GST Law and Practice Solved Question Paper 2022 PDF [Dibrugarh University BCom 6th Sem. CBCS]

GST Law and Practice Solved Question Paper 2022 PDF [Dibrugarh University BCom 6th Sem. CBCS]

Hello, Dear readers. Today we are going to share with you the Dibrugarh University B.Com 6th Sem GST Law and Practice Solved Question Paper 2022 . This paper was held in 2022 July and we (TEAM-PROEFUNOTES) have solved it with the help of the prescribed textbook and some online resources. We hope this will help you to prepare for your upcoming exams and score good marks.


Dibrugarh University 6th Sem GST Law and Practice Solved Question Paper 2022


Dibrugarh University BCom 6th Sem (CBCS)

2022 (June/July)

COMMERCE (Core)

Paper: C-614 (GST Law and Practice)

Full Marks: 80

Pass Marks: 32

Time: 3 hours.

The figures in the margin indicate full marks for the questions


1. (a) Fill in the blanks:                                   1x4=4

(1) Kelkar Task Force, 2004 recommended that the integration of indirect taxes into the form of GST in India.

(2) Term ‘Goods’ means movable property, but does not include Money and Securities.

(3) The full form of GSTIN is Goods and Services Tax Identification Number.

(4) In India, GST is a comprehensive, multi-stage, destination-based tax with both Central GST and State GST components levied on the same base.


(b) Write True or False:                  1x4=4


(1) GST registration certificate is valid for 5 years.

ANSWERFalse, GST registration certificate is valid until it is cancelled or surrendered.

(2) Every taxpayer is assigned with State wise PAN based GSTIN which is 15-digit long Alpha-numeric number.

ANSWER: True.


(3) There are four types of GST levied in India under GST Laws.

ANSWER: TrueThe four types of GST are CGST, SGST, IGST and UTGST.


(4) The Chairperson of GST Council is the State Finance Minister.

ANSWER: False, The Chairperson of GST Council is the Union Finance Minister.


2. Write short notes on any four of the following:           4x4=16


(a) Dual model of GST: The dual model of GST is a system where both the central and state governments levy and collect GST on the supply of goods and services within their respective jurisdictions. This model is adopted in federal countries like India, Canada, and Brazil, where the division of powers between the centre and the states requires a harmonized tax system. The dual model of GST has two components: Central GST (CGST) and State GST (SGST) for intra-state supplies, and Integrated GST (IGST) for inter-state supplies. The dual model of GST aims to reduce the cascading effect of taxes, enhance the tax base, and simplify the compliance process¹².


(b) GST network: The GST network (GSTN) is a non-profit, non-government organization that manages the IT infrastructure and services for the implementation of GST in India. It provides a common portal for taxpayers, tax authorities, and other stakeholders to access various GST-related information and services. The GSTN facilitates the registration of taxpayers, the filing of returns, the payment of taxes, the generation and verification of e-way bills, the matching and reconciliation of invoices, and the settlement of IGST among the centre and the states. The GSTN also provides various tools and applications for data analysis, reporting, and auditing³⁴.


(c) Input tax credit: Input tax credit (ITC) is a mechanism that allows taxpayers to claim a reduction in their output tax liability by the amount of tax they have already paid on their inputs. Inputs are the goods or services used or intended to be used in the course or furtherance of business. ITC can be claimed by a registered person under GST only if he fulfills certain conditions, such as possessing a valid tax invoice, receiving the goods or services, filing the returns, and paying the tax to the government. ITC can be utilized to pay the output tax liability of CGST, SGST, or IGST, subject to some restrictions. ITC helps to avoid the cascading effect of taxes and reduce the cost of production.


