Procedure and Levy Under GST Very Short Answer Type Questions

Question 1.
Where is the power to levy GST derived from?
Answer:
Article 246A of the Constitution, which was introduced by the Constitution (101st Amendment) Act, 2016 confers concurrent powers to both parliament and state legislatures to make laws with respect to GST. However, clause 2 of Article 246A read with Article 269A provides exclusive power to the Parliament to legislate with respect to inter-state trade or commerce.

Question 2.
What Is deemed registration?
Answer:
The grant of registration or the Unique Identity Number under the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act shall be deemed to be a grant of registration or the Unique Identity Number under this Act subject to the condition that the application for registration or the Unique Identity Number has not been rejected under this Act within the time specified in sub-section (10) of section 25.

Question 3.
When the registration granted under GST can be cancelled?
Answer:
Registration may be cancelled, if the person, who has voluntarily registered doesn’t commence business within 6 months from the registration. Further, the registered person himself may apply for cancellation of registration only after the expiry of 1 year from the date of registration.

Question 4.
When will a nonresident become liable for registration?
Answer:
A nonresident taxable person shall become liable for registration, when he makes any taxable supply.

Question 5.
Whether registered person required display his certificate of registration?
Answer:
Every registered person shall display his registration certificate in a prominent location at his principal place and at every additional place or place of business.

Question 6.
What do you mean by Compulsory registration?
Answer:
A business whose aggregate turnover in a financial year exceeds Rs 20 lakhs has to mandatorily register under Goods and Services Tax. This limit is set at Rs 10 lakhs for North Eastern and hilly states flagged as special category states.

Question 7.
What is a bill of supply?
Answer:
A bill of supply should be issued instead of a tax invoice in case of the following supplies:

  1. Supply of exempted goods or services.
  2. Supplies made by a composition supplier.

Question 8.
Whether supplier can issue Consolidated bill of supply to the recipient of goods or services?
Answer:
Consolidated bill of supply can be issued by the supplier to the recipient of goods or services, if the value of goods or services supplied is less than Rs.1200.

Question 9.
How many copies of invoices are required in case of supply of goods?
Answer:
The invoice should be prepared in triplicate. The original is for the recipient, the duplicate for the transporter and the triplicate for the supplier.

Question 10.
What is receipt voucher?
Answer:
Receipt voucher is issued when advance is collected/received in relation to supply of goods or services. .

Question 11.
Whether every registered person is required to maintain books of account?
Answer:
Every registered person is required to maintain books of accountancy his principal place of business that is mentioned in the certificate of registration.

Question 12.
Mention the basic accounts to be maintained by every registered person.
Answer:
The following accounts need to be maintained: production or manufacture of goods, inward or outward supply of goods or services, stock of goods, input tax credit availed, output tax payable and paid.

Question 13.
What is meant by provisional input tax credit?
Answer:
The input tax credit availed by the recipient in its return is allowed to the recipient on a provisional basis. Once the input tax credit availed by the recipient is matched with the outward supply details furnished by the supplier, input tax credit will become final.

Question 14.
What is tax deducted at source?
Answer:
Tax deducted at source is a mechanism, wherein the recipient of goods or services will deduct out of the amount payable to the supplier, an amount at a percentage of value of supply and deposit the same to the account of the government within the time prescribed.

Question 15.
Who is authorized to undertake the audit of a taxable person?
Answer:
The commissioner of CGST/SGST or any officer authorized by him may undertake audit of any registered person.

Question 16.
What is the threshold for opting to pay tax under the composition scheme?
Answer:
The threshold for composition scheme is Rs. 50 Lakhs of aggregate turnover in financial year.

Question 17.
How to compute ‘aggregate turnover’ to determine eligibility for composition scheme?
Answer:
The methodology to compute aggregate turnover is given in Section 2(6). Accordingly, ‘aggregate turnover’ means ‘Value of all supplies (taxable and non – taxable supplies + Exempt supplies + Exports) and it excludes Taxes levied under CGST Act, SGST Act and IGST Act, Value of inward supplies + Value of supplies taxable under reverse charge of a person having the same PAN.

Question 18.
What is the minimum rate of tax prescribed for composition scheme?
Answer:
The minimum rate of tax prescribed for composition scheme is 1%.

Question 19.
When exemption from whole of tax collected on goods and/or services has been granted unconditionally, should a taxable person pay tax?
Answer:
No, the taxable person providing such goods or services shall not collect the tax on such goods or services.

Question 20.
What is remission of tax/duty?
Answer:
Remission of tax/duty means relieving the tax payer from the obligation to pay taxon goods when they are lost or destroyed due to any natural causes. Remission is subject to conditions stipulated under the law and rules made there under.