GST Solved Example

Posted on - 30-01-2025

GST Solved Example

Example 1

On1st April, XYZ Traders purchased goods worth ₹50,000 from alocal supplier(intra-state). The supplier chargedCGST @ 9%andSGST @ 9%. Journalise the transaction.

Solution (Hinglish)

1.Yeintra-statepurchase hai, toh do taxes lagte hain: CGST aur SGST, dono 9%.

2.Cost of goods= 50,000.

3.CGST =9% of 50,000 = ₹4,500

4.SGST =9% of 50,000 = ₹4,500

5.Total Invoice= 50,000 + 4,500 + 4,500 = ₹59,000

Journal Entry Table:

Date	Particulars	L.F.	Debit (₹)	Credit (₹)
2025-Apr-01	Purchases A/cDr.		50,000
	Input CGST A/cDr.		4,500
	Input SGST A/cDr.		4,500
	ToCreditor / Bank A/c			59,000
	(Being goods purchased locally with 9% CGST & SGST)

Hinglish Explanation:

Humne local supplier se samaan khareeda (intra-state), isliyeCGST & SGSTlagate hain.
Purchases A/c ko debit karte hain (cost ₹50,000).
Input CGST/SGST (credit available) mein alag-alag amounts debit.
Total payablehum “Creditor A/c” (agar udhaar hai) ya “Bank A/c” (agar payment immediately) ko credit kar dete hain.

Example 2

ABC Ltd. purchasesraw materialsfrom a supplier in adifferent statefor ₹1,00,000 plusIGST @ 18%. Pass the journal entry.

Solution (Hinglish)

1.Inter-statetransaction hai, toh sirf IGST lagta hai.

2.Cost= 1,00,000.

3.IGST @18%= ₹18,000.

4.Total= ₹1,18,000.

Journal Entry Table:

Date	Particulars	L.F.	Debit (₹)	Credit (₹)
2025-May-05	Purchases A/cDr.		1,00,000
	Input IGST A/cDr.		18,000
	ToCreditor / Bank A/c			1,18,000
	(Being goods purchased inter-state @18% IGST)

Hinglish Explanation:

Dusre state se purchase kiya, isliye IGST lagta hai.
Purchases A/c aur Input IGST A/c debit hue (humare liye asset / input credit).
Creditor ya Bank credit hota hai as the payable or payment side.

Example 3

M/s PQR sold goods worth ₹80,000 to alocal customer(intra-state). They chargedCGST @ 9%andSGST @ 9%. Record the journal entry for thesale.

Solution (Hinglish)

1.Intra-state sale: CGST & SGST dono lagte hain.

2.Sale value= 80,000.

3.CGST @9% = 7,200; SGST @9% = 7,200.

4.Total invoice= 94,400.

Journal Entry Table:

Date	Particulars	L.F.	Debit (₹)	Credit (₹)
2025-Jun-01	Debtor / Cash A/cDr.		94,400
	ToSales A/c			80,000
	ToOutput CGST A/c			7,200
	ToOutput SGST A/c			7,200
	(Being local sale with 9% CGST & SGST)

Hinglish Explanation:

Sale karte waqt hum Sales A/c credit karte hain (80,000).
Output CGST & SGST credit hote hain (9% each).
Customer se jo amount lena hai (94,400) wo debit hota hai.

Example 4

ABC Pvt. Ltd. sells goods to abuyer in another statefor ₹1,50,000 plusIGST @ 18%. Pass thejournal entryfor the sale (assume credit sale).

Solution (Hinglish)

1.Inter-state sale: IGST lagta hai.

2.Sale = 1,50,000.

3.IGST 18% = 27,000.

4.Total invoice= 1,77,000.

Journal Entry Table:

Date	Particulars	L.F.	Debit (₹)	Credit (₹)
2025-Jul-10	Debtor A/cDr.		1,77,000
	ToSales A/c			1,50,000
	ToOutput IGST A/c			27,000
	(Being inter-state sale @18% IGST on credit)

Hinglish Explanation:

Jab aap dusri state mein sale karte ho,IGSTapply hota hai.
Debtor (customer) ko puri invoice value se debit karte hain (1,77,000).
Sales A/c aur Output IGST A/c ko credit karte hain.

Example 5

XYZ Ltd.returnedgoods worth ₹10,000 (list price) to a supplier (Sam) from whom it purchased locally. The purchase was originally subjected to CGST @ 9% and SGST @ 9%. Record thepurchase returnentry.

Solution (Hinglish)

1.Return kar rahe hain, matlabpurchase return.

2.Original purchase pe 9% CGST & 9% SGST tha.

3.On ₹10,000, CGST = ₹900, SGST = ₹900.

4.Purchase Returnentry often calls for reversing the earlier input.

Journal Entry Table:

Date	Particulars	Debit (₹)	Credit (₹)
2025-Aug-05	Creditor (Sam) A/cDr.	11,800
	ToPurchase Return A/c		10,000
	ToInput CGST A/c		900
	ToInput SGST A/c		900
(Being goods returned to Sam; reversing input)

Hinglish Explanation:

Purchase return se hum apni input GST bhi reverse kar dete hain (kyunki goods wapas).
Creditor ko debit karte hain kyunki ab unka payable kam ho jaayega.

