Glossary of Terms and their Interpretation as Used in Annual Return i.e. FORM GSTR-9 and 9C
1. FINANCIAL YEAR – The period of twelve months from 1st April to 31st March of every calendar year in which business transactions / supply of goods or services or both are performed is termed as ‘Financial Year’.
2. GSTIN – Goods and Services Tax Identification Number, is a unique number allotted for every registered entity in accordance to Chapter VI of the CGST/ SGST Act 2017, as per Sec. 25 every person who is liable to be registered under Sec. 22 or Sec. 24 shall apply for registration online on GST portal. GSTIN number is a 14 digit number, consisting of first two digits as State Code, nine digit PAN number of the person/assessee and last three digits the code of GSTN.
3. LEGAL NAME – The name of the person or business entity by which it is legally recognised for its legal status e.g. Pvt. Ltd., Ltd., LLP, Proprietorship, Partnership, Society, Trust etc. The person is registered under GST with its legal name.
4. TRADE NAME – The name by which business is commonly known in trade parlance. It may be the registered trade name of the person or the product in which it mainly deal. Example – Aditya Birla is the company name of the group while its one of the business entity is known as Pantaloons which is the trade name.
It is a name which by user and reputation has acquired the property of indicating that a certain trade or occupation is carried on by a particular person[1].
5. OUTWARD SUPPLY – Outward supply in relation to a taxable person, means supply of goods or services or both, whether by sale, transfer, barter, exchange, license, rental, lease or disposal or any other mode, made or agreed to be made by such person in the course or furtherance of business[2].
6. INWARD SUPPLY – Inward supply in relation to a person, shall mean receipt of goods or services or both whether by purchase, acquisition or any other means with or without consideration[3].
7. TAXABLE VALUE – Final value on which tax is levied. Value of supply of Goods or Services used in determining amount of tax the tax-payer will pay[4].
8. CENTRAL TAX – Tax charged and levied under CGST Act under Sec 9[5] which means all the tax levied on inter-state supply of goods or services or both i.e. supplies made outside a state / UT, this tax is collected by Centre.
9. STATE TAX – Tax charged and levied under State Goods and Services Tax[6] which means all the tax levied on intra-state supply of goods or services or both i.e. supplies made within the State.
10. UT TAX – Tax charged and levied under Union Territory Goods and Services Tax[7].
11. INTEGRATED TAX – Tax levied under Integrated Goods and Service Tax[8]. This tax is levied on the supplies made inter-state i.e. when a supply is made from one state to another.
12. CESS – It is a type of additional tax levied on certain type of goods or services, it is a tax imposed by an Act or Ordinance passed by the Parliament for a specific purpose. Presently Cess is levied on specified luxury items only.
13. UNREGISTERED PERSON – A person who is not registered or is not liable for registration under GST including a person who is not liable to tax due to having turnover less than the threshold limit of minimum GST Turnover required for registration in GST as per Section 22 or due to some specific circumstances as envisaged in GST Law.
14. REGISTERED PERSON – Person who is registered under section 25 but does not include a person having a Unique Identity Number[9]. Every person liable to tax must register in GST in its state or union territory in accordance to the procedure for registration provided under Sec 25 of CGST Law.
15. B2C – Business to Consumer. This is where the transfer or supply is from a registered entity (Business) to unregistered entity or person. (Final consumer).
16. B2B – Business to Business. This is where the transfer or supply is from a registered entity (Business) to another registered entity (other business).
17. ZERO RATED SUPPLY – Zero rated supply are the supply on which 0% of GST is to discharge while making an outward supply of goods, e.g. Supply made for exports of goods or services under GST. Entity gets the ITC on inputs used for making such supplies subject to ITC restrictions under Sec 17.
18. SEZ – means each Special Economic Zone notified under the proviso to sub‑section (4) of section 3 and sub‑section (1) of section 4 (including Free Trade and Warehousing Zone) and includes an existing Special Economic Zone;[10] Business units under SEZ zones are subject to IGST in case of Purchase or Supply of Goods or Services. Section 3 (4) and Section 4 (1) deals with power with government to declare any area as SEZ. Supplies made to SEZ are treated as deemed exports.
19. EXPORT – It is defined as:
- “Export of goods” with its grammatical variations and cognate expressions, means taking goods out of India to a place outside India[11];
(2) “Export of services” means the supply of any service when,––
(i) The supplier of service is located in India;
(ii) The recipient of service is located outside India;
(iii) The place of supply of service is outside India;
(iv)The payment for such service has been received by the supplier of service in convertible foreign exchange; and
(v) The supplier of service and the recipient of service are not merely establishments of a distinct person in accordance with Explanation 1 in section 8[12];
To send, take, or carry an article of trade or commerce out of the country. To transport merchandise from one country to another in the course of trade[13]. Person/ business entity can perform a transaction of export under three methods i.e. with payment of tax (IGST), without payment of tax (LUT) and as per notification No 40/2017 by payment of 0.01% of IGST.
