Clarification on certain issues (sale by government departments to unregistered person; leviability of penalty under section 73(11) of the CGST Act; rate of tax in case of debit notes / credit notes issued under section 142(2) of the CGST Act; applicability of notification No. 50/2018-Central Tax; valuation methodology in case of TCS under Income Tax Act and definition of owner of goods) related to GST.

GST Circular: Tax on Used Goods by Government, Section 73(11) Penalties, Section 51 TDS Rules Explained.

The circular provides clarifications on several GST-related issues. It confirms that the supply of used vehicles and goods by government departments to unregistered persons is taxable, requiring registration and GST payment. Penalties under section 73(11) are not applicable for late GSTR-3B filings if taxes are paid with interest, but a general penalty may apply. For debit/credit notes post-GST implementation, the GST rate applies. Section 51 TDS provisions apply to government bodies with over 51% control. TCS under the Income Tax Act is not included in GST value. Ownership of goods under section 129(1) is determined by accompanying documents.