GST implementation in India

 Brief overview of GST implementation in India

Features of GST Model Adopted by India
  • Concurrent Dual GST
  • Destination based Consumption Tax


Reason for shifting to GST
  • Remove cascading effect of double taxation
  • Allow cross ITC on Goods and services


Threshold Limit
  • By and large Rs. 20 Lakh
  • No Limit for Interstate sale , Composition scheme, Reverse Charge, NRI, TDS and E com. business




  1. Unified Market across India
  2. Remove double taxation
  3. Seamless flow of tax input Credits
  4. Complex issues such as division of works contracts resolved
  5. Increase in threshold limit for registration
  6. Clarity on valuation and ITC
  7. Tax limited to value addition
  8. Refund Mechanism for exporters



  1. Difficult to determine actual jurisdiction – Place of supply and time of supply.
  2. Increase in tax rates for service sector
  3. No Centralised Registration
  4. No Abatements
  5. Large number of Procedural and documentation compliances. 3-4 Monthly Returns and 1 Annual Return
  6. Internal transfer (within branches or units) to attract GST such as Audit and accounting functions
  7. Services by employer to employee without consideration are taxable.
  8. If no Payment to Vendor ag. Invoice – Otherwise ITC reversed with interest and penalty.
  9. Stringent penalty Provisions
  10. Matching concept – No credit until proper return filed by supplier
  11. No ITC available against Expenses on Employees:
    Food and Beverages
    Club Membership
    Rent a Cab
    Health Insurance
    Travel Benefits
  12. Interest and late payment Penalty part of Consideration for GST.
  13. Outside GST – Electricity tax, Petroleum and Alcohol.
  14. Stamp Duty to Continue





Important Concepts under GST

What is the taxable event under GST The taxable event under GST shall be the supply of goods and / or services made for consideration in the course or furtherance of business
Supply of Goods




 all forms of Sale, Transfer, exchange, Licence, rental, , lease for consideration and Furtherance of business


Taxable Supply even without consideration are taxable 

  1. Self-supplies (within units of same organisation)
  • Inter-state self-supplies such as stock transfers will be taxable as a taxable person has to take state wise registration in terms of Schedule 1(5). even if there is no consideration.


  • However, intra-state self-supplies are not taxable.
  1. Supply To Related or Distinct person
  • Director,
  • Employee or


  1. Import of Services
  • Taxable  – if from related person even without consideration or furtherance of business


  1. Between Principal & Agents

Work Contracts


Catering Services

Renting of Immovable Property

  • Covered under Supply of Services



Exempt Supplies

  • Employee to Employer
  • Court
  • MP
  • Diplomat
  • Funeral
  • Import without Consideration expect from related person


Time of Supply (POT)



Forward Mechanism






Under Reverse Charge Mechanism (RCM)Whichever is earlier


Date of Issue of Invoice, If Invoice is issued within prescribed period

date of completion of service

Date of receipt of payment

Date on which Supplier Receive Payment


Receipt of Invoice

Receipt of Services.

Debit in Books of Accounts.

Payment in bank or books of accountPlace of Supply Intra State – Location of Supplier and place of Supply SameCGST & SGST are applicableInter State (IGST) DifferentSingle Rate is applicable


Type of Invoices  
Tax Invoice Within 30 Days
Bill of Supply
Rate of Tax 0% Essential

5% Common

12% Std.

18% Std.

28% Luxury


GST Returns  
GSTR-1 Outward Supply By 10thof subsequent month
GSTR-2 Inward Supply By 10th – 15th of subsequent month
GSTR-3 Monthly Return By 15-20th of subsequent month
GSTR-7 TDS Supply By 10thof subsequent month
GSTR-9 Annual Supply By 31st Dec from the end of F.Y.
Payment of GST GST PMT -4
3 Type of E-Ledgers on GST Common Portal
E Tax liability Register GST PMT -1
E Credit Register GST PMT -2
E Cash Ledger GST PMT -3
Late Fee Rs. 100/- per day max 5000



For any inquiries or questions regarding GST Contact us at or dial 9810414035 or visit our website –

Deduction u/s 80DDB

To claim deduction u/s 80DDB following condition should be satisfied.

