Goods and Services Tax

CHOUDHARY CHARAN SINGH

UNIVERSITY, MEERUT

Research Project for B.com 6th Semester in Commerce

Supervisor Researcher
Mr. Dheeraj Goyal Mohd Nazim Saifi
(Asst. Professor) Roll No.- 210291303040
Department of Commerce

-Research Center-
Department of Commerce
CH.VEDRAM COLLEGE OF HIGHER EDUCATION
SIRODHAN, HAPUR-245101

2023-24
 DECLARATION

I hereby declare that the title of the research report “Goods

and Services Tax (GST)” submitted by me in partial
fulfilment of the requirement of Bachelor of Commerce,
exclusively specially prepared and conceptualized by me. And
It has not been submitted to any other institution or university
or published elsewhere for any Degree/ Diploma/ Certificate.
This is my original work and has not been obtained from any
other source.

Mohd Nazim Saifi

Enrollment Number:-21171012
Roll Number:- 210291303040
B.Com – VI Semester
 ACKNOWLEDGEMENT

Every work constitutes a great deal of assistance and guidance

from the people concerned; this project is no exception.
A project of this nature is surely a result of tremendous
support, guidance, encouragement and help.

I Wish to place on record my sincere gratitude to

Mr. Dheeraj Goyal Sir, Faculty Guide, of Ch. Vedram
College of Higher Education, Sirodhan Hapur -245101
for his valuable guidance. Without his support and
guidance taking this would not have been possible.

Also, wish to acknowledge the enthusiastic

encouragement and support extended to me by my
family members.

At last, I would like to thank all the faculty of Commerce for

helping me complete this project.
I am also thankful to my friends who provided me with their
constant support and assistance.

Mohd Nazim Saifi

Enrollment No.-21171012
Roll No.- 10291303040
B.Com – VI Semester
 PREFACE

In India, there exist several indirect taxes that are either levied
by the Central Government or by the state government such
as Excise Duty, Customs Duty, Service Tax, Sales Tax,
Stamp Duty, Octroi and many more. There have been
various attempts to reform the indirect tax structure to
make the tax system simple, stable and burdensome.

In this process of reform, we have already implemented

VAT and service tax. For further significant improvement, the
next logical step towards comprehensive indirect tax
reform in the country will be to implement Goods and
Services Tax (GST). GST is a tax on goods and services in a
comprehensive manner. It is a multi-tier tax where the ultimate
burden of tax falls on the consumer of goods or services.

It is called value-added tax because at every stage tax is being

paid on value addition. The present research paper is an attempt
to study the concept of goods and service tax, how it works and
its advantages to the Indian economy.
 INDEX
SR.
CONTENT PAGE NO.
NO.
1 Introduction 01-02
Objectives of Study
i) Genesis of GST in India
2 ii) Problem In The Implementation 03-14
Of GST
iii) Components Of GST
Literature Review
i) GSTN
ii) GST Registration
iii) Composition Dealer
3 15-32
iv) Time of Supply
v) Place of Supply
vi) Input Tax Credit
vii) GST Return
4 Research Methodology 33
Suggestions/
5 34
Recommendation
6 Conclusion 35
7 Limitation 36
8 Bibliography 37
 INTRODUCTION

The Goods and Services Tax (GST) represents one of the most
significant fiscal reforms in many countries, including India and
Australia, aimed at streamlining the indirect taxation system.
Implemented to replace a multitude of state and national taxes, GST is
a comprehensive, multi-stage, destination-based tax that is levied on
every value addition. The primary objective of GST is to create a
unified market, ensuring seamless movement of goods and services
across regions by eliminating the cascading effect of multiple taxes.
This reform not only simplifies the tax structure but also enhances
transparency and compliance.

GST is characterized by its dual nature, where both the central and state
governments have the authority to levy taxes. In India, for instance,
this system is manifested in the form of Central GST (CGST), State
GST (SGST), and Integrated GST (IGST) for inter-state transactions.
This dual GST model ensures that both levels of government have a
concurrent right to tax the supply of goods and services, thereby
maintaining the federal structure. The introduction of GST has led to
the abolition of various indirect taxes like Value Added Tax (VAT),
service tax, excise duty, and others, which were previously levied
separately at different stages of the supply chain.

