GST – LAW & PRACTICE

UNIT – 5
VALUATION OF GOODS AND SERVICES UNDER GST
FORMAT FOR COMPUTATION OF TRANSACTION VALUE:
PARTICULARS RS RS
Selling Price XXX
Add: Inclusions not included in the sale price
1. Pre delivery Inspection charges XXX
2. Publicity charges XXX
3. Packing cost XXX
4. Materials purchased (exclusive of GST) XXX
5. Design and development charges XXX
6. Advertising expenses XXX
7. Servicing charges XXX
8. Freight charges XXX
9. Installation and erection charges XXX
10. Insurance cost XXX
11. Transport cost XXX
12. Taxes, duties, cess, fees and charges XXX
13. Loading and handling charges XXX
14. Warranty charges XXX XXX
XXXX
Less: Exclusions included in the sale price
Cash/trade discount (discount shall be deducted, if it is allowed XXX
before or at the time of supply)
Add: Advanced discount XXX
Add: Penalty for delay in making payment by the buyer more XXX
than 180 days
Less: cost of durable and returnable packing included in the sale XXX
price
Transaction Value Before Adding the Profit Margin XXX
Add: Profit Margin XXX
Transaction Value After Adding the Profit Margin XXX

VANDANA RAMESH, ASST PROF, MCOM, KSET 1

 GST – LAW & PRACTICE

PROBLEMS:
1. Mistake company manufactures 10,000 units of products and sold to a wholesaler at
Rs.50 per unit. 20% trade discount is allowed to the wholesaler as per the normal
practice. What is the amount of GST payable if rate of GST is 18%. (Assumed
Exclusive of GST)

2. M/s Raghu Company ltd., manufactures 5,000 units of Product A and sold to a
wholesaler at Rs.12 per unit. Also, he manufactures 2,000 units of product B and sold
to a dealer at Rs.10 per unit. 10% trade discount was allowed to the wholesaler as per
the normal practice. Cost of packing and freight Rs.10,000 charged separately. What is
the amount of GST payable if the rate of GST is 28%? Assume the supply as intra-state
supply.

3. Compute the transaction value of goods from the following information and GST
payable by a dealer registered in Karnataka.
Selling price (including IGST of RS.2000) 43,000
Following transactions are not included in the above price:
Freight charges paid by supplier charged separately 1,000
Normal secondary packing cost 1,500
Cost of durable and returnable packing 1,500
Insurance on freight paid by the supplier charged separately 500
Trade discount (Normal practice) 1,000
Rate of GST 18%

4. X company manufacture 1,000 units of products and sold to a wholesaler at Rs.100 per
unit 10% trade discount is allowed to the whole seller as per the normal practice. What
is the amount of GST payable if the rate of GST is 12%.

5. Having regard to the provisions of CGST and SGST act, 2017. Compute the transaction
value of goods from the following information and GST payable.
Listed selling price (including IGST RS.2,500) 32,500
Following transactions are not included in the above price:
Normal secondary packing cost 1,000
Cost of special packing 500
Cost of durable and returnable packing 750
Freight charges paid by the supplier charged separately 400
Insurance on freight paid by the supplier charged separately 100
Trade discount (normal practice) 1,000
Rate of GST 12%

6. The provisions of GST Act, 2017. Compute the transaction value of goods from the
following information and GST payable.
Particulars Rs.
Selling price (including IGST Rs.5,000) 80,000
Transactions are not included in the above price:
Secondary packing cost 3,000
Cost of special packing 2,000

VANDANA RAMESH, ASST PROF, MCOM, KSET 2

 GST – LAW & PRACTICE

Cost of durable and returnable packing 2,500

Freight charges paid by the supplier charged separately 2,500
Insurance on freight paid by the supplier charged separately 800
Trade discount 10% of transaction value
Rate of GST 18%