20. DEEMED EXPORT – It means such supplies of goods as may be notified under section 147[14]. Section 147 says, government can notify deemed export to goods where goods supplied do not leave India, and payment for such supplies is received either in Indian rupees or in convertible foreign exchange, if such goods are manufactured in India.
Supplies made to SEZ are deemed exports. SEZ is defined as:
(i) taking goods, or providing services, out of India, from a Special Economic Zone, by land, sea or air or by any other mode, whether physical or otherwise; or
(ii) Supplying goods, or providing services, from the Domestic Tariff Area to a Unit or Developer of SEZ; or
(iii) Supplying goods, or providing services, from one Unit to another Unit or Developer, in the same or different Special Economic Zone;[15]
21. ADVANCES – Moneys paid before or in advance of the proper time of payment. This word, when taken in its strict legal sense, does not mean gifts (advancements) and does mean a sort of loan; and when taken in its ordinary and usual sense, it includes both loans and gifts.[16]
Any payment made or received in advance by an assessee registered under GST for a specified supply of goods or services for which generally invoice is issued later.
22. TAX INVOICE – Bill issued with a proper serial number and details of the entity issuing the bill and receiving the goods, GSTIN details of the entities, Description of Goods or Services or both along with HSN Code / SAC Code, clear and proper description of due tax charged as per the type of supply i.e. intra state or interstate supply on it along with signature of the authorized person.
Information that must be on an invoice:
(a) Name, address and GSTIN of the supplier;
(b) A consecutive serial number not exceeding sixteen characters, in one or multiple series, containing alphabets or numerals or special characters hyphen or dash and slash symbolized as “-” and “/” respectively, and any combination thereof, unique for a financial year;
(c) Date of its issue;
(d) Name, address and GSTIN or UIN, if registered, of the recipient;
(e) Name and address of the recipient and the address of delivery, along with the name of State and its code, if such recipient is un-registered and where the value of taxable supply is fifty thousand rupees or more;
(f) HSN code of goods or Accounting Code of services;
(g) Description of goods or services;
(h) Quantity in case of goods and unit or Unique Quantity Code thereof;
(i) Total value of supply of goods or services or both;
(j) Taxable value of supply of goods or services or both taking into account discount or abatement, if any;
(k) Rate of tax (Central tax, State tax, Integrated tax, Union territory tax or Cess);
(l) Amount of tax charged in respect of taxable goods or services (Central tax, State tax, Integrated tax, Union territory tax or Cess);
(m) Place of supply along with the name of State, in case of a supply in the course of inter-State trade or commerce;
(n) Address of delivery where the same is different from the place of supply;
(o) Whether the tax is payable on reverse charge basis; and
(p) Signature or digital signature of the supplier or his authorized representative
23. CREDIT NOTE – This document is issued by a registered person under sub-section (1) of section 34[17]. Credit Note is issued in cases where goods or services are returned after the delivery or issue of tax invoice.
24. DEBIT NOTE – This is a document issued by registered person under sub-section (3) of section 34[18]. Debit Note is issued in cases where goods or services are returned after the delivery or issue of tax invoice.
25. AMENDMENTS – It means changes. These are circumstances or changes with respect to transactions related to last financial year (2017-18) for which these changes are to be shown in the GSTR-9. These are concerned with debit note or credit note and reversal of excess ITC. Declarations made under wrong head previously filed under previous returns for particular periods can be corrected in GSTR-9.
26. REVERSE CHARGE – It means the liability to pay tax by the recipient of supply of goods or services or both instead of supplier of such goods or services or under sub section (3) or Sub- section (4) of section 9, or under sub-section (3) or sub-section (4) of section 5 of the integrated goods and Services Tax[19]. E.g. Purchase of goods by a registered entity from an un-registered dealer, on such type of transaction GST liability has to be discharged on reverse charge basis.
27. EXEMPTED – Supply which originally attracts the rate higher than nil rate but tax payable thereon is nil[20].
It means supply of any goods or services or both which attracts nil rate of tax or which may be wholly exempt from tax under section 11, or under section 6 of the Integrated Goods and Services Tax Act, and includes non-taxable supply[21].
28. NIL-RATED – supply which attracts nil rate of tax i.e. 0% as per the tariff[22] and no ITC is allowed on such supply.
29. NON- GST SUPPLY / NON-TAXABLE SUPPLY UNDER GST – These are as per constitution which are:- Supply of Alcohol for human consumption, Crude Oil, High Speed Diesel, Motor spirit (petrol), Natural gas and Aviation turbine fuel (ATF)[23].
It means a supply of goods or services or both which is not leviable to tax under GST Act or under the Integrated Goods and Services Tax Act[24].