One of the critical advantages of GST is the enhancement of the input

tax credit mechanism, which allows businesses to offset the taxes paid
on inputs against the taxes payable on outputs. This feature
significantly reduces the cost of production and encourages
manufacturers and service providers to expand their operations.
Page | 1
Moreover, GST has facilitated easier tax administration and
compliance through the digitization of tax processes. The introduction
of the GST Network (GSTN), an IT backbone, has provided a robust
platform for taxpayers to register, file returns, and make payments
online, thereby reducing the scope for tax evasion and fostering a
transparent tax environment.

The impact of GST on the economy has been multifaceted. On one

hand, it has led to a more organised and formalized economy, with a
broader tax base and increased revenue for the government. On the
other hand, businesses, tiny and medium enterprises (SMEs), initially
faced challenges adapting to the new tax regime, including
understanding the complex tax structure and meeting compliance
requirements. Over time, however, the benefits of GST, such as the
reduction in overall tax burden, improved logistics and supply chain
efficiency, and the creation of a unified national market, have
outweighed the initial hurdles.

In conclusion, the Goods and Services Tax is a landmark reform that

has revolutionized the indirect taxation system. By unifying various
taxes under a single framework, it has simplified compliance,
promoted transparency, and contributed to economic growth.
Ongoing research into GST continues to explore its long-term effects
on different sectors, regional disparities, and overall economic
dynamics, providing valuable insights for policymakers and
stakeholders aiming to optimize its implementation and impact.

Page | 2
 OBJECTIVES OF THE STUDY

• To analyze the impact of GST on the overall economic

growth of the country.

• To evaluate the effectiveness of GST in streamlining the

indirect tax system.

• To assess the benefits and challenges faced by small and

medium enterprises (SMEs) under GST.

• To examine the role of GST in enhancing tax compliance

and reducing tax evasion.

• To study the influence of GST on consumer prices and

inflation rates.

• To explore the digital transformation and administrative

efficiency brought by GST implementation.

• To understand the regional disparities and sectoral

impacts resulting from GST adoption.To understand the
concept of goods and service tax.

Page | 3
 GOODS AND SERVICES TAX (GST)

Genesis of GST in India

The journey towards the implementation of the Goods

and Services Tax (GST) in India was a prolonged and
complex process, characterized by extensive deliberation
and negotiation among various stakeholders. The concept
of GST in India was first proposed in 2000 during a
meeting of the Empowered Committee of State Finance
Ministers. The objective was to create a more efficient,
uniform, and transparent tax system by replacing the
myriad of indirect taxes levied by the central and state
governments with a single comprehensive tax. This
proposal aimed to address the inefficiencies and
cascading effects inherent in the previous tax structure.

In 2003, the Kelkar Task Force on the implementation of

the Fiscal Responsibility and Budget Management
(FRBM) Act strongly recommended the introduction of
GST as a significant step towards tax reform. The task
force underscored the need for a destination-based tax on

Page | 4
consumption, which would subsume various central and
state taxes, thereby creating a seamless national market.
However, the political and logistical challenges of
achieving consensus among states, which were
apprehensive about potential revenue losses and the
erosion of fiscal autonomy, delayed the progress of GST
implementation.

The momentum for GST gained traction when the 115th

Constitutional Amendment Bill was introduced in the
Parliament in 2011, laying the groundwork for a
comprehensive GST framework. This bill sought to
empower both the central and state governments to
concurrently levy GST on the supply of goods and
services. Despite this, the bill faced numerous hurdles
and underwent several revisions to address the concerns
of various stakeholders, including the need for
compensation to states for potential revenue losses.

A significant breakthrough occurred in 2014 when the

newly elected government reintroduced the GST Bill as
the 122nd Constitutional Amendment Bill. Following
extensive discussions and amendments, the bill was
passed by both houses of Parliament in 2016, and
subsequently ratified by a majority of state legislatures.
This paved the way for the creation of the GST Council,
a federal body responsible for the administration and
regulation of GST, ensuring that both the central and state
governments have a say in its functioning.