7. Calculate GST payable by a registered dealer in Bangalore from the following details:
i. Sales made to a registered dealer in Mysore – Rs.8,00,000 @ 18% GST
ii. Sales made to a registered dealer in Mangalore- Rs.4,00,000 @ 18% GST
iii. Goods transferred to a branch in Bangalore – Rs.1,25,000 @ 18% GST
The following are the returns made by a dealer:
i. Goods returned from a dealer of Mysore – Rs.15,000 within 50 days
ii. Goods returned from a dealer of Mangalore – Rs.25,000 after 7 months
iii. Goods returned from Bangalore Branch – Rs.5,000 after 3 months

8. Mr. Ratul Roy, a dealer in Bangalore entered a contract with a supplier in Mysore to
deliver a Machinery along with essential accessories. From the information determine
the total amount of GST payable U/S 15 of the GST Act 2017.
Particulars Rs.
Price of the machinery (excluding GST) 10,00,000
Installation expenses, charged separately in the invoice 50,000
Insurance charges, charged separately in the invoice 35,000
Warranty charges, charged separately in the invoice 28,000
Transport charges charged separately in the invoice 5,000
Other information:
i. Cash discount 5% on price on the machinery was allowed as per terms of
contracts. Since full payment was received before dispatch of machinery.
ii. Accessories were supplied (essential)along with machinery for Rs.20,000 and
accessories are charged for tax at the rate of 5%.
iii. GST rate on machinery is 18%

9. Compute the amount of GST payable from a manufacture has prepared the invoice as
under:
Particulars Rs
Price of goods (excluding CGST at 9% and SGST at 9%) 5,00,000
Items not included in the above price:
Selling expenses 30,000
Publicity charges 40,000
Advertising charges 50,000
Loading and handling charges 11,000
Outward freight and insurance on buyer request 22,000
Discount at 10% on the price of the goods and shown in invoice.

VANDANA RAMESH, ASST PROF, MCOM, KSET 3

 GST – LAW & PRACTICE

10. Compute the transaction value of taxable goods and IGST payable from the following
information.
Whole sale price of a product sold to Gujarat from a dealer in Bangalore. (Including
GST 12%) – Rs.2,10,000
The following items are not included in the price
Secondary packing cost Rs.10,800
Cost of special packing Rs.16,200
Cost of returnable packing Rs.8,000
Freight and insurance Rs. 7,500
Trade discount Rs.20,000

11. XYZ ltd of Chennai agreed to sell an electronic motor on which the rate of GST
applicable is 12% to ABC ltd. Of Bangalore for Rs.7,500 on ex-factory basis. Other
particulars are:
i. Transportation and transit insurance were arranged by XYZ ltd. This was at the
request of ABC ltd. And amounted to for Rs.625 and Rs.750 respectively which
were charged separately.
ii. A discount of Rs.500 was given to ABC ltd on the agreed price on payment of
an advance of Rs.1,250 with the other. (Ignore notional interest on advance)
iii. Interest of Rs.400 was charged from DEF ltd as it failed to make the payment
within 30 days.
iv. Packing charges of the motor amount to Rs.650
v. The expenditure incurred by ABC ltd towards “free after sale service” during
warranty period comes to be Rs.250 per motor. Compute IGST payable.

12. A dealer in Hyderabad entered a contract within a supplier in Tumkur to deliver

machinery along with essential accessories. From the information, determine the total
amount of GST payable u/s 15 of the CGST Act 2017.
Particulars Rs
Price of machinery (excluding taxes and duties) 3,15,000
Installation and erection expenses charged separately in Invoice 10,000
Packing charges (primary and secondary) 7,500
Design and engineering charges paid by the buyer 4,000
Cost of material supplied by buyer free of charge 1,000
Pre delivery inspection charges 500
Loading and handling charges within the factory 600
Other information:
Cash discount 2% on price of machinery was allowed as per terms of contract. Since
full payment was received before dispatch of machinery.
Bought out accessories supplied along with machinery valued at Rs.2,500 which was
necessary for the working of the machinery. These bought out goods are charged for
tax at the rate of 5%.
GST rate 18%. Make suitable assumptions as are required and provide brief reasons.