30. NO SUPPLY – No Supply are considered supplies as per Schedule III[25]. These are different from the list of Non-GST Supply. There is ambiguity in its treatment[26].
31. TURNOVER – Turnover means total receipts made from its outward supply, by a registered dealer in a Financial Year.
Aggregate Turnover has been defined under CGST Act, 2017 which means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis), exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number, to be computed on all India basis but excludes central tax, State tax, Union territory tax, integrated tax and cess[27].
32. ITC– Input Tax Credit means the credit of input tax which is available to an assessee regiserted under GST subject to certain restrictions as per GST Law[28].
33. IMPORT – It is defined as:
‘‘Import of goods” with its grammatical variations and cognate expressions, means bringing goods into India from a place outside India[29];
‘‘Import of services” means the supply of any service, where–– (i) the supplier of service is located outside India; (ii) the recipient of service is located in India; and (iii) the place of supply of service is in India[30];
This means to bring goods into India from another country and are regulated by customs law[31].
34. CAPITAL GOODS – means goods which are essential part of a business for e.g. Plant and Machinery, Moulds, Dies, Factory Building, Trucks, Cranes, Power Generators etc., the value of which is capitalised in the books of account of the person claiming the input tax credit and which are used or intended to be used in the course or furtherance of business[32].
35. INPUTS – It means any goods other than capital goods used or intended to be used by a supplier in the course or furtherance of business[33] or for providing an outward supply under GST. Example raw material used for making product or material used in packing of goods.
36. INPUT SERVICES – It means any service used or intended to be used by a supplier in the course or furtherance of business[34]. Example works contract services.
37. TRANSITION CREDIT – Transition Credit is the ITC available in the credit / cash ledger of the previous indirect tax regime of taxation, which is transferred by the assessee in the GST regime in its credit / cash ledger after filling of TRAN-1 or TRAN-2 Form on the GST portal Note: In some cases GST dept. has rejected the claim or has partially allowed the claim made in TRAN-1 or TRAN-2 by the assessee, in such cases proper declaration should be made while filling GSTR-9.
38. REVISIONS – This term is not defined under GST law with respect to GSTR -9. This means any amendments or changes made to the Annual return after finalising it. This term has been used in terms of ‘revising the return’.
Note: One should not get confuse with the revision proceeding as defined under Civil Procedure Code and should be able to differentiate between the two context used even under GST law.
39. REVERSAL OF CREDIT – ITC which has been availed by the assesse, may be reversed by the GST dept., if it is found that the ITC availed by the assesse is wrongly claimed or the assessee was not entitled to take claim of such ITC. ITC wrongly claimed on goods and services can also be reversed while filing GSTR-9.
40. UTILISATION OF ITC – Utilisation of the balance available in the assessee’s cash ledger and credit ledger can be used while discharging the liability of payment of due tax.
41. ITC LAPSED – This terms is specific to GST regime. It means the credit which was to be utilised towards payment of outward liability of GST is no more valid due to the reason that the outward supply falls under nil rated category, the assesse cannot take refund of the ITC accumulated in the credit ledger on making such supplies It is lapsed and cannot be further validly used.
42. INTEREST – Interest leviable on amount of taxable turnover if the tax is not paid on time (18%) or ITC has been availed wrongly (24%).
43. LATE FEE – Additional fee payable if returns or tax is paid after the due date. This is in penalising nature.
44. COMPOSITION TAX PAYERS (GSTR-4 & 9A) – Assesse who are registered under GST under a special category known as Composition scheme. These assesse have to discharge their liability to pay GST on their total taxable turnover with the condition that no ITC can be claimed by the Buyers.
45. HSN – Harmonised Standard of Nomenclature. It is a universal code of classification of Goods as per their description. These are given on the Finance Ministry’s website for reference in GST. These are unique type of series which is used to classify the goods based on their description. Currently under GST regime an assesse is liable to mention the HSN code up to 4 digits and in small category of dealers only up to 2 digits.
46. UQC – Unique Quantity Code. It is the Code as per which the Goods or Services can be measured i.e. Kg, Pcs, Ltrs, Pounds, Tons etc.
47. DEEMED SUPPLY – Under GSTR-9 deemed supply is with reference to section 143 i.e. Job Work (supply for further processing on the goods).
48. REFUND SANCTIONED – This refers to the case where refund of tax has been given by the authorities. The process of giving back refund is complete from authority’s side.
49. REFUND CLAIMED – This is where the refund is asked for by the assesse. There may or may not be any revert from the authorities on this yet.
50. REFUND REJECTED – This is where person applied for refund by filing a prescribed form giving his reason for claim of refund, but as per the reasoning of tax authorities, the refund is not valid and hence, they have rejected it.
51. REFUND PENDING – This is where the refund is asked for by the person. There may be revert from the authorities on this. It is at pending stage.
