Section 7 CGST Act 2017

[ Section 7 CGST Act 2017 Notified w.e.f 01.07.2017 vide Notification No. 9/2017 – Central Tax Dated 28th June, 2017 ]

Section 7 CGST Act 2017 explains about Scope of supply and is covered in Chapter III – Levy and Collection of tax :-

[Note : CGST Act 2017 also known as CENTRAL GOODS AND SERVICES TAX ACT, 2017 assented by the President of India on 12-4-2017 -An Act to make a provision for levy and collection of tax on intra-State supply of goods or services or both by the Central Government and the matters connected therewith or incidental thereto. ]

Scope of supply.

[Notes ]

7. (1) For the purposes of this Act, the expression “supply” includes—

(a) 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;

(b) import of services for a consideration whether or not in the course or furtherance of business; ⁷[and]

(c) the activities specified in Schedule I, made or agreed to be made without a consideration; ⁸[***][Note -1 ]

(d) *[Note -9]

¹⁰ [ (1A) Where certain activities or transactions constitute a supply in accordance with the provisions of sub-section (1), they shall be treated either as supply of goods or supply of services as referred to in Schedule II. ]

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

(a) activities or transactions specified in Schedule III ; or

(b) 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[note 6] by the Government on the recommendations of the Council,

shall be treated neither as a supply of goods nor a supply of services.[ Note – 1 ,2 and 3,5]

(3) Subject to the provisions of ¹¹[sub-sections (1), (1A) and (2)],, the Government may, on the recommendations of the Council, specify, by notification, the transactions that are to be treated as—

(a) a supply of goods and not as a supply of services; or

(b) a supply of services and not as a supply of goods.

Notes on Section 7 CGST Act 2017

11 Substituted for “sub-sections (1) and (2)” by the Central Goods and Services Tax (Amendment) Act, 2018, w.r.e.f. 1-7-2017.

10 Inserted by the Central Goods and Services Tax (Amendment) Act, 2018, w.r.e.f. 1-7-2017.

9 Omitted by the Central Goods and Services Tax (Amendment) Act, 2018, w.r.e.f. 1-7-2017. Prior to its omission, clause (d) read as under :

8 Word “; and” omitted by the Central Goods and Services Tax (Amendment) Act, 2018, w.r.e.f. 1-7-2017.

7 .Inserted by the Central Goods and Services Tax (Amendment) Act, 2018, w.r.e.f. 1-7-2017.

6 Notification No 17/2018 Integrated Tax (Rate) 26th July, 2018 Dated Seeks to amend notification No. 11/2017- Integrated Tax (Rate) to notify that services by way of any activity in relation to a function entrusted to a municipality under Article 243W shall be treated neither as a supply of good nor a service.

5 Notification No 16/2018 Central Tax (Rate) Dated 26th July, 2017 Seeks to amend notification No. 14/2017- Central Tax (Rate) to notify that services by way of any activity in relation to a function entrusted to a municipality under Article 243W shall be treated neither as a supply of good nor a service.

4  services supplied without  consideration to a recipient other  than ‘related party’ / ‘distinct person’ not taxable Q31 of  GST FAQs on Financial Services Sector published by CBIC

3 To notify the supplies which shall be treated neither as a supply of goods nor a supply of service under the IGST Act vide Notification No. 11/2017-Integrated Tax (Rate) Dated 28th June, 2017

2. The supplies which shall be treated neither as a supply of goods nor a supply of service under the CGST Act vide Notification No. 14/2017-Central Tax (Rate) Dated 28th June, 2017

1. The supplies which shall be treated neither as a supply of goods nor a supply of service under the UTGST Act vide Notification No. 14/2017-Union Territory Tax (Rate) Dated the 28th June, 2017

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