VANDANA RAMESH, ASST PROF, MCOM, KSET 4

 GST – LAW & PRACTICE

13. A manufacturer has to supply machinery as following terms and conditions:

Particulars Rs
Price of machinery (net of taxes and duties) 2,00,000
Installation and erection expenses charged separately in invoice 13,000
Packing charges (primary and secondary) 2,000
Design and engineering charges (net taxes and duties) 15,000
Cost of material supplied by buyer at reduced cost (actual price of the 2,500
materials is Rs.12,500)
Pre delivery inspection charges 1,500
Rate of GST on machinery 18%
Other information:
Cash discount of Rs.7,500 will be offered if full payment is received before dispatch of
goods. The buyer has made the payment as per the conditions stipulated.
The machine is supplied along with bought out accessories at Rs.4,250. The accessories
were optional and rate of duty applicable of these accessories is 28%. The manufacturer
incurred cost of Rs.750 in loading the machine in the truck in his factory. These are not
charged separately to buyer.
Find the transaction value and GST payable if the rate of GST on principal supply is
5%.

14. A dealer in Mysore, agreed to supply 10 computer systems to a dealer in Bangalore in

the month of August 2022 on the following terms:
Sl No. Particulars Rs
1. Price of each CPU supplied (Exclusive of GST at 18%) 20,000
2. Price of each desktop supplied (inclusive of GST at 12%) 7,840
3. Packing for transportation 2,000
4. Transport charges to recipient place charged separately in
invoice 4,000
5. Commission paid to the agents to fix up agreement for the sale 4,000
6. Late fee charged to buyer for the delayed payment 2,000
7. Subsidy received from an NGO which was directly linked to
price of the goods 25,000
8. Subsidy received from Government which was directly linked
to price of the goods 10,000
The dealer supplied following essential items along with the CPU:
a) 10 keypads supplied along with the desktops costing RS.400 each and rate of
GST applicable is 12%
b) 10 mouse supplied along with the desktops costing RS.500 each and rate of GST
applicable is 12%
c) Cost of operating software supplied for all the systems is Rs.20,000. GST
applicable to software is 5%
d) Special discount of Rs.4,000 was given, if advance of Rs.1,00,000 is paid with
order. The buyer has paid the advance with the order.
Find the transaction value and GST payable for the month of August, 2022

VANDANA RAMESH, ASST PROF, MCOM, KSET 5

 GST – LAW & PRACTICE

15. The Taj Hotel group of companies provided the following services the state of
Karnataka from its various establishments. Compute the amount of GST payable for
the month of July 2022.
Supply of food or drink in restaurant not having facilities in air conditioning @12%
GST Rs.10,000
Supply of food or drink in restaurant in having license to serve liquor 18% GST
Rs.30,000
Supply of food or drink in outdoor catering @18% GST Rs.50,000
Renting of hostels rooms @18% GST Rs.75,000
Supply of food or drinks in air condition restaurant in 5 star or above rated hotel @28%
GST Rs.50,000.

16. The following are the services provided by a cargo industry, which is registered in the
state of Mumbai in the Month of August 2022. Compute the amount of GST payable.
Transport of goods by rail @5% GST Rs.1,50,000
Transport of goods in a vessel @5% GST Rs.1,00,000
Transport of goods in a container by rail @12% GST Rs.50,000
Transport of Courier Rs.10,000 @18%
Transport of agricultural products by rail Rs.35,000
Transport of Passengers by metro – Rs.45,000