Finally, on July 1, 2017, GST was formally launched in

India, marking a historic moment in the country's
economic history. The implementation of GST replaced a

Page | 5
plethora of central and state taxes such as excise duty,
service tax, and value-added tax (VAT) with a single,
unified tax structure. This reform not only simplified the
tax regime but also aimed to enhance compliance, reduce
the tax burden on businesses, and create a more integrated
and efficient national market. The genesis of GST in
India is a testament to the collaborative effort and
persistent drive towards achieving a simplified and
transparent tax system that aligns with global standards.

The Goods and Services Tax (GST) is a revolutionary

fiscal reform designed to unify and streamline the
indirect taxation system in many countries, notably India.
It replaces multiple state and national taxes with a single,
comprehensive tax applied to the supply of goods and
services. GST operates on a multi-stage, destination-
based model, meaning it is collected at every step of the
supply chain but ultimately borne by the end consumer.
One of its most significant advantages is the elimination
of the cascading tax effect, where tax is paid on tax,
thereby reducing the overall tax burden on businesses and
Page | 6
consumers. Additionally, GST enhances tax compliance
through a robust IT infrastructure, simplifying processes
such as registration, filing returns, and tax payments.
While initially challenging for businesses to adapt to,
especially for small and medium enterprises (SMEs), the
long-term benefits include a more organized tax
structure, increased transparency, and a unified national
market that promotes economic growth and efficiency.

MULTI-STAGE

The implementation of the Goods and Services Tax

(GST) has had a profound impact on the economic growth
of India, serving as a pivotal reform in the nation's tax
structure. By replacing a multitude of central and state
taxes with a single, comprehensive tax, GST has
streamlined the tax system, reducing complexity and
fostering a more business-friendly environment. This
reform has enhanced the efficiency of the supply chain,
minimized the cascading effect of taxes, and increased
compliance due to its transparent and simplified nature.

Consequently, GST has contributed to improved

economic efficiency, which, in turn, has stimulated
investment and growth. The unified tax regime has also
facilitated a more seamless inter-state trade, creating a
common national market that has bolstered economic
activities and expanded the tax base. However, the
transition to GST has not been without challenges,
including initial compliance burdens on businesses and
transitional revenue losses for states. Overall, the impact

Page | 7
of GST on India's economic growth has been significant,
promoting a more organized, transparent, and efficient
economic framework that supports sustained growth and
development.

There are multiple changes an item goes throug

h a l o n g i t s s u p p l y c h a i n : f r o m m a n u f a c t u r e to
final sale to consumer. Let us consider the following case:
• Purchase of raw materials
• Production or manufacture
• Warehousing of finished goods
• Sale of the product to the retailer

Sale to the end consumer Goods and Services Tax will be

levied on each of these stages, which makes it a multi-stage tax.
Value Addition The manufacturer who makes shirts buys yarn.
The value of yarn gets increased when the yarn is woven into a
shirt.

Page | 8
 SOME IMPORTANT DEFINITIONS IN GST

➢ GOODS [sec.2(52) of CGST Act]

mean every kind of movable property other than money
and securities but includes actionable claims, growing
crops, grass and other things attached to or forming part
of land which are agreed to be severed before supply or
under a contract of supply.

➢ SERVICES [sec.2(102) of CGST Act]

means anything other than goods, money and securities
but includes activity relating to the use of money or its
conversion by cash or by any other mode, from one form,
currency or denomination, to another form, currency, or
denomination for which a separate consideration is
charged. Services include facilitating or arranging
transactions in securities.

Page | 9
 ➢ MONEY [sec.2(75) of CGST Act]
“money” means the Indian legal tender or any foreign
currency, cheque, promissory note, bill of exchange,
letter of credit, draft, pay order, traveller cheque, money
order, postal or electronic remittance or any other
instrument recognized by the reserve bank of India when
used as a consideration to settle an obligation or
exchange with Indian legal tender of another
denomination but shall not include any currency that is
held for its numismatic value.

