Taxability of related party loans: interest only consideration is exempt, but separate processing or administrative fees attract GST.
The circular confirms that supply between related persons exists under the UPGST Act, but services of granting loans/advances where consideration is solely interest or discount are exempt under the notified entry. Processing, administrative, facilitation or loan granting charges distinct from interest constitute taxable consideration for supply of services and attract GST. Where no such additional fees are charged between related parties or affiliates, no separate taxable service arises and open market valuation is not applicable; any additional fees will be subject to GST.

Special procedure compliance requires machine identification, Chartered Engineer certification of electricity use, and applies to job workers.
Manufacturers must complete FORM GST SRM-I Table 6 with machine identification: make/model optional (year of purchase may substitute), a machine number is mandatory and may be assigned if missing. Declare electricity consumption per machine from markings/records or obtain a certified calculation by a Practicing Chartered Engineer in FORM GST SRM-III and upload with SRM-I; list uploaded documents in Table 10. Report sale price where no MRP in FORM GST SRM-II Table 9. Chartered Engineer must hold a certificate of practice from the Institute of Engineers India. The procedure excludes SEZ units and manual sealing/packing and applies to job workers, with principal liable if the job worker is unregistered.

Monetary limits for government appeals restrict departmental filing before appellate fora unless merits require contestation.
Fixation of monetary limits governs the Department's authority to file appeals or applications under the UPGST Act: the Commissioner prescribes thresholds below which State Tax officers shall ordinarily refrain from instituting appeals or Special Leave Petitions before appellate fora. The relevant quantum for threshold purposes is the disputed amount of tax, interest, penalty, late fee or refund, aggregated in composite orders. Non-filing pursuant to limits does not create precedent or acquiescence, and specified exclusions require appeals to be taken on merit regardless of thresholds.

Valuation of imported services by related persons clarified for recipients eligible to full input tax credit, guidance issued for uniform application.
Clarification explains valuation of imported services supplied by related persons where the recipient is eligible to full input tax credit, affirming that valuation must follow existing GST valuation principles, including consideration of related party adjustments, markup and arm's length assessment as applicable. The State Tax Commissioner has circulated the Department of Revenue circular to subordinate officers and trade organisations for dissemination and uniform application.

Extended warranty treated as a separate supply of services when supplied after sale or by a different supplier, attracting GST obligations.
Extends prior circular instructions so that references to replacement of "part(s)" shall be read as "goods or its parts" for warranty replacements; confirms that distributor replacements from own stock later replenished by the manufacturer via delivery challan without consideration attract no GST and require no ITC reversal by the manufacturer; and clarifies that extended warranty supplied by a different person at sale, or supplied after sale, is a separate supply treated as a supply of services, with the warranty supplier liable to discharge GST.

Salvage ownership determines GST liability: insurer pays GST only when salvage vests with insurer on disposal.
GST liability on salvage/wreck is determined by ownership and the existence of supply. If the insurance contract deducts salvage value from the claim (treating it as a pre agreed deductible and limiting liability to IDV less salvage), the salvage remains the insured's property and the insurer has no GST liability on that value. If the insurer settles the full claim without deducting salvage, the salvage vests in the insurer and any subsequent disposal by the insurer is a taxable supply attracting GST.

Input tax credit availability: insurers can claim ITC for reimbursed motor repair costs when invoices are in insurer's name.
Insurance companies are entitled to claim input tax credit on motor vehicle repair services in reimbursement settlements where invoices are issued in the insurer's name, because the insurer is the recipient for the approved repair liability and consideration includes payments made by another person; ITC is limited to the approved reimbursed amount when full invoices exceed approved claim cost, and ITC is unavailable where the invoice is not in the insurer's name.

Proportionate reversal of input tax credit: suppliers must obtain verifiable certificates or recipient undertakings to validate post supply discounts.
Suppliers giving post-supply discounts via tax credit notes may exclude those discounts from taxable value only if Section 15(3)(b)(ii) conditions are met, notably proportionate reversal of input tax credit by the recipient. Until portal verification exists, suppliers must obtain a CA/CMA certificate (with UDIN) or, below the prescribed tax threshold, a recipient undertaking, detailing credit notes, linked invoice numbers, ITC reversal amounts and the FORM GST DRC-03/return reference; these documents will serve as admissible evidence for compliance and must be produced to tax authorities when required.

Time of supply for spectrum services: GST arises when each instalment is due or paid under reverse charge.
Supply of spectrum by DoT to a telecom operator is a continuous supply where payment obligations exceed three months and is taxable on reverse charge. For reverse charge supplies, time of supply is the earlier of payment date recorded by the recipient or sixty days after issue of an invoice/document; where instalment due dates are contractually ascertainable from the NIA/FAL, invoices must be issued on or before each instalment due date. GST is payable on upfront payment when paid or due, and on deferred instalments when each instalment is due or paid, whichever is earlier.

