Library / Goods and Services Tax: The Professional's Master Guide

List of Illustrations

Illustrations are numbered through the guide. The chapter number is shown in brackets.

1. Tax on tax under the old system (Chapter 1) 13

2. Which tax applies (Chapter 1) 13

3. Credit chain from manufacturer to consumer (Chapter 1) 14

4. A bill with GST and non-GST items (Chapter 1) 15

5. Weighted voting in the Council (Chapter 2) 18

6. Double tax struck down in Mohit Minerals (Chapter 2) 19

7. Scope of an advance ruling (Chapter 2) 21

8. Effect of the rate cut on the consumer price (Chapter 3) 24

9. Stock held on 21 September 2025 (Chapter 3) 25

10. ITC reversal by a health insurer (Chapter 3) 25

11. Cement supplied around 22 September 2025 (Chapter 3) 26

12. Year-end discount under the present law (Chapter 3) 28

13. Credit note after the section 34(2) amendment (Chapter 3) 28

14. Government activity as business (Chapter 4) 31

15. Deposits and Government subsidy (Chapter 4) 32

16. Computing aggregate turnover (Chapter 4) 33

17. Related companies and valuation (Chapter 4) 34

18. Stock transfer to a branch (Chapter 4) 34

19. Input or capital goods (Chapter 4) 35

20. Zero-rated versus exempt (Chapter 4) 36

21. Sale of old laptops by a business (Chapter 5) 37

22. Resident welfare association charges (Chapter 5) 38

23. Import of services by an individual and by a firm (Chapter 5) 39

24. Business asset given away (Chapter 5) 39

25. Gifts to employees (Chapter 5) 40

26. Cross charge by head office (Chapter 5) 40

27. Goods sent to an agent (Chapter 5) 41

28. Flat sold before and after completion (Chapter 5) 43

29. Merchanting trade (Chapter 5) 43

30. Gift voucher redeemed for a shirt (Chapter 5) 43

31. Which recoveries attract GST (Chapter 5) 45

32. Hotel room with breakfast (Chapter 6) 47

33. Tractor sold with toolkit and free first service (Chapter 6) 47

34. Festive hamper (Chapter 6) 47

35. Coaching fee including books (Chapter 6) 48

36. Monthly reverse charge register (Chapter 7) 52

37. GTA: reverse charge or forward charge (Chapter 7) 52

38. Import of services (Chapter 7) 52

39. Shortfall in purchases from registered suppliers (Chapter 7) 53

40. ITC reversal for exempt supplies (Chapter 7) 54

41. HSN digits required (Chapter 8) 55

42. What a classification dispute costs (Chapter 8) 56

43. Refund for a bicycle manufacturer (Chapter 8) 58

44. Checking eligibility (Chapter 9) 60

45. ITC reversal on opting in (Chapter 9) 61

46. Crossing the limit during the year (Chapter 9) 61

47. Quarterly tax under composition (Chapter 9) 61

48. Trader selling to consumers (Chapter 9) 62

49. Small restaurant (Chapter 9) 62

50. Invoice issued after removal of goods (Chapter 10) 64

51. Thirty-day rule and advance for services (Chapter 10) 65

52. Facility management contract (Chapter 10) 66

53. Reverse charge on legal services (Chapter 10) 66

54. Import of services from an associated enterprise (Chapter 10) 66

55. Gift card (Chapter 10) 67

56. Salon services across the rate change (Chapter 10) 68

57. Cement dealer and the four working day rule (Chapter 10) 68

58. Building up the value of supply (Chapter 11) 69

59. Volume rebate under a dealership agreement (Chapter 11) 70

60. Exchange offer on a television (Chapter 11) 71

61. Stock transfer to a branch (Chapter 11) 71

62. Corporate guarantee by a holding company (Chapter 11) 71

63. Money changer and air travel agent (Chapter 11) 72

64. Customs broker's invoice (Chapter 11) 73

65. Contract with client-supplied cement (Chapter 11) 74

66. Secondment to an Indian subsidiary (Chapter 11) 75

67. Three-party bill-to-ship-to sale (Chapter 12) 77

68. Machine installed at site (Chapter 12) 78

69. Goods sold on board a train (Chapter 12) 78

70. General rule for a professional firm (Chapter 12) 79

71. Hotel stay and banquet for a sales conference (Chapter 12) 79

72. Organising a dealer conference (Chapter 12) 80

73. Transport of goods and of passengers (Chapter 12) 80

74. CGST and SGST charged in place of IGST (Chapter 12) 81

75. Testing, remote repair and temporary import (Chapter 13) 83

76. Architectural services across the border (Chapter 13) 84

77. Event held partly in India (Chapter 13) 84

78. Self-drive car for a foreign tourist (Chapter 13) 84

79. Commission agent before and after 30 March 2026 (Chapter 13) 85

80. Foreign software subscription (Chapter 13) 87