➢ SECURITIES [sec.2(101) of CGST Act]

Securities shall have the same meaning as assigned in
section 2(H) of the Securities Contract (Regulation)
Act,1956.
The term “securities” includes shares, scrips, stock,
bonds, debentures, or marketable securities.

The reform process of indirect taxes in India, culminating

in the implementation of the Goods and Services Tax (GST),
has been a multifaceted journey marked by extensive
deliberation, legislative amendments, and collaborative
decision-making. Historically, India's indirect tax system
was fragmented and complex, characterized by a multitude of
taxes levied by both the central and state governments, such

Page | 10
WHAT ARE THE COMPONENTS OF GST?

Page | 11
PROBLEM IN THE IMPLEMENTATION OF GST

GST
CHALLANGES

The implementation of Goods and Services Tax (GST) in India,

while a significant reform, encountered several challenges:

• Complexity and Compliance: The GST regime introduced

a new tax structure that required businesses to adapt to
a unified system of taxation. The complexity of
understanding and complying with new tax rates,
procedures, and technology platforms posed challenges,
especially for small and medium-sized enterprises (SMEs)
and businesses operating in remote areas with limited
access to digital infrastructure.

• Technological Issues: The transition to GST necessitated

the development and implementation of a robust
technological infrastructure to support online

Page | 12
 registration, return filing, invoice matching, and tax
payment processes. However, the GST Network (GSTN)
portal faced initial technical glitches, including slow
response times, crashes, and system errors, which
hindered smooth compliance and led to frustration
among taxpayers.

• Transitional Challenges: The switch to GST required

businesses to adapt their accounting systems, revise
pricing strategies, and clear existing inventory with the
transition provisions. Some sectors faced short-term
disruptions and confusion regarding tax treatment for
transitional goods, leading to inventory destocking and
financial uncertainties.

• Classification and Tax Rates: Determining the

appropriate classification of goods and services under
different tax slabs and categories posed challenges for
businesses and tax authorities. Ambiguities in tax rate
classifications and frequent changes in tax rates for
certain items added complexity and compliance burdens,
requiring constant clarification and updates.

• Interstate Transactions and Compliance: Interstate

transactions under GST are subject to Integrated Goods
and Services Tax (IGST), which requires businesses to

Page | 13
 navigate complex compliance requirements for invoicing,
documentation, and tax credits. Compliance with IGST
provisions, particularly for businesses with operations
across multiple states, posed logistical and administrative
challenges.

• Administrative Burdens: The decentralized nature of GST

administration, with both the central and state
governments sharing administrative responsibilities, led
to administrative overlaps, duplication of efforts, and
jurisdictional disputes. Coordination among different
government agencies, particularly regarding tax refunds
and dispute resolution, needed improvement to ensure
smoother implementation.

Page | 14
 LITERATURE REVIEW
India is a federal country and both the Centre and States have
the right to collect taxes. Each state is independent in levying
and collecting taxes. The taxation powers are defined
clearly in the Indian Constitution. Centre collects all the
direct taxes (income tax, corporate taxes etc)along with the
Indirect taxes like Service Tax, Excise duty and Customs duty.

The States collect indirect taxes like VAT on goods, CST

and Local Taxes. These revenues states keep with
themselves. Earlier instead of VAT, States had sales
taxes on various goods. Now states have replaced sales
taxes with VAT. Each state has adopted its VAT with different
duties and structures. In an earlier taxation system, people paid
taxes at various levels.

There was no system of getting a rebate on the taxes paid

previously while paying the inputs. This is also called as
cascading effect. Ideally, the taxes should be based on value
addition and the producer should pay taxes on whatever value
he adds to the product. In the absence of such a system,
producers ended up paying much higher taxes.

Higher taxes are a barrier to business and discourage business

activity. The businesses instead spend time trying to save
taxes leading to distortions and
a parallel economy. A large number of enterprises prefer to st
ay out of the taxation system and avoid paying taxes. High
taxes also lead to lobbying activities where producers of
a certain sector ask the government to lower/waive taxes
for their sector. This also leads to multiple taxation rates
for multiple products and further increases inefficiency in the
Page | 15
system. A Value-Added Taxation system is seen as a way to negate
this cascading effect. VAT taxes goods at each stage and on the
value, addition done by the enterprise.

