Exempt, Non GST Supply & Zero Rated supply in GST

Following is the meaning of exempt supply, non GST supply, zero rated supply, not a supply in GST:

Exempt Supply:

Exempt supply means supply of any goods or services or both which:

• attracts nil rate of tax or
• may be wholly exempt from tax or
• non-taxable supply

Following are the example of exempt supply:

1. Supply of live sheep and goats, fresh milk and pasteurised milk, curd, lassi, butter milk, potatoes, tomatoes and many more.
2. Intra-state purchase of goods or services or both by a registered person from unregistered person for a value of Rs. 5000/- or less per day. Here Rs. 5000/- includes all purchases from unregistered persons in a day.
3. Following supply are exempted:
   • The supply of goods by the CSD to the Unit Run Canteens
   • The Supply of goods by the authorized customers
   • The supply of goods by the Unit Run Canteens to the authorized customers
4. Intra-State supplies of second hand goods received by a registered person, dealing in buying and selling of second hand goods and who pays the central tax on the value of outward supply of such second hand goods, from any supplier, who is not registered.
5. Via notification no: 12/2017-Central Tax (Rate), dt. 28-06-2017
   • Services by an entity registered under section 12AA of the Income tax Act, 1961 by way of charitable activities.
   • Services provided by way of pure labour contracts of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of a civil structure or any other original works pertaining to the beneficiary-led individual house construction or enhancement under the Housing for All (Urban) Mission or Pradhan Mantri Awas Yojana.
   • Services by way of pure labour contracts of construction, erection, commissioning, or installation of original works pertaining to a single residential unit otherwise than as a part of a residential complex.
   • Services by way of renting of residential dwelling for use as residence.
   • Services by a hotel, inn, guest house, club or campsite, by whatever name called, for residential or lodging purposes, having declared tariff of a unit of accommodation below Rs.1000/- per day or equivalent.
   • Service of transportation of passengers, with or without accompanied belongings, by (a) railways in a class other than—
     •  first class; or
     •  an air-conditioned coach;

(b) metro, monorail or tramway;

(c) inland waterways;

(d) public transport, other than predominantly for tourism purpose, in a vessel                         between places located in India; and

(e) metered cabs or auto rickshaws (including e-rickshaws).

• Services by way of transportation of goods-

(a) by road except the services of—

(i) a goods transportation agency;

(ii) a courier agency;

(b) by inland waterways.

• Services by way of transportation of goods by an aircraft from a place outside India        upto the customs station of clearance in India.
• Service by way of access to a road or a bridge on payment of toll charges.
• Transmission or distribution of electricity by an electricity transmission or distribution utility.
• And many more

Non GST Supply:

GST is not chargeable on the supply of following items. Hence it is called Non GST Supply:

• alcoholic liquor for human consumption
• petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas and aviation turbine fuel.

Zero rated supply:

Zero rated supply means any of the following supplies of goods or services or both, namely:––

(a) export of goods or services or both; or

(b) supply of goods or services or both to a SEZ developer or a SEZ unit.

Not a supply:

The following activities or transactions shall not be considered as supply of goods or services under GST:

1. Services of funeral, burial, crematorium or mortuary including transportation of the deceased.
2. The duties performed by any person as a Chairperson or a Member or a Director in a body established by the Central Government or a State Government or local authority and who is not deemed as an employee before the commencement of this clause.
3. The duties performed by any person who holds any post in pursuance of the provisions of the Constitution in that capacity; or
4. The functions performed by the Members of Parliament, Members of State Legislature, Members of Panchayats, Members of Municipalities and Members of other local authorities;
5. Services by an employee to the employer in the course of or in relation to his employment.
6. Services by any court ( court here includes District court, High court, Supreme court ) or Tribunal established under any law
7. Sale of land and, subject to clause (b) of paragraph 5 of Schedule II, sale of building.
8. Actionable claims, other than lottery, betting and gambling.

Where to Show Exempt Supply, Non GST Supply and Zero rated supply in GST returns?

In GSTR-3B:

In Table no. 3.1 (b) Outward zero rated supply

3.1 (c) Outward Nil rated supply or exempt

3.1 (e) Non GST outward Supply

In Table no. 5 Inward Exempt supply and Non GST supply

In GSTR-2

In Table no. 7 Inward Exempt supply, Non GST supply