81. Customs duty and IGST on imported machinery (Chapter 14) 88

82. Personal and business imports (Chapter 14) 89

83. Which services qualify as exports (Chapter 14) 89

84. LUT or IGST payment for a goods exporter (Chapter 14) 90

85. Late realisation of export proceeds (Chapter 14) 90

86. Components to an SEZ unit (Chapter 14) 91

87. Supply to an advance authorisation holder (Chapter 14) 91

88. Merchant export at 0.1% (Chapter 14) 92

89. Basic credit and set-off for a textile unit (Chapter 15) 93

90. Machinery received in lots (Chapter 15) 94

91. Bill-to-ship-to supply (Chapter 15) 95

92. Supplier fails to file GSTR-3B: rule 37A (Chapter 15) 95

93. Proportionate reversal under rule 37 (Chapter 15) 96

94. Choosing between ITC and depreciation (Chapter 15) 96

95. Time limit for FY 2025-26 invoices (Chapter 15) 97

96. Vehicle fleet of a manufacturer (Chapter 16) 100

97. Canteen, events and staff lunch (Chapter 16) 101

98. New factory project (Chapter 16) 102

99. Flood loss with insurance claim (Chapter 16) 103

100. Gifts, samples and personal use (Chapter 16) 103

101. Working out the value of exempt supplies (Chapter 17) 105

102. Monthly computation under rule 42 (Chapter 17) 106

103. Annual true-up with interest (Chapter 17) 107

104. Rule 43 for two capital goods (Chapter 17) 107

105. Option under section 17(4) (Chapter 17) 108

106. Switch to composition: rule 44 (Chapter 17) 108

107. Sale of used machinery (Chapter 17) 109

108. Credit note with and without reversal (Chapter 17) 110

109. Moving out of composition (Chapter 18) 111

110. Credit transfer on demerger (Chapter 18) 112

111. Inputs not returned within one year (Chapter 18) 112

112. ISD with three State registrations (Chapter 18) 113

113. Warranty and extended warranty (Chapter 18) 114

114. Books, GSTR-2B and GSTR-3B for October 2026 (Chapter 19) 116

115. Extent of blocking (Chapter 19) 117

116. Applying rule 86B (Chapter 19) 117

117. Responding to DRC-01C (Chapter 19) 118

118. Aggregate turnover of a goods trader (Chapter 20) 121

119. Supplier of both goods and services (Chapter 20) 121

120. Stock transfer between distinct persons (Chapter 20) 122

121. Advance deposit by a casual taxable person (Chapter 20) 123

122. Payment under section 29(5) (Chapter 20) 124

123. Last date for revocation (Chapter 20) 125

124. Last date for a service invoice (Chapter 21) 127

125. Advance for services and refund voucher (Chapter 21) 127

126. Self-invoice and payment voucher under reverse charge (Chapter 21) 128

127. Sales return and the credit note time limit (Chapter 21) 128

128. Is e-invoicing applicable? (Chapter 22) 130

129. 30-day limit (Chapter 22) 131

130. Consignment value test (Chapter 22) 131

131. Validity for normal cargo and ODC (Chapter 22) 132

132. Penalty on detention (Chapter 22) 133

133. Inputs not returned by the job worker (Chapter 23) 135

134. Retention period and unaccounted stock (Chapter 23) 136

135. Last date under the three-year bar (Chapter 24) 139

136. Late fee and interest on a delayed GSTR-3B (Chapter 24) 139

137. GSTR-9 late fee (Chapter 24) 139

138. Set-off to minimise cash (Chapter 25) 141

139. Interest on delayed GSTR-3B (Chapter 25) 142

140. Interest on wrong ITC utilised (Chapter 25) 142

141. TDS on a Government contract (Chapter 25) 142

142. TCS by an e-commerce operator (Chapter 25) 143

143. Two-year limit (Chapter 26) 144

144. Interest on delayed refund (Chapter 26) 145

145. Excess tax charged to customers (Chapter 26) 146

146. Export refund with the 150% cap (Chapter 26) 146

147. Inverted duty refund (Chapter 26) 147

148. Affordable or not (Chapter 27) 150

149. Annual output tax of a mixed project (Chapter 27) 150

150. Shortfall tax under the 80% rule (Chapter 27) 151

151. Commercial office unit with ITC (Chapter 27) 151

152. JDA: landowner flats and development rights (Chapter 27) 152

153. Main contractor and sub-contractor (Chapter 27) 153

154. Rent under reverse charge (Chapter 27) 154

155. TCS on a marketplace seller (Chapter 28) 156

156. Section 9(5) on three platforms (Chapter 28) 157

157. Import of SaaS under reverse charge (Chapter 28) 158

158. Rule 42 or the 50% option (Chapter 29) 160

159. Value of forex sale (Chapter 29) 161

160. Health insurer after 22 September 2025 (Chapter 29) 161

161. Diwali gifts and canteen (Chapter 30) 163

162. Sitting fees under reverse charge (Chapter 30) 164

163. Corporate guarantee for a subsidiary (Chapter 30) 165

