OBJECTIVE
Goods and Services Tax (GST) is the Indirect Tax levied in India introduced in July 2017 which was one of the most important reforms in the Indian Economy. GST subsumed various indirect laws in the country and the led to the formation of a common national market. In this webinar, we shall look at various important definitions and terminologies under the GST Law.
3. Legends used in the Presentation
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AOP Association of Persons
BOI Body of Individuals
CG Central Government
CGST Central Goods and Services Tax
HUF Hindu Undivided Family
IGST Integrated Goods and Services Tax
ITC Input Tax Credit
LLP Limited Liability Partnership
PAN Permanent Account Number
SG State Government
SGST State Goods and Services Tax
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Introduction
In this webinar, definition and meanings of certain important terms are discussed
Goods and Services Tax (GST) is the Indirect Tax levied in India introduced in July
2017 which was one of the most important reforms in the Indian Economy
GST subsumed various indirect laws in the country and the led to the formation
of a common national market
GST is one of the essential laws to be understood for all stakeholders of the
business environment
Understanding the definitions and meaning of terms used in the Legislation is crucial
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India
-The territory of India,
-its territorial waters,
-seabed and sub-soil underlying such waters,
-continental shelf,
-exclusive economic zone or any other maritime zone and
-the air space above its territory and territorial waters
Territorial Waters The territorial waters is the line every point of which is at a distance of 12
nautical miles from the nearest point of the appropriate baseline*
Continental Shelf
Comprises the seabed and subsoil of the submarine areas that extend beyond the limit of its
territorial waters throughout the natural prolongation of its land territory to the outer edge of
the continental margin or to a distance of 200 nautical miles from the baseline
Exclusive Economic Zone An area beyond and adjacent to the territorial waters, and the limit of such zone is
200 nautical miles from the baseline
*the line along the coast from which the seaward limits of a state's
territorial sea and certain other maritime zones of jurisdiction are measured
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Business
Any trade, commerce, manufacture, profession, vocation, adventure, wager or any other similar activity, whether or not it is for a
pecuniary benefit
Any activity or transaction in connection with or incidental or ancillary thereto
Any activity or transaction regarded as business, whether or not there is volume, frequency, continuity or regularity of such
transaction
Supply or acquisition of goods including capital goods and services in connection with commencement or closure of business
Provision of facilities or benefits to its members by a club, association, society, or any such body
Admission, for a consideration, of persons to any premises
Services supplied by a person as the holder of an office which has been accepted by him in the course or furtherance of his trade,
profession or vocation
Services provided by a race club by way of totalizator* or a licence to book maker in such club
Any activity or transaction undertaken by the CG, a SG or any local authority in which they are engaged as public authorities
includes
* registers bets and divides the total amount bet among those who won
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Manufacture
means processing of raw material or inputs in any manner that results in
emergence of a new product having a distinct name, character and use and
the term “manufacturer” shall be construed accordingly
Recipient
Where a consideration is payable for the supply of goods or services or
both, the person who is liable to pay that consideration
Where no consideration is payable for the supply of goods, the person to
whom the goods are delivered or made available, or to whom possession
or use of the goods is given or made available
Where no consideration is payable for the supply of a service, the person
to whom the service is rendered
Recipient of supply of goods or services or both, means—
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Person
includes
Individual HUF Company Firm LLP
AOP or BOI Government Company
Any body corporate
incorporated by or
under the laws of a
country outside India
Co-operative society Local authority
Central Government
or a State Government
Society Trust
Every artificial juridical
person, not falling
within any of the
above
Family
The spouse and children of the person
The parents, grand-parents, brothers and sisters of the person if they
are wholly or mainly dependent on the said person
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means a person who is registered under GST but does not
include a person having a Unique Identification Number*
Registered Person
* Unique Identification Number - a special class of GST registration for foreign diplomatic
missions and embassies which are not liable for taxes in the Indian territory`
Casual Taxable Person
-A person who occasionally undertakes transactions involving supply of
goods or services or both
-in the course or furtherance of business,
-whether as principal, agent or in any other capacity, in a State or a Union
territory where he has no fixed place of business
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Taxable supplies, Exempt supplies,
Exports of goods or
services or both and
inter-state supplies
of persons
Having the same
PAN, to be computed
on all India basis
Central tax, State tax, Union territory tax, Integrated tax and
Cess
Aggregate
Turnover
Excluding the value of inward supplies on which tax is payable by a person on reverse charge basis
The aggregate value of all
But excludes
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Place from where the business is ordinarily carried on, and includes a warehouse, a godown or any other place
where a taxable person stores his goods, supplies or receives goods or services or both; or
Place where a taxable person maintains his books of account; or
Place where a taxable person is engaged in business through an agent, by whatever name called
Place of Business
The place of business specified as the principal place of business in the GST Certificate
Principle Place of Business
Fixed Establishment
means a place (other than the registered place of business) which is characterised by a
sufficient degree of permanence and suitable structure in terms of human and technical
resources to supply services, or to receive and use services for its own needs
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Place of Supply The place of delivery of goods or consumption of service
Location of the
Supplier of Services
Where a supply is made from registered office, the location of such place of business;
Where a supply is made from a place other than from registered office (a fixed establishment elsewhere),
