CGST Section 7 – Scope of Supply [Updated 2019]

CGST Section 7 – Scope of Supply

CGST Section 7 (1)

For the purposes of this Act, the expression “supply” includes––

(a) all forms of supply of goods or services or both such as sale, transfer, barter, exchange, license, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business;

(b) import of services for a consideration whether or not in the course or furtherance of business; [1][and]

(c) the activities specified in Schedule I, made or agreed to be made without a consideration; [2][****]

(d) [3][****]

[4][(1A) where certain activities or transactions constitute a supply in accordance with the provisions of sub-section (1), they shall be treated either as supply of goods or supply of services as referred to in Schedule II.]

CGST Section 7 (2)

Notwithstanding anything contained in sub-section (1),–

  • activities or transactions specified in Schedule III; or
  • such activities or transactions undertaken by the Central Government, a State Government or any local authority in which they are engaged as public authorities, as may be notified by the Government on the recommendations of the Council,

shall be treated neither as a supply of goods nor a supply of services.

CGST Section 7 (3)

Subject to the provisions of [5][sub-sections (1), (1A) and (2)], the Government may, on the recommendations of the Council, specify, by notification, the transactions that are to be treated as—

(a) a supply of goods and not as a supply of services; or
(b) a supply of services and not as a supply of goods.


[1] Word Inserted by the Central Goods and Services Tax (Amendment) Act, 2018.  Date of Amendment : 29-08-2018, Effective from : 01-07-2017, Retrospective Effect : Yes

[2] Word “and” omitted by the Central Goods and Services Tax (Amendment) Act, 2018. Date of Amendment : 29-08-2018, Effective from : 01-07-2017, Retrospective Effect : Yes

[3] Clase (d) omitted by the Central Goods and Services Tax (Amendment) Act, 2018. Prior to its omission, clause (d) read as under :

“(d) the activities to be treated as supply of goods or supply of services as referred to in Schedule II.” Date of Amendment : 29-08-2018, Effective from : 01-07-2017, Retrospective Effect : Yes

[4] Inserted by the Central Goods and Services Tax (Amendment) Act, 2018.  Date of Amendment : 29-08-2018, Effective from : 01-07-2017, Retrospective Effect : Yes

[5] Substituted for the words “sub-sections (1) and (2)” by the Central Goods and Services Tax (Amendment) Act, 2018. Date of Amendment : 29-08-2018, Effective from : 01-07-2017, Retrospective Effect : Yes

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