, at supplier’s (OEM) place of business. The OEM handed over the equipment to transporter on 28th February 2025 but equipment physically received by VTPL on 2nd March 2025. Applicable rate of GST is 6% each of CGST and SGST. |
10,00,000 |
|
(iii) |
On 5th year of its incorporation, VTPL arranged an event from M/s Daksh Event company for customer’s meet: M/s Daksh Event company charges single price of event charge as ₹ 2,50,000 which is inclusive of food charges of ₹ 40,000 as per the general trend followed by the industry. Applicable rate of CGST and SGST @ 9% each for event and @ 14% each for food supply. |
2,50,000 |
|
(iv) |
Purchased Truck for transport of Goods (Rate of CGST and SGST @ 14% each). Claimed ₹ 2,10,000 (₹ 14,00,000 @ 15%) as depreciation under the Income Tax Act, 1961. |
14,00,000 |
Assume all the above transactions are in the course of Intra-State.
Subject to Information given above, assume that all the other conditions necessary for availing ITC (unless specified otherwise) have been fulfilled and all the suppliers are registered under regular scheme.
Determine the amount of Input Tax Credit (ITC) that can be availed by Veer Trading Private Limited (VTPL) for each individual item as well as total eligible ITC for the month of February 2025 by giving necessary explanations for treatment of each item.
Examine the following independent cases and determine the Place of supply under the GST law along with the relevant legal provisions :
(i) Mr. Mukul, a bank manager is transferred from Kolkata, West Bengal to Jodhpur, Rajasthan. His family resides at Ranchi, Jharkhand. He hires Fastman Couriers Private Limited, a registered company in Kolkata, to transport his household goods from Ranchi to Jodhpur.
(ii) M/s Ravi Builders of Pune, Maharashtra hired M/s Builder and Co., an architectural firm registered under the GST law at Ahmedabad, Gujarat for designing an architectural plan for a 21 floor building to be constructed by them in Canada.
In the month of February 2025 Mr. Venkatesh started supply of both goods and services from the states of Rajasthan and Tripura. His statistics for the month of February 2025 are as under :
| S. No. | Particulars | Rajasthan (₹) | Tripura (₹) |
| (i) | Intra-State taxable supplies | 11,00,000 | 5,00,000 |
| (ii) | Intra-State Sale by Mr. Venkatesh as an agent of Ganesh enterprises, a non-taxable person of Rajasthan | 1,00,000 | - |
| (iii) | Intra-State supply of non-taxable goods | 2,00,000 | - |
Additional Information :
(i) In the State of Rajasthan, Intra-State taxable supply includes commission received as an insurance agent from an insurance company worth ₹ 50,000.
(ii) In the State of Tripura, Intra-State taxable supplies includes inward supply of service on which tax is payable under Reverse charge worth ₹ 1,00,000.
(iii) For sale by Mr. Venkatesh in the capacity of agent for Ganesh Enterprises the invoice was issued in the name of Mr. Venkatesh only.
Assume all the above figures are excluding GST and amount given to be considered as value determined as per the GST law.
Based on the above-mentioned information, you are required to determine the following along with the relevant provision in brief :
Also discuss whether your answer to the (2) above will change or not if in the state of Tripura Mr. Venkatesh is engaged only in Intra-State supply of exempt goods and other information will remain same.
State in brief the requirement of generation of an E-way Bill with reference to Rule 138(1) of the CGST Rules, 2017.
Also discuss in brief the provision of generation of E-way Bill in case of supply of goods on behalf of the third person (i.e. “Bill to Ship to” Model).
“Rule 86B of the CGST Rules, 2017 impose restrictions on the use of amount available in Electronic Credit Ledger if the value of taxable supply is more than ₹ 50 lakh in the month.”
Read the above statement with reference to provision of Input Tax Credit (ITC) and discuss in brief the Nature of Restriction imposed under this Rule 86B and also list out the exceptions of this rule.
Note: Detailed discussion of exceptions is not required.
“A taxpayer cannot file GSTR-1 before the end of the tax period.”
State the exceptions to the statement. Further, discuss in brief any four circumstances where a registered person is debarred from furnishing details of outward supplies in GSTR-1/IFF.
“Unregistered persons with aggregate turnover up to threshold limit of registration and supplying goods through an ECO (E-Commerce Operator) are exempted from obtaining registration subject to fulfilment of certain conditions.”
State any five such conditions with reference to the Notification No. 34/2023 CT dated 31.07.2023 and provisions of Section 23 of the CGST Act, 2017.
Ruchika Saboo
An All India Ranker (AIR 7 - CA Finals, AIR 43 - CA Inter), she is one of those teachers who just loved studying as a student. Aims to bring the same drive in her students.
Ruchika Ma'am has been a meritorious student throughout her student life. She is one of those who did not study from exam point of view or out of fear but because of the fact that she JUST LOVED STUDYING. When she says - love what you study, it has a deeper meaning.
She believes - "When you study, you get wise, you obtain knowledge. A knowledge that helps you in real life, in solving problems, finding opportunities. Implement what you study". She has a huge affinity for the Law Subject in particular and always encourages student to - "STUDY FROM THE BARE ACT, MAKE YOUR OWN INTERPRETATIONS". A rare practice that you will find in her video lectures as well.
She specializes in theory subjects - Law and Auditing.
Yashvardhan Saboo
A Story teller, passionate for simplifying complexities, techie. Perfectionist by heart, he is the founder of - Konceptca.
Yash Sir (As students call him fondly) is not a teacher per se. He is a story teller who specializes in simplifying things, connecting the dots and building a story behind everything he teaches. A firm believer of Real Teaching, according to him - "Real Teaching is not teaching standard methods but giving the power to students to develop his own methods".
He cleared his CA Finals in May 2011 and has been into teaching since. He started teaching CA, CS, 11th, 12th, B.Com, M.Com students in an offline mode until 2016 when Konceptca was launched. One of the pioneers in Online Education, he believes in providing a learning experience which is NEAT, SMOOTH and AFFORDABLE.
He specializes in practical subjects – Accounting, Costing, Taxation, Financial Management. With over 12 years of teaching experience (Online as well as Offline), he SURELY KNOWS IT ALL.
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