Unit-1 GST

Introduction-Meaning and Definition of GST, Objectives, Features, Advantages and

Disadvantages of GST, Taxes subsumed under GST, Structure of GST (Dual Model) - CGST,
SGST and IGST. GST Council, Composition, Powers and Functions. CGST Act,2017-Feature and
Important definitions
Meaning
GST is known as the Goods and Services Tax. It is an indirect tax which has replaced many indirect
taxes in India such as the excise duty, VAT, services tax, etc. The Goods and Service Tax Act was
passed in the Parliament on 29th March 2017 and came into effect on 1st July 2017.
Objectives Of GST
1.To achieve the ideology of ‘One Nation, One Tax’
GST has replaced multiple indirect taxes, which were existing under the previous tax regime. The
advantage of having one single tax means every state follows the same rate for a particular product
or service. Tax administration is easier with the Central Government deciding the rates and
policies. Common laws can be introduced, such as e-way bills for goods transport and e-invoicing
for transaction reporting. Tax compliance is also better as taxpayers are not bogged down with
multiple return forms and deadlines. Overall, it’s a unified system of indirect tax compliance.
2.To subsume a majority of the indirect taxes in India
India had several erstwhile indirect taxes such as service tax, Value Added Tax (VAT), Central
Excise, etc., which used to be levied at multiple supply chain stages. Some taxes were governed
by the states and some by the Centre. There was no unified and centralised tax on both goods and
services. Hence, GST was introduced. Under GST, all the major indirect taxes were subsumed into
one. It has greatly reduced the compliance burden on taxpayers and eased tax administration for
the government.
3.To eliminate the cascading effect of taxes
One of the primary objectives of GST was to remove the cascading effect of taxes. Previously, due
to different indirect tax laws, taxpayers could not set off the tax credits of one tax against the other.
For example, the excise duties paid during manufacture could not be set off against the VAT
payable during the sale. This led to a cascading effect of taxes. Under GST, the tax levy is only on
the net value added at each stage of the supply chain. This has helped eliminate the cascading
effect of taxes and contributed to the seamless flow of input tax credits across both goods and
services.
4.To curb tax evasion
GST laws in India are far more stringent compared to any of the erstwhile indirect tax laws. Under
GST, taxpayers can claim an input tax credit only on invoices uploaded by their respective
suppliers. This way, the chances of claiming input tax credits on fake invoices are minimal. The
introduction of e-invoicing has further reinforced this objective. Also, due to GST being a
nationwide tax and having a centralised surveillance system, the clampdown on defaulters is
quicker and far more efficient. Hence, GST has curbed tax evasion and minimised tax fraud from
taking place to a large extent.
5.To increase the taxpayer base
GST has helped in widening the tax base in India. Previously, each of the tax laws had a
different threshold limit for registration based on turnover. As GST is a consolidated tax levied on
both goods and services both, it has increased tax-registered businesses. Besides, the stricter laws
surrounding input tax credits have helped bring certain unorganised sectors under the tax net. For
example, the construction industry in India.
6.Online procedures for ease of doing business
Previously, taxpayers faced a lot of hardships dealing with different tax authorities under each tax
law. Besides, while return filing was online, most of the assessment and refund procedures took
place offline. Now, GST procedures are carried out almost entirely online. Everything is done with
a click of a button, from registration to return filing to refunds to e-way bill generation. It has
contributed to the overall ease of doing business in India and simplified taxpayer compliance to a
massive extent. The government also plans to introduce a centralised portal soon for all indirect
tax compliance such as e-invoicing, e-way bills and GST return filing.
7.An improved logistics and distribution system
A single indirect tax system reduces the need for multiple documentation for the supply of goods.
GST minimises transportation cycle times, improves supply chain and turnaround time, and leads
to warehouse consolidation, among other benefits. With the e-way bill system under GST, the
removal of interstate checkpoints is most beneficial to the sector in improving transit and
destination efficiency. Ultimately, it helps in cutting down the high logistics and warehousing
costs.
8.To promote competitive pricing and increase consumption
Introducing GST has also led to an increase in consumption and indirect tax revenues. Due to the
cascading effect of taxes under the previous regime, the prices of goods in India were higher than
in global markets. Even between states, the lower VAT rates in certain states led to an imbalance
of purchases in these states. Having uniform GST rates have contributed to overall competitive
pricing across India and on the global front. This has hence increased consumption and led to
higher revenues, which has been another important objective achieved.
