MCQ (ICAI Study Material)

Q.1. Mention the supplies on which reverse charge (d) None of the above
mechanism would apply? Answer :-(b) XYZ Ltd
(a) Notified categories of goods or services or both
(b) Inward supply of goods or services or both from an Q. 7. Services by a Recovery Agent to M/s ZZZ bank
unregistered dealer Ltd., is liable for GST in the hands of:
(c) Both the above
(d) None of the above (a) M/s ZZZ bank Ltd.
Answer :- (c) Both the above (b) Recovery Agent
Q. 2. Which of the following services are covered (c) Both the above
under Reverse Charge Mechanism under Section 9(3) (d) None of the above
of CGST Act, 2017 Answer :- (a) M/s ZZZ bank Ltd.
i. Legal Consultancy ii. Goods Transport Agency
iii. Manpower Supply iv. Rent-a-Cab
(a) i & iii Q. 8. Silk yarn procured by M/s ABC Silks Ltd. from a
(b) i & iv Trader, GST is payable by:
(c) i & ii
(a) Trader
(d) All the above
Answer :- (c) i & ii (b) M/s ABC Silks Ltd
(c) Both the above
Q.3. In case of GTA Services, provided to an Individual
not registered under GST and not a business entity, (d) None of the above
liability to pay GST is on Answer :- (a) Trader
(a) Supplier
(b) Recipient
(c) Both Q.9. Lottery procured from State Government by a
(d) None of the above lottery distributor, GST is payable by:
Answer :- (a) Supplier
(a) Lottery Distributor
(b) State Government
Q. 4. In case of renting of land, inside an Industrial
estate, by State Government to a manufacturing (c) Both the above
company, GST is: (d) None of the above
(a) Exempted Answer :- (a) Lottery Distributor
(b) Applicable under Normal Charge
(c) Applicable under Reverse Charge
(d) None of the above
Q.10
Answer :- (c) Applicable under Reverse Charge
Reverse charge u/s 9(3) of the CGST Act is
applicable on:-
Q. 5. Services by an Insurance Agent to Ms. ABC (a) Only on Notified Services
Insurance Co. Ltd., GST is to be paid by:
(b) Only on Notified Goods
(a) Insurance Agent
(c) Notified Goods & Services
(b) ABC Insurance Co. Ltd.
(c) Both (d) None of the above
(d) None of the above Answer :- (c) Notified Goods & Services
Answer :- (b) ABC Insurance Co. Ltd.
Q.11. If Tobacco leaves procured from an
Q. 6. Sitting Fees received by director of XYZ Ltd., is Agriculturist by a registered person, then: -
liable for GST in the hands of the……… (a) Reverse charge is applicable
(b) Normal charge is applicable
(a) Director
(c) Joint charge is applicable
(b) XYZ Ltd (d) None of the above
(c) Both of above Answer :- (a) Reverse charge is applicable

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Q.12. M/s. PQR Ltd. has availed rent-a-cab service MCQ :-
from M/s ABC Travels (Proprietor) service then which
one of the following is Reverse charges - Basic Questions
true:-
(a) Reverse charge is applicable as this is a notified Q.18. In case of reverse charge who is liable to pay
service. tax?
(b) Reverse charge is applicable if ABC Travels is not a. Supplier
registered. b. Recipient
(c) Joint charge is applicable c. Both a and b
(d) None of the above d. None of these
Answer :- (d) None of the above Ans:-
Q. 19. Who are the persons liable to pay tax under
Q. 13. Reverse Charge is applicable: reverse charge mechanism?
(a) Only on intra state supplies a. Registered Supplier
(b) Only on inter-state supplies b. Registered Recipient
c. Unregistered Supplier
(c) Both intra and interstate supplies
d. Unregistered Recipient
(d) None of the above Ans:-
Answer :- (c) Both intra and interstate supplies
Q. 20 When is the person eligible to claim the credit of
Q.14. Banking services provided by Department of tax paid under RCM?
post: a. Same month
(a) Taxable & Reverse Charge Mechanism is applicable b. Next month
(b) Taxable & Normal Charge is applicable c. Any of the two months
(c) Exempt from GST d. In any month of the year
(d) Nil rated Ans:-
Answer :- (c) Exempt from GST
Q. 21. Can Input tax credit standing in the Electronic
Q.15. A radio taxi driver has provided his services credit ledger be utilized for payment of tax under
through Electronic Commerce Operator – Kuber Reverse Charge Mechanism?
Cabs. The tax on such supplies shall be paid by the a. Yes
(ICAI Study Material) b. No
(a) Electronic Commerce Operator – Kuber Cabs c. Not Applicable
(b) Radio taxi driver d. May be
(c) Customer receiving the services from radio taxi driver Ans:-
(d) None of the above
Answer :- (a) Electronic Commerce Operator –Kuber Q. 22.Is ITC available to the supplier, supplying goods
Cabs / services under Reverse Charge Mechanism
Q.16. GST is payable by the recipient under reverse a. Yes
charge on: (ICAI Study Material) b. No
(a) Sponsorship services c. Not applicable
d. Yes, if permitted by the authority
(b) Transport of goods by rail
Ans:-
(c) Transport of passengers by air
(d) All of the above Q. 23. What is the amount of Input tax credit available
to a composite dealer falling under Reverse
Answer :- (a) Sponsorship services
charge mechanism?
Q.17. Which of the following services does not fall under a. 100% of tax paid
reverse charge provisions as contained under section 9(3) b. 50% of tax paid
of the CGST Act? (CA Inter MTP Mar 19) c. Nil
(a) Services supplied by arbitral tribunal to business entity d. Some portion of tax paid
(b) Sponsorship provided to any partnership firm Ans:-
(c) Sponsorship provided to any body corporate
(d) None of the above
Answer :-(d) None of the above

