Dr.JAYARAM.A.

Surana College, Centre for Post-Graduation Studies CHAPTER-1

Contact num- 9620843555 Bangalore University, Bangalore
Chapter 5
Format for computation of transaction value
Particulars Rs. Rs.
Selling Price / ex- showroom price / quoted price(excluding GST) xxx
Add: Inclusions not included in the sale price
1. Pre-delivery inspection charges xx xx
2. Publicity expenses xx xx
3. Packing cost xx xx
4. Discount in case of advance payment xx xx
xx xx
5. Materials purchased (Exclusive of GST)
xx xx
6. Raw materials supplied by buyer directly or indirectly on free of
xx xx
cost or reduced cost for use in connection with such supply
xx xx
7. Design and development charges
8. Subsidies directly linked to the price other than subsidies provided xx
by Central or State Government
9. Bonus, Commission and incentives for increasing sales xx
10. Royalties and licence fees related to the supply
11. Advertising expenses xx
12. Servicing expenses
13. Selling expenses xx xx
14. Freight charges incurred by seller up to recipient place/place of
delivery xx xx
15. Installation and erection expenses (if it is shown in invoice at the
time or before delivery)
16. Insurance charges incurred by seller up to the place of delivery /
recipients place.
17. Transport charges
18. Taxes, Duties, Cesses, fees and charges except CGST, SGST,
IGST xxx
19. Imported from other country (inclusive of BCD & exclusive of
IGST)
20. Loading and handling charges
21. Warranty expenses

Less: Exclusions included in the sale price xxx

a) Cash/Trade discount (Discount shall be deducted, if it is allowed xx
before or at the time of supply)
b) Discount in normal practices xx xx
c) Cost of durable & returnable packing included in the sale price xxx

Transaction value before adding the profit margin

Add: Profit margin xxx xxx

Transaction value Xxx

TRANSACTION VALUE UNDER GST 1

Dr.JAYARAM.A.
Surana College, Centre for Post-Graduation Studies CHAPTER-1
Contact num- 9620843555 Bangalore University, Bangalore

Amount (Rs)
Particulars
Transaction value or taxable value of goods/services supplied XXX
Output Tax
CGST ( Transaction value X rate of CGST) XXX
SGST (Transaction value X rate of SGST) XXX
Total CGST and SGST Output Tax liability XXX

Format for computation of Output tax Liability

Note: If supply is between two states IGST can be calculated in the place of CGST & SGST

Formula for computation of Tax Liability:

This method is generally followed when tax is not charged separately in the invoice. i.e.
the sales invoice shows sale inclusive of tax. In Such case computation is done as follows:

Tax Liability = Rate of GST X Taxable Turnover (inclusive of GST)

100+ Rate of GST

Turnover (Excluding GST) = 100 X Taxable Turnover (inclusive of GST)

100+ Rate of GST

TRANSACTION VALUE UNDER GST 2

Dr.JAYARAM.A.
Surana College, Centre for Post-Graduation Studies CHAPTER-1
Contact num- 9620843555 Bangalore University, Bangalore

Practical Problems

PROCEDURE ON TIME OF SUPPLY OF GOODS & SERVICES

1) Determine the time of supply of goods in each of following independent cases in accordance with provisions of
Section 12 of CGST Act, 2017 in case supply involves movements of goods.

Date when goods made Date of receipt of

Sl.No Date of removal Date of invoice
available to recipient payment
1 01-08-2019 02-08-2019 03-08-2019 15-08-2019
2 03-08-2019 02-08-2019 04-08-2019 25-09-2019
3 04-09-2019 04-09-2019 06-09-2019 03-08-2019

2) Determine the time of supply of goods in each of following independent cases in accordance with provisions of
section 12 of CGST Act, 2017 in case supply does not involves movements of goods.