Salient Features of GST
Goods and Services Tax (GST) is a comprehensive indirect tax levied on the supply of goods and
services in India. Here are some of the salient features of GST:
a. One Nation, One Tax: GST replaced multiple indirect taxes levied by the Central and
State Governments, such as excise duty, service tax, value-added tax (VAT), and others. It
 brought uniformity in the tax structure across India, eliminating the cascading effect of
taxes.
b. Dual Structure: GST operates under a dual structure, comprising the Central GST (CGST)
levied by the Central Government and the State GST (SGST) levied by the State
Governments. In the case of Inter-state transactions, Integrated GST (IGST) is applicable,
which is collected by the Central Government and apportioned to the respective State.
Import of goods or services would be treated as inter-state supplies and would be subject
to IGST in addition to the applicable customs duties.
c. Destination-based Tax: GST is a destination-based tax, levied at each stage of the supply
chain, from the manufacturer to the consumer. It is applied to the value addition at each
stage, allowing for the seamless flow of credits and reducing the tax burden on the end
consumer.
d. Input Tax Credit (ITC): GST allows for the utilization of input tax credit, wherein
businesses can claim credit for the tax paid on inputs used in the production or provision
of goods and services. This helps avoid double taxation and reduces the overall tax liability.
e. GST would apply on all goods and services except Alcohol for human consumption. GST
on five specified petroleum products (Crude, Petrol, Diesel, ATF & Natural Gas) would by
applicable from a date to be recommended by the GSTC. Tobacco and tobacco products
would be subject to GST. In addition, the Centre would have the power to levy Central
Excise duty on these products. Exports are zero-rated supplies. Thus, goods or services that
are exported would not suffer input taxes or taxes on finished products.
f. Threshold Exemption: Small businesses with a turnover below a specified threshold
(currently, the threshold is ₹ 20 lakhs for supplier of services/both goods & services and ₹
40 lakhs for supplier of goods (Intra–Sate) in India) are exempt from GST. For some special
category states, the threshold varies between ₹ 10-20 lakhs for suppliers of goods and/or
services except for Jammu & Kashmir, Himachal Pradesh and Assam where the threshold
is ₹ 20 lakhs for supplier of services/both goods & services and ₹ 40 lakhs for supplier of
goods (Intra–Sate). This threshold helps in reducing the compliance burden on small-scale
businesses.
g. Composition Scheme: The composition scheme is available for small taxpayers with a
turnover below a prescribed limit (currently ₹ 1.5 crores and ₹ 75 lakhs for special category
state). Under this scheme, businesses are required to pay a fixed percentage of their
turnover as GST and have simplified compliance requirements.
h. Online Compliance: GST introduced an online portal, the Goods and Services Tax
Network (GSTN), for registration, filing of returns, payment of taxes, and other
compliance-related activities. It streamlined the process and made it easier for taxpayers to
fulfill their obligations.
i. Anti-Profiteering Measures: To ensure that the benefits of GST are passed on to the
consumers, the government established the National Anti-Profiteering Authority (NAA).
The NAA monitored and ensured that businesses do not engage in unfair pricing practices
and profiteering due to the implementation of GST. All GST anti-profiteering complaints
are now dealt by the Competition Commission of India (CCI) from 1st December, 2022.
j. Increased Compliance and Transparency: GST aims to enhance tax compliance by
bringing more businesses into the formal economy. The transparent nature of the tax
 system, with the digitization of processes and electronic records, helps in curbing tax
evasion and increasing transparency.
k. Sector-specific Exemptions: Certain sectors, such as healthcare, education, and basic
necessities like food grains, are given either exempted from GST or have reduced tax rates
to ensure affordability and accessibility.
l. Accounts would be settled periodically between the Centre and the States to ensure that the
credit of SGST used for payment of IGST is transferred by the Exporting State to the
Centre. Similarly, IGST used for payment of SGST would be transferred by the Centre to
the Importing State. Further, the SGST portion of IGST collected on B2C supplies would
also be transferred by the Centre to the destination State. The transfer of funds would be
carried out on the basis of information contained in the returns filed by the taxpayers.
