CMA Final Indirect Tax Laws and Practice Syllabus

Indirect Tax Laws and Practice syllabus — full chapter and topic list

Expand any chapter to see its topics and sub-topics. This is the whole examinable outline for Indirect Tax Laws and Practice in CMA Final, not a summary of it.

1. 1

   Goods and Services Tax (GST)

   3 topics

   • GST Concepts and Definitions
   • Levy and Collection of GST
   • Input Tax Credit
2. 2

   Customs Law

   3 topics

   • Basic Concepts of Customs Law
   • Valuation and Assessment
   • Import and Export Procedures
3. 3

   Foreign Trade Policy

   3 topics

   • Export Promotion Schemes
   • Duty Drawback
   • Special Economic Zones

Indirect Tax Laws and Practice flashcards for CMA Final

21 of 53 cards from the Indirect Tax Laws and Practice deck — real questions with worked answers.

1. Under the CGST Act, what is the definition of 'supply' that triggers GST liability?

   Supply includes all forms of supply of goods or services such as sale, transfer, barter, exchange, licence, rental, lease or disposal made or agreed to be made for a consideration in the course or furtherance of business (Section 7 of CGST Act).

2. What is the difference between CGST, SGST, IGST and UTGST?

   CGST and SGST are levied together on intra-State supplies (collected by Centre and State respectively); IGST is levied on inter-State supplies and imports (collected by Centre); UTGST replaces SGST in Union Territories without a legislature.

3. In GST, how do you distinguish an inter-State supply from an intra-State supply?

   If the location of the supplier and the place of supply are in the same State/UT, it is intra-State (CGST+SGST). If they are in different States/UTs, it is inter-State (IGST). Imports and exports are always treated as inter-State.

4. What is a 'composite supply' under GST and how is it taxed?

   A composite supply consists of two or more naturally bundled supplies, one of which is the principal supply. It is taxed at the rate applicable to the principal supply. Example: goods packed and transported with insurance.

5. What is a 'mixed supply' under GST and how is it taxed?

   A mixed supply is two or more individual supplies made together for a single price that are not naturally bundled. It is taxed at the rate of that item which attracts the highest rate of tax.

6. Define 'aggregate turnover' under GST.

   Aggregate turnover is the all-India PAN-based total value of taxable supplies, exempt supplies, exports and inter-State supplies, excluding CGST, SGST, IGST, UTGST, cess and inward supplies on which tax is paid under reverse charge.

7. What activities are treated as neither supply of goods nor supply of services under Schedule III of the CGST Act?

   Examples include services by an employee to employer in the course of employment, services by courts/tribunals, functions of MPs/MLAs, services of funeral/burial, sale of land and (subject to conditions) sale of completed buildings, and actionable claims other than lottery, betting and gambling.

8. What is the GST treatment of supplies made without consideration?

   Generally supply requires consideration, but Schedule I lists activities treated as supply even without consideration, e.g. permanent transfer of business assets on which ITC was availed, supplies between related/distinct persons in the course of business, and principal-agent supplies.

9. What is the taxable event under GST?

   The taxable event under GST is 'supply' of goods or services or both. GST is levied on supply, replacing earlier taxable events like manufacture, sale and provision of service.

10. Under GST, what is the maximum rate of CGST that can be levied as per the CGST Act?

    The CGST Act caps the rate at 20% (so combined CGST+SGST can be up to 40%); IGST is capped at 40%.

11. What is the Reverse Charge Mechanism (RCM) under GST?

    RCM is where the liability to pay tax is on the recipient of goods/services instead of the supplier. It applies to notified goods/services and to supplies received from unregistered persons in specified cases (Section 9(3) and 9(4) of CGST Act).

12. What is the threshold limit for compulsory GST registration for suppliers of goods (normal category States)?

    Rs. 40 lakh aggregate turnover for exclusive suppliers of goods in normal category States; Rs. 20 lakh for services, and Rs. 20 lakh / Rs. 10 lakh in specified special category States.

13. What is the GST Composition Scheme turnover limit and tax rate for a manufacturer/trader?

    Available to taxpayers with aggregate turnover up to Rs. 1.5 crore (Rs. 75 lakh in special category States). Tax rate is 1% (0.5% CGST + 0.5% SGST) for manufacturers and traders, 5% for restaurants, and 6% under the composition scheme for services up to Rs. 50 lakh.

14. Can a composition dealer collect tax or claim input tax credit?

    No. A composition taxpayer cannot collect GST from customers, cannot issue a tax invoice (issues a bill of supply), and cannot claim input tax credit. He pays tax out of his own pocket at the fixed rate.

15. What is the time of supply of goods under forward charge in GST?

    The earlier of (a) the date of issue of invoice or the last date by which invoice should be issued, or (b) the date of receipt of payment (Section 12 of CGST Act). [Note: for goods, advance receipt is no longer taxed; tax is generally at invoice/removal stage.]

16. What is the place of supply of goods when the supply involves movement of goods?

    Where the supply involves movement of goods, the place of supply is the location of the goods at the time at which movement of the goods terminates for delivery to the recipient.

17. What is meant by 'zero-rated supply' under GST?

    Zero-rated supply means export of goods/services and supplies to a SEZ developer or unit. Such supplies bear no tax and the supplier can claim refund either by exporting under LUT/bond without payment of tax, or by paying IGST and claiming refund.

18. What is the difference between exempt supply and zero-rated supply in GST?

    Exempt supply attracts nil/exempt rate and ITC on related inputs is not allowed. Zero-rated supply (exports/SEZ) is taxed at 0% but ITC on inputs is allowed and refundable.

19. What is Input Tax Credit (ITC) under GST?

    ITC is the credit of GST (CGST, SGST, IGST, UTGST, cess) paid on inward supplies of goods or services used in the course or furtherance of business, which can be set off against output tax liability.

20. What are the four key conditions for availing ITC under Section 16 of the CGST Act?

    (1) Possession of a tax invoice/debit note; (2) Receipt of goods/services; (3) Tax actually paid to government by supplier and invoice reflected in GSTR-2B; (4) Recipient has furnished the return under Section 39.

21. What is the time limit for availing ITC on an invoice in GST?

    ITC must be availed by the 30th November following the end of the financial year to which the invoice/debit note relates, or the date of filing the annual return, whichever is earlier.

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