GST is an extended version of Value Added Tax (VAT)

and aims to cover all goods and services. VAT covers mostly
goods and GST covers all goods and services. GST is
an attempt to get rid of weaknesses in the VAT structure. With a
GST in place, all these indirect taxes should be merged into one
tax.

Ideally, these taxes will be collected by the Centre which will

then be transferred to the States via a rule/formula. This will
require changes in the constitution as the Centre can only tax
goods at the production stage and on Services. The States can
only tax the sale of goods. Hence, States cannot tax services
and Centre cannot tax sales of goods.

The States cannot also tax imports. All this needs to be changed
with the GST and hence would require amendments in the
Indian Constitution. That is the reason why the 115th
Constitution Amendment Bill has been introduced;
implementation of GST has always been seen as a
concern for States as they surrender their powers to tax.
This is a very difficult issue and as a result number of
discussions have followed between the stakeholders.

Page | 16
 GSTN
The GSTN (Goods and Services Tax Network) is the
backbone of the GST regime in India, established as a non-
profit organization, GSTN operates the technology platform for
the administration of GST and provides various services to
taxpayers, tax authorities, and other stakeholders. Its primary
functions include taxpayer registration, return filing, tax
payment processing, invoice matching, and data analytics. The
GSTN portal, managed by GSTN, serves as the central hub
where taxpayers interact with the GST system, facilitating
seamless registration, compliance, and administration of GST
laws. With its robust IT infrastructure and advanced technology
solutions, the GSTN plays a crucial role in ensuring the smooth
functioning of the GST regime, enhancing transparency,
efficiency, and compliance in the taxation system.
Purpose of GST Identification Number (GSTIN)

The GST Identification Number (GSTIN) is a unique, 15-digit

alphanumeric code assigned to every registered taxpayer under
the Goods and Services Tax (GST) regime in India. The GSTIN
serves as a crucial identifier for businesses and entities
operating within the GST framework, enabling seamless
communication and transactional processes. The format of the
Page | 17
GSTIN includes state code, PAN (Permanent Account
Number) of the taxpayer, entity code, and check digits,
ensuring a standardized and easily recognizable structure. The
proposed GSTIN undergoes a rigorous validation process to
ensure accuracy and prevent duplication, thereby enhancing the
integrity and reliability of the GST system. Once registered,
taxpayers use their GSTIN for various compliance activities
such as filing returns, claiming input tax credits, and
conducting inter-state and intra-state transactions. The
introduction of GSTIN has significantly streamlined the
taxation process in India, promoting transparency,
accountability, and ease of doing business in the country's
economic landscape.

Page | 18
 GST REGISTRATION

GST registration is the process by which businesses and entities

in India obtain a unique GST Identification Number (GSTIN)
to comply with the Goods and Services Tax (GST) law. It
involves providing necessary details about the business, such
as PAN, address, and bank account information, to the GST
portal. Once registered, companies can file GST returns, collect
customer taxes, and claim input tax credits on purchases.
Registration thresholds vary based on turnover and business
type, with non-compliance penalties.

Page | 19
 COMPOSITION DEALER

A composition dealer under GST is a small taxpayer who opts

for a simplified compliance scheme. They pay tax at a fixed
rate on their turnover without the need to maintain detailed
records or file regular returns. Composition dealers cannot
collect tax from their customers or claim input tax credits. This
scheme is beneficial for small businesses with turnover below
a specified threshold, reducing their compliance burden and
administrative costs. However, composition dealers have
certain restrictions and cannot engage in interstate transactions
or supply certain goods/services.

APPLICABILITY
The threshold limit for the composition scheme under GST
varies depending on the type of business and the state in which
the business operates. As of my last update, the threshold limit
for eligibility for the composition scheme for goods suppliers
is INR 1.5 crores (aggregate turnover in the preceding
financial year). However, for special category states and
Union Territories, this threshold may differ.

