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CGST Rule 28

12 July 2021

Why we can cosider invoice value as open Market value when recipient eligible for full ITC? can any one explain logic behind this rule!!!

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2 Replies

Balamurali Unnithan MS (STUDENT) (1631 Points)
Replied 14 July 2021

Invoice value is after GST and any discounts if any.
GST charged on taxable value

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Pankaj Rawat (GST Practitioner) (55047 Points)
Replied 14 July 2021

Dear Raghuteja
In term of 2nd proviso to rule 28 where the recipient is eligible for full ITC, the value declared in the invoice shall be deemed to be the OMV of goods or services.

The rationale behind this proviso to get revenue neutral when Recepient is eligible for credit.
Thus liberty is provided under this proviso that if the recipient eligible for full ITC , the invoice value shall be deemed to OMV.

Note : In Rule 32(7) of CGST Act : value of taxable services between distinct person & such services notified by council to be NIL . However it is not notified till date.