Advantages of GST
Simplified Tax Structure: GST has replaced multiple indirect taxes with a single tax, simplifying
the tax structure.
Higher Tax Compliance Levels: GST has introduced a single cumulative tax return that the
taxpayer needs to file, elevating tax compliance and reducing tax evasion.
Greater Revenue Collection: More people are filing tax returns, complying with the GST
requirements, and avoiding evasion of taxes, resulting in increased tax revenue for various central
and state government agencies.
Increasingly Efficient Logistics: GST has moved goods and services across states easier, reduced
the overheads incurred by companies, and improved overall logistics and operations.
Increased Transparency: GST is a transparent tax system that provides a clear and
comprehensive view of the taxes paid and collected, reducing corruption within the tax
administration and related agencies.
Easy Accessibility: GST returns can be filed anytime and from anywhere using a web-enabled
device like a smartphone, tablet, or PC, encouraging higher compliance.
Convenience for Small Businesses: GST has simplified the tax structure for small businesses,
reducing the burden of adhering to multiple compliances and simplifying the protocols for micro,
small, and medium enterprises (MSMEs).
Encouragement for Foreign Investments: The elimination of disparate taxes and increased
transparency has made India a highly-attractive investment avenue for foreign investors, with the
export of Indian commodities surging while foreign companies are flocking to set up operations
here.
Digitisation: GST has encouraged the digitisation of businesses, increasing efficiency in
operations and heightened transparency in reporting.
Boost to the Economy: More taxes collected and a more efficient inter-state supply chain have
benefited the entire economy, especially the less-developed states that can now benefit from the
additional GST amount that can be distributed across the country.
Disadvantages of GST
To holistically comprehend the GST advantages and disadvantages in India, we must also check
out the challenges in the new system.
Increased Costs: To comply with the GST-suggested accounting practices, businesses need to
upgrade their software. The specialised GST-compliant software comes with additional costs of
purchasing, installation, training, and maintenance. All of this has increased the overall operational
expenses of businesses.
Higher Tax Liability of SMEs: Before GST, small and medium enterprises (SMEs) with a
turnover in excess of ₹1.5 Cr were liable to pay excise duty. However, under GST, any business
with a turnover of more than ₹20 L has to pay taxes. Although, for businesses with an annual
turnover of less than ₹1 Cr, a composition scheme exists that allows them to reduce their burden,
its caveats and conditions require an in-depth cost-benefit analysis.
Penalties and Fines: Most SMEs usually lack the resources and infrastructure to comply with the
new tax system. Then, there is the complication of grasping the GST-related nuances. If not fully
onboard with the new process, companies can face fines and penalties adding to their operational
costs.
Impact on Unorganised Sector: While the unorganised sector such as construction and textile
has come under the ambit of GST, the businesses operating within it are still struggling to become
GST-compliant in their infrastructure.
Other Teething Issues: GST was hurriedly implemented in 2017. Since the financial year was
already underway, many companies found it challenging to comprehend the new requirements and
adopt the system. However, this has become more congenial in the last six years.

Taxes Subsumed and Not Subsumed Under GST

In India, the Goods and Services Tax (GST) represents a pivotal shift in indirect taxation, replacing
various taxes and levies with a unified system.
This transformation under the GST regime has streamlined the tax process, alleviating the
complexity and multiplicity of previous taxes. Yet, confusion persists among taxpayers regarding
the specific taxes that have been subsumed under GST.
The article aims to clarify which taxes are included and excluded within the GST framework,
shedding light on its comprehensive impact.
Principles of taxes subsumed
The principles of tax inclusion under the Goods and Services Tax (GST) are guided by specific
criteria outlined by the Indian Constitution and GST laws.
These criteria were established to identify which central, state, and local taxes could be
incorporated into GST. The key principles are as follows:
Indirect Nature of Taxes: GST encompasses taxes that are incorporated into the cost of goods
and services. Taxes unrelated to purchasing or selling goods and services do not fall under the
GST regime.
Inclusion in the Transaction Chain: Taxes under GST are applicable throughout the supply
chain, encompassing the delivery of goods and services from production to final consumption,
ensuring a comprehensive tax framework.
