Provisions under First Schedule (I) to CGST Act 2017 regarding “Activities to be treated as Supply even if made Without Consideration”, are as under:
Schedule I to CGST Act 2017: Activities to be treated as Supply even if made Without Consideration (See Section 7)
1. Permanent transfer or disposal of business assets where input tax credit has been availed on such assets.
2. Supply of goods or services or both between related persons or between distinct persons as specified in section 25, when made in the course or furtherance of business:
Provided that gifts not exceeding fifty thousand rupees in value in a financial year by an employer to an employee shall not be treated as supply of goods or services or both.
3. Supply of goods—
(a) by a principal to his agent where the agent undertakes to supply such goods on behalf of the principal; or
(b) by an agent to his principal where the agent undertakes to receive such goods on behalf of the principal.
4. Import of services by a person from a related person or from any of his other establishments outside India, in the course or furtherance of business.
1. The word ‘taxable’ omitted from sub-section (4) vide CGST (Amendment) Act, 2018. Thus, any person (not just a taxable person) importing in above situation will have to compulsory register and pay tax on RCM basis.
Govt. has notified the Central Goods and Services Tax (CGST) Act, 2017 on 12 April, 2017 followed with various CBIC Notifications on commencement date for various Sections/ Provisions thereof from time to time. Govt. has further notified the Central Goods and Services Tax (CGST) (Amendment) Act, 2018 on 30 Aug. 2018 followed with CBIC Notification on commencement date of various Sections/ Provisions thereof from 1 Feb. 2019 vide Notification No. 2/2019 Central Tax dt. 29 Jan. 2019 except for amendments where the date of commencement is different from 1 Feb. 2019 and has specifically been mentioned in the CGST Amendment Act, 2018 itself.
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