What is Schedule III of the CGST Act, 2017?
Schedule III of the CGST Act, 2017 covers a list of activities or transactions which shall be treated neither as a supply of goods nor a supply of services. In simple words, schedule III covers those activities on which GST is not applicable.
Which items are covered in Schedule III of the CGST Act, 2017? Or Which items are covered in the negative GST list?
1. Services by an employee to the employer in the course of or about his employment.
2. Services by any court or Tribunal established under any law for the time being in force.
3. (a) the functions performed by the Members of Parliament, Members of State Legislature, Members of Panchayats, Members of Municipalities, and Members of other local authorities;
(b) the duties performed by any person who holds any post in pursuance of the provisions of the Constitution in that capacity; or
© 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.
4. Services of funeral, burial, crematorium or mortuary including transportation of the deceased.
5. Sale of land and, subject to clause (b) of paragraph 5 of Schedule II, sale of building.
6. Actionable claims, other than 4[specified actionable claims.
7. Supply of goods from a place in the non-taxable territory to another place in the non-taxable territory without such goods entering into India.
8. (a) Supply of warehoused goods to any person before clearance for home consumption;
(b) Supply of goods by the consignee to any other person, by endorsement of documents of title to the goods, after the goods have been dispatched from the port of origin located outside India but before clearance for home consumption.
Explanation 1.- For the purposes of paragraph 2, the term “court” includes District Court, High Court, and Supreme Court.
Explanation 2. — For the purposes of paragraph 8, the expression “warehoused goods” shall have the same meaning as assigned to it in the Customs Act, 1962 (52 of 1962).]
Conclusion
Understanding Schedule III of the CGST Act, 2017 is crucial for businesses and individuals to comprehend the scope of GST applicability. This schedule outlines specific activities and transactions that are neither considered a supply of goods nor services, effectively placing them outside the purview of GST.
From services provided by employees to employers, to the sale of land and buildings, and specific functions performed by constitutional and governmental bodies, Schedule III provides clarity on what falls under the negative list for GST.
Recognizing these exemptions helps in accurate tax planning and compliance, ensuring that businesses do not inadvertently account for GST on exempted transactions.
