Question

Three friends A, B and C live in Delhi. A sells medicine worth ₹ 50,000 to B, B sells the same medicine to C at a profit of ₹ 6000. If the rate of GST is 12%, then: 

1. SGST paid by B is:
   1. ₹ 300
   2. ₹ 360
   3. ₹ 400
   4. ₹ 425
2. Total CGST is:
   1. ₹ 2600
   2. ₹ 2700
   3. ₹ 3360
   4. ₹ 3500

Answer 1

i. Given,

A sells medicine worth ₹ 50,000 to B.

Rate of GST = 12%

Since, the transaction is intrastate.

SGST rate = `"GST rate"/2`

SGST rate = 6%

SGST paid by B = `6/100 xx 50000`

SGST paid by B = ₹ 3,000

ii. Given,

B sells the same medicine to C at profit of ₹ 6,000.

Thus, B sells the medicine to C at ₹ 56,000.

SGST rate = `"GST rate"/2`

SGST rate = 6%

SGST charged by B = `6/100 xx 56000`

SGST charged by B = ₹ 3,360

Net SGST paid by B = SGST charged by B – SGST paid by B

= ₹ 3,360 – ₹ 3,000

= ₹ 360

Hence, option b is the correct option.

(ii) From part (i),

B sells the medicine to C (end-user) at ₹ 56,000.

CGST rate = `"GST rate"/2`

CGST rate = 6%

CGST = `6/100 xx 56000`

CGST = ₹ 3,360

Hence, option c is the correct option.