Time of supply for HAM highway services: invoice date or receipt of payment determines tax liability.
Time of supply for HAM concession contracts treating construction plus O&M as a single continuous supply is the invoice issuance date or receipt of payment, whichever is earlier, when the invoice is issued on or before the contractually specified date or event; otherwise the time of supply is the date of provision of service (or contractual due date of payment) or receipt of payment, whichever is earlier. Interest component in installments is includible in taxable value.

Input tax credit availability on ducts and manholes clarified as not barred by immovable-property blocked-credit rules.
Ducts and manholes forming part of an optical fiber cable network function as apparatus and infrastructure used to make outward supply of telecommunication services and are not excluded under the Explanation to the blocked-credit provisions; therefore, availment of input tax credit on such ducts and manholes is not barred by the immovable-property blocking rules.

Taxability of employee share schemes: no GST on cost-to-cost reimbursements; GST on additional facilitation fees under reverse charge.
The circular clarifies that securities/shares allotted by a foreign holding company to employees of an Indian subsidiary as part of ESOP/ESPP/RSU are neither goods nor services; where the domestic subsidiary reimburses the foreign holding company on a cost to cost basis, no supply arises and GST is not leviable. If the foreign holding company charges any additional fee, markup or commission beyond cost, that additional amount is taxable as an import of services and GST must be paid by the domestic subsidiary under reverse charge.

Reverse charge input tax credit time limit: ITC period is tied to the financial year when the recipient issues the invoice.
Where a registered recipient must pay tax on reverse charge for supplies from unregistered suppliers and issues the invoice under the statutory invoice provision, the relevant financial year for the time limit to avail input tax credit is the financial year in which the recipient issues that invoice; ITC is available only subject to payment of the tax and compliance with other statutory conditions, and delayed issuance/payment attracts interest and potential penal consequences.

Place of supply rules for goods to unregistered persons clarified; authorities instructed to notify subordinate officers and trade bodies.
Clarification on clause (ca) of Section 10(1) of the Integrated Goods and Service Tax Act, 2017 explains the place of supply rules for goods supplied to unregistered persons and their compliance implications; the Government circular was forwarded by the State Tax Commissioner, Uttar Pradesh with directions to notify subordinate officers and trade organisations and an enclosed copy.

Input tax credit reversal not required where valuation-excluded premium portion in life policies is not an exempt supply.
The circular clarifies that the portion of life insurance premium excluded from taxable value under the life-insurance valuation rule does not constitute an exempt or non-taxable supply; it results from valuation methodology only. Consequently, that excluded premium portion does not trigger reversal of input tax credit under the GST reversal provisions and related rules applicable when supplies are for exempt or non-taxable purposes.

Input tax credit reversal not required for premium portions excluded under Rule 32(4) valuation for life insurance policies.
The portion of premium excluded from taxable value under Rule 32(4) for life insurance policies is a valuation outcome and is not thereby converted into an exempt or non taxable supply; consequently, reversal of input tax credit under Section 17(1) read with Rules 42 and 43 is not required for that excluded portion.

GST on ESOP reimbursements: cost-to-cost reimbursements not taxable, additional facilitation fees taxable under reverse charge.
Securities (including shares) issued as ESOP/ESPP/RSU to employees form part of remuneration and, being neither goods nor services, are not subject to GST; reimbursement by the domestic subsidiary to the foreign holding company on a strict cost-to-cost basis for such shares does not amount to import of services and is not taxable. Any additional amount charged by the foreign holding company over and above the cost-labelled fee, markup, or commission-constitutes consideration for facilitation services and is taxable, with GST payable by the domestic subsidiary on reverse charge.

Proportionate reversal of input tax credit: evidence via CA/CMA certificate or recipient undertaking enables exclusion of post supply discounts.
Suppliers issuing post supply discounts by tax credit notes may exclude those discounts from taxable value only if the recipient has proportionately reversed the input tax credit attributable to the discount; absent portal verification, suppliers should obtain a CA/CMA certificate (with UDIN) from the recipient specifying credit note and invoice details, amount and documentary reference of ITC reversal, or, for discounts below a de minimis threshold in a financial year, an undertaking from the recipient. These certificates/undertakings constitute admissible evidence under Section 15(3)(b)(ii) and must be produced to tax authorities when required.

Input tax credit timing: ITC window tied to the invoice issuance year for RCM supplies from unregistered suppliers.
Where tax is payable under reverse charge on supplies from unregistered persons, the recipient must issue the invoice under Section 31(3)(f), pay tax in cash, and may claim input tax credit only within the time limit computed from the financial year in which that recipient issued invoice pertains, subject to fulfillment of other ITC conditions. Delayed issuance/payment attracts interest and potential penalties.

Valuation of import of services: invoice value deemed open market value where recipient has full input tax credit.
Where an Indian registered person imports services from a related person abroad and the Indian recipient is eligible for full input tax credit, the value declared in the recipient's invoice is deemed the open market value under the second proviso to Rule 28(1) of the CGST Rules. Such imports attract tax under reverse charge and require the recipient to issue a self-invoice. If no invoice is issued by the recipient for services from the foreign affiliate, the recipient's declaration of Nil value may be treated as the open market value under the proviso.