(d) Scope of supply: The scope of supply under GST refers to the range of transactions and activities that are subject to GST. It includes the supply of goods or services or both, whether for consideration or without consideration, in the course or furtherance of business, by a taxable person within the taxable territory. The scope of supply also covers various forms of supply, such as sale, transfer, barter, exchange, license, rental, lease, or disposal. Moreover, the scope of supply includes certain transactions that are deemed as supply, such as import of services, self-supplies, and supply of goods or services between related or distinct persons. The scope of supply determines the applicability and liability of GST on different transactions.


(e) Electronic way bill: An electronic way bill (e-way bill) is a document that is generated electronically for the movement of goods of value more than Rs. 50,000 from one place to another. It contains the details of the consignor, consignee, transporter, goods, and vehicle. The e-way bill is required to be generated on the e-way bill portal by the person causing the movement of goods, whether for supply or for reasons other than supply, or due to inward supply from an unregistered person. The e-way bill is a compliance mechanism that ensures the proper declaration and tracking of goods and prevents tax evasion.


3. (a) What is indirect tax? Mention five indirect taxes which have been subsumed in GST. Distinguish between Direct Tax and Indirect Tax.       3+3+8=14

ANSWER: Indirect tax is a type of tax that is not directly levied on income but is imposed on the production, sale, or consumption of goods and services. It is passed on to the consumer in the form of higher prices for goods and services.


Under the Goods and Services Tax (GST) in India, five indirect taxes have been subsumed:


1. Central Excise Duty

2. Service Tax

3. Value Added Tax (VAT)

4. Central Sales Tax

5. Entry Tax


Distinguish between Direct Tax and Indirect Tax:



Basis 

Direct Tax

Indirect Tax

Meaning

Paid directly to the government

Paid to the government via intermediary

Levied on

Profits and income

Goods and services

Taxpayer

Individuals, HUFs and businesses

End-consumers of products, goods and services.

Tax Rate

Directly depends on income and profits

Same for everyone

Tax Burden

Progressive

Rate of tax is flat so tax burden is regressive

Transfer of liability

Not transferable

Can be transferable

Tax Collection

Complex

Quite convenient

Types

Income Tax and STT

Goods and Services Tax (GST)

Evasion

Possible

Not possible


Or

(b) Explain briefly the history of Indirect Taxes in India.    14

ANSWER: Indirect taxes are taxes that are levied on goods and services, rather than on income or wealth. In India, indirect taxes have a long history, dating back to the colonial era. Below is a brief overview of the history of indirect taxes in India:


- The first indirect tax in India was the excise duty, which was imposed by the British Raj in 1944 to protect British-made goods in the domestic market. It was a tax on the production of goods such as salt, sugar, and textiles. The excise duty was one of the reasons behind the Swadeshi movement, which promoted the use of Indian-made goods.

- The second indirect tax in India was the customs duty, which was reintroduced by the Indian government after independence in 1959. It was a tax on the import of goods, mainly to preserve the foreign exchange reserves and to protect the domestic industries. The customs duty was also used to regulate the trade policy and to promote exports.

- The third indirect tax in India was the sales tax, which was introduced by the states in the 1950s. It was a tax on the sale of goods within the state. The sales tax varied from state to state, creating a complex and fragmented tax system. The sales tax also led to the problem of cascading, which means the tax was levied on the value of the goods plus the tax paid at the previous stage.

- The fourth indirect tax in India was the service tax, which was introduced by the central government in 1994. It was a tax on the provision of services, such as telecommunication, banking, insurance, etc. The service tax was initially levied on a few selected services, but gradually expanded to cover almost all services. The service tax also faced the issue of cascading, as it was not integrated with the other indirect taxes.

- The fifth indirect tax in India was the value-added tax (VAT), which was introduced by the states in 2005. It was a tax on the value added by each stage of production and distribution of goods. The VAT replaced the sales tax and aimed to eliminate the cascading effect and to harmonize the tax rates across the states. The VAT also provided input tax credit, which means the tax paid on the inputs could be deducted from the tax payable on the outputs.

