Let us look at chapter 4 of CGST rules – Determination of Value of Supply. This text is taken from http://www.cbec.gov.in/resources//htdocs-cbec/gst/cgst-rules-01july2017%20.pdf
Value of Supply of Goods or Services Where the Consideration is not
Wholly in Money
money, the value of the supply shall-
(a) be the open market value of such supply;
total of consideration in money and any such further amount in money as is equivalent to the consideration not in money, if such amount is known at the time of supply;
(b), be the value of supply of goods or services or both of like kind and quality;
clause (c), be the sum total of consideration in money and such further amount in money that is equivalent to consideration not in money as determined by the application of rule 30 or rule 31 in that order.
(1) Where a new phone is supplied for twenty thousand rupees along with the exchange of an old phone and if the price of the new phone without exchange is twenty four thousand rupees, the open market value of the new phone is twenty four thousand rupees.
barter of a printer that is manufactured by the recipient and the value of the printer known at the time of supply is four thousand rupees but the open market value of the laptop is not known, the value of the supply of the laptop is forty four thousand rupees.
Value of Supply of Goods or Services or Both Between Distinct or
Related Persons, Other Than Through an Agent
supplier and recipient are related, other than where the supply is made through an agent, shall-
goods or services of like kind and quality;
as determined by the application of rule 30 or rule 31, in that order:
the recipient, the value shall, at the option of the supplier, be an amount equivalent to ninety percent of the price charged for the supply of goods of like kind and quality by the recipient to his customer not being a related person:
credit, the value declared in the invoice shall be deemed to be the open market value of the goods or services.
Value of Supply of Goods Made or Received Through an Agent
The value of supply of goods between the principal and his agent shall-
of the supplier, be ninety per cent. of the price charged for the supply of goods of like kind and quality by the recipient to his customer not being a related person, where the goods are intended for further supply by the said recipient.
supplying groundnuts of like kind and quality in subsequent supplies at a price of five thousand rupees per quintal on the day of the supply. Another independent supplier is supplying groundnuts of like kind and quality to the said agent at the price of four thousand five hundred and fifty
four thousand five hundred and fifty rupees per quintal or where he exercises the option, the value shall be 90 per cent. of five thousand rupees i.e., four thousand five hundred rupees per quintal.
same shall be determined by the application of rule 30 or rule 31 in that order.
Value of Supply of Goods or Services or Both Based on Cost
manufacture or the cost of acquisition of such goods or the cost of provision of such services.
Residual Method for Determination of Value of Supply of Goods or
Services or Both
this rule, ignoring rule 30.
Determination of Value in Respect of Certain Supplies
(1) Notwithstanding anything contained in the provisions of this Chapter, the value in respect of supplies specified below shall, at the option of the supplier, be determined in the manner provided hereinafter.
foreign currency, including money changing, shall be determined by the supplier of services in the following manner, namely:-
shall be equal to the difference in the buying rate or the selling rate, as the case may be, and the Reserve Bank of India reference rate for that currency at that time, multiplied by the total units of currency:
amount of Indian Rupees provided or received by the person changing the money:
of the two amounts the person changing the money would have received by converting any of the two currencies into Indian Rupee on that day at the reference rate provided by the Reserve Bank of India.
and such option shall not be withdrawn during the remaining part of that financial year.
supply of foreign currency, including money changing, shall be deemed to be-
up to one lakh rupees, subject to a minimum amount of two hundred and fifty rupees;
currency exchanged for an amount exceeding one lakh rupees and up to ten lakh rupees; and
the gross amount of currency exchanged for an amount exceeding ten lakh
for travel by air provided by an air travel agent shall be deemed to be an amount calculated at the rate of five per cent. of the basic fare in the case of domestic bookings, and at the rate of ten per cent of the basic fare in the case of international bookings of passage for travel by air.
fare” means that part of the air fare on which commission is normally paid to the air travel agent by the airlines.
cent. of single premium charged from the policy holder; or
the policy holder in the first year and twelve and a half per cent. of the premium charged from the policy holder in subsequent years:
entire premium paid by the policy holder is only towards the risk cover in life insurance.
selling of second hand goods i.e., used goods as such or after such minor processing which does not change the nature of the goods and where no input tax credit has been availed on the purchase of such goods, the value of supply shall be the difference between the selling price and the purchase price and where the value of such supply is negative, it shall be ignored:
borrower, who is not registered, for the purpose of recovery of a loan or debt shall be deemed to be the purchase price of such goods by the defaulting borrower reduced by five percentage points
date of disposal by the person making such repossession.
postage stamp) which is redeemable against a supply of goods or services or both shall be equal to the money value of the goods or services or both redeemable against such token, voucher, coupon, or stamp.
providers as may be notified by the Government, on the recommendations of the Council, as referred to in paragraph 2 of Schedule I of the said Act between distinct persons as referred to in section 25, where input tax credit is available, shall be deemed to be NIL.
Value of Supply of Services in Case of Pure Agent
conditions are satisfied, namely,-
he makes the payment to the third party on authorisation by such recipient;
supply has been separately indicated in the invoice issued by the pure agent to the recipient of service; and
pure agent of the recipient of supply are in addition to the services he supplies on his own account.
means a person who-
as his pure agent to incur expenditure or costs in the course of supply of goods or services or both;
both so procured or supplied as pure agent of the recipient of supply;
services in addition to the amount received for supply he provides on his own account.
work pertaining to the incorporation of Company B. Other than its service fees, A also recovers from B, registration fee and approval fee for the name of the company paid to the Registrar of Companies. The
approval of the name are compulsorily levied on B. A is merely acting as a pure agent in the payment of those fees.
the value of supply made by A to B.
Rate of Exchange of Currency, Other Than Indian Rupees, for Determination of Value
Value of Supply Inclusive of Integrated Tax, Central Tax, State Tax, Union Territory Tax
case may be, central tax, State tax, Union Territory tax, the tax amount shall be determined in the following manner, namely,-
case may be, CGST, SGST or UTGST) ÷ (100+ sum of tax rates, as applicable, in %)
time when the supply being valued is made;
any other supply of goods or services or both made under similar circumstances that, in respect of the characteristics, quality, quantity, functional components, materials, and the reputation of the goods or services or both first mentioned, is the same as, or closely
or substantially resembles that supply of goods or services or both.