(Some books reduce “Purchases A/c” directly, but “Purchase Return A/c” is also common.)

Example 6

ABC Traders had sold goods worth ₹20,000 (local) with CGST+SGST @ 9% each. Thecustomernowreturnsgoods worth half of that value. Pass thesales returnentry.

Solution (Hinglish)

1.Pehle humne local sale kiya tha, ₹20,000 + 9%+9%.

2.Ab half (i.e. ₹10,000 portion) ki goods wapas.

3.CGST = 9% of 10,000 = 900, SGST = 900.

4.Sales return se humOutput GSTbhi reverse kar dete hain.

Journal Entry Table:

Date	Particulars	Debit (₹)	Credit (₹)
2025-Aug-10	Sales Return A/cDr.	10,000
	Output CGST A/cDr.	900
	Output SGST A/cDr.	900
	ToDebtor / Customer A/c		11,800
(Being goods returned by customer)

Hinglish Explanation:

Jab customer ne goods wapas kiye, toh hum apni “Sales Return” account debit karte hain aurOutput GSTko bhi reverse kar dete hain.
Debtor’s account ko credit karte hain kyunki ab unka payable (to us) kam ho jaayega, or unhe hum refund/adjustment de rahe hain.

Example 7

Rahul & Co. buys goods worth ₹60,000 (intra-state, CGST+SGST @ 6% each) on credit. Theyimmediately pay ₹20,000, and the rest is due after 2 months. Pass the entries.

Solution (Hinglish)

1.Intra-state purchase, total GST = 12% (6% + 6%).

2.Tax on 60,000 = 3,600 (CGST 1,800 + SGST 1,800).

3.Invoice total = 60,000 + 3,600 = 63,600.

4.Immediately pay 20,000 out of 63,600, balance 43,600 due later.

Step 1: Purchase Entry

Date	Particulars	Debit (₹)	Credit (₹)
2025-Sep-01	Purchases A/cDr.	60,000
	Input CGST A/cDr.	1,800
	Input SGST A/cDr.	1,800
	ToCreditor A/c		63,600
(Being goods bought on credit)

Step 2: Immediate Part-Payment

Date	Particulars	Debit (₹)	Credit (₹)
2025-Sep-01	Creditor A/cDr.	20,000
	ToCash / Bank		20,000
(Being part-payment of purchase)

Hinglish Explanation:

Pehle humne pura invoice record kiya, total 63,600.
Phir usi din ₹20,000 pay kia, toh “Creditor A/c Dr. To Bank A/c.”
Baki 43,600 abhi outstanding.

Example 8

A firm purchased goods from aninter-statesupplier (Invoice ₹1,18,000 including IGST). Thebasic valueof goods is unknown. IGST @ 18%. Find thebasic costandIGSTamount, then pass thejournal entry.

Solution (Hinglish)

1.Total invoice = 1,18,000 (ye gross figure, jisme cost + 18% IGST included).

2.Let cost = x. Then x + 18% of x = 1,18,000→x (1 + 0.18) = 1.18x = 1,18,000. x=1,18,000/1.18=₹1,00,000.

3.IGST = 1,18,000 – 1,00,000 = ₹18,000 (or 18% of 1,00,000).

Journal Entry Table:

Date	Particulars	Debit (₹)	Credit (₹)
2025-Oct-10	Purchases A/cDr.	1,00,000
	Input IGST A/cDr.	18,000
	ToCreditor / Bank		1,18,000
(Being goods purchased inter-state, cost found by dividing total by 1.18)

Hinglish Explanation:

Humne reverse calculation se base cost (1,00,000) nikala. 18% on that is 18,000.
Phir journal entry pass kar di.

Example 9

M/s ABC hasOutput GST liabilityof ₹45,000 (CGST+SGST combined) in the current month. They haveInput GST Creditof ₹30,000 from previous purchases. They pay thebalance in cash. Show thejournal entryforutilisation of input creditandpayment.

Solution (Hinglish)

1.Output GST liability = 45,000 (assume CGST 22,500 + SGST 22,500 for simplicity).

2.Input GST available = 30,000. So partial set-off:

oOutput CGST Dr. 22,500

oOutput SGST Dr. 22,500

oTo Input GST (part of 30k credit, let’s say we fully use 22,500 for CGST + 7,500 for SGST? Typically you can’t cross-allocate CGST credit to SGST liability. Let’s assume they have enough split credit or a simpler approach: if 15k is Input CGST and 15k is Input SGST, we can do the respective distribution.

For simplicity, let’s do acombinedapproach (some textbooks just do a single “Input GST” if not differentiating).

Step 1: Adjust output with input:

Particulars	Debit (₹)	Credit (₹)
Output CGST A/c Dr.	22,500
Output SGST A/c Dr.	22,500
To Input CGST A/c	15,000
To Input SGST A/c	15,000
(Utilising input credit total 30,000)

Now total liability was 45,000, we used 30,000 input. Remaining 15,000 to be paid in cash:

Particulars	Debit (₹)	Credit (₹)
Output CGST A/c Dr.	(bal figure)
Output SGST A/c Dr.	(bal figure)
To Bank/Cash A/c	15,000
(Paying remaining in cash)

(Alternatively, you can combine into one entry, but stepwise is clearer.)