- The sixth indirect tax in India was the goods and services tax (GST), which was introduced by the central and the state governments in 2017. It was a tax on the supply of goods and services, which replaced all the previous indirect taxes. The GST aimed to create a unified and simplified tax system, which would reduce the tax burden, enhance the tax compliance, and boost the economic growth. The GST also provided input tax credit across the supply chain and across the states.



4. (a) (1) GST is a destination based tax. Enumerate the statement.                           7

ANSWER: Goods and Services Tax (GST) is a destination-based tax, meaning that the tax is levied on the consumption of goods and services at the destination rather than at the point of origin. This concept is integral to the structure of GST and is designed to ensure a seamless and transparent tax system.


The destination principle implies that the tax revenue is collected by the state where the goods or services are ultimately consumed. In a GST system, the tax is applied at each stage of the supply chain, and the credit for taxes paid at the previous stages is utilized in the next stages, leading to a cascading effect reduction.


This destination-based approach promotes fair distribution of tax burdens among states and prevents tax evasion by ensuring that taxes are paid where the consumption occurs. It also encourages economic efficiency by allowing businesses to claim credits for taxes paid on inputs, facilitating smoother trade across state borders.


In essence, GST as a destination-based tax fosters a more equitable and efficient taxation system, supporting economic growth and simplifying the tax structure.



(2) What are the features of GST?                             7

ANSWER: The Following are the features of GST :- 


1. One Nation, One Tax: GST replaces a complex tax structure with a single, unified tax system, promoting uniformity across the nation.

2. Multiple Taxes Integration: It integrates various indirect taxes like VAT, service tax, excise duty, etc., simplifying the taxation process.

3. Destination-Based Taxation: GST is a destination-based tax, meaning the tax is levied at the point of consumption rather than the point of origin.

4. Input Tax Credit: Businesses can claim credit for the taxes paid on inputs, ensuring that the tax burden is not passed on at each stage of the supply chain.

5. Composition Scheme: Small businesses with a turnover below a specified limit can opt for a composition scheme, allowing for simplified compliance and reduced tax liability.

6. Online Filing and Payment: GST introduced a digital platform for filing returns and making payments, promoting transparency and efficiency in the tax system.


7. Threshold Exemption: Small businesses with turnover below a certain limit are exempted from GST, reducing the compliance burden on micro-enterprises.

8. Anti-Profiteering Measures: To prevent businesses from unjustly benefiting from reduced tax rates, anti-profiteering measures are in place to ensure that the benefits of lower taxes are passed on to consumers.

9. GST Council: A federal body comprising representatives from the central and state governments, responsible for making important decisions related to GST rates, rules, and regulations.

10. Simplified Compliance: GST has streamlined the tax filing process, reducing the number of forms and making compliance more straightforward for businesses.


Or

(b) What was pre-GST regime indirect tax structure? Explain the limitations of pre-GST regime which created base for implementation of GST structure.             7+7=14

ANSWER: The pre-GST regime indirect tax structure in India was complex and fragmented, involving multiple taxes levied by the central and state governments. Some of the major indirect taxes were sales tax, value-added tax (VAT), excise tax, customs duty, and service tax. These taxes were not mutually exclusive, meaning that the same goods or services could be taxed multiple times at different stages of production and distribution. This resulted in a cascading effect of taxes, which increased the cost of goods and services and created inefficiencies in the economy.


The limitations of the pre-GST regime were:


  1. - Lack of uniformity: Different states had different rates and rules for VAT, sales tax, and other taxes, creating confusion and compliance issues for businesses operating across states. This also led to tax evasion and avoidance, as well as disputes and litigation.

  2. - High compliance cost: Businesses had to deal with multiple authorities, forms, returns, and audits for different taxes, increasing the administrative burden and cost of doing business.

  3. - Distortion of trade: The differential tax treatment of goods and services created an imbalance in the market, as some sectors were favored over others. For example, the manufacturing sector was subject to multiple taxes, while the service sector was relatively lightly taxed. This also affected the competitiveness of Indian exports in the global market, as they faced higher taxes compared to imports.