Taxpayer should be resident in India in the previous year.
Deduction is available to Individual or HUF only.
Deduction is available on actual expenditure on medical treatment of specified Disease or ailment as prescribed.
Expenditure should be incurred for medical treatment of
assessee himself
wholly/mainly dependent Husband/wife(spouse)
wholly /mainly dependent children
wholly/mainly dependent parents
wholly/mainly dependent Brother
wholly/mainly dependent Sisters
in case of Huf ,wholly/mainly dependent member of the HUF
Assesee shall have to submit certificate in form no 10-I from prescribed specialist working in Government hospital
Government hospital includes a departmental dispensary whether full-time or part-time established and run by a Department of the Government for the medical attendance and treatment of a class or classes of Government servants and members of their families, a hospital maintained by a local authority and any other hospital with which arrangements have been made by the Government for the treatment of Government servants;
This deduction can not be allowed by DDO(employer) while calculating the TDS amount .So assessee have to apply for claim this deduction while filing his return in Income tax tax department
Amount of Deduction:

Deduction is available for Rs. 40000 or amount actually paid ,which ever is less.
If expenditure has been done in respect of dependent who is at least of 65 year of age in any time during the previous year then deduction shall be Rs. 60000 or amount paid which ever is less. Update : Age Limit for Senior Citizen has been proposed to be reduced to 60 Year wef financial year 2012-13 through Finance Bill 2012
deduction Amount as arrived in above (1) or (2) will be reduced by amount reimbursed by employer or by insurer.
Specified diseases and ailments for the purpose of deduction under section 80DDB.

(i) Neurological Diseases where the disability level has been certified to be of 40% and above,
(a) Dementia ;
(b) Dystonia Musculorum Deformans ;
(c) Motor Neuron Disease ;
(d) Ataxia ;
(e) Chorea ;
(f) Hemiballismus ;
(g) Aphasia ;
(h) Parkinsons Disease ;

(ii) Malignant Cancers ;
(iii) Full Blown Acquired Immuno-Deficiency Syndrome (AIDS) ;
(iv) Chronic Renal failure ;
(v) Hematological disorders :
(i) Hemophilia ;
(ii) Thalassaemia.

Payroll Outsourcing Services in Gurgaon

We are a Proactive organization specializing in Payroll Processing and Consultancy services.

We are Firm of qualified Chartered Accountants with over fifteen years of hands on experience in handling business processes and legal compliances.

We use Advance Payroll software and processes used for processing payroll .

We offer web access to employees to retirve their payslips, Tax Sheets, Loan Statements etc.

Gurgaon as IT outsourcing hub

The Gurgaon story: A mirror to India’s growth

Gurgaon: In this city that barely existed two decades ago, there are 26 shopping malls, seven golf courses and luxury shops selling Chanel and Louis Vuitton. Mercedes-Benzes and BMWs shimmer in automobile showrooms. Apartment towers are sprouting like concrete weeds, and a futuristic commercial hub called Cyber City houses many of the world’s most respected corporations.

Jaipur may challenge Gurgaon as IT outsourcing hub

Jaipur is fast becoming a rival for outsourcing hub Gurgaon, with large IT and BPO firms setting up offices in the pink city.

More than 100 IT and ITES companies have set up operations in Jaipur in the past three years, growing the total exports from the city by 40%, to about $100 million in the current fiscal year, according to senior state officials.