Hinglish Explanation:

Humari output liability 45k thi. Input credit 30k tha, usse adjust kar liya. Bacha 15k humne cash se pay kar diya.
Practically CGST credit SGST pe use nahi ho sakta; hum assume kar rahe hain unke input credits me sufficient distribution hogi.

Example 10

ABC Pvt. Ltd. has the following GST credits at the end of a month:Input CGST = ₹5,000,Input SGST = ₹5,000,Input IGST = ₹12,000. ItsOutput CGSTis ₹8,000,Output SGSTis ₹8,000, andOutput IGSTis ₹3,000. Show how credit isutilisedstep by step and anybalanceto be paid in cash.

Solution (Hinglish)

Let’s do stepwise:

1. Set off Output IGST first

Output IGST = ₹3,000
We can useInput IGSTfirst. (IGST credit must be used first against IGST liability)
So Input IGST 12,000→use 3,000.
New Input IGST balance = 12,000 – 3,000 = 9,000.
Output IGST is now 0.

2. Output CGST = ₹8,000

Use leftover Input IGST (9,000) or Input CGST (5,000).
By rule: Input IGST can be used for CGST or SGST after IGST liability is done.
Suppose we first exhaust Input CGST = 5,000. Now CGST liability left = 3,000.
Then use Input IGST (9,000) for remaining 3,000 CGST. Now Input IGST left = 6,000.
Output CGST is now 0.

3. Output SGST = ₹8,000

We have Input SGST = 5,000, leftover Input IGST = 6,000.
First, use Input SGST = 5,000→SGST liability left = 3,000.
Use leftover Input IGST for that 3,000→now Input IGST = 6,000–3,000 = 3,000 leftover.
Output SGST is 0.

4. Final

All output taxes (CGST, SGST, IGST) are zero.
We still have Input IGST leftover = 3,000, but no more output liability. So no cash needed!

Tabular Summaries

Particular	Amount (₹)	Comments
Input Credits Initially
Input CGST	5,000
Input SGST	5,000
Input IGST	12,000
Output Liabilities
Output CGST	8,000
Output SGST	8,000
Output IGST	3,000
Step 1: Pay Output IGST 3,000 using Input IGST	–3,000	IGST credit left = 9,000
Step 2: Pay Output CGST 8,000	Use Input CGST 5,000 + leftover IGST 3,000 = 8,000	CGST paid fully, leftover IGST now 6,000
Step 3: Pay Output SGST 8,000	Use Input SGST 5,000 + leftover IGST 3,000 = 8,000	leftover IGST = 3,000
Result	–	All output tax = 0, leftover IGST = 3,000

Hinglish Explanation:

IGST credit ko pehle IGST liability me use karte hain. Bacha toh CGST/SGST me laga sakte hain. CGST credit sirf CGST→then IGST, SGST credit sirf SGST→then IGST.
Yahan humne systematically sab set off kiya. Koi cash pay karne ki zaroorat nahi padi because leftover IGST credit was enough.

Example 11:

Reverse Charge Mechanism (RCM) on Freight

M/s ABC hired anunregistered Goods Transport Agency (GTA)to transport goods. Thefreightcharged was ₹10,000. Under GST,freight on GTA(unregistered) is liable underreverse charge mechanism@ 5% IGST (assuming inter-state). ABC pays the freight directly to GTA. Show thejournal entryfor RCM in ABC’s books.

Solution (Hinglish)

1.Reverse chargeka matlab: recipient (ABC) ko hi GST govt ko dena hoga.

2.Freight = 10,000, IGST @5% = ₹500.

3.ABC will record expense for freight + RCM liability. Then they can claimInput IGST(subject to RCM rules) if the supply is eligible.

Step-by-step

At the time of incurring expense:

Freight Expense Dr. (net + tax? Actually, under RCM, we separate the tax portion as liability to Govt, but eventually we also get input credit on it.)

Entry(simplified approach):

Freight (Expense) A/c Dr. 10,000

Input IGST (under RCM) A/c Dr. 500

To Cash/Bank A/c 10,000

To RCM IGST Payable A/c 500

(Being freight paid under RCM, IGST @5%)

Then,payment of RCM liabilityto govt:

RCM IGST Payable A/c Dr. 500

To Cash/Bank A/c 500

(Being IGST under RCM paid to Govt)

Because it’s RCM, ABC can claim that₹500asInput IGSTif it’s allowed (the second line in the first entry shows we recorded “Input IGST (RCM) A/c” also).

Table(one way to see it):

Particulars	Debit (₹)	Credit (₹)
1. Freight Expense A/c	10,000
2. Input IGST (RCM) A/c	500
To Bank A/c (freight paid)		10,000
To RCM IGST Payable A/c		500
(Freight cost + IGST under RCM)
RCM IGST Payable A/c Dr.	500
To Bank A/c (tax paid to Govt)		500
(RCM liability cleared)

Hinglish Explanation:

Yahan freight ek unregistered GTA se liya, tohreverse chargeke tahat ABC ko khud hi tax dena hai.
ABC entry mein freight expense debit, RCM IGST payable credit karti hai. Saath hi hum Input IGST (RCM) bhi create karte hain, jisse hum baad me offset kar sakte hain.
Lastly, RCM liability pay karke hum “RCM IGST Payable A/c” ko settle kar dete hain.