Uninterrupted Tax Credit Flow: Integrating taxes under GST allows businesses to seamlessly
claim tax credits for taxes paid on inputs against taxes due on sales, facilitating cross-state
transactions.
Fair Sharing of Money: When combining taxes into GST, it's important that both the government
in a state and the whole country get a fair share of the tax money.
These principles aim to streamline tax administration, eliminate tax on tax, and ensure that the
GST system is comprehensive, equitable, and conducive to a unified market across the country.
List of taxes subsumed under GST in India
The Goods and Services Tax (GST) consolidated numerous central and state taxes into a single
tax system. Here's a simplified overview of the taxes that were absorbed into GST-
Central Taxes Subsumed:
Central Excise Duty (CENVAT): Central Excise Duty (CENVAT) is an indirect tax imposed
and collected by the central government on goods manufactured or produced within India.
Additional Excise Duties: Additional Excise Duties refer to an extra tax on specific domestically
manufactured items, as outlined under the 1957 'Additional Duties of Excise Act,' with revenue
divided between the central and state governments.
Duties of Excise (Medicinal and Toilet Preparations): It is an indirect tax on the making of
medicinal and toilet preparations containing alcohol, narcotic drugs.
Additional Duties of Excise (Goods of Special Importance): It is an additional tax levied and
collected on special items like tobacco, sugar, and clothes made from textiles.
Additional Duties of Excise (Textiles and Textile Products): This is an additional charge
specifically for products made from textiles.
Additional Duties of Customs (Countervailing Duty, CVD): Additional Duties of Customs
(Countervailing Duty, CVD) is a tax applied to imported goods to align their prices with those of
domestic products, supporting Indian manufacturers.
Service Tax: Service Tax is applied to various services, including restaurant dining, travel
services, and cable television subscriptions.
Central Surcharge and Cess: These were extra charges and taxes the central government added
to the supply of goods and services. It’s like an extra charge on luxury items to fund education or
health initiatives.
State Taxes Subsumed:
State VAT (Value Added Tax): A tax on the value added to goods and services at each stage of
the supply chain, varying by state.
Central Sales Tax: Central Sales Tax is applied to the sale of goods that occur across state lines.
Luxury Tax: Luxury Tax is imposed on high-end goods and services considered luxurious.
Entry Tax (All Forms): In all its forms, states charge taxes on goods that enter their territory from
another state.
Entertainment and Amusement Tax: Entertainment and Amusement Tax is levied on
commercial entertainment and amusement activities by state governments.
Taxes on Advertisements: Taxes on Advertisements are applied to advertisements that appear in
print media.
State Surcharge and Cess: All state-imposed surcharges and cesses were included.
List of taxes not subsumed under GST in India
The following taxes are not subsumed under GST:
Basic Customs Duty: Basic Customs Duty is a tax on imported goods, separate from GST, aimed
at regulating imports and supporting local businesses, calculated based on the item's value entering
India.
Tax on Petrol and Diesel: These fuels don't fall under GST. Instead, they're taxed by both the
central and state governments due to the adverse revenue impact it has.
Tax on Tobacco and Alcohol: This lets states keep taxing these products.
Stamp Duty on Property: When people buy property, they pay this tax to the state, and it's not
included in GST. The cost varies in different states.
Electricity Duty: The tax on electricity consumption remains outside GST. It applies to
individuals and businesses based on their electricity usage.
Vehicle Tax: When registering a new vehicle, people pay this tax to the state, which isn't part of
GST.
Property Tax: This tax is on owning property like houses and land. Local governments charge it,
and it's separate from GST.
Impact of taxes subsumed under GST

Consolidating taxes under GST simplifies tax management, benefiting businesses with easier compliance
and operational efficiency. The following points represent the impact of taxes submitted under GST in a
better way:

Pros:
Reduces the cascading effect of taxes.
Ease of doing business with a reduction in multiple compliances
GST Simplifies Taxes: It applies one tax rate to all goods and services, reducing business
complexity.
One Tax System: GST combines various taxes into one, making tax compliance easier for
businesses.
Tougher on Tax Avoidance, Good for Revenue: GST has tightened up tax collection and made it
harder to skip paying taxes, helping the government earn more.