Gratuity Applicability


Every factory (as defined in Factories Act), mine, oilfield, plantation, port and railway.
Every shop or establishment to which Shops & Establishment Act of a State applies in which 10 or more persons are employed at any time during the year end.
Any establishment employing 10 or more persons as may be notified by the Central Government.
Once Act applies, it continues to apply even if employment strength falls below 10.
Any person employed on wages/salary.
At the time of retirement or resignation or on superannuation, an employee should have rendered continuous service of not less than five years,
In case of death or disablement, the gratuity is payable, even if he has not completed 5 years of service.
The quantum of gratuity is to be computed at the rate of 15 days wages (7 days wages in case of seasonal establishments) based on rate of wages last drawn by the employee concerned for every completed year of service or a part thereof exceeding 6 months.
The total amount of gratuity payable shall not exceed the prescribed limit.
In case where higher benefit of gratuity is available under any gratuity scheme of the Co., the employee will be entitled to higher benefit
Calculation of Gratuity
Gratuity = Monthly Salary x 15 days x No. of yrs. of service
Max. Gratuity payable under the Act is Rs. 10,00,000/-
Penal Provisions
Nonpayment of gratuity payable under the Act is punishable with imprisonment up to 2 years (minimum 6 months) and/or fine up to RS 20,000/-. Other contravention/offenses attract imprisonment up to 1 year and/or fine up to RS 10,000.

80CCF Infra bonds saving abolished w.e.f. FY 2012-2013

Deduction under 80 CCF Discontinued from Assesment Year 2013 -14

Section 80 CCF reads as follows:- “ In computing the total income of an assessee, being an individual or a Hindu undivided family, there shall be deducted, the whole of the amount, to the extent such amount does not exceed twenty thousand rupees, paid or deposited, during the previous year relevant to the assessment year beginning on the 1st day of April, 2011 [or to the assessment year beginning on the 1st day of April, 2012], as subscription to long-term infrastructure bonds as may, for the purposes of this section, be notified by the Central Government.]”

The section has not been amended this year to provide for deduction with respect to Previous year commencing on 1st day April 2012 i.e. AY 2013-14.

When Gratuity is payable to an employee

Query: When Gratuity is payable to an employee.

Answer: According to Section 4 of the Payment of Gratuity Act (1) Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years,-

(a) on his superannuation, or

(b) on his retirement or resignation, or

(c) on his death or disablement due to accident or disease :

Provided that the completion of continuous service of five years shall not be necessary where the termination of the employment of any employee is due to death or disablement:

Provided further that in the case of death of the employee, gratuity payable to him shall be paid to his nominee or, if no nomination has been made, to his heirs, and where any such nominees or heirs is a minor, the share of such minor, shall be deposited with the controlling authority who shall invest the same for the benefit of such minor in such bank or other financial institution, as may be prescribed, until such minor attains majority.

Explanation.- For the purposes of this section, disablement means such disablement as incapacitates an employee for the work which he was capable of performing before the accident or disease resulting in such disablement.

(2) For every completed year of service or part thereof in excess of six months, the employer shall pay gratuity to an employee at the rate of fifteen days’ wages based on the rate of wages last drawn by the employee concerned :

Provided that in the case of a piece-rated employee, daily wages shall be computed on the average of the total wages received by him for a period of three months immediately preceding the termination of his employment, and, for this purpose, the wages paid for any overtime work shall not be taken into account :

Provided further that in the case of an employee who is employed in a seasonal establishment and who is not so employed throughout the year, the employer shall pay
the gratuity at the rate of seven days’ wages for each season.

Explanation.- In the case of a monthly rated employee, the fifteen days’ wages shall be calculated by dividing the monthly rate of wages last drawn by him by twenty-six and multiplying the quotient by fifteen.

Payroll Outsourcing & Attendance Management

Payroll Outsourcing & Attendance Management Systems – Delhi, Gurgaon, Manesar, Noida, Greater Noida, Faridabad and Jaipur

Welcome to Amit Arun & Associates!

We are Delhi’s Leading HR Consulting and Payroll Outsource firm. We deal in Human Resource Information Systems (HRIS), Payroll Consultation and Training, Payroll Accounting, Payroll Outsourcing, Payroll Audit, Time and Attendance Management systems, Leave Processing and Reimbursement Claim Processing. Our local presence in Delhi help us to serve our clients across the cities like Delhi, Gurgaon, Manesar, Noida, Greater Noida, Faridabad and Jaipur.