the location of such fixed establishment;
Where a supply is made from more than one establishment, whether the place of business or fixed
establishment, the location of the establishment most directly concerned with the provisions of the supply;
In absence of such places, the location of the usual place of residence of the supplier
Usual Place of
Residence
• In case of an individual, the place where he ordinarily resides
• In other cases, the place where the person is incorporated or otherwise legally
constituted
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Location of the
Recipient of
Services
Where a supply is received at a place of business for which the registration has been
obtained, the location of such place of business;
Where a supply is received at a place other than the place of business for which
registration has been obtained (a fixed establishment elsewhere), the location of such
fixed establishment;
Where a supply is received at more than one establishment, whether the place of
business or fixed establishment, the location of the establishment most directly
concerned with the receipt of the supply;
In absence of such places, the location of the usual place of residence of the recipient;
Agent
A person, including
-a factor,
-broker,
-commission agent,
-arhatia (who is doing business
on behalf of others),
-del credere agent,
-an auctioneer,
Who carries on the business of supply or receipt of
goods or services or both on behalf of another
Factoring is a financial transaction and a type of debtor finance
in which a business sells its accounts receivable (i.e., invoices)
to a third party (called a factor)
A del credere agency is a type of principal-agent relationship wherein
the agent acts not only as a salesperson, or broker, for the principal,
but also as a guarantor of credit extended to the buyer
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Common portal which would facilitate registration, tax
payment, filing of returns, computation and settlement
of integrated tax, electronic way bill and any other
purpose as prescribed by Government
Common Portal
Consideration
• Any payment made or to be made, whether in money or
otherwise,
• in respect of, in response to, or for the inducement* of,
• the supply of goods or services or both,
• whether by the recipient or by any other person but
• shall not include any subsidy given by the CG or SG
• The monetary value of any act or forbearance**,
• in respect of, in response to, or for the inducement of,
• the supply of goods or services or both,
• whether by the recipient or by any other person but
• shall not include any subsidy given by the CG or a SG
includes
Deposit given in respect of the supply of goods or services or both shall not be considered as payment
made for such supply unless the supplier applies such deposit as consideration for the said supply
https://www.gst.gov.in is
the official common portal
notified by the
government
*Inducement - a thing that persuades or leads someone to do something
**forbearance – restraint and tolerance
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Turnover in State/UT
Aggregate value of:
All taxable supplies (excluding the value of inward
supplies on which tax is payable by a person on reverse
charge basis) and exempt supplies made within a
State/UT by a taxable person,
Exports of goods or
services or both and
Inter-State supplies of goods
or services or both made
from the State/UT by the said
taxable person
but excludes central tax,
State tax, Union territory
Job Work
means any treatment or process undertaken by a person on goods
belonging to another registered person and the expression “job
worker” shall be construed accordingly
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Works contract
wherein transfer of property in goods (whether as goods or in some other
form) is involved in the execution of such contract
of any immovable property
building, construction, fabrication, completion, erection, installation, fitting
out, improvement, modification, repair, maintenance, renovation, alteration or
commissioning
means a contract for:
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Capital goods
means goods,
• the value of which is capitalised in the books of account of the person claiming ITC
• and which are used or intended to be used in the course or furtherance of business
Input
means any goods other than capital goods used or intended to be used by
a supplier in the course or furtherance of business
Input service
means any service used or intended to be used by a supplier in the course
or furtherance of business
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Input Tax
But does not include Tax paid under the composition levy*
and includes IGST paid on Imports and Tax paid on Reverse Charge Basis
on any supply of goods or services or both made to him
means the CGST, SGST, IGST or UTGST charged
In relation to a registered person,
Input tax credit means the credit of input tax
Input Service
Distributor (ISD)
• means an office of the supplier of goods or services or both
• which receives tax invoices towards the receipt of input services
• and issues a ‘ISD Invoice’ for the purposes of distributing the ITC on services
• to a supplier of taxable goods or services or both having the same PAN as that of the
said office (branch)
*The composition levy is an alternative method of levy of tax designed for small taxpayers whose turnover
is below Rs. 1crore. However, in case of North-Eastern states and Himachal Pradesh, the limit is Rs 75 lakh
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Exempt Supply
means supply of any goods or services or both
Which attracts nil rate of tax or
which may be wholly exempt from tax on recommendation of GST Council (through notification)
and includes non-taxable supply
Non-taxable Supply means a supply of goods or services or both which is not leviable to tax
Means a supply of goods or services or both which is leviable to tax under the ActTaxable Supply
Means a person who is registered or liable to be registered under the ActTaxable Person
means the liability to pay tax by the recipient of supply of goods or services or both
instead of the supplier of such goods or services or both
Reverse Charge
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Composite Supply
which are naturally bundled and supplied in conjunction with each other in the ordinary course of
business, one of which is a principal supply
consisting of two or more taxable supplies of goods or services or both, or any combination thereof,
means a supply made by a taxable person to a recipient
22. Authorised
Representative A person who is authorised by a person to appear in his behalf
Adjudicating
Authority
means any authority, appointed or authorised to pass any order or decision under this Act, but
does not include the Central Board of Excise and Customs, the Revisional Authority, the
Authority for Advance Ruling, the Appellate Authority for Advance Ruling, the Appellate
Authority and the Appellate Tribunal
