Question ID : 36882

Liability to GST audit

Dear Colleagues, An NBFC has interest income of Rs 10 crores and loan processing fee of Rs 1.50 crores. Is it Liable for GST audit? Is interest income a part of turnover?

Answer ID : 76039

Dear, Section 35(5) states the word Turnover, but turnover is not defined in the CGST Act but the word "turnover in the state" is defined. Sec 2(112)of CGST Act 2017 defines turnover in a state means aggregate value of taxable supplies and "exempt supplies". Further rule 80(3) states the word aggregate turnover, which is defined under sec 2(6) of CGST Act 2017. which states taxable and exempt supplies both. So for calculating the turnover 2 crores you have to include exempt supplies as well as taxable supplies both. Hence Liable for GST Audit

Answer ID : 76041

yes, liable for GST audit. Section 35(5) commences with the expression “every registered person whose turnover during a financial year exceeds the prescribed limit” whereas the relevant Rule 80(3) uses the expression “every registered person whose aggregate turnover during a financial year exceeds two crore rupees” The definition of aggregate turnover includes exempt turnover. Exempt turnover is defined under CGST Act to mean 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.

Answer ID : 76042

Yes. Aggregate turnover includes exempted turnover. Hence liability to GST audit arises in this case.

Answer ID : 76044

Yes liable as the turnover in 17-18 crosses 2 cr.

Answer ID : 76046

Yes, audit required, it appears. Please consider that debate about 'turnover v. aggregate turnover' has been about turnover lying in different States. But this debate has not been around 'taxable turnover v. total turnover'. As such, there does not appear to be any room to exclude exempt turnover from threshold limit of 2 cr. of turnover.

Answer ID : 76077

Yes it is liable to GST audit. The reason being the turn over for calculation for applicability of GST audit will include the taxable as well as exempted turnover. Since total turnover including the exempted turnover is more than 2 Crores(the turnover for applicability of the GST audit). Therefor GST audit is applicable to the NBFC in question.

Answer ID : 76103

Yes, GST Audit is applicable in this case

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