FOC supply under GST What provision of supplier and receiver?
what is the ITC provision of both?
Supplies made by the recipient to supplier, which are either not in relation to supply or, if in relation to the supply, the supplier was not liable to be paid for by the supplier, are not includible in transaction value. For better understanding let us take following examples:
Example 1: A Limited awards contract for construction of two thousand electrical towers. Steel is major raw material for these towers. Under the contract A Limited will supply required quantity of steel to the contractor. Contractor will arrange for all other materials and deliver complete tower at designated place and time. Value of steel will not be included in taxable value for GST as the supplier was not liable to pay for the steel as per the contract.
CAclubindia
