UTGST Act, 2017 — Chapter III — Levy and Collection of Tax…

UNION TERRITORY GOODS AND SERVICES TAX ACT, 2017 Chapter III — LEVY AND COLLECTION OF TAX (Sections 7-8) Chapter Index — fourteen-section architecture Effective from 1 July 2017…

Chapter Index — fourteen-section architecture

Effective from 1 July 2017 (UTGST Act, 2017) | First Edition | May 2026

[UTGST charging section + exemption power — substantive heart of UTGST regime for UTs without Legislature; parallel framework with CGST s. 9-11]

1. Scope at a Glance

Chapter III UTGST (ss. 7-8) is the substantive heart of UTGST for intra-UT supplies in UTs without Legislature. Section 7 is the charging section with five sub-sections covering substantive charge (max 20%), petroleum deferral, RCM on notified categories, substituted RCM for notified class from unregistered (real-estate per Notif 7/2019), and ECO deemed-supplier framework. Section 8 provides exemption power mirroring CGST s. 11 and IGST s. 6.

2. Section-by-Section Synopsis

SECTION	SYNOPSIS
Section 7 — Levy and collection	Five sub-sections; substantive charge max 20%; petroleum deferral; RCM s. 7(3); substituted s. 7(4) for notified class from unregistered (FA 2018); ECO deemed-supplier s. 7(5).
Section 8 — Exemption power	Three sub-sections + Explanation; general exemption by notification (absolute / conditional); special exemption by order in exceptional cases; Explanation insertion within one year.

3. Key Doctrines

DOCTRINE	SOURCE
Maximum rate 20% cap	s. 7(1) — outer constitutional boundary for UT tax component.
Mohit Minerals composite-supply + Council persuasive	(2022) 10 SCC 700.
Petroleum deferral framework	s. 7(2) — not yet notified.
Substituted s. 7(4) narrowed scope post FA 2018	Effective 01.02.2019.
ECO deemed-supplier under s. 7(5)	Mirror of CGST s. 9(5).
Dilip Kumar strict-then-liberal exemption	(2018) 