Practice Test - 01 CA INTERMEDIATE UDESH REGULAR (GROUP-1) MAY 2024 28/01/2024

GST (OBJECTIVE)

1. Determine the value of taxable supply as per 4. M/s. BAJAJ, a banking company, appoints Mr. B
provisions of section 15 of the CGST Act, 2017? (auctioneer) to auction certain goods.
Contracted value of supply of goods (including The auctioneer arranges for the auction and
GST @ 18%) Rs 10,85,600. Not included in
identifies the potential bidders. The highest bid is
above are:
accepted and the goods are sold to the highest
(i) Commission paid to agent by recipient on
instruction of supplier Rs 5,000 bidder by M/s. BAJAJ.
(ii) Freight and insurance charges paid by The invoice for the supply of the goods is issued
recipient on behalf of supplier Rs 75,000 by M/s. BAJAJ to the successful bidder.
(2 Marks) Is Mr. B an agent of M/s BAJAJ for the supply of
(1) Rs 11,00,000 (2) Rs 11,80,000 goods in terms of Schedule I para 3?
(3) Rs 10,00,000 (4) Rs 11,75,000
(2 Marks)
2. Prasad purchased certain goods worth INR 17,000 (1) Yes
from Dushyant foods Pvt. ltd. As a matter of (2) No
security, Prasad made a request to the supplier to
provide for an additional packaging on the given
item for safe transportation which cost around INR 5. When can the transaction value be rejected for
1500. computation of value of supply?
The supplier charged value of the additional
packaging separately after the supply was made. (i) When the buyer and seller are related and
What is the final value of such supply made? price is not the sole consideration
(2 Marks) (ii) When the buyer and seller are related or price
(1) Rs 17,000 is not the sole consideration
(2) Rs 18,500 (iii) It can never be rejected
(3) Rs 15,500
(4) None of the above (iv) Both (a) & (b)
(2 Marks)
3. Mr. Shyam and Mr. Ram are two brothers running (1) When the buyer and seller are related and
a business of supplying lubricants located in the price is not the sole consideration
State of Gujarat in their company, M/s. Tata
Lubricants (P) Ltd. On the death of their respected (2) When the buyer and seller are related or price
father, the two brothers have divided their is not the sole consideration
business. (3) It can never be rejected
However, they have signed an agreement that Mr.
Ram will not enter into the business of supplying (4) Both (a) & (b)
lubricants similar to the business done by M/s.
Tata Lubricants (P) Ltd. run by Mr. Shyam, for
6. One of the following states does not fall under the
which Mr. Shyam will pay him Rs. 2.5 crores as a
lump sum payment. special category given under Article 279A of the
State whether transaction entered through the Constitution.
above agreement constitutes supply under CGST (1 Marks)
Act, 2017 or not.
(1) Himachal Pradesh
(2 Marks)
(1) Yes, supply of goods by Mr. Shyam. (2) Uttarakhand
(2) Yes, supply of goods by Mr. Ram. (3) Chhattisgarh
(3) Yes, supply of services by Mr. Shyam. (4) Jammu & Kashmir
(4) Yes, supply of services by Mr. Ram.
7. Which of the following goods will not be covered 9. A _______ supply consisting of two or more
under the GST act? supplies shall be treated as the supply of that
particular supply that attracts the highest rate of
(1 Marks)
tax.
(1) Cooking gas (1 Marks)
(2) Liquor (1) Composite
(3) Petrol (2) Mixed
(4) Both b & c above (3) Both (a) and (b)
(4) None of the above
8. Who of the following will be the members of the
GST Council? 10. The value of supply should include
(i) Union Finance Minister (1 Marks)
(ii) Union Minister of State in charge of Revenue (1) Any non GST taxes duties cesses fees
or Finance charged separately by supplier
(iii) Chief Ministers of States (2) Interest late fee or penalty for delayed
(1 Marks) payment of any consideration for any supply
(1) 1 & 3 (3) Subsidies directly linked to the price except
(2) 1 & 2 subsidies provided by the Central and State
Governments
(3) 2 & 3
(4) All of the above
(4) All of the above
 ANSWER KEY

1. (3) 6. (3)

2. (2) 7. (4)

3. (4) 8. (2)

4. (2) 9. (2)

5. (4) 10. (4)

1. (3) 6. (3)
Value of supply = Amount including GST ÷ There are 11 Special Category States, namely,
(100+Rate of GST) States of Arunachal Pradesh, Assam, Jammu and
10,85,600 ÷ 118% = Rs 9,20,000. Add Rs 5000 Kashmir, Manipur, Meghalaya, Mizoram,
and Rs 75,000 Total Rs 10,00,000/- Nagaland, Sikkim, Tripura, Himachal Pradesh and
Uttarakhand.
2. (2)
7. (4)
As per section 15 (2), The value of supply shall
GST is levied on all goods and services, except
include - incidental expenses, including alcoholic liquor for human consumption and
commission and packing, charged by the supplier petroleum crude, diesel, petrol, ATF and natural
to the recipient of a supply and any amount gas.
charged for anything done by the supplier in
respect of the supply of goods or services or both 8. (2)
at the time of, or before delivery of goods or The Union Finance Minister is the Chairman of
supply of services. this Council and Ministers in charge of
Finance/Taxation or any other Minister nominated
3. (4) by each of the States & UTs with Legislatures are
As per schedule II para 5e Supply of service its members. Besides, the Union Minister of State
in charge of Revenue or Finance is also its
means - agreeing to the obligation to refrain from
member.
an act, or to tolerate an act or situation. Hence
consideration paid by Shyam of Rs 2.5 crores is 9. (2)
for supply of service by Ram. As per Section 8 clause b, a mixed supply
comprising two or more supplies shall be treated
4. (2) as supply of that particular supply that attracts the
As Mr. B rendered auction services and invoice is highest rate of tax.
issued by the M/s BAJAJ hence it can not be said Hence Option (b) selected i.e. Mixed
that Mr. B is an agent of M/s BAJAJ.
10. (4)
5. (4) The value of supply under GST shall include Any
Basically as per Sec 15(1) Transaction value is the taxes duties cess fees and charges levied under
price which is paid or payable for the supply of any act except GST GST Compensation Cess will
be excluded if charged separately by the supplier
goods or services or both. Where the supplier and
Any amount that the supplier is liable to pay
the recipient of the supply are not related and the
which has been incurred by the recipient and is
price is the sole consideration for the supply. not included in the price.
In all the above options, option (a) and (b) gives The value will include all incidental expenses in
that situation wherein the transaction value can be relation to sale such as packing commission etc
rejected because under both the options the Subsidies linked to supply except Government
supplier and the recipient are related persons subsidies will be included.
which contradicts the definition as per the CGST Interest late fee penalty for delayed payment of
Act. consideration will be included
Hence all of the above is selected

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