Sl.No Date of invoice Date when goods made available to recipient Date of receipt of payment
1 02-08-2019 03-08-2019 15-09-2019
2 04-08-2019 01-08-2019 25-09-2019
3 04-09-2019 06-09-2019 01-08-2019

3) Determine the time of supply of services in each of the following independent cases in accordance with provisions
of CGST act 2017:

Date of actual Time[date] of invoice, bill or Date of which payment received

Sl.no
provisions of service challan as the case may be
1 10-09-2019 30-09-2019 15-10-2019
2 10-09-2019 30-09-2019 15-09-2019
3 10-09-2019 30-09-2019 15-09-2019(part) and
10-10-2019(remaining)
4 10-09-2019 30-09-2019 06-09-2019 (part) and
09-09-2019 (remaining)

4) Determine the time of supply of services in each of the following independent cases in accordance with provisions
of CGST act 2017:

Sl.no Date of actual Time[date] of invoice, bill or Date of which payment received
provisions of service challan as the case may be
1 10-08-2019 30-08-2019 06-08-2019(part) and
16-08-2019 (remaining)
2 10-08-2019 12-09-2019 30-01-2020
3 10-08-2019 12-09-2019 05-08-2019(part) and
25-09-2019(remaining)
4 10-08-2019 22-09-2019 12-09-2019

TRANSACTION VALUE UNDER GST 3

Dr.JAYARAM.A.
Surana College, Centre for Post-Graduation Studies CHAPTER-1
Contact num- 9620843555 Bangalore University, Bangalore

COMPUTATION OF TRANSACTION VALUE & TAX LIABILITY

5) How would you arrive at the transaction value for the purpose of levy of GST and calculate GST payable. From the
following particulars.
The selling price of the product exclusive GST RS 12,000, rate of GST is applicable to the product is 5%, Trade discount
allowed as per normal trade practice before delivery of the product is Rs 1,500. Freight attributable for the supply of the
product is Rs 900 from factory to buyer place which is not included in the above selling price.

6) JD Company manufactures 3,000 units of Products and sold to a whole seller at Rs 200 per Unit. 10% trade
discount is allowed to the whole seller as per the normal practice. What is the amount of GST payable if rate of
GST is 12%?

7) Having Regards to the provisions of CGST and SGST Act, 2017. Compute the Transaction Value of Goods from
the following information and GST payable.

Particulars Amount (Rs)

Listed selling Price (including CGST & SGST of Rs 6,000) 42,000
FOLLOWING TRANSACTIONS ARE NOT INCLUDED
Normal Secondary Packing Cost 3,000
Cost of Special Packing 1,500
Cost of Durable and returnable packing 2,000
Freight charges paid by supplier Charged Separately 1,000
Insurance on Freight paid by supplier Charged Separately 500
Trade Discount (normal Practice) 2,400
Rate of GST 12%.
8) Raj a manufacturer has prepared the Invoice as under:

Particulars Amount (Rs)

Price of Goods (excluding CGST at 14% and SGST at 14%) 10,00,000
THE FOLLOWING ITEMS NOT INCLUDED
Advertising Charges 100,000
Publicity Charges 70,000
Selling Expenses 30,000
Loading & Handling Expenses 8,000
Servicing charges 10,000
Outward freight & insurance on buyer request 55,000
Allowed discount at 10% on the Price of the goods and Shown in Invoice. Compute the amount of GST payable.

9) Determine the total amount of GST Payable on a machine using the details given below:

Particulars Amount (Rs)

Selling Price of the Machine (Inclusive of CGST at 9% and SGST at 9%) 375,000
Cost of Durable & Returnable packing included in the sale price given above 15,000
Design & Development charges paid by buyer on behalf of seller to a 3 rd Party 18,000
Warranty Charges Charged Separately by the seller 5,000
Rate of GST 18%

TRANSACTION VALUE UNDER GST 4

Dr.JAYARAM.A.
Surana College, Centre for Post-Graduation Studies CHAPTER-1
Contact num- 9620843555 Bangalore University, Bangalore

10) How will you arrive the Transaction value under the subject Transaction to be determined under section 15 of
the CGST ACT 2017? Give reasons with suitable assumptions where necessary.

Contracted sale price for delivery at buyer’s premises Rs 15,00,000. The contracted sale price includes the following elements
of cost.