GST has made it cheaper for smaller companies and new startups, supporting their growth.
Businesses get a pricing advantage due to ITC claims.
There was a drop in prices of many commodities due to a reduction in tax rate.
Cons:
Higher Tax Rates for Certain Services: GST makes certain services, like phone bills and bank fees,
more expensive due to higher tax rates.
Exclusion of Essential Commodities: Items like petrol and alcohol don't fall under GST, so their
prices remain unaffected by the tax reform.
Need to obtain multiple GSTINs: Multiple registrations of GST to be taken by businesses
operating in more than one state.
STRUCTURE OF DUAL GST MODEL
The GST in India is a Dual GST framework, wherein, Centre will levy and administered CGST &
IGST, while respective state/ Union Territory will levy and administer SGST/UTGST. This
structure discussed as under;
1. CGST (Central Goods and Service Tax) : CGST is a tax levied on Intra State supplies of both
goods and services by the Central Government and will be governed by the CGST Act. SGST will
also be levied on the same Intra State supply but will be governed by the State Government. This
implies that both the Central and the State governments will agree on combining their levies with
an appropriate proportion for revenue sharing between them. However, it is clearly mentioned in
Section 8 of the GST Act that the taxes be levied on all Intra-State supplies of goods and/or services
but the rate of tax shall not be exceeding 14%, each.
2. SGST (Sate Goods and Service Tax ): SGST is a tax levied on Intra State supplies of both goods
and services by the State Government and will be governed by the SGST Act. As explained above,
CGST will also be levied on the same Intra State supply but will be governed by the Central
Government. Note: Any tax liability obtained under SGST can be set off against SGST or IGST
inputtaX credit only.
3. UTGST (Union Territory Goods and Services Tax): UTGST is just the way similar to SGST.
The only difference is that the tax revenue goes to the treasury for respective administration of
union territory where the goods or services have finally been consumed. There is a key difference
between union territory and states. The Union Territory directly comes under the supervision of
the Central Government and does not have its own elected government as in case of States. UGST
is also charged at the same rates that of CGST. But, amongst UTGST or SGST only one at a time
shall be levied together with CGST in each case. Currently, there are 8 union territories in India:
Lakshadweep Dadra and Nagar Haveli and Daman and Diu Andaman and Nicobar Islands Delhi
Puducherry Ladakh Jammu & Kashmir
4. IGST (Integrated Goods & Service Tax): Under GST, IGST is a tax levied on all Inter-State
supplies of goods and/or services and will be governed by the IGST Act. IGST will be applicable
SALIENT FEATURES OF DUAL GST MODEL
The following points describes the Salient features of Dual GST Model:
GST shall have two components one levied by the Centre (referred to as Central GST), and the other levied
by the States (referred to as State GST) Central GST and the State GST would be applicable to all
transactions of goods and services
iii. Central GST and State GST are to be paid to the accounts of the Centre and the States individually
Central GST and State GST are to be treated individually, therefore taxes paid against the Central GST
shall be allowed to be taken as input tax credit (ITC)
Cross utilization of ITC between the Central GST and the State GST would not be permitted except in the
case of inter-State supply of goods and services Cross utilization of ITC between the Central GST and the
State GST would not be permitted except in the case of inter-State supply of goods and services
Credit accumulation on account of refund of GST should be avoided by both the Centre and the States
except in the cases such as exports, purchase of capital goods, input tax at higher rate than output tax etc.
Uniform procedure for collection of both Central GST and State GST would be prescribed in the respective
legislation for Central GST and State GST.
Composition/Compounding Scheme for the purpose of GST should have an upper ceiling on gross annual
turnover and a floor tax rate with respect to gross annual turnover.
The taxpayer would need to submit periodical returns, in common format as far as possible, to both the
Central GST authority and to the concerned State GST authorities.
Each taxpayer would be allotted a PAN-linked taxpayer identification number with a total of 14/15 digits.
BENEFITS/ ADVANTAGES OF DUAL GST MODEL The Dual GST is a simple and transparent tax
with one or two CGST and SGST rates.
