Section 15 CGST Act 2017 prescribes the VALUE of SUPPLY for tax purposes as:
Aany value (cf. CGST Act 2017, Section 15) (cf. CGST Act 2017, Section 15) (cf. CGST Act 2017, Section 15) (cf. CGST Act 2017, Section 15) (cf. CGST Act 2017, Section 15)
BTRANSACTION VALUE — the price actually paid or payable, when (a) supplier and recipient are NOT RELATED; (b) price is SOLE CONSIDERATION; INCLUSIVE of taxes (except GST), incidental expenses, royalty, etc.
Cmarket value (cf. CGST Act 2017, Section 15) (cf. CGST Act 2017, Section 15) (cf. CGST Act 2017, Section 15) (cf. CGST Act 2017, Section 15) (cf. CGST Act 2017, Section 15)
DMRP (cf. CGST Act 2017, Section 15) (cf. CGST Act 2017, Section 15) (cf. CGST Act 2017, Section 15) (cf. CGST Act 2017, Section 15) (cf. CGST Act 2017, Section 15)
Answer & Solution
Correct answer: B. TRANSACTION VALUE — the price actually paid or payable, when (a) supplier and recipient are NOT RELATED; (b) price is SOLE CONSIDERATION; INCLUSIVE of taxes (except GST), incidental expenses, royalty, etc.
1. Section 15(1) CGST Act 2017: the VALUE of a SUPPLY of goods or services or both shall be the TRANSACTION VALUE — the PRICE ACTUALLY PAID OR PAYABLE for the supply where:
2. (i) supplier and recipient are NOT RELATED;
3. (ii) PRICE is the SOLE CONSIDERATION for the supply.
4. Section 15(2) — value INCLUDES:
5. (a) Any taxes/duties levied under any law (other than GST);
6. (b) Amount paid by recipient on behalf of supplier (not included in price);
7. (c) INCIDENTAL EXPENSES — commission, packing, anything charged by supplier;
8. (d) INTEREST/FEE for delayed payment;
9. (e) SUBSIDIES linked to price (other than CG/SG subsidies).
10. Section 15(3) — value EXCLUDES:
11. (a) DISCOUNTS recorded in invoice;
12. (b) DISCOUNTS after supply if pre-agreed.
13. Section 15(4): when transaction value not determinable, value as per CGST Rules.
14. Hence option B is correct.
_Source: CS Executive Paper 4 Tax Laws (ICSI BoS) + Income Tax Act 1961 + CGST Act 2017 — CGST Act 2017, Section 15_
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