Example 12:

Export of Goods (Zero-Rated Supply)

XYZ exports goods worth ₹2,00,000. Under GST, exports arezero-rated. So no output tax is charged to the foreign buyer. Show thejournal entryforexport sales. Also assume no IGST was charged, and the company can claiminput tax refundseparately.

Solution (Hinglish)

1.Exports= zero-rated, matlab 0% output tax.

2.If there was input GST on purchase side, the exporter can claim refund or adjust as per rules.

3.Saleentry has no GST portion on output side.

Journal Entry:

Debtor (Foreign Customer) A/c Dr. 2,00,000

To Sales A/c 2,00,000

(Being goods exported at zero-rated GST)

No “Output GST A/c” because export is zero-rated.

Hinglish Explanation:

Export par0%GST lagta hai, yaani aap output me kuch charge nahi karte.
Company apna input GST refund claim kar sakti hai (but that’s a separate procedure).
Yahan sale entry sirf basic amount ke liye pass hota hai, koi “Output GST” dikhaya nahi jaata.

Example 13:

Partial Use of IGST Credit

ABC Co. hasoutput CGSTof ₹10,000 andoutput SGSTof ₹10,000 this month. They haveinput IGSTcredit of ₹15,000 andnoinput CGST/SGST credit. Show how they canset offthe liabilities if total output liability is ₹20,000 (CGST + SGST) and they only have IGST credit.

Solution (Hinglish)

1.Total output = CGST 10k + SGST 10k = ₹20k.

2.Input IGST = ₹15k.

3.IGST credit sabse pehle hum IGST liability me use karte, but yahan koi IGST output liability hi nahi. Toh ab hum CGST/SGST par use kar sakte hain.

4.ForCGST10k, hum IGST credit me se 10k use kar lete hain. Bach gaya input IGST = 5k.

5.Ab SGST liability 10k bachi, aur humare paas input IGST 5k. Hum 5k use kar sakte hain. Bacha SGST liability 5k hum cash se pay karenge.

Entry(Simplified approach):

Output CGST A/c Dr. 10,000

Output SGST A/c Dr. 10,000

To Input IGST A/c 15,000 (partial usage)

To Bank/Cash A/c 5,000 (rest SGST liability)

(Being adjustment of IGST credit & payment of remainder in cash)

Table:

Liability	Amount	Credit Source	Balance
CGST	10,000	IGST credit (10,000 used)	0
SGST	10,000	IGST credit leftover (5,000)	5,000 cash
Totals	20,000	IGST 15,000 + cash 5,000	0

Hinglish Explanation:

Pura output tax 20k hai, humare paas sirf IGST input 15k hai.
CGST 10k poora pay kiya IGST credit se, fir SGST 10k me se 5k use kiya, baaki 5k cash se bharna pada.
Entry me hum Output CGST & Output SGST ko Dr. karke uska payment dikha dete hain (To Input IGST and To Cash).

Example 14:

Goods Purchased with Trade Discount + GST

M/s PQR purchases goods with a list price of ₹1,00,000, subject to10% trade discount, plusIGST @ 18%. Show thejournal entryif payment is made in cash immediately.

Solution (Hinglish)

1.List price 1,00,000→less 10% T.D. =₹10,000→net 90,000.

2.IGST 18% of 90,000 = 16,200.

3.Total= 90,000 + 16,200 = ₹1,06,200.

Journal Entry:

Purchases A/c Dr. 90,000

Input IGST A/c Dr. 16,200

To Cash A/c 1,06,200

(Being goods purchased with 10% T.D. and IGST @18%, paid in cash)

Hinglish Explanation:

Sabse pehletrade discountminus karo, phir GST calculate.
IGST lag raha hai kyunki assume hum inter-state se kharid rahe.
Payment immediate, toh “To Cash A/c” credit hoga.

Example 15:

Capital Goods Purchase with GST

ABC Ltd. purchases amachinery(capital good) for ₹2,00,000 plusCGST 9%andSGST 9%. Payment made via bank. Show thejournal entry, assuming the input credit is allowed for capital goods as per rules.

Solution (Hinglish)

1.Machinery cost = 2,00,000.

2.CGST 9% = 18,000, SGST 9% = 18,000.

3.Total = ₹2,36,000.

4.Input tax credit on capital goods is typically claimable if used for business.

Journal Entry:

Machinery A/c Dr. 2,00,000

Input CGST A/c Dr. 18,000

Input SGST A/c Dr. 18,000

To Bank A/c 2,36,000

(Being capital goods purchased with CGST & SGST)

Hinglish Explanation:

Machinery ek capital asset, isliye hum “Machinery A/c” debit karte hain, plusInput CGST&Input SGST.
Payment bank se ho gaya, isliye “To Bank A/c.”
Later on, hum output liability me in input credits ko use kar sakte hain (subject to rules).

Hinglish Recap

Final Hinglish Recap

1.Intra-statetransactions peCGST + SGSTlagta hai;Inter-statepeIGSTlagta hai.

