Scope of supply

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Central Goods and Service Tax Act, 2017

Scope of supply (Sec. 7)


(1)

  1. all forms of supply of goods or services or both such as sale, transfer, barter, exchange, licence, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business;
  2. import of services for a consideration whether or not in the course or furtherance of business;
  3. the activities specified in Schedule I, made or agreed to be made without a consideration; and&
  4. the activities to be treated as supply of goods or supply of services as referred to in Schedule II.

(2) Notwithstanding anything contained in sub-section (1),—

  1. activities or transactions specified in Schedule III; or
  2. such activities or transactions undertaken by the Central Government, a State Government or any local authority in which they are engaged as public authorities, as may be notified by the Government on the recommendations of the Council,

(3) Subject to the provisions of sub-sections (1) and (2), the Government may, on the recommendations of the Council, specify, by notification, the trans-actions that are to be treated as—

  1. a supply of goods and not as a supply of services; or
  2. a supply of services and not as a supply of goods.

Notes

  • This section provides the scope of supply. It provides an inclusive meaning of the term ‘supply’. It provides for activities to be treated as supply. It further provides that certain activities, specified in Schedule I of the Act, even made or agreed to be made without a consideration shall be treated as supply. This section also provides activities which are neither supply of goods nor supply of services.

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