Power to grant exemption from tax section 11 - GST Ready Reckoner - GST

POWER TO GRANT EXEMPTION FROM TAX As Per Section 11 of CGST Act (1) Where the Government is satisfied that it is necessary in the public interest so to do, it may, on the recommendations of the Council, by notification , exempt generally, either absolutely or subject to such conditions as may be specified therein, goods or services or both of any specified description from the whole or any part of the tax leviable thereon with effect from such date as may be specified in such notification. (2) Where the Government is satisfied that it is necessary in the public interest so to do, it may, on the recommendations of the Council, by special order in each case, under circumstances of an exceptional nature to be stated in such order, exempt from payment of tax any goods or services or both on which tax is leviable. (3) The Government may, if it considers necessary or expedient so to do for the purpose of clarifying the scope or applicability of any notification issued under sub-section (1) or order issued under sub-section (2), insert an explanation in such notification or order, as the case may be, by notification at any time within one year of issue of the notification under sub-section (1) or order under sub-section (2), and every such explanation shall have effect as if it had always been the part of the first such notification or order, as the case may be. Explanation . For the purposes of this section, where an exemption in respect of any goods or services or both from the whole or part of the tax leviable thereon has been granted absolutely, the registered person supplying such goods or services or both shall not collect the tax, in excess of the effective rate, on such supply of goods or services or both. In other words : An exemption may be conditional or absolute. When exemption has been granted absolutely, i.e. it is not subjected to any condition or the happening of any event, it is mandatory. Illustrations 1. Absolute exemption : Exemption to the following taxable services from tax leviable thereon: Services by way of renting of residential dwelling for use as residence. Services by Reserve Bank of India. Services by a veterinary clinic in relation to health care of animals or birds. [ Notification No. 12/ 2017 Central Tax (Rate), dt.28-Jun-2017 ] 2. Conditional Exemption: The Central Government has exempted the tax payable under the CGST/ UTGST/ IGST Acts by any taxable person on supply of 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 less than ₹ 1000/- per day . [ Notification No. 12/ 2017 Central Tax (Rate), dt.28-Jun-2017 ] 3. Conditional, partial exemption : These exemptions are provided on some conditions/ limitations. For example., Notification No. 08/ 2017-Central Tax (Rate), dt. 28-Jun-2017 provided exemptions from payment of tax under reverse charge in case of intra-State supplies of goods or services or both received by a registered person from an unregistered person