We have the expertise in HR consulting and Payroll processing where we believe in giving a professional touch to every minute detail in regards to the payrolls. Our uniqueness lies in its partnering with niche system developers, combined with the strength of professionals. Our well qualified team consisting of professionals including Chartered Accountants and MBAs work incessantly to give our clients solution to each aspect/ problem during the whole financial year.

We provide end to end function of payroll services. The services comprises activities like:-

Time and Attendance Management and Leave Processing
Payroll Processing
Payroll tax forecasting
Reimbursement Claim Processing
Statutory Compliances and filing of eTDS returns
Annual Bonus and Ex-gratia processing
Exit Formalities
Payroll Audit
Reimbursement Claim Processing
Beside above mentioned services we also help clients in other areas of Payroll Outsourcing:-

Training on payroll, time and attendance management systems and leave processing.
Travel Claims Processing
Withholding tax compliances by the employer
Fringe Benefit Tax (FBT) compliances
Employee Compensation Structuring
Provident Fund, ESI and Gratuity related legal compliances

Applicability of TDS provisions in case of expat

Income earned by expatriate employees abroad is taxable in India….!

In a landmark ruling of the Supreme Court confirming that Domestic companies must deduct tax at source on salaries paid to their expatriate staff and if tax can be levied on these employees on wages given abroad by foreign joint venture partners of the Indian firms. Further, in case the expatriates are seconded to work for the India subsidiary/ joint venture, then Indian subsidiary/ joint venture should deduct tax on entire salary i.e. salary paid in India and overseas.

Supreme Court in case of Commissioner of Income-tax, New Delhi vs. M/s Eli Lilly & Company (India) Pvt. Ltd [Civil Appeal No. 5114 / 2007 – Supreme Court] confirms liability to deduct tax on offshore salary paid to non-resident employees for services rendered in India.

The I-T department has contended that the job offer to the employees through the JV Board indicated that only a part of their gross salary was paid by the assessee in India and the major part was paid by the foreign partner outside India despite employees not performing any work outside the country.

It was also found that the JV was deducting TDS only from the part of the salary paid in India, it said. The income tax department while partly allowing the appeal of the company had held that the income earned by expatriate employees abroad was taxable in India.

However, it had ruled that no tax can be demanded from Eli Lilly & Company as the expatriate employers had paid advance tax on the total income, including the salary received abroad, earned by them.

The Supreme Court further decides:

• Where the home salary paid to the expatriates has any connection or nexus with his rendition of service in India, then such payment would constitute income which is deemed to accrue or arise to the expatriate in India in terms of section 9(1)(ii) of the Act. Section 9 is not only a machinery section but also provides chargeability of tax on incomes which are deemed to accrue or arise in India.

• If the services of employment are rendered in India, the place of receipt or actual accrual of salary is immaterial. Section 192(1) of the Act has to be read with section 9(1)(ii) of the Act.

• Where the home salary is paid and it is found that no services have been performed outside India, such payment shall be “deemed to accrue or arise in India” and the Indian subsidiary/JV is statutorily obliged to deduct tax under section 192(1) of the Act.

Overseas Assets Disclosure Not Applicable to NOR

According to 3rd Proviso to Section 139 of the I. T. Act has been introduced with effect from 01/04/2012 the requirement for submitting the details of Overseas Assets are restricted to Resident and Ordinarily Resident (R & OR) it is not applicable to Not Ordinarily Resident in India (NOR).

Extract of proviso to Section 139[(1) is given below for reference:

9a[Provided also that a person, being a resident other than not ordinarily resident in India within the meaning of clause (6) of section 6, who is not required to furnish a return under this sub-section and who during the previous year has any asset (including any financial interest in any entity) located outside India or signing authority in any account located outside India, shall furnish, on or before the due date, a return in respect of his income or loss for the previous year in such form and verified in such manner and setting forth such other particulars as may be prescribed :