2.Purchases pe hum “Input GST” (asset) lete hain; sales pe “Output GST” (liability) record karte hain.

3.GST returns me humne jo input pay kiya hai, use output liability me set off kar sakte hain (subject to rules).

4.Purchase Returnme input GST reverse;Sales Returnme output GST reverse hota hai.

5.Utilisationof credit me pehle aap apni output type se matching inputs use karte ho (CGST→CGST), phir IGST credit ko CGST/SGST me use kar sakte ho. CGST credit directly SGST ke liye use nahi hota aur vice versa.

6.Reverse Chargeme buyer hi GST pay karta hai govt ko, phir input claim kar sakta hai.

7.Exportszero-rated hoti hain, output GST 0% charge hota hai.

8.IGST credit ko pehle IGST liability me adjust karte hain, baaki bache toh CGST/SGST me.

9.Trade Discountke baad hi GST lagta hai.

10.Capital goodspar bhi input credit mil sakta hai, isliye Machinery ke saath Input CGST/SGST accounts use karte hain.

In sab examples se aapko GST ke alag-alag scenarios(reverse charge, export, partial set off, trade discount, capital goods, etc.)samajhne me help milegi!

GST Solved Example

Example 1

On1st April, XYZ Traders purchased goods worth ₹50,000 from alocal supplier(intra-state). The supplier chargedCGST @ 9%andSGST @ 9%. Journalise the transaction.

Solution (Hinglish)

1.Yeintra-statepurchase hai, toh do taxes lagte hain: CGST aur SGST, dono 9%.

2.Cost of goods= 50,000.

3.CGST =9% of 50,000 = ₹4,500

4.SGST =9% of 50,000 = ₹4,500

5.Total Invoice= 50,000 + 4,500 + 4,500 = ₹59,000

Journal Entry Table:

Date	Particulars	L.F.	Debit (₹)	Credit (₹)
2025-Apr-01	Purchases A/cDr.		50,000
	Input CGST A/cDr.		4,500
	Input SGST A/cDr.		4,500
	ToCreditor / Bank A/c			59,000
	(Being goods purchased locally with 9% CGST & SGST)

Hinglish Explanation:

Humne local supplier se samaan khareeda (intra-state), isliyeCGST & SGSTlagate hain.
Purchases A/c ko debit karte hain (cost ₹50,000).
Input CGST/SGST (credit available) mein alag-alag amounts debit.
Total payablehum “Creditor A/c” (agar udhaar hai) ya “Bank A/c” (agar payment immediately) ko credit kar dete hain.

Example 2

ABC Ltd. purchasesraw materialsfrom a supplier in adifferent statefor ₹1,00,000 plusIGST @ 18%. Pass the journal entry.

Solution (Hinglish)

1.Inter-statetransaction hai, toh sirf IGST lagta hai.

2.Cost= 1,00,000.

3.IGST @18%= ₹18,000.

4.Total= ₹1,18,000.

Journal Entry Table:

Date	Particulars	L.F.	Debit (₹)	Credit (₹)
2025-May-05	Purchases A/cDr.		1,00,000
	Input IGST A/cDr.		18,000
	ToCreditor / Bank A/c			1,18,000
	(Being goods purchased inter-state @18% IGST)

Hinglish Explanation:

Dusre state se purchase kiya, isliye IGST lagta hai.
Purchases A/c aur Input IGST A/c debit hue (humare liye asset / input credit).
Creditor ya Bank credit hota hai as the payable or payment side.

Example 3

M/s PQR sold goods worth ₹80,000 to alocal customer(intra-state). They chargedCGST @ 9%andSGST @ 9%. Record the journal entry for thesale.

Solution (Hinglish)

1.Intra-state sale: CGST & SGST dono lagte hain.

2.Sale value= 80,000.

3.CGST @9% = 7,200; SGST @9% = 7,200.

4.Total invoice= 94,400.

Journal Entry Table:

Date	Particulars	L.F.	Debit (₹)	Credit (₹)
2025-Jun-01	Debtor / Cash A/cDr.		94,400
	ToSales A/c			80,000
	ToOutput CGST A/c			7,200
	ToOutput SGST A/c			7,200
	(Being local sale with 9% CGST & SGST)

Hinglish Explanation:

Sale karte waqt hum Sales A/c credit karte hain (80,000).
Output CGST & SGST credit hote hain (9% each).
Customer se jo amount lena hai (94,400) wo debit hota hai.

Example 4

ABC Pvt. Ltd. sells goods to abuyer in another statefor ₹1,50,000 plusIGST @ 18%. Pass thejournal entryfor the sale (assume credit sale).

Solution (Hinglish)

1.Inter-state sale: IGST lagta hai.

2.Sale = 1,50,000.

3.IGST 18% = 27,000.

4.Total invoice= 1,77,000.

Journal Entry Table:

Date	Particulars	L.F.	Debit (₹)	Credit (₹)
2025-Jul-10	Debtor A/cDr.		1,77,000
	ToSales A/c			1,50,000
	ToOutput IGST A/c			27,000
	(Being inter-state sale @18% IGST on credit)

Hinglish Explanation:

Jab aap dusri state mein sale karte ho,IGSTapply hota hai.
Debtor (customer) ko puri invoice value se debit karte hain (1,77,000).
Sales A/c aur Output IGST A/c ko credit karte hain.