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 Q. 24. Which of the following statements are true?
a. Self – invoicing must be done Q. 29. GST is payable by recipient of services in the
b. A single consolidated monthly invoice can be issued. following cases:-
c. Both statements are correct (i)Services provided by way of sponsorship to ABC Ltd.
d. Both statements are incorrect (ii)Services supplied by a director of Galaxy Ltd. to Mr.
Ans:- Krishna.
(iii)Services by Department of Posts by way of speed post
Q. 25. Is the below statement correct: “A person is not to MNO Ltd.
required to obtain registration if he is required to (iv)Services supplied by a recovering agent to SNSP
pay tax under reverse charge but he has not Bank
exceeded his threshold limit” a. (i) & (iii)
a. Incorrect, the person is required to take registration b. (i) & (iv)
& pay tax under reverse charge irrespective the fact c. (ii) & (iii)
that threshold is crossed or not. d. (ii) & (iv)
b. Incorrect, if the person is required to pay tax under Ans:-
reverse charge he shall obtain registration only if
the value of supply under reverse charge exceeds
the threshold limit. 9(3)-RCM - Legal Service
c. Above statement is correct Q. 30. True or False: In case of legal services by an
d. Correct, a person is required to obtain registration if individual advocate including a senior advocate
he is required to pay tax under reverse charge and, or firm of advocated, GST is payable by recipient
he is making taxable supplies irrespective of the if he is a business entity located in India.
threshold limit. a. True
Ans:- b. False
Q. 26. GST is payable by the recipient under reverse Ans:-
charge on
a. Sponsorship service
b. Transport of goods by rail Q. 31. Mr. A businessman who take legal service
from individual advocate and pay the tax under
c. transport of passenger by air
RCM by using
d. all of the above
a. Electronic credit ledger
Ans:-
b. Electronic cash ledger
c. Both a and b
d. None of the above
Q. 27.Mr. A was having Rs. 50,000 in his credit ledger in Ans:-
the month of January, 2018 and in the same month
he made purchases on which tax of Rs. 30,000
under RCM was to be paid. Which of the following
method can be used for the same?
a. Pay Rs. 30,000 by utilizing ITC of Rs. 50,000 Q. 32. Which of the following legal services does not
b. Pay Rs. 30,000 from cash ledger fall under RCM provisions as contained under
c. Pay Rs. 15,000 by cash and utilize ITC for the section 9(3) of the CGST Act-
balance amount a. Representation services provided by an individual
d. Anyone of the above can be followed advocate
Ans:- b. Representation services provided by a senior
advocate
c. Representation services provided by a firm of
9(3)-Reverse charge Mechanism advocates
Q. 28. Micro Apparels in Chennai, Tamil Nadu, avails d. Legal services provided by an advocate to an
fashion designing services of ` 50,00,000 from unregistered individual
Prabhu Designs in Singapore. Who is liable to pay Ans:-
GST?
a. Micro Apparels
b. Prabhu Designs
c. Both
d. None of the above.
Ans:-