The dual GST is already proved and provides the results in:-
reduction in the number of taxes at the Central and State level
decrease in effective tax rate for many goods
removal of the current cascading effect of taxes
reduction of transaction costs of the taxpayers through simplified tax compliance
increased tax collections due to wider tax base and better compliance

GST Council: Functions, Structure & GST Implementation

GST Council is a constitutional body. It monitors and coordinates all aspects of the Goods and
Services Tax (GST), including tax inclusion, mergers, exemptions, and other implementation
processes. The 101st Amendment Act of 2016 created the body, making recommendations to the
federal and state governments about the GST.
The GST Council combines ideas and rules into a single document, notifying stakeholders of
changes through circulars and notifications that are made public following meetings. In this article,
we will look into the background, structure, features, functions, and implementation of the GST
Council.
What is the GST Council?
The GST Council is a constitutional body concerned with advising the Union or State governments
on matters related to the Goods and Services Tax. In India, the GST Council is a key decision-
making body for the Goods and Services Tax. The GST Council’s mission is to maintain the
highest standards of cooperative federalism in all aspects of the Council’s functioning. The first
federal body established by the Constitution with the power to decide on all major GST matters is
the GST Council.
Background of the GST Council
The Goods and Services Tax is a new tax system that was implemented in the nation by the 101st
Amendment Act of 2016. Coordination and cooperation between the states and the federal
government are necessary for the effective and seamless administration of the GST. The GST
Council was to be formed as part of the reforms to facilitate the consolation process. The Indian
President was given the authority to establish a GST Council by the insertion of Article 279-A into
the Indian Constitution. Thus, the GST Council was established by the President in 2016. Its
secretariat is presently located in New Delhi.
Structure of the GST Council
The states and the centre participate jointly in the GST council. The Union Finance Minister is the
chairperson of the GST Council.
The Union State Minister of Revenue or Finance and the Ministers managing Finance or Taxation
in each State are among the other members of the GST Council.
The members of the state councils are required to select one member to serve as the vice-
chairperson of the GST Council. They also have the authority to choose their term.
The 33 members of the GST Council are divided between two members from the central and 31
members from 28 states with legislation and three Union territories.
The central board of excise and customs’ chairman is always invited to all meetings but does not
have voting rights.
Principles and Objectives of the GST Council
The establishment of a unified national market for goods and services, along with a standardized
GST structure, serves as the guiding principle of the GST Council. It also establishes the process
by which it will perform its duties. The following are the goals and objectives of the Council:
Being the first constitutional federal body with the authority to decide on all significant matters
about GST, the Council aims to establish the highest standards of cooperative federation in its
operations.
Through broad input, the Council aims to develop a GST structure that is information technology-
driven and user-friendly.
Features of GST Council
Features of the GST Council include the following:
The Indian Revenue Secretary serves as the Ex-officio Secretary to the GST Council.
All GST Council meetings are chaired by the Central Board of Excise and Customs (CBEC),
which also serves as a permanent invitee with no vote.
There would be a position created for the GST Council’s Additional Secretary. This position
would be equivalent to that of the Indian government’s Additional Secretary.
Four commissioner positions would be created in the GST Council Secretariat at the rank of
Joint Secretary of the GST Council.
Officers appointed from both the Central and State Governments on a deputation basis would
make up the GST Council Secretariat.
Functions of the GST Council
According to Article 279 A (4), the GST council’s role is to advise the Union and the state
governments on the following matters:
The Goods and Services Tax is imposed by the Union, the States, and municipal governments
through cesses, taxes, and surcharges.
Any exceptional prices are offered for a limited time to raise extra funds in the event of a crisis
or natural disaster.
The products and services that could be subject to the Goods and Services Tax or excluded from
it.
The minimum turnover threshold below which products and services could be free from GST.
Model legislation or guidelines related to GST, GST-exempt flooring.
Special provisions for the states of Uttarakhand, Assam, Mizoram, Nagaland, Tripura, Manipur,
Meghalaya, Himachal Pradesh, and Arunachal Pradesh.
Also, the GST Council can suggest when gasoline, high-speed diesel, petroleum crude, aviation
turbine fuel, and natural gas may be subject to the GST.
In addition, the GST Council must suggest that the states be compensated for the five years that
the implementation of the GST has caused them to lose revenue. Parliament made a decision
regarding compensation based on the recommendation.
