Page 119 - CA Final GST

Badlani Classes

Sec 15 1- The value of a supply of goods or services or both shall be the transaction
value, which is the price actually paid or payable(refer example 1) for
the said supply of goods or services or both where the supplier and the
recipient of the supply are not related and the price is the sole
consideration for the supply.
Example :
Contracted price for 1 MT of cement from X Ltd to Y: ` 7000
Advance payment before despatch: `700
Payable after credit period of 30 days: ` 6300
Base taxable value: ` 7000. (Additions as further discussed below may
also have to be made.) This would be so even though only`700 has been
received at the time of payment of GST on the supply

2- The value of supply shall include–
a- any taxes, duties, cesses, fees and charges levied under any law for
the time being in force other than this Act, the State Goods and
Services Tax Act, the Union Territory Goods and Services Tax Act
and the Goods and Services Tax (Compensation to States) Act, if
charged separately by the supplier;
Example: As per rent contract tenant required to pay local taxes
directly to the local body or to owner of the premise. Such local tax
may form part of consideration for the supply of renting services.
Example: Levy of entertainment tax by local authority is not
subsumed by GST. So, it will form part of transaction value
Example: Grand Biz contracts with ABC Co. to conduct a dealers’
meet. In furtherance of this, Grand Biz contracts with vendors to
deliver goods / services, like water, soft drinks, audio system,
projector, catering, flowers etc. at the venue on the stipulated dates at
the stipulated prices. Grand Biz is liable to make these payments as
contracted. The soft drinks supplier wants payment upon delivery;
ABC Co. agrees to pay the bill raised by the soft drinks vendor on
Grand Biz on receiving the crates of soft drinks. This amount is not
billed by Grand Biz to ABC Co. However, it would be added to the
value of service provided by Grand Biz to ABC Co. for payment of
GST.

b- any amount that the supplier is liable to pay in relation to such supply
but which has been incurred by the recipient of the supply and not
included in the price actually paid or payable for the goods or
services or both;
Example: A CA conduct an audit at client premises out of the
state & hotel payment is made by client. Here, the payment made
to hotel by client will be part of transaction value.

c- incidental expenses, including commission and packing, charged by Page118
the supplier to the recipient of a supply and any amount charged for
anything done by the supplier in respect of the supply of goods or

Central Goods & Services Tax Act, 2017