Example 5

Solution (Hinglish)

1.Return kar rahe hain, matlabpurchase return.

2.Original purchase pe 9% CGST & 9% SGST tha.

3.On ₹10,000, CGST = ₹900, SGST = ₹900.

4.Purchase Returnentry often calls for reversing the earlier input.

Journal Entry Table:

Date	Particulars	Debit (₹)	Credit (₹)
2025-Aug-05	Creditor (Sam) A/cDr.	11,800
	ToPurchase Return A/c		10,000
	ToInput CGST A/c		900
	ToInput SGST A/c		900
(Being goods returned to Sam; reversing input)

Hinglish Explanation:

Purchase return se hum apni input GST bhi reverse kar dete hain (kyunki goods wapas).
Creditor ko debit karte hain kyunki ab unka payable kam ho jaayega.

(Some books reduce “Purchases A/c” directly, but “Purchase Return A/c” is also common.)

Example 6

ABC Traders had sold goods worth ₹20,000 (local) with CGST+SGST @ 9% each. Thecustomernowreturnsgoods worth half of that value. Pass thesales returnentry.

Solution (Hinglish)

1.Pehle humne local sale kiya tha, ₹20,000 + 9%+9%.

2.Ab half (i.e. ₹10,000 portion) ki goods wapas.

3.CGST = 9% of 10,000 = 900, SGST = 900.

4.Sales return se humOutput GSTbhi reverse kar dete hain.

Journal Entry Table:

Date	Particulars	Debit (₹)	Credit (₹)
2025-Aug-10	Sales Return A/cDr.	10,000
	Output CGST A/cDr.	900
	Output SGST A/cDr.	900
	ToDebtor / Customer A/c		11,800
(Being goods returned by customer)

Hinglish Explanation:

Jab customer ne goods wapas kiye, toh hum apni “Sales Return” account debit karte hain aurOutput GSTko bhi reverse kar dete hain.
Debtor’s account ko credit karte hain kyunki ab unka payable (to us) kam ho jaayega, or unhe hum refund/adjustment de rahe hain.

Example 7

Rahul & Co. buys goods worth ₹60,000 (intra-state, CGST+SGST @ 6% each) on credit. Theyimmediately pay ₹20,000, and the rest is due after 2 months. Pass the entries.

Solution (Hinglish)

1.Intra-state purchase, total GST = 12% (6% + 6%).

2.Tax on 60,000 = 3,600 (CGST 1,800 + SGST 1,800).

3.Invoice total = 60,000 + 3,600 = 63,600.

4.Immediately pay 20,000 out of 63,600, balance 43,600 due later.

Step 1: Purchase Entry

Date	Particulars	Debit (₹)	Credit (₹)
2025-Sep-01	Purchases A/cDr.	60,000
	Input CGST A/cDr.	1,800
	Input SGST A/cDr.	1,800
	ToCreditor A/c		63,600
(Being goods bought on credit)

Step 2: Immediate Part-Payment

Date	Particulars	Debit (₹)	Credit (₹)
2025-Sep-01	Creditor A/cDr.	20,000
	ToCash / Bank		20,000
(Being part-payment of purchase)

Hinglish Explanation:

Pehle humne pura invoice record kiya, total 63,600.
Phir usi din ₹20,000 pay kia, toh “Creditor A/c Dr. To Bank A/c.”
Baki 43,600 abhi outstanding.

Example 8

A firm purchased goods from aninter-statesupplier (Invoice ₹1,18,000 including IGST). Thebasic valueof goods is unknown. IGST @ 18%. Find thebasic costandIGSTamount, then pass thejournal entry.

Solution (Hinglish)

1.Total invoice = 1,18,000 (ye gross figure, jisme cost + 18% IGST included).

2.Let cost = x. Then x + 18% of x = 1,18,000→x (1 + 0.18) = 1.18x = 1,18,000. x=1,18,000/1.18=₹1,00,000.

3.IGST = 1,18,000 – 1,00,000 = ₹18,000 (or 18% of 1,00,000).

Journal Entry Table:

Date	Particulars	Debit (₹)	Credit (₹)
2025-Oct-10	Purchases A/cDr.	1,00,000
	Input IGST A/cDr.	18,000
	ToCreditor / Bank		1,18,000
(Being goods purchased inter-state, cost found by dividing total by 1.18)

Hinglish Explanation:

Humne reverse calculation se base cost (1,00,000) nikala. 18% on that is 18,000.
Phir journal entry pass kar di.

Example 9

Solution (Hinglish)

1.Output GST liability = 45,000 (assume CGST 22,500 + SGST 22,500 for simplicity).

2.Input GST available = 30,000. So partial set-off:

oOutput CGST Dr. 22,500

oOutput SGST Dr. 22,500

For simplicity, let’s do acombinedapproach (some textbooks just do a single “Input GST” if not differentiating).