Page | 20
For businesses providing services or a mix of goods and
services, the threshold limit for composition scheme eligibility
is INR 50 lakhs. Again, this threshold may vary for special
category states and Union Territories.

MIGRATION TO GST
Migration to GST refers to the process by which existing
taxpayers registered under the previous indirect tax regime,
such as VAT, Service Tax, Central Excise, etc., transition into
the Goods and Services Tax (GST) system. It involves the
registration of these taxpayers on the GST portal and the
migration of their tax-related data from the old system to the
new GST regime. The migration process typically requires
taxpayers to provide certain information and documents, such
as PAN, registration certificates, and financial statements, to
facilitate a smooth transition. Once migrated, taxpayers are
issued a new GST Identification Number (GSTIN) and are
required to comply with the provisions of GST, including filing
returns and paying taxes as per the new regulations.

Page | 21
PENALTIES FOR NOT REGISTRATION UNDER GST
Not registering under GST when required can lead to
penalties. The penalty for not registering under GST can be
significant, often amounting to a percentage of the tax
evaded or a specified amount per day of default, whichever
is higher. Additionally, non-registration may result in fines
and legal consequences, including prosecution. Businesses
must comply with GST registration requirements to avoid
penalties and ensure legal compliance.
MULLTIPLE REGISTRATION UNDER GST
Multiple registrations under GST refer to the scenario where a
business or entity obtains more than one GST Identification
Number (GSTIN) for different branches, business verticals, or
states. This could happen due to various reasons, such as
separate legal entities within a corporate group, distinct
business operations in different states, or the need to segregate
taxable activities for compliance purposes.

While multiple registrations are permissible under GST, it's

essential to ensure proper coordination and compliance across
all registrations. Each registered entity must maintain separate
accounts and records for each GSTIN and file returns
accordingly. Failure to comply with these requirements may
lead to penalties and legal consequences.

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 TIME AND PLACE OF SUPPLY OF
GOODS & SERVICES
TIME OF SUPPLY OF GOODS
Under GST, the point of taxation, i.e., the liability to pay
CGST/SGST will arise at the time of supply as determined for
Goods & Services. The time of supply of Goods shall be the
earlier of the following dates, namely:-
• The date of issue of invoice by the supplier (or the last date
on which he is required to issue the invoice) or
• The date on which the supplier receives the payment
concerning the supply. The time of supply of goods where tax
is to be paid on reverse charge shall be the earlier of the
following dates, namely :
• The date of receipt of goods, or
• The date of payment or
• 30 days from the date of issue of invoice by the supplier (If
it is not possible to determine under i), ii) or iii), the date of
entry of supply in the books of the recipient)
The time of supply of goods in case of vouchers shall be the
earlier of the following dates, namely :
• The date of issue of the voucher; or
• The date of redemption of the voucher. (If the date could not
be determined then the date of periodical return filed or the date
on which the CGST/SGST is paid.

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TIME OF SUPPLY OF SERVICES
The time of supply of services shall be the earliest of the
following dates, namely:
i. The date of issue of the invoice or
ii. The date of receipt of payment.

The time of supply of services where tax is to be paid on

reverse charge shall be the earliest of the following
dates, namely:
i. The date of receipt of payment or
ii. 60 days immediately from the date of invoice. If it is
not possible to determine under( i) or ( ii), the date
of entry.
PLACE OF SUPPLY OF GOODS
The "Place of Supply of Goods" refers to the location where a
supply of goods is deemed to have occurred for taxation
purposes under the Goods and Services Tax (GST) framework.
This determination is crucial as it dictates which jurisdiction
has the authority to levy and collect the applicable GST on the
transaction. The concept of place of supply is essential for
determining whether a supply is intra-state (within the same
state) or inter-state (across different states) in nature.
(The place of supply of goods would be the location where the
goods are delivered)

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PLACE OF SUPPLY OF SERVICES (The place of supply
of services would be the location of the recipient