164. A hotel bill after GST 2.0 (Chapter 31) 166

165. Cab rental to a company (Chapter 31) 167

166. GTA: 5% under reverse charge or 18% with ITC (Chapter 31) 167

167. Hospital room rent above Rs. 5,000 (Chapter 32) 169

168. Incubation fees and equity for services (Chapter 32) 170

169. RWA maintenance charges (Chapter 32) 171

170. Professional fees in a small company (Chapter 33) 172

171. A freelance designer (Chapter 33) 173

172. The 180-day rule (Chapter 33) 173

173. Slump sale or itemised sale (Chapter 34) 175

174. Sale of a used machine (Chapter 34) 176

175. GST dues in a resolution plan (Chapter 34) 176

176. Provisional assessment and interest on final assessment (FY 2024-25, before GST 2.0) (Chapter 35) 179

177. Replying to ASMT-10 for FY 2023-24 (Chapter 35) 181

178. Withdrawal of a best judgement order (Chapter 35) 182

179. Handling audit paras for FY 2023-24 (Chapter 35) 183

180. Working out time limits for a notice (Chapter 36) 187

181. Section 73: penalty at each payment stage (Chapter 36) 188

182. Section 74: penalty at each payment stage (Chapter 36) 188

183. Section 74A: both scales (FY 2024-25) (Chapter 36) 189

184. Waiver under section 128A (Chapter 36) 189

185. Instalments under section 80 (Chapter 36) 192

186. Provisional release of seized goods (Chapter 37) 193

187. Is arrest possible? (Chapter 37) 195

188. Advance ruling timeline (Chapter 38) 197

189. Reach of a ruling (Chapter 38) 198

190. Pre-deposit at each stage (Chapter 39) 200

191. Penalty-only appeal (Chapter 39) 200

192. GSTAT limitation (Chapter 39) 201

193. Penalty under section 122 (Chapter 40) 204

194. Minor breach under section 126 (Chapter 40) 205

195. Late fee computations (Chapter 40) 205

196. Compounding amount (Chapter 40) 206

197. Revising prices after GST 2.0 (Chapter 41) 207

198. Credit on stock bought before the cut (Chapter 41) 208

199. One month's entries for Kavya Foods Pvt. Ltd., Gujarat (5% goods) (Chapter 42) 210

200. Refund of unutilised ITC on exports under LUT (Chapter 42) 211

201. Blocked credit capitalised (Chapter 42) 212

202. GSTR-2B vs purchase register for one month (Chapter 43) 213

203. Rule 42 annual true-up for FY 2025-26 (Chapter 43) 214

204. Books to GSTR-9 for Patel Components Pvt. Ltd., FY 2025-26 (Chapter 43) 214

205. A limitation diary for a section 74A notice (Chapter 44) 216

206. Paying within 60 days versus contesting (Chapter 44) 217

207. Rule 86B check for Suryoday Electricals (Chapter 45) 221

208. Rule 43 on the common packing line (Chapter 46) 224

209. Interest on the rule 42 shortfall (Chapter 46) 224

210. Ledger limit and order of debit (Chapter 47) 227

211. Effect of the 2022 amendment and of excluding input services (Chapter 48) 230

212. The 80% test for FY 2025-26 (Chapter 49) 233

213. Development rights relating to unsold flats (Chapter 49) 233

214. Apportionment of credit for June 2026 (Chapter 50) 236

215. Value of the stock transfer (Chapter 51) 239

216. GSTR-3B of the Maharashtra GSTIN for August 2026 (Chapter 51) 239

217. Credit apportionment for the year (annual figures) (Chapter 52) 242

218. Input Service Distributor for the two offices (Chapter 52) 242

219. Corporate guarantee for the subsidiary (Chapter 53) 245

220. Reverse charge on the secondment recharge (Chapter 53) 245

221. High sea purchase (Chapter 54) 248

222. Bill-to-ship-to sale (Chapter 54) 248

223. Margin comparison for FY 2027-28 (Chapter 55) 251

224. Interest working for the first option (Chapter 56) 253

225. Appeal and pre-deposit (Chapter 56) 254

226. Additional liability paid through DRC-03 (Chapter 57) 256

227. Transfer of credit through ITC-02 (Chapter 58) 259

228. Section 18(6) on the press sold separately (Chapter 58) 259

229. Consultant under section 10(2A) (Chapter 59) 262

230. Interest on late payment of tax (Chapter 59) 301

231. Late fee on GSTR-3B (Chapter 59) 302

232. Interest on ITC wrongly availed and utilised (Chapter 59) 302

233. Late fee on GSTR-9 (Chapter 59) 302

234. Penalty under section 74A (Chapter 59) 302

PART A: FOUNDATIONS

Structure, Constitution, recent reforms and the vocabulary of GST

This Part lays the base for the rest of the guide. It explains why GST was introduced, how the Constitution divides the power to tax, how the law is made and read, what changed with GST 2.0 and the Finance Acts of 2025 and 2026, and the definitions that decide most questions of taxability.