TREATMENT OF CENTRAL GOVERNMENT SUBSIDY TO FERTILISER MANUFACTURERS

[Pramod Panda]

A MANUFACTURER OF SSP FERTILIZER IS RECEIVING SUBSIDY FROM CENTRAL GOVERNMENT WHICH DOES NOT CONSTITUTE PART OF VALUE OF SUPPLY IN ACCORDANCE WITH SEC-15(2)(e) OF THE CGST ACT.

QUERY;

1. WHETHER SUCH SUBSIDY IS A NON GST SUPPLY OR EXEMPTED SUPPLY OR NO SUPPLY?

2. WHERE TO SUCH SUCH ITEMS IN GSTR-9 AND GSTR-9C ?

[KASTURI SETHI]

1. It is exempted supply.

2. Show it in Table N0.5(D) of GSTR-9

3. Show in in Table No.7 (B) of GSTR-9C.

[Pramod Panda]

DEAR KASTURIJI,

IN MY VIEW, SINCE THE SUBSIDY RECEIVED FROM CENTRAL GOVERNMENT IS NOT TO BE CONSIDERED AS PART OF THE VALUATION AS PER SEC-15(2)(e) FOR THE PURPOSE LEVY OF GST, IT SHOULD BE CONSIDERED AS NO-SUPPLY.

[KASTURI SETHI]

It cannot be termed as "No supply". It can be called as non-taxable supply. "No supply" has been defined/detailed in Schedule-III under Section 7 of CGST Act, 2017.

AI Summary

Debate Over SSP Fertilizer Subsidy: Exempted, Non-GST, or No Supply? Reporting in GSTR-9 and GSTR-9C Discussed. A manufacturer of SSP fertilizer receives a subsidy from the central government, which is not part of the value of supply under Section 15(2)(e) of the CGST Act. The discussion involves whether this subsidy is a non-GST supply, exempted supply, or no supply, and where it should be reported in GSTR-9 and GSTR-9C. One participant argues it is an exempted supply to be shown in specific tables of GSTR-9 and GSTR-9C. Another contends it should be considered as no-supply, while the first participant clarifies it is a non-taxable supply, not no-supply, as per the CGST Act.