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 9(3)-RCM - Service by Director of company
Q. 33. ABC Pvt. Ltd. appointed Mr. Z as their independent Q. 38. GTA is under expansion mode and is acquiring lot
director and paid him the sitting fees. Is this supply of trucks for the transportation. It wants to take the
covered under RCM? ITC on such capital goods. What rate shall he charge
a. Yes in order to avail the ITC?
b. No a. 18%
c. Not taxable at all b. 12%
d. Taxable under forward charge c. 5%
Ans:- d. 28%
Ans:-
Q. 34. Mr. Vishal is appointed as a director of ABC Ltd.
company (not in capacity of employee) and earn Q. 39.Mr. B, a GTA in Delhi supplied services of Rs.
sitting fees ` 5,00,000. Who is liable to pay GST ? 60,000 to Mr. Q, a registered person in Delhi and
a. Mr. Vishal the entire amount was being paid to the GTA.
b. ABC Ltd. Company What shall be the tax amount to be paid under
RCM?
c. Exempt supply
a. Rs. 1,500 each in CGST and Delhi GST
d. Not cover in a supply b. Rs. 3,000 in IGST
Ans:- c. Rs. 2,857 each in CGST and Delhi GST
d. Rs. 2,857 in IGST
9(3)-RCM - Goods Transport Agency Ans:-
Q. 40.Mr. Alok had to transport his personal goods
Q. 35. In case of Goods Transport Agency (GTA)
from Mumbai to Goa. He contacts Sigma travel
services, tax is to be paid under forward charge if:
services. Sigma travels is passenger bus traveler
a. GST is payable @ 12%
and also does transportation of goods i.e., Goods
b. GST is payable @ 5% and a factory registered under
Transport Agency. He transports goods of all
the Factories Act, 1948 is the recipient of GTA service.
persons including non- passengers.
c. GST is payable @ 5% and an unregistered individual
end customer is the recipient of GTA service. Mr. Alok hands over the goods to Sigma travel
services. Sigma travels issues consignment note
d. None of the above
Ans:- for his goods. Alok is an unregistered person.
What will be GST scenario in this case?
a. Goods transport agency service rendered to un-
Q. 36. ABC Ltd. avail service of Rudra goods transport registered person is exempt from tax
agency for transportation of goods from factory b. Goods transport agency is required to pay GST
located in Mumbai to its Nasik depot and paid under reverse charge for service rendered to un-
freight `1,00,000 and GST is applicable @ 5%. Who registered person
will pay GST? c. Unregistered person is required to pay GST to
a. Rudra goods transport agency transport agency which in turn will be deposited by
b. ABC Ltd. Co. Goods transport agency to government.
c. Both a 50% and b 50% d. None of the above
d. None of the above Ans:-
Ans:-
Q. 41 . GTA service provided to Local authority
Q. 37. Goods transportation agency (GTA) is registered which is not registered under CGST Act, 2017 is
and does not avail the ITC. He provides GTA services taxable under reverse charge. State true or false
to another registered person. Will this transaction a. True
fall under RCM? What shall be the GST Rate? b. False
a. RCM applicable, Rate – 5% Ans:-
b. RCM applicable, Rate – 12%
c. RCM not applicable, Rate – 18% under forward Q. 42. Service provided by GTA registered under
charge
CGST Act, 2017 to any department or establishment
d. Not taxable
of Central government registered for deducting tax
Ans:-
u/s 51 and not engaged in making taxable supply of
goods or services will be chargeable under:

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 a. Normal Charge
b. Reverse Charge 9(3)-RCM - Sponsorship Service
c. Not liable to tax or exempt from tax
d. Nil rates Q. 48.Bharat Jewellers paid ` 50,00,000 for
Ans: sponsorship of Miss India beauty pageant for
sponsorship service. Who is liable to pay GST?
Q. 43. The liability to pay tax in case where service a. Bharat Jewellers
provided by GTA registered under CGST Act, 2017 to b. Miss India Beauty
any governmental agency registered for deducting c. both a 50% and b 50%
tax u/s 51 and also engaged in making taxable supply d. None of the above
of goods or services will be on: Ans:-
a. GTA
b. Governmental Agency
c. Both of the above 9(3)-RCM - Arbitral Tribunal Service
d. None of the above
Ans: Q. 49. Kokilabehen is appointed as an arbitral
tribunal to reliance Industry Ltd. GST is payable
by
Q. 44. GTA can avail the benefit of input tax credit on a. kokilabehen
input services if: b. Reliance Industry Ltd.
a. GTA pays tax @ 12% under forward charge (i.e. 6% c. Service of arbitral tribunal is Exempt
CGST & 6% SGST) d. service of arbitral tribunal is not a supply
b. GTA pays tax @ 5% under forward charge (i.e. 2.5% Ans:-
CGST & 2.5% SGST)
c. Recipient pays tax @ 5% under reverse charge (i.e. 9(3)-RCM - Service by Agent
2.5% CGST & 2.5% SGST) Q. 50. Mr Veer is an agent of Life Insurance company.
d. Both a & b above The insurance company pays commission `
Ans: 8,00,000 excluding taxes. Who is liable to pay
GST ?
Q. 45. If GTA opts to pay tax @ 5% then ITC will be a. Mr. Veer
available to: b. Life insurance company
a. GTA paying tax under forward charge c. Exempt supply
b. Recipient paying tax under reverse charge d. no GST because taxable supply not exceed ` 20
c. Either a or b above lakh
d. None of above Ans:-
Ans:
Q. 51. ABC National Bank appointed Mr. A, a
recovery agent in order to recover the amount
9(3)-RCM - Service by Government paid to a defaulter Mr. B. who shall pay the tax in
this supply?
Q. 46. Express Parcel Post Services provided by
a. ABC National Bank
Department of Post to a business entity. The GST is
b. Mr. A
liable to be paid by:
c. Mr. B
a. business entity
d. None of them
b. Department of Post
Ans:-
c. Exempted supply
d. Not at all supply.
Ans:- 9(3)-RCM - Service by person in non taxable territory
Q. 52. ABC Pvt. Ltd. has taken consultancy services
Q. 47. In which case Govt. is not liable to pay tax from an engineer in USA. Who shall be liable to
a. Renting of immovable property to registered person pay tax and under what head?
b. Renting of immovable property to other than a. ABC Pvt. Ltd. will pay the tax, IGST
registered person b. ABC Pvt. Ltd. will pay the tax, CGST and SGST
c. Renting of immovable property for residential dwelling c. Engineer will pay the tax, IGST
d. All of the above d. Engineer will pay the tax, CGST & SGST
Ans:- Ans:-

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9(3)-RCM - Security personal 9(5)- Liability of E-Commerce operator
Q. 53. Security service provided by the security Q. 57. Which category of supply specify in sec 9(5)?
personnel to any person including government and a. Supply of goods only
local authority registered under CGST Act, 2017 is b. Supply of service only
c. Both a and b
taxable under reverse charge whether or not such
d. None of the above
entities are making taxable supplies under GST. State Ans:-
the validity of this statement.
[Hint:- Government, local authority, government
Q. 58. Which supply of service is specified under sec
agencies etc. which has taken registration only for 9(5)
deducting TDS & not making taxable supplies are a. Supply through ECO transportation of passengers
excluded from reverse charge] by cab
a. Valid b. Supply through ECO renting of accommodation by
b. Invalid unregistered hotels
c. Supply through ECO service by unregistered
Ans: plumber, housekeeper, etc.
d. all of the above
Q. 54. Which of the following services are covered Ans:-
under reverse charge?
a. Service by business facilitator to a banking Q. 59. Ola being an E – commerce operator provides
company cab services to the passengers through various
b. Service by an agent of business correspondent to local service providers. The liability to pay tax on
business correspondent such services shall be applicable to:
c. Security services provided by any person other than a. Ola
body corporate to a person paying tax under b. Passengers
composition scheme c. Local Service Providers
d. All of the above d. None
e. Only a & b above Ans:-
Ans:

9(4)- RCM - Supply by unregistered person to

Answer:-
specified registered person
1 c 19 b 37 a 55 a
Q. 55.When was the notification in respect to 2 c 20 a 38 b 56 a
suspension of RCM u/s 9(4) was being issued 57 b
3 a 21 b 39 a
initially?
a. 13th October 2017 4 c 22 b 40 a 58 b
b. 15th November 2017 5 b 23 c 41 b
c. 15th October 2017 59 a
6 b 24 a 42 a
d. None of the above
Ans:- 7 a 25 a 43 b
8 a 26 a 44 a
9 a 27 b 45 b
Q. 56. Sec 9(4) of CGST reverse charge is applicable
10 c 28 a 46 b
when supply of goods or services by
a. Unregistered supplier to specified registered person 11 a 29 b 47 a
b. Unregistered supplier to unregistered person 12 d 30 a 48 a
c. Registered supplier to registered person 13 c 31 b 49 b
d. Registered supplier to Unregistered person 14 c 32 d 50 b
Ans:- 15 a 33 a 51 a
16 a 34 b 52 a
17 d 35 a 53 b
18 b 36 b 54 e

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