  4. - Loss of revenue: The complex and opaque tax system resulted in leakage of revenue for the government, as there were many exemptions, concessions, and loopholes in the tax laws. Moreover, the tax base was narrow, as many sectors and activities were outside the tax net.


These limitations created the need for a comprehensive and simplified tax system that would eliminate the cascading effect of taxes, create a uniform market, reduce the compliance cost, promote trade and investment, and enhance the revenue collection. This led to the implementation of the Goods and Services Tax (GST) structure, which replaced the multiple indirect taxes with a single tax levied on the supply of goods and services at the national level. GST is based on the principle of destination-based consumption taxation, meaning that the tax is collected by the state where the goods or services are consumed, rather than where they are produced. GST also has a dual structure, with a central GST (CGST) and a state GST (SGST) levied on the same transaction, ensuring that both the central and state governments share the revenue. GST aims to create a seamless and transparent tax system that benefits the consumers, businesses, and the government.


5. (a) What are the powers of the GST Officers relating to inspection, search and seizure?               14

ANSWER: The powers of the GST Officers relating to inspection, search and seizure are as follows:


- Inspection: A Joint Commissioner or an officer of higher rank can authorize any officer in Form GST INS-01 to inspect places of businesses of any person, transporter or warehouse owner, if he has reasons to believe that such person has evaded tax or violated any provisions of the GST Act. The inspection can also cover any other place where the officer suspects that any goods, accounts, registers or documents are concealed¹.

- Search: A Joint Commissioner or an officer of higher rank can authorize any officer in Form GST INS-02 to search any premises where he has reasons to believe that any goods, accounts, registers or documents are liable to confiscation. The search can be carried out by any means, including breaking open the door, almirah, electronic devices, box or receptacle, if access is denied.

- Seizure: An officer conducting a search can seize any goods or documents that are liable to confiscation or relevant for any proceedings under the GST Act. The officer can also seal or break open any goods or documents if they are not produced on demand. The seized goods or documents must be returned within six months, unless extended by the Commissioner for another six months.


The above powers are subject to certain conditions and limitations as specified by the Board or the Commissioner. The person from whom any goods or documents are seized is entitled to a copy of the inventory. The person can also claim provisional release of the seized goods or documents by executing a bond and furnishing a security or paying applicable tax, interest and penalty.


Or

(b) Explain the special provisions of constitutional aspects of GST in India.              14

ANSWER: The special provisions of constitutional aspects of GST in India are as follows:


- Article 246A of the Constitution gives power to the Parliament and the Legislature of each State to make laws with respect to GST imposed by the Union or the State, subject to some exceptions.

- Article 269A of the Constitution relates to the levy and collection of GST on inter-State supply of goods or services or both, and the apportionment of the tax between the Union and the States.

- Article 279A of the Constitution establishes the GST Council, which is a constitutional body that makes recommendations to the Union and the States on various matters related to GST.

- Article 286 of the Constitution puts restrictions on the GST law making powers of the States, and provides that no State law shall impose GST on supply of goods or services or both that takes place outside the State, in the course of import or export, or in the course of inter-State trade or commerce.

- Article 366(12A) of the Constitution defines GST as any tax on supply of goods or services or both, except supply of alcoholic liquor for human consumption.


Or 

ANSWER: The constitutional aspects of Goods and Services Tax (GST) in India are pivotal in shaping the tax framework. Article 246A grants concurrent powers to the Parliament and State Legislatures to enact laws concerning GST, with certain exceptions. This dual structure ensures a collaborative approach between the Central and State governments, replacing an array of indirect taxes.


Article 269A addresses the taxation of inter-State supplies, delineating the mechanism for levy and collection of GST and the subsequent apportionment between the Union and the States. This provision facilitates a uniform approach in dealing with transactions across state boundaries.