Page | 25
 INPUT TAX CREDIT
An uninterrupted and seamless chain of input tax credit
(hereinafter referred to as, “ITC”) is one of the key features of
Goods and Services Tax. ITC is a mechanism to avoid
cascading of taxes. Cascading of taxes, in simple language, is
‘tax on tax’. Under the present system of taxation, credit of
taxes being levied by the Central Government is not available
as a set-off for payment of taxes levied by State Governments,
and vice versa. One of the most important features of the GST
system is that the entire supply chain would be subject to GST
to be levied by Central and State Governments concurrently.
As the tax charged by the Central or the State Governments
would be part of the same tax regime, the credit of tax paid at
every stage would be available as a set-off for payment of tax
at every subsequent stage. Under this new system, most of the
indirect taxes levied by Central and State Governments on the
supply of goods or services or both would be combined under
a single levy.

GST comprises of the following levies:

• Central Goods and Services Tax (CGST) [on intra-state
supply of goods or services or both].
• State Goods and Services Tax (SGST) [on intra-state supply
of goods or services or both.]
• Integrated Goods and Services Tax (IGST) [ on inter-state
supply of goods or services or both. In case of import of

Page | 26
goods also, the present levy of Countervailing Duty (CVD)
and Special Additional Duty(SAD) would be replaced by
IGST.]
The protocol to avail and utilize the credit of these taxes is as
follows:-
Credit of To be utilized Balance can be
first for payment utilized for
of payment of
CGST CGST IGST
SGST SGST IGST
IGST IGST CGST/SGST

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Conditions for claiming ITC
(i) Tax-payer should possess a tax invoice or debit
note or any other tax-paying documents issued by
a supplier registered under the GST Act.
(ii) He should have received the goods or services or
both.
(iii) Supplier should have reported the supply in the
returns and should have paid tax.
ITC is not allowed in the following circumstances
(i) ITC is not allowed for a composition dealer.
(ii) ITC not allowed for goods or services received by a
non-resident taxable person except on goods
imported by him.
(iii) ITC is not allowed for goods or services used for
personal consumption.
(iv) ITC not allowed for Goods
lost/stolen/destroyed/returned or disposed of by way
of gift /free samples.
The time limit for claiming ITC for a supply received in a
financial year has to be claimed any time before the filing of
returns for the month of September (of the following
financial year) or the relevant annual return whichever is
earlier.

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 TAX INVOICE
Under the Goods and Services Tax (GST) regime, a tax
invoice plays a crucial role in documenting transactions
between registered taxpayers. A tax invoice is a legal
document issued by a registered supplier to the recipient,
containing details of the goods or services supplied, along
with the applicable GST.
It includes information such as the seller's and buyer's
GSTIN (Goods and Services Tax Identification Number),
invoice number, date of issuance, description and quantity of
goods/services, value of the goods/services, and applicable
tax rates. A tax invoice acts as evidence of the supply of
goods or services and serves as a basis for claiming input tax
credit (ITC) by the recipient. It must be issued in accordance
with the prescribed format and maintained for record-
keeping and audit purposes.
These include details such as the seller's name, address, and
GSTIN; buyer's name and address; invoice number and date;
description, quantity, and value of goods or services;
applicable GST rates and amounts; and any discounts or other
charges. Failure to comply with these requirements may
result in penalties or disallowance of input tax credit.

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 GST RETURN
Every person registered under the Goods and Services Tax Act,
2017 has to file the return. Under the GST law, a normal
taxpayer must file monthly and one annual return. Similarly,
there are separate returns for taxpayers registered under the
composition scheme, a non-resident taxable person, a taxpayer
registered as an Input Service Distributor, and a person liable
to deduct or collect the tax (TDS/TCS).
All the returns have to be filed through online by using any of
the following methods:
• Through the GSTN portal (www.gst.gov.in)
• Through offline utilities provided by GSTN
• Through GST Suvidha Providers (GSPs).