Step 1: Adjust output with input:

Particulars	Debit (₹)	Credit (₹)
Output CGST A/c Dr.	22,500
Output SGST A/c Dr.	22,500
To Input CGST A/c	15,000
To Input SGST A/c	15,000
(Utilising input credit total 30,000)

Now total liability was 45,000, we used 30,000 input. Remaining 15,000 to be paid in cash:

Particulars	Debit (₹)	Credit (₹)
Output CGST A/c Dr.	(bal figure)
Output SGST A/c Dr.	(bal figure)
To Bank/Cash A/c	15,000
(Paying remaining in cash)

(Alternatively, you can combine into one entry, but stepwise is clearer.)

Hinglish Explanation:

Humari output liability 45k thi. Input credit 30k tha, usse adjust kar liya. Bacha 15k humne cash se pay kar diya.
Practically CGST credit SGST pe use nahi ho sakta; hum assume kar rahe hain unke input credits me sufficient distribution hogi.

Example 10

Solution (Hinglish)

Let’s do stepwise:

1. Set off Output IGST first

Output IGST = ₹3,000
We can useInput IGSTfirst. (IGST credit must be used first against IGST liability)
So Input IGST 12,000→use 3,000.
New Input IGST balance = 12,000 – 3,000 = 9,000.
Output IGST is now 0.

2. Output CGST = ₹8,000

Use leftover Input IGST (9,000) or Input CGST (5,000).
By rule: Input IGST can be used for CGST or SGST after IGST liability is done.
Suppose we first exhaust Input CGST = 5,000. Now CGST liability left = 3,000.
Then use Input IGST (9,000) for remaining 3,000 CGST. Now Input IGST left = 6,000.
Output CGST is now 0.

3. Output SGST = ₹8,000

We have Input SGST = 5,000, leftover Input IGST = 6,000.
First, use Input SGST = 5,000→SGST liability left = 3,000.
Use leftover Input IGST for that 3,000→now Input IGST = 6,000–3,000 = 3,000 leftover.
Output SGST is 0.

4. Final

All output taxes (CGST, SGST, IGST) are zero.
We still have Input IGST leftover = 3,000, but no more output liability. So no cash needed!

Tabular Summaries

Particular	Amount (₹)	Comments
Input Credits Initially
Input CGST	5,000
Input SGST	5,000
Input IGST	12,000
Output Liabilities
Output CGST	8,000
Output SGST	8,000
Output IGST	3,000
Step 1: Pay Output IGST 3,000 using Input IGST	–3,000	IGST credit left = 9,000
Step 2: Pay Output CGST 8,000	Use Input CGST 5,000 + leftover IGST 3,000 = 8,000	CGST paid fully, leftover IGST now 6,000
Step 3: Pay Output SGST 8,000	Use Input SGST 5,000 + leftover IGST 3,000 = 8,000	leftover IGST = 3,000
Result	–	All output tax = 0, leftover IGST = 3,000

Hinglish Explanation:

IGST credit ko pehle IGST liability me use karte hain. Bacha toh CGST/SGST me laga sakte hain. CGST credit sirf CGST→then IGST, SGST credit sirf SGST→then IGST.
Yahan humne systematically sab set off kiya. Koi cash pay karne ki zaroorat nahi padi because leftover IGST credit was enough.

Example 11:

Reverse Charge Mechanism (RCM) on Freight

Solution (Hinglish)

1.Reverse chargeka matlab: recipient (ABC) ko hi GST govt ko dena hoga.

2.Freight = 10,000, IGST @5% = ₹500.

3.ABC will record expense for freight + RCM liability. Then they can claimInput IGST(subject to RCM rules) if the supply is eligible.

Step-by-step

At the time of incurring expense:

Freight Expense Dr. (net + tax? Actually, under RCM, we separate the tax portion as liability to Govt, but eventually we also get input credit on it.)

Entry(simplified approach):

Freight (Expense) A/c Dr. 10,000

Input IGST (under RCM) A/c Dr. 500

To Cash/Bank A/c 10,000

To RCM IGST Payable A/c 500

(Being freight paid under RCM, IGST @5%)

Then,payment of RCM liabilityto govt:

RCM IGST Payable A/c Dr. 500

To Cash/Bank A/c 500

(Being IGST under RCM paid to Govt)

Because it’s RCM, ABC can claim that₹500asInput IGSTif it’s allowed (the second line in the first entry shows we recorded “Input IGST (RCM) A/c” also).

Table(one way to see it):

Particulars	Debit (₹)	Credit (₹)
1. Freight Expense A/c	10,000
2. Input IGST (RCM) A/c	500
To Bank A/c (freight paid)		10,000
To RCM IGST Payable A/c		500
(Freight cost + IGST under RCM)
RCM IGST Payable A/c Dr.	500
To Bank A/c (tax paid to Govt)		500
(RCM liability cleared)

Hinglish Explanation:

Yahan freight ek unregistered GTA se liya, tohreverse chargeke tahat ABC ko khud hi tax dena hai.
ABC entry mein freight expense debit, RCM IGST payable credit karti hai. Saath hi hum Input IGST (RCM) bhi create karte hain, jisse hum baad me offset kar sakte hain.
Lastly, RCM liability pay karke hum “RCM IGST Payable A/c” ko settle kar dete hain.

Example 12:

Export of Goods (Zero-Rated Supply)

Solution (Hinglish)

1.Exports= zero-rated, matlab 0% output tax.

