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Trade discount of 10% routinely given by Hindustan Ltd to its dealers, recorded on every invoice. Hindustan Ltd's value of supply:
AExcludes only if discount above 25%
BIncludes the 10% — discounts can never be excluded
CExcludes the 10% discount (Sec 15(3)(a))
DExcludes only post-tax
Answer & Solution
Correct answer: C. Excludes the 10% discount (Sec 15(3)(a))
1. A trade discount given at the time of supply (on the invoice) is a Sec 15(3)(a) discount.
2. Recording on the invoice is the only condition — excluded from value.
3. Hindustan Ltd computes GST on the post-discount price.
_Source: ICAI BoS CA Final Paper 8, Ch 5 "Value of Supply", §Sec 15(3)(a)_
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