Return Description Who files? Date for

filing
GSTR-1 Monthly Registered 10th of the
statement for person next month
outward
supplies of
goods and
services
GSTR-2 Monthly Registered 15th of the
statement for person next month
inward supplies
of goods and
services

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GSTR-3 Monthly return Registered 20th of the
for a normal person next month
taxpayer
GSTR-4 Quarterly return Composition 18th of the
dealer month
succeeding
the quarter
GSTR-5 Monthly return Non-resident 20th of the
for a non- taxable next month,
resident taxable person succeeding
person the tax
period or
within 7 days
of expiry
GSTR-6 Monthly return Input Service 13th of the
for an Input Distributor next month
Service
Distributor(ISD)
GSTR-7 Monthly return Tax deductor 10th of the
for the next month
authorities
deducting tax at
source

GSTR-8 Monthly return e-commerce 10th of the

for ECO operator next month
GSTR-9 Annual return Registered 31st
person other December of
than an ISD, the next
TDS / TCS financial year
Tax payer,
casual taxable
person and
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 Non-resident
Tax payer
GSTR-10 Final return Taxable Within 3
person whose months of
registration the date of
has been cancellation
surrendered or date of
or cancelled order of
cancellation
whichever is
later.

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 Research Methodology
Research methodology is a way to systematically solve the
research problem. It is the science of studying how research is
done scientifically. In it, we study the various steps that are
generally adopted by a researcher in studying his/her research
problem along with the logic behind them. It includes:
➢ Research Design
➢ Data Collection

A) Research Design
Analytical Research has been used.
B) Source of Data Collection
In this Research, I have used two types of data.
Primary Source
Secondary Source
Primary sources include:-
→Discussion with Experts
→Discussion with the taxpayer
Secondary source Includes:-
→Various Books Related to GST
→Websites were used as a vital information source

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SUGGESTIONS & RECOMMENDATIONS

➢ Taxpayers, need to be educated more about the GST.

➢ Standardization of systems and procedures.

➢ Well-defined procedures in case of Job works

➢ Uniform dispute settlement machinery.

➢ Adequate training for both tax payers and tax enforcers.

➢ Re-organization of administrative machinery for GST

implementation.

➢ Building information technology backbone – the single

most important initiative for GST implementation.

➢ Uniform Implementation of GST should be ensured across

all states (unlike the staggered implementation of VAT)
as many issues might arise in case of transactions
between states who comply with GST and states who are
not complying with GST.

Page | 34
 CONCLUSION

The implementation of the Goods and Services Tax (GST) in

India marks a watershed moment in the country's tax history,
ushering in a new era of unified taxation and economic reform.
Over the years since its inception, GST has proven to be a
transformative measure, streamlining the indirect tax system,
enhancing tax compliance, and fostering a more integrated
national market.

One of the most significant achievements of GST has been the

consolidation of multiple central and state taxes into a single,
comprehensive tax regime. This consolidation has eliminated
the cascading effect of taxes, simplifying tax compliance for
businesses and reducing the overall tax burden on consumers.
Additionally, GST has introduced a uniform tax structure,
promoting transparency and efficiency in tax administration.

Moreover, GST has played a crucial role in facilitating

interstate trade by creating a common market across the
country. The removal of barriers to trade and the harmonization
of tax rates have encouraged businesses to expand their
operations beyond state borders, contributing to economic
growth and development.

Page | 35
 LIMITATION
Although all efforts have been taken to make the results of
the survey as accurate as possible the survey suffers from the
following limitations -:

1)The possibility of respondent’s responses being biased

cannot be ruled out.
2)Limited access to secondary data about Income Filling
is selected region only.
3)Most of the time people don’t give appropriate
information.
4) Most respondents don’t want to give accurate
information and act rudely.

Page | 36
 Bibliography

Book Referred:
• Bharat’s Publisher
Handbook on GST by CA Raj K Agarwal.

• Atlantic Publisher & Distributor

Handbook on GST by Sant Kumar.

• Sanjay (Sahitya Bhawan)

GST Book by Dr. Abdul Karim, R.K Tyagi.

• Rajeev Bansal’s SBPD:

Goods and Services Tax book by CA Nikhil Gupta, CA
Anoop Modi and CA Mahesh Gupta.

Internet Source:
www.digitalnewsreport.org
www.google.com
www.chatGPT.com
www.wikipedia.org

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