Particulars Amount (Rs)

Cost of drawings and designs 5,000
Cost of primary packing 6,000
Cost of packing at buyer’s request for safety during transport 9,000
IGST @ 12% 1,80,000
Freight and Insurance Charges Paid from Factory place to delivery 30,000
Durable and returnable container charges included 15,000
Discount allowed as per the Trade Practice and shown in Invoice 22,000

11) Arya Ltd of Vijayawada agreed to sell an electronic Motor on which the rate of GST Applicable is 12% to
Bhanu Ltd of Bengaluru for Rs 18,000 on ex-factory basis. Other Particulars are:
(i) Transportation and transit insurance were arranged by Arya Ltd. This was at the request of Bhanu Ltd and
amounted to for Rs 1,500 and 1,800 respectively which were charged separately.
(ii) A discount of Rs 1,800 was given to Bhanu Ltd. On the agreed price on payment of an advance of Rs 4,000 with
the order. (Ignored national interest on advance).
(iii) Interest of Rs 1,000 was charged from ABC Ltd. As it failed to make the payment within 30 days.
(iv) Packing charges of the motor amount to Rs 1,500.
(v) The expenditure incurred by Bhanu Ltd. Towards free after sale service during warranty period comes out to be Rs
750 Per motor. Compute IGST payable.

12) Having Regard to the Provisions of section 15 of CGST Act 2017, compute the Transaction value of taxable
goods, for levy of GST, given the following information:

Particulars Amount (Rs)

Wholesale Price of a Product sold to Hyderabad from a Dealer in Bangalore 84,000
(Including GST 12%)
ABOVE PRICE IS EXCLUSIVE OF THE FOLLOWING
Normal Secondary Packing cost 6,000
Cost of special Secondary packing 7,500
Cost of durable and returnable Packing 4,000
Freight 3,000
Insurance on freight 1,000
Trade discount (normal Practice) 10,000
State in the foot note to your answer, reasons for the admissibility or otherwise of the deductions. Compute IGST Payable.

TRANSACTION VALUE UNDER GST 5

Dr.JAYARAM.A.
Surana College, Centre for Post-Graduation Studies CHAPTER-1
Contact num- 9620843555 Bangalore University, Bangalore
COMPUTATION OF TRANSACTION VALUE & TAX LIABILITY UNDER COMPOSITE SUPPLY
13) A dealer in Cochin entered a contract with a supplier in Mysore to deliver Machinery along with essential
accessories. From the information determine the total amount of GST payable u/s 15 of the CGST Act 2017.

Particulars Amount (Rs)

Price of Machinery (excluding taxes and duties) 7,20,000

Installation and erection expenses charged separately in invoice 24,000

Packing Charges (Primary and Secondary) 18,000

Design and engineering charges paid by the buyer 12,000

Cost of material supplied by buyer free of charge 3,600

Pre delivery inspection charges 1,500
Loading & handling charges within the factory 1,800
Other Information:
i) Cash discount 2% on Price of Machinery was allowed as per terms of Contracts. Since full payment was received
before dispatch of machinery. ii) Bought out accessories supplied along with machinery valued at Rs 6,000 which
was necessary for the working.
These bought out goods are charged for tax at the rate of 5%. iii) GST Rate 18%. Make
suitable assumptions as are required and provide brief reasons.

14) A dealer in Hubli agreed to supply 5 Computer Systems to a dealer in Bellary in the Month of September 2017 on
following terms:

Particulars Amount (Rs)

Price of the each CPU Supplied (inclusive of GST at 18%) 32,000
Price of each desktops Supplied (Exclusive of GST at 28%) 7,500
Packing of Transportation 6,000
Transport charges to recipient place charged separately in invoice 7,500
Commission paid to the agents to fix up agreement for the Sale these. 12,500
Late fee charged to buyer for the delayed payment of the Materials supplied in the month of
August 2017. 3,000

The dealer supplied following essential items Along with the CPU:
i) 5 Keyboards supplied with the laptops costing Rs 400 each and the rate of GST applicable is 12%. ii)
5 Mouses supplied along with the Laptop costing Rs 300 each and rate of GST applicable is 12%.

iii) Cost of operating Software’s supplied for all the system 50,000 rate tax applicable to software’s 5%.
iv) Special discount of Rs 6,000 for is given if advance of Rs 1,00,000 is paid with order. The buyer has paid the
advance with the order.
Find the Transaction Value and the GST payable for the month of September 2017.