17. Mr. Harish is a registered dealer in Jaipur. From the following particulars, find out GST
payable on outwards supply:
a) Chocolates not containing cocoa worth Rs.2,04,000 sold to a registered dealer
of Punjab (IGST rate is 18%)
b) Mineral water worth Rs.2,20,000 were transferred to their branch at Kolkata
(IGST rate is 18%)
c) Ayurvedic medicines worth Rs.1,64,800 are sold to the registered dealer in MP
(IGST rate is 5%)
d) Skimmed milk powder worth Rs.54,000 are sold to the registered dealer in UP
(IGST rate is 5%)
e) Goods amounting to Rs.3,10,000 were sold to a firm of London in the course of
export outside India
f) Silver worth Rs.5,40,000 are sold to a registered dealer in UP (IGST rate is 5%)
g) Coffee beans worth Rs.2,20,000 were transferred to their branch at Kolkata.
h) Sale of petroleum products to a register dealer in UP for Rs.2,50,000
i) Sale of alcoholic liquor for human consumption to a register dealer in MP for
Rs.4,50,000.
18. Shri Laxman is a registered dealer in Karnataka. From the following particulars, find
out payable on outwards supply:
a. Shaving creams worth Rs.2,02,000 sold to a registered dealer within the state
(CGST and SGST rate is 9% each)
b. Speakers and monitors worth Rs.2,20,000 were transferred to their branch at
Mandya (CGST and SGST rate is 14% each)
c. Cell phones worth Rs.1,60,000 are sold within the state. (CGST and SGST rate is
6% each)

VANDANA RAMESH, ASST PROF, MCOM, KSET 6

 GST – LAW & PRACTICE

d. Frozen vegetables worth Rs.54,000 are sold to a registered dealer in Mysore. (CGST
and SGST rate is 9% each)
e. Butter milk worth Rs.2,00,000 were transferred to their branch at Mangalore.
f. Sale of motor spirit to a registered dealer in Mysore for Rs.2,00,000
g. Sale of bangles to a registered dealer in Mangalore for Rs.4,50,000.

19. Mr. Kumar submits the following information. Calculate the transaction value.
Particulars Rs
Preserved vegetables purchases within the state (GST inclusive of
@18%) 1,18,000
Shaving creams purchased from USA (excluding BCD at 10% &
GST at 28%) 1,28,000
Soups purchased from unregistered dealer for rate of GST is 18% 80,000
Machine tools purchased from UK (including BCD at 10% and
including GST at 18%) 1,18,000
Food mixes purchased from composite dealer; rate of GST is 18% 5,00,000
Printed circuits purchased from Pakistan including BCD at 10% and
excluding GST at 18% 4,00,000
Transportation cost is 2,00,000
Profit to manufacturer 80,000
20. A dealer in Kolkata entered a contract with a supplier in Odisha to deliver a machinery
along with essential accessories. From the following information determine the total
amount of GST payable:
Particulars Rs
Machinery cost (excluding taxes) 4,00,000
Installation expenses charged separately 30,000
Packing charges 80,000
Design charges paid by the buyer 10,000
Cost of material supplied by buyer free of charge 5,000
Pre delivery inspection charges 2,000
Loading and handling charges within the factory. 5,000
Other information:
a) Cash discount 5% on price of machinery.
b) Bought out accessories supplied along with machinery valued at RS.10,000
which was necessary for the working of the machinery. These bought out goods
are charged for tax at the rate of 5%.
c) GST rate 18%. Make suitable assumptions as are required and provide brief
reasons.

21. Mr. Madan a dealer submits the following information in relation to manufacture and
selling of water pumps. Compute the transaction value from the following information
if GST @12%
Particulars Rs
Import of Raw material (excluding 20% BCD on import and 12% IGST) 4,20,000
Raw materials purchased from Karnataka (including CGST at 14% and
SGST at 14%) 4,81,600

VANDANA RAMESH, ASST PROF, MCOM, KSET 7

 GST – LAW & PRACTICE

Subsidy received from an NGO which was directly related to price of 11,000
the goods. 1,000
Raw material from Goa including GST at 5% 1,000
Penalty levied by Mr. Madan for delayed payment
Subsidy received from Central Government which was directly liked to 34,000
the price of the product 9,000
Additional incentives paid to the employees 40,000
Warranty and manufacturing charges
Service received from Regd. Dealer to manufacture a machinery rate of 25,000
GST applicable to these services is 12%
Along with the machine he supplied 3 different necessary components
at a fixed price of Rs.40,000 each

