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Mr. A, registered in Karnataka, supplies goods worth Rs 50,000 to his branch in Tamil Nadu (also registered under the same PAN). This transaction is:
ANot a supply (same entity)
BComposite supply
CSupply of goods exempt under Schedule III
DSupply between distinct persons under Sec 25(4) — taxable even without consideration
Answer & Solution
Correct answer: D. Supply between distinct persons under Sec 25(4) — taxable even without consideration
1. Sec 25(4) treats persons with separate GST registrations (different States) as distinct persons under the Act.
2. Schedule I para 2 deems supplies between distinct persons in furtherance of business as supply, even without consideration.
3. Hence the inter-State branch transfer is taxable under IGST, value being determined under Rule 28.
_Source: ICAI BoS CA Final Paper 8, Ch 3 "Levy and Collection of Tax", §Sec 25(4) + Sched I_
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