GST Meetings and Decision Making
Every decision made by the GST Council is subject to the following conditions:
A majority of present members voting with at least three-fourths of their votes.
The Central Government of India considers one-third of the total votes cast for making decisions.
Also, the votes cast by the state governments must account for two thirds of the total votes voted.
Any actions or procedures of the GST Council should not be deemed invalid for the reasons
listed below:
Any gaps or deficiencies in the GST Council’s composition.
Any error in the selection of any GST Council member.
The GST Council’s procedural irregularities have no bearing on the case’s merits.
Resolution of Disputes by the GST Council
The GST Council also has the responsibility of developing a system for resolving the following
disagreements:
Disagreements arise between a state’s state government and the federal government.
Conflicts arising from disagreements between the Central Government and one or more States
and one or more States on opposing sides.
Disagreements between two or more States that resulted from the GST Council’s
recommendations being implemented or from the council’s recommendations itself.
Powers of GST Council
Quorum: For the GST council meeting to ahead, at least 50 per cent of the total number of
members should be present at the meeting.
Decision-making: The decision-making will be based on a majority of not less than three-fourths
of the weighted votes of the members present and voting at the meeting.
Voting Powers: The centre has one-third of the total votes, while the weightage of the states’ is
two-thirds.

Salient features of CGST

The Central Goods and Services Tax (CGST) has several salient features. Read below to learn
more about these.
CGST is levied on all the intra-state goods and services supply.
It expands the input tax credit base by ensuring their availability as taxes paid on supply of goods
and services.
CGST enables self-assessment by taxpayers on taxes payable by them.
CGST conducts audits so taxpayers can ensure compliance with the Act’s provisions.
The CGST can recover tax arrears through provisions for detaining and restricting sale of goods
and property by defaulting taxpayers.
The CGST has provisions for levying GST penalties or fines in case of contravention by
taxpayers.
For consumers, the Central Goods and Services Tax enables a reduction of the tax burden on
various goods and services.
Important definitions
Aggregate Turnover’ refers to the aggregate value of all taxable supplies (excluding the value of
inward supplies on which tax as payable by a person on reverse charge basis), exempt supplies,
exports of goods or services or both and inter-State supplies of persons having the same
Permanent Account Number, shall contain data at all India basis but excludes central tax,
State tax, Union territory tax, integrated tax and cess.
Adjudicating authority means any authority competent to pass any order or decision relating to
the GST Act, but does not include the Central Board of Excise and Customs, the Revisional
authority, authority for the advance ruling, appellate authority for an advance ruling, appellate
authority, or the appellate tribunal.
Place of business includes:
A place from where the business is ordinarily carried on, including a warehouse, a godown, or
any other place where a taxable person stores his goods, or provides or receives goods and/or
services
A place where a taxable person keeps his books of account
A place where a taxable person is engaged in business through an agent
Goods refers to all types of movable property, including actionable claim, growing crops, grass,
and things attached to the land that are agreed to be severed before supply or under a contract of
supply. Excludes securities and money.
Services means anything other than goods, money and securities but includes activities 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.
Capital goods are goods that are capitalized in the books of accounts of the person claiming the
credit and are intended to be used during business.
Person includes:
An individual
A Hindu undivided family
A company
A firm
A Limited Liability Partnership
An association of persons or a body of individuals, whether incorporated or not, in India or
outside India
Any corporation set up by or under any Central, State, or Provincial Act or a government
company as defined in section 2(45) of the Companies Act, 2013 (18 of 2013)
A body corporate incorporated by or under the laws of a country outside India
A cooperative society registered under any law relating to cooperative societies
A local authority
Central government or a State government.
Society as defined under the Societies Registration Act, 1860 (21 of 1860)
A trust
Every artificial juridical person, not falling within any of the preceding sub-clauses
Taxable person is an individual who carries on any business at any place in any state of India
and who is registered or required to be registered under GST.
Casual taxable person is a person occasionally undertaking transactions involving the supply of
goods and/or services during business, whether as principal, agent or in any other capacity, in a
taxable territory where he has no fixed place of business.
Non-resident taxable person is someone who occasionally undertakes transactions involving
the supply of goods and/or services, whether as principal or agent, or in any other capacity, but
with no fixed place of business in India.