Clarification on certain issues (sale by government departments to unregistered person; leviability of penalty under section 73(11) of the KGST Act; rate of tax in case of debit notes / credit notes issued under section 142(2) of the KGST 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

Karnataka GST Update: Government Must Register for Used Goods Sales; Section 73(11) Penalties Clarified; TDS Rules Explained.

The circular issued by the Commissioner of Commercial Taxes in Karnataka addresses several GST-related issues. It clarifies that the sale of used vehicles and other goods by government entities to unregistered persons is taxable, requiring the government to register and pay GST. Penalties under section 73(11) of the KGST Act are not applicable for late GSTR-3B filings if taxes are paid with interest, but a general penalty may apply. For debit/credit notes, GST rates apply post-implementation. Section 51 TDS provisions apply to entities with significant government ownership. GST valuation includes TCS under the Income Tax Act. Ownership of goods for section 129(1) is determined by accompanying documentation.