2.If there was input GST on purchase side, the exporter can claim refund or adjust as per rules.

3.Saleentry has no GST portion on output side.

Journal Entry:

Debtor (Foreign Customer) A/c Dr. 2,00,000

To Sales A/c 2,00,000

(Being goods exported at zero-rated GST)

No “Output GST A/c” because export is zero-rated.

Hinglish Explanation:

Export par0%GST lagta hai, yaani aap output me kuch charge nahi karte.
Company apna input GST refund claim kar sakti hai (but that’s a separate procedure).
Yahan sale entry sirf basic amount ke liye pass hota hai, koi “Output GST” dikhaya nahi jaata.

Example 13:

Partial Use of IGST Credit

Solution (Hinglish)

1.Total output = CGST 10k + SGST 10k = ₹20k.

2.Input IGST = ₹15k.

3.IGST credit sabse pehle hum IGST liability me use karte, but yahan koi IGST output liability hi nahi. Toh ab hum CGST/SGST par use kar sakte hain.

4.ForCGST10k, hum IGST credit me se 10k use kar lete hain. Bach gaya input IGST = 5k.

5.Ab SGST liability 10k bachi, aur humare paas input IGST 5k. Hum 5k use kar sakte hain. Bacha SGST liability 5k hum cash se pay karenge.

Entry(Simplified approach):

Output CGST A/c Dr. 10,000

Output SGST A/c Dr. 10,000

To Input IGST A/c 15,000 (partial usage)

To Bank/Cash A/c 5,000 (rest SGST liability)

(Being adjustment of IGST credit & payment of remainder in cash)

Table:

Liability	Amount	Credit Source	Balance
CGST	10,000	IGST credit (10,000 used)	0
SGST	10,000	IGST credit leftover (5,000)	5,000 cash
Totals	20,000	IGST 15,000 + cash 5,000	0

Hinglish Explanation:

Pura output tax 20k hai, humare paas sirf IGST input 15k hai.
CGST 10k poora pay kiya IGST credit se, fir SGST 10k me se 5k use kiya, baaki 5k cash se bharna pada.
Entry me hum Output CGST & Output SGST ko Dr. karke uska payment dikha dete hain (To Input IGST and To Cash).

Example 14:

Goods Purchased with Trade Discount + GST

M/s PQR purchases goods with a list price of ₹1,00,000, subject to10% trade discount, plusIGST @ 18%. Show thejournal entryif payment is made in cash immediately.

Solution (Hinglish)

1.List price 1,00,000→less 10% T.D. =₹10,000→net 90,000.

2.IGST 18% of 90,000 = 16,200.

3.Total= 90,000 + 16,200 = ₹1,06,200.

Journal Entry:

Purchases A/c Dr. 90,000

Input IGST A/c Dr. 16,200

To Cash A/c 1,06,200

(Being goods purchased with 10% T.D. and IGST @18%, paid in cash)

Hinglish Explanation:

Sabse pehletrade discountminus karo, phir GST calculate.
IGST lag raha hai kyunki assume hum inter-state se kharid rahe.
Payment immediate, toh “To Cash A/c” credit hoga.

Example 15:

Capital Goods Purchase with GST

ABC Ltd. purchases amachinery(capital good) for ₹2,00,000 plusCGST 9%andSGST 9%. Payment made via bank. Show thejournal entry, assuming the input credit is allowed for capital goods as per rules.

Solution (Hinglish)

1.Machinery cost = 2,00,000.

2.CGST 9% = 18,000, SGST 9% = 18,000.

3.Total = ₹2,36,000.

4.Input tax credit on capital goods is typically claimable if used for business.

Journal Entry:

Machinery A/c Dr. 2,00,000

Input CGST A/c Dr. 18,000

Input SGST A/c Dr. 18,000

To Bank A/c 2,36,000

(Being capital goods purchased with CGST & SGST)

Hinglish Explanation:

Machinery ek capital asset, isliye hum “Machinery A/c” debit karte hain, plusInput CGST&Input SGST.
Payment bank se ho gaya, isliye “To Bank A/c.”
Later on, hum output liability me in input credits ko use kar sakte hain (subject to rules).

Hinglish Recap

Final Hinglish Recap

1.Intra-statetransactions peCGST + SGSTlagta hai;Inter-statepeIGSTlagta hai.

2.Purchases pe hum “Input GST” (asset) lete hain; sales pe “Output GST” (liability) record karte hain.

3.GST returns me humne jo input pay kiya hai, use output liability me set off kar sakte hain (subject to rules).

4.Purchase Returnme input GST reverse;Sales Returnme output GST reverse hota hai.

6.Reverse Chargeme buyer hi GST pay karta hai govt ko, phir input claim kar sakta hai.

7.Exportszero-rated hoti hain, output GST 0% charge hota hai.

8.IGST credit ko pehle IGST liability me adjust karte hain, baaki bache toh CGST/SGST me.

9.Trade Discountke baad hi GST lagta hai.

10.Capital goodspar bhi input credit mil sakta hai, isliye Machinery ke saath Input CGST/SGST accounts use karte hain.

In sab examples se aapko GST ke alag-alag scenarios(reverse charge, export, partial set off, trade discount, capital goods, etc.)samajhne me help milegi!