52. UNBILLED REVENUE (9C) – These are those revenue which has been recognised in the books of accounts on accrual basis generally, but no invoice has been issued by the entity during the financial year[35].
53. UNADJUSTED ADVANCES (9C) – These are those advances made against the supply, which has been recognised in the books of accounts on accrual basis generally, but no invoice has been issued by the entity during the financial year[36].
54. RECONCILIATION (9C) – Checking if the bank and the accounting records have the same cash balance[37]. Reconciliation is used in GST Act which refers to the reconciliation statements made under accounting. The term is also used in GSTR with respect to matching the previously filed returns and balances with the current return being filed.
55. SAC (9B) – Services Accounting Code are codes issued by the indirect tax authorities. This is to uniformly classify each services under GST. Similar to that of HSN, This does not applies to goods. It is restricted for services. These SAC codes can be used in invoices created by you for the services you delivered.
56. TRAN-I – It is a form where every registered person entitled to take credit of input tax Under section 140[38] shall, within ninety days of the appointed day, submit a declaration electronically in FORM GST TRAN-1[39].
57. TRAN-II – Form for transition from old regime to the GST regime where it is to be used by GST Registered people not registered under old regime or those who do not have the documents/bills/proof of duty paid on old stock.
58. ISD – “Input Service Distributor” means an office of the supplier of goods or services or both which receives tax invoices issued under section 31 towards the receipt of input services and issues a prescribed document for the purposes of distributing the credit of central tax, State tax, integrated tax or Union territory tax paid on the said services to a supplier of taxable goods or services or both having the same Permanent Account Number as that of the said office[40].
Disclaimer: This has been written with the information as on July 2019 with the GST Return perspective only. It is only for educational purpose and contains our interpretation.
[1] The black laws dictionary 2nd ed.
[2] CGST Act 2017, S. 2 (83)
[3] CGST Act 2017, S. 2 (67)
[4] The black laws Dictionary 2nd ed.
[5] CGST Act 2017, Sec. 2 (21)
[6] CGST Act 2017, Sec. 2 (104)
[7] CGST Act 2017, Sec. 2 (115)
[8] CGST Act 2017, Sec. 2 (58)
[9] CGST Act 2017, Sec. 2 (94)
[10] Special Economic Zone Act, 2005 Sec.2 (za)
[11] IGST Act 2017, Sec. 2(5)
[12] IGST Act 2017, Sec. 2(6)
[13] The black laws dictionary 2nd ed. State v. Turner, 5 Har. (Del.) 501.
[14] CGST Act 2017, Sec. 2 (39)
[15] Special Economic Zone Act, 2005 Sec.2 (m)
[16] The Black Laws Dictionary 2nd Edition
[17] CGST Act 2017, 2(37)
[18]CGST Act 2017, 2(38)
[19]CGST Act 2017, 2(98)
[20] Aditya Singhania, “GST practice manual with GST Audit: day to day tax practice guide for professionals”, Taxman’s, September 2018, P. 472 Para 4.14
[21] CGST Act 2017, S. 2(47) defined as exempted supply
[22] Aditya Singhania, “GST practice manual with GST Audit: day to day tax practice guide for professionals”, Taxman’s, September 2018, P. 472 Para 4.14
[23] Aditya Singhania, “GST practice manual with GST Audit: day to day tax practice guide for professionals”, Taxman’s, September 2018, P. 474 Para 4.14
[24] CGST Act, 2017 S. 2(78) as non-taxable supply
[25] CGST Act, 2017
[26] Aditya Singhania, “GST practice manual with GST Audit: day to day tax practice guide for professionals”, Taxman’s, September 2018, P. 474 Para 4.14
[27] CGST Act 2017 Sec. 2(6)
[28] CGST Act 2017, 2(63)
[29] IGST Act, 2017 Sec. 2 (10)
[30] IGST Act, 2017 Sec. 2 (11)
[31] The black laws Dictionary 2nd ed.
[32] CGST Act 2017, 2(19)
[33] CGST Act 2017, 2(59)
[34] CGST Act 2017, 2(60)
[35] Aditya Singhania, “GST practice manual with GST Audit: day to day tax practice guide for professionals”, Taxman’s, September 2018, P. 533 Para 4.14
[36] Aditya Singhania, “GST practice manual with GST Audit: day to day tax practice guide for professionals”, Taxman’s, September 2018, P. 542 Para 4.14
[37] The black laws dictionary, 2nd Ed.
[38] Transitional arrangements for input tax credit
[39] CGST Rules, Chapter-14(1)
[40] CGST Act, 2017 Sec. 2(61)
Prateek Gupta, Adv
Partner
SHARNAM LEGAL
Nainshree Goyal, Adv
Associate Lawyer
Sharnam Legal
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