Crucially, Article 279A establishes the GST Council as a constitutional body, promoting cooperative federalism. The council, comprising representatives from the Union and States, recommends measures such as tax rates and exemptions, ensuring a consultative and consensus-driven decision-making process.


Article 286 places restrictions on the state's authority, stating that no State law can impose GST on certain transactions like those occurring outside the state or in the course of inter-State trade. This provision aims to maintain consistency and prevent overlapping tax jurisdictions.


Lastly, Article 366(12A) defines GST, encompassing any tax on the supply of goods or services, excluding alcoholic liquor for human consumption. This definition lays the foundation for the broad scope of GST, emphasizing its applicability to a wide range of transactions.


In conclusion, these constitutional provisions underpin the GST regime in India, fostering a cooperative federal structure, preventing dual taxation, and providing a comprehensive legal framework for the taxation of goods and services.



6. (a) What do you mean by valuation of Taxable Services? Provide the format of computation of taxable value and GST on goods.                            4+10=14

ANSWER:  Valuation of taxable services means determining the value on which GST is to be levied. The value of taxable services is usually the transaction value, which is the price actually paid or payable for the supply of services, provided the supplier and the recipient are not related and the price is the sole consideration. However, there are some cases where the transaction value is not applicable, such as when the consideration is not wholly in money, or when the supply is between related parties, or when the supply is by an agent or a principal. In such cases, the value of taxable services is determined by following the valuation rules prescribed under the GST law.

The format of computation of taxable value and GST on goods is as follows:

Particulars

Amount (in Rs.)

Base price of goods

X

Add: Any taxes, fees, charges, expenses, subsidies, etc. that are not included in the base price and are leviable under any law other than GST

Y

Less: Any discounts that are allowed before or at the time of supply and are duly recorded in the invoice

Z

Taxable value of goods

X + Y - Z

Add: GST on goods (CGST + SGST or IGST) at the applicable rate

W

Invoice value of goods

X + Y - Z + W


Example of how to calculate the taxable value and GST on goods using this format:

Particulars

Amount (in Rs.)

Base price of goods

10,000

Add: Packing charges (not included in the base price)

500

Less: Trade discount (10% on base price)

1,000

Taxable value of goods

9,500

Add: GST on goods (18%)

1,710

Invoice value of goods

11,210



Or




(b) (1) Who is required to furnish annual return in GST? What is the due date for the return?    4

ANSWER:  The annual return in GST is called GSTR-9, and it is a summary of all the outward and inward supplies, tax liability, and input tax credits claimed in the financial year. It is filed by all regular taxpayers who are registered under GST, except for some exempted categories¹².


The due date to file GSTR-9 for a financial year is 31st of December of the year following the relevant financial year. For example, the due date for filing GSTR-9 for FY 2022-23 is 31st December 2023. However, the government may extend the deadline in some cases, as it has done in the past. Therefore, it is advisable to check the latest notifications and updates on the GST portal or other reliable sources.


(2) From the following details of Mr. Bharat a registered dealer engaged in purchase and sales of goods. Ascertain the GST liability (SGST/CGST/IGST) for the month of November 2021:                               10


Particulars

Rs.

Sales price charged to customers within the State (excluding GST)

Commission charged to buyers

Packing and forwarding expenses incidental to sales

Weighment charges shown separately in invoice

Prompt payment discount indicating in invoice

CGST

SGST

12,50,000

12,000

18,000

9,500

1%

9%

9%


SOLUTION





Particulars

Amount (Rs.)

Sales price charged to customers within the State (excluding GST)

12,50,000

Commission charged to buyers

12,000

Packing and forwarding expenses incidental to sales

18,000

Weighment charges shown separately in invoice

9,500

Prompt payment discount indicating in invoice

(12,500)

Value of supply

12,75,500

CGST @ 9%

1,14,795

SGST @ 9%

1,14,795

Total GST liability

2,29,590


-00000-




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