Meaning of ” Price is not the sole consideration ” under GST

By | March 17, 2017
(Last Updated On: March 17, 2017)

Price is not the sole consideration.

As per Section 15 [ Value of taxable supply] of Revised Model GST Law  i.e transaction value will be taken as value of Taxable Supply  only when 

i) supplier and the recipient of the supply are not related and

ii) price is the sole consideration for the supply.

There may be the situations when Price is not the sole consideration of supply of Goods or Services under GST

Buyer may  indirectly compensates the seller for the supply of goods / services, then it can be said that price is not the sole consideration.

Example When price is not the sole consideration.

Mr A (Buyers ) discharges the loan of Mr B ( seller ) which was payable by Mr B  to a Mr C ( third party.) . Thus Mr A directly pays to Mr C for Loan taken by Mr B .

 

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