22. Mr. Shekar, (dealer in Delhi) entered into a contract with a supplier in Mysore to deliver
Machinery along with essential accessories. From the following information determine
the total amount of GST payable:
Price of machinery (exclusive of GST) 6,00,000
Installation and erection expenses charged separately in Invoice 46,000
Packing charges charged separately in invoice 4,000
Design and engineering charges charged separately in invoice 55,000
Pre delivery inspection charges 6,000
Rate of GST on machinery 18%
Cash discount of Rs.25,000 was allowed as per terms of contracts. Since full payment
was received before dispatch of machinery.
The machinery is supplied along with accessories (optional) at Rs.10,000 and the rate
of duty applicable to these accessories is 28%.
Find the GST payable, if the rate of GST on principal supply is 18%.

23. From the following details, compute the value of taxable services and GST payable for
the Month of March 2023. If the rate of CGST is 14% and SGST is 14%.
Particulars Rs
Services relating to supply of farm labor 4,50,000
Services providing to foreign diplomatic mission 8,00,000
Aerial advertising 1,80,000
Services by way of private tuitions 1,70,000
Speed post services 50,000
House given on rent for residential purposes 2,00,000
Value of free services rendered to friends 7,50,000
Certification for exchange control purpose 2,50,000
Secretarial auditing 25,000
Liquidator fees 3,00,000
Vacant land used for horticulture 2,00,000
Sale of time slot to broadcasting organization 5,00,000

VANDANA RAMESH, ASST PROF, MCOM, KSET 8

 GST – LAW & PRACTICE

24. CA Pavan, practicing chartered accountant (Bangalore) received money from various
clients for the services rendered in the month of November 2023.
Particulars Rs
Accounting and auditing services 1,25,000
Representation before various statutory authorities 1,00,000
Cost accounting and cost auditing 50,000
Secretarial auditing 35,000
Verification of declarations in prescribed forms of compliance for
obtaining a certificate of commencement of business 40,000
Certification of documents to be filed before registrar of
companies 25,000
Ledger maintenance, non-professional services and preparation of
coaching material. 20,000
Fee for routine visits to income tax offices 55,000
Remuneration for teaching CA and ICWA students 30,000
Fee from outsourcing work of a client such as billing and ledger 75,000
posting
Services rendered in Delhi 70,000
Fees paid to the state govt 2,000
You are required to calculate GST payable on outwards supply. (IGST rate is 18%,
CGST is 9% & SGST is 9%).

25. Compute the amount of output tax to be uploaded by the dealer for the month of July
and which is the last date to update in credit ledger.
Particulars Rs
Product A sold to a dealer in Bangalore rate of GST notified to this
product is 12% 50,000
Product B sold to a dealer in Mysore rate of GST @ 5% 25,000
Product C @ nil rate GST sold to dealer in Pondicherry 60,000
Product D @ 18% GST sold to a dealer in Jammu and Kashmir 1,00,000
Product E @ 28% GST to a unregistered dealer within the state 1,60,000
Product F rate of GST notified is 18% sold to SEZ developer in 2,50,000
Bangalore
Product G sold to a dealer in union territory rate of gst notifies is 12% 2,00,000
Product H which exempted from GST sold to a registered dealer in 3,00,000
Pune
Product I exported to China the GST are notified by GST council for 2,25,000
this product is 12% if it is sold in India.
Product K sold to a registered dealer within the state the rate of GST 1,25,000
notified is 12%
Product J sold to a unit of SEZ in Mysore the rate of GST notified to 1,50,000
this product is 5%
Product L sold to a dealer in Belagavi who has registered under 1,00,000
composition scheme @28% GST

VANDANA RAMESH, ASST PROF, MCOM, KSET 9