GST has been passed in the parliament and the Government is working eagerly to make this act let applicable from 1st April 2017 following the motto “One Nation One Tax”. After this act comes into force each person whether of Service background or of Manufacturing background or of any other back ground will come under one common tax net. Each person has to file common return whether he/she is of Service background or of Manufacturing background or of any other background. This article will give you information on the applicability and exemption on different assesses under the GST law/act.

Levy and Collection of Central/State Goods and Services Tax (Section 7)

At a specified rate in the schedule of this act tax shall be levied or collected in such manner as may be prescribed on all intra state supplies of goods and services such tax which are levied are known as the Central/State Goods and Services Tax (CGST/SGST.

As per the provision of this act every person shall pay CGST/SGST.

Although anything contained in sub-section (2), the Central or a State Government may, on the recommendation of the Council, by notification, specify categories of supply of goods and/or services the tax on which is payable on reverse charge basis and the tax thereon shall be paid by the person receiving such goods and/or services and all the provisions of this Act shall apply to such person as if he is the person liable for paying the tax in relation to such goods and/or services.

Composition Levy (Section 8)

(1) Notwithstanding anything to the contrary contained in the Act but subject to sub-section (3) of section 7, on the recommendation of the Council, the proper officer of the Central or a State Government may, subject to such conditions and restrictions as may be prescribed, permit a registered taxable person, whose aggregate turnover in a financial year does not exceed [Rs. 50 lakh], to pay, in lieu of the tax payable by him, an amount calculated at such rate as may be prescribed, but not less than one percent of the turnover during the year:

Provided that no such permission shall be granted to a taxable person who effects any inter-State supplies of goods and/or services

Provided further that no such permission shall be granted to a taxable person unless all the registered taxable persons, having the same PAN as held by the said taxable person, also opt to pay tax under the provisions of this sub-section

(2) A taxable person to whom the provisions of sub-section (1) apply shall not collect any tax from the recipient on supplies made by him nor shall he be entitled to any credit of input tax.

(3) If the proper officer has reasons to believe that a taxable person was not eligible to pay tax under sub-section (1), such person shall, in addition to any tax that may be payable by him under other provisions of this Act, be liable to a penalty equivalent to the amount of tax payable as aforesaid:

Provided that no penalty shall be imposed without giving a notice to show cause and without affording a reasonable opportunity of being heard to the person proceeded against.

Taxable person (Section 9)

(1) Taxable Person means a person who carries on any business at any place in India /State and who is registered or required to be registered under Schedule III of this Act:

Provided that an agriculturist shall not be considered as a taxable person

Provided further that a person who is required to be registered under paragraph 1 of Schedule III of this Act shall not be considered as a taxable person until his aggregate turnover in a financial year exceeds [Rs 10 lakh]

Provided further that a person who is required to be registered under paragraph 1 of Schedule III of this Act shall not be considered as a taxable person until his aggregate turnover in a financial year exceeds [Rs 5 lakh]

[This threshold of 5 lacs will apply only if a taxable person conducts his business in any of the North  States including Sikkim.]

(2) The Central Government, a State Government or any local authority shall be regarded as a taxable person in respect of activities or transactions in which they are engaged as public authorities other than the activities or transactions as specified in Schedule IV to this Act.

(3) The following persons shall not be considered as taxable persons for the purposes of this Act –

(a) Any person who provides services as an employee to his employer in the course of, or in relation to his employment, or by any other legal ties creating the relationship of employer and employee as regards working conditions, remunerations and employer’s liability;

(b) Any person engaged in the business of exclusively supplying goods and/or services that are not liable to tax under this Act;

(c) Any person, liable to pay tax under sub-section (3) of section 7 receiving services of value not exceeding ______ rupees in a year for personal use, other than for use in the course or furtherance of his business.

Power to grant exemption from tax (Section 10)

(1) If the Central or a State Government is satisfied that it is necessary in the public interest so to do, it may, on the recommendation of the Council, by notification, exempt generally either absolutely or subject to such conditions as may be specified in the notification, goods and/or services of any specified description from the whole or any part of the tax leviable thereon.

Explanation- Where an exemption under sub-section (1) in respect of any goods and/or services from the whole of the tax leviable thereon has been granted absolutely, the taxable person providing such goods and/or services shall not pay the tax on such goods and/or services.

(2) If the Central or a State Government is satisfied that it is necessary in the public interest so to do, it may, on the recommendation of the Council, by special order in each case, exempt from payment of tax, under circumstances of an exceptional nature to be stated in such order, any goods and/or services on which tax is leviable.

(2) The Central or a State Government may, if it considers necessary or expedient so to do for the purpose of clarifying the scope or applicability of any notification issued under sub-section (1) or order issued under sub-section (2), insert an explanation in such notification or order, as the case may be, by notification at any time within one year of issue of the notification under sub-section (1) or order under sub-section (2), and every such explanation shall have effect as if it had always been the part of the first such notification or order, as the case may be.

(4) Every notification issued under sub-section (1) or sub-section (3) and every order issued under sub-section (2) shall

(a) Unless otherwise provided, come into force on the date of its issue by the Central or a State Government for publication in the Official Gazette; and

(b) Be made available on the official website of the department of the Central or a State Government.

Remission of tax on supplies found deficient in quantity (Section 11)

The Central or a State Government may, by rules made under this sub-section, provide for remission of tax on such supplies which are found to be deficient in quantity due to any natural causes.

Any rules made under sub-section (1) may, having regard to the nature of the supply, fix the limit or limits of percentage beyond which no such remission shall be allowed.

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    I hope by reading this article you got enlighten on ,GST Levy and exemption on different assessesTax treatment amount collected in case of disputed liability ?, Case of Sundaram Finance Ltd. V. Asst. CIT (SC), Amount collected on adhoc basis for non clarity of taxability can be treated as Income ?, further to mention before taken any financial decision based on this content it is prefered to take an expert opinion as matter can be subjective.