TRANSACTION VALUE UNDER GST 6

Dr.JAYARAM.A.
Surana College, Centre for Post-Graduation Studies CHAPTER-1
Contact num- 9620843555 Bangalore University, Bangalore
15) A Manufacturer has to supply Machinery as following terms and Conditions:

Particulars Amount (Rs)

Price of Machinery (Net of taxes and Duties) 6,00,000
Installation and erection expenses charged separately in Invoice 30,000
Packing Charges (Primary and Secondary) 7,500
Design and engineering Charges (net of taxes and duties) 36,000
Cost of material supplied by buyer at reduced cost 7,500
(the Actual price of the materials is Rs 25,000)
Pre delivery inspection charges 4,200
Rate of GST on Machinery 18%
Other Information’s:

Cash discount of Rs 20,000 will be offered if full payment is received before dispatch of goods. The buyer has
made the payment as per the conditions stipulated.
The Machine is supplied along with bought-out accessories at Rs 9,000. The accessories were optional and
the rate of duty applicable to these accessories is 28%.
The Manufacture incurred cost of Rs 2,000 in loading the machine in the truck in his factory. These are not
charged separately to buyer.
Find the transaction value and the GST payable if the rate of GST on Principle supply is 5%.

16) A Dealer in Mumbai agreed to Supply 12 Laptops to a dealer in Mangaluru in the month of September 2018 on
following terms:

Particulars Amount (Rs)

Price of each laptop (inclusive of IGST at 18%) 58,500

Packing for transportation of Laptop 6,000

Transport charges of Laptop 6,500
Commission paid to the agents to fix up agreement for the sale these. 12,000
Additional features charges incurred by seller on request of buyer for each laptop 18,000
The dealer supplied following optional items Along with the laptops:
i) 12 Pen drives supplied along with the laptops costing Rs 500 each and rate of GST applicable is 8%. ii) 12
Keyboards supplied along with the laptops costing Rs 300 each and rate of GST applicable is 12%. iii) 12
optical Mouses supplied along with the laptop costing Rs 320 each and rate of GST applicable is 12%.
iv) 5 Printers supplied along with the Laptop Costing Rs 6,000 each and rate of GST applicable is 28%.
v) Special discount of Rs 5,000 for each laptop is given, if advance of Rs 2,00,000 is paid with order. The buyer has
paid the advance with the order.

Find the Transaction Value and the GST payable for the month of September 2018.

TRANSACTION VALUE UNDER GST 7

Dr.JAYARAM.A.
Surana College, Centre for Post-Graduation Studies CHAPTER-1
Contact num- 9620843555 Bangalore University, Bangalore
17) Compute the amount of output tax to be uploaded by the dealer for the month of july and which is the last date to
upload it in credit ledger.

Product M Sold to a dealer in Hubli rate of GST notified to this product is 12%. 2,00,000.
Product U sold to a dealer in Shimoga rate of GST @ 5%. 1,00,000.
Product N @ Nil Rate GST sold to a dealer in Panaji 2,40,000
Product I @ 18% GST sold to a dealer in Punjab 4,00,000
Product R @ 28% GST sold to a unregistered dealer within the state 6,40,000
Product A rate of GST Notified is 18% sold to a SEZ developer in Bangalore 10,00,000
Product J sold to a dealer in union territory rate of GST notified is 12% 8,00,000
Product H Which is exempted from GST is sold to a registered dealer of Hyderabad. 12,00,000
Product E is exported to Srilanka the GST rate notified by GST Council for this product is 12%
if it is sold in India 9,00,000
Product P sold to a unit of SEZ in Mysuru the rate of GST notified to this product is 5% 6,00,000
Product S sold to a registered dealer within the state, the rate of GST notified is 12%. 5,00,000

Product H Sold to a dealer in Vijayapura who has registered under Composition

Scheme @ 28% GST. 4,00,000

18) The Adyar Anand Bhavan group of Companies provided the following services within the state of Karnataka
from its various establishments. Compute the amount of GST payable for the month July 2019.

1… Supply of food or drink in restaurant not having facilities in air conditioning @ 12% GST Rs 35,000.
2… Supply of food or drink in restaurant in having licence to serve liquor @ 18% GST Rs 80,000.
3… Supply of food or drink in outdoor catering @ 18% GST Rs 1,50,000.
4… Renting of hotels rooms @ 18% GST Rs 2,00,000.
5… Supply of food or drink in air condition restaurant in 5 star or above rated hotel @ 28% GST Rs 1,00,000.

19) R B Travels, a transport agency registered in the state of Karnataka Provided the following services in the month
of August 2019. Compute the amount of GST payable for the month August 2019.
1. Transport of passenger by air condition contract or stage
Carriage the rate of GST applicable is 5% 72,000
2. Transport of passenger by radio taxi @ 5% GST applicable 24,000
3. Transport by passenger by air in economy class @ 5% GST 1,50,000
4. Transport of passenger by air in other than economy Class @ 12%. 75,000
5. Service provided to a foreign tourist in relation to a tour
Conducted wholly outside India which is exempt from GST 4,20,000

TRANSACTION VALUE UNDER GST 8

Dr.JAYARAM.A.
Surana College, Centre for Post-Graduation Studies CHAPTER-1
Contact num- 9620843555 Bangalore University, Bangalore
20) From the following details, Compute the value of taxable service and Goods & Services tax liability

Particulars Amount (Rs)

Services provided by foreign diplomatic mission 600,000
Aerial advertising 150,000
Service by way of private tuitions 45,000
Speed post services 75,000
House given on rent for residential purpose 400,000
Value of free service rendered to friends 80,000
Service rendered to UNO 240,000
Certificate for exchange control purpose 80,000
Secretarial Auditing 25,000
Fees to act as a liquidator 150,000
Vacant land used for horticulture 1,200,000
Sale of time slot by broadcasting organisation 1,50,000
Services rendered within Indian territorial water 12,00,000
Service relating to supply of farm labour 250,000

21) Mr. Bahubali is registered dealer in Karnataka Provides the following services for the month of July 2019.
Compute the value of taxable service and GST payable for the month july 2019.

Particulars Amount (Rs)

Service Rendered to RBI 3,00,000
Selling of space for advertisement in a newspaper rate notified is 5% GST. 84,000
Advance received from his clients for the service to be rendered to make the crops ready
for retail market. 1,45,000

Service relating to education. 82,000

Received from a client for the service rendered in June 2017 for which
invoice was raised and issued to him on 28th july 2017. 1,48,000
Service rendered by supply of labour for agriculture purpose 85,000
Free service rendered to his relatives and friends 100,000
Placement services 180,000
Health care service 80,000
A bill was raised and issued to his client for services 450,000
rendered but no payment is received (date of bill is 16 th July 2017)
Service by way of training in recreational activities 110,000
Part Payment of 22,500 was received from a client in respect of service rendered 85,000
Renting of agro machinery for agriculture purpose 7,80,000
Service rendered in Jammu and Kashmir 80,000

TRANSACTION VALUE UNDER GST 9

Dr.JAYARAM.A.
Surana College, Centre for Post-Graduation Studies CHAPTER-1
Contact num- 9620843555 Bangalore University, Bangalore
22) CA Gulecha, a practicing Charted Accountant received money from Various clients for the services rendered in
the month of July 2017.

• Accounting and Auditing Services of Rs 1,25,000.

• Representation before various statutory authorities Rs 1,00,000.
• Cost accounting and cost Auditing Rs 50,000
• Secretarial Auditing of Rs 35,000
• Verification of declarations in prescribed forms of compliance for obtaining a certificate of commencement of business
Rs 40,000
• Certificate of documents to be filed before registrar of companies Rs 25,000.
• Ledger maintenance, non-professional services and preparation of coaching materials Rs 20,000.
• Fee for routine visits to income tax offices Rs 55,000.
• Remunerations for teaching CA and ICWA students Rs 30,000.
• Fee from outsourcing work of a client such as billing and ledger posting Rs 75,000.

You are required to calculate taxable services under practicing chartered Accountant services and Tax liability for the
month assuming the above receipts are exclusive of GST

TRANSACTION VALUE UNDER GST 10