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How GST is Levied in the case of Intra-State Supply of Goods and/or Service under GST Act.

Basis of charge in the case of intra-State supplies of goods or services or both is given below –

Dual GST –

Intra-State supply of goods/services is chargeable simultaneously under the following two Acts –

1

- Central GST Act (CGST Act)

Section 9 of CGST Act

2

- State GST Act (SGST Act)
Or
- Union Territory GST Act (UTGST Act)

Section 9 of SGST Act

Section 7 of UTGST Act

To impose SGST on supply of goods and services within the State, each State has passed its own State GST Act. These State GST Acts are copies of CGST Act (all provisions are identical). For instance, in the case of intra-State supply in Karnataka (i.e., supply by a person from Karnataka to Karnataka), it is taxable simultaneously under section 9 of CGST Act and section 9 of Karnataka GST Act. If GST rate is 12%, 6% will be charged under section 9 of CGST Act and 6% will be charged under section 9 of SGST Act.

UTGST Act has been passed for Union Territories which do not have legislature. These Union Territories are (a) Andaman and Nicobar Islands (b) Lakshadweep (c) Dadra and Nagar Haveli (d) Daman and Diu (e) Chandigarh*. IntraState supply of goods/services within a Union Territory (for instance supply by a trader from Andaman to another trader in Andaman), is taxable simultaneously under section 9 of CGST Act and section 7 of UTGST Act. If GST rate is 12%, 6% will be charged under section 9 of CGST Act and 6% will be charged under section 7 of UTGST Act. For the purpose of GST, each Union Territory shall be considered as a separate Union Territory. For instance, if a trader of Andaman supplies goods to a trader of Chandigarh, it will be treated as inter-State supply and subject to IGST.

Delhi and Puducherry are not covered by the list of Union Territories for this purpose. They have their own legislatures and they have passed their own SGST Acts.

GST Rate –

On the recommendation of GST Council, GST rates are notified as follows –

Act

Who will notify GST Rates

Maximum GST Rates

Under CGST Act

Central Government has power to notify rates under SGST Act

Maximum rate cannot exceed 20%

Under SGST Act

The concerned State Government has power to notify rates under CGST Act

Maximum rate cannot exceed 20%

Under UTGST Act

Central Government has power to notify rates under UTGST Act

Maximum rate cannot exceed 20%

 

Alcoholic liquor excluded –

All intra-State supplies are covered. However, GST is not applicable on the supply of alcoholic liquor for human consumption.

GST presently not applicable on petroleum products –

Intra-State supplies of petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas and aviation turbine fuel, are presently not covered by GST. GST in respect of these supplies will be levied from a date which is yet to be notified.

Taxable value –

For the purpose of charging GST, taxable value of supply shall be calculated under section 15 of CGST Act (similar provisions are given in section 15 of SGST Act) [see paras 464 to 475].

Reverse charge –

Generally, GST is payable by the supplier of goods and/or services. However, in a few cases (which are notified by the Government on the recommendation of GST Council), GST is payable by the recipient of supply under reverse charge mechanism.

Supply by unregistered person to a registered person –

If intra-State supply is made by an unregistered person to a registered person, the recipient of supply is required to pay GST under reverse charge mechanism (however, this rule is not applicable during October 13, 2017 and September 30, 2019).

Power to grant exemption –

Central Government/State Governments have power to grant exemption by issue of a Notification on the recommendation of GST Council. Full exemption/partial exemption from GST may be given subject to certain condition specified in the relevant notification.

What is intra-State supply –

To find out whether a supply is intra-State supply or not, one has to first ascertain the location of supplier and the place of supply.

When treated as intra-State supply –

Where the location of supplier of goods/services and location of supply of goods/services are in the same State or same Union Territory, the supply is treated as intra-State supply.

When not treated as intra-State supply –

The following supplies are not treated as intra-State supply –

  1. Supply of goods/services to (or by) a Special Economic Zone (SEZ) developer or SEZ unit.

  2. Goods imported into the territory of India (till they cross the customs frontiers of India).

  3. Goods supplied to a tourist.

 
Persons Eligible to take Input Tax Credit (ITC) under Special Circumstances [Section 18(1)] GST - Ready Reckoner in India How GST Is Levied in the case of Inter-State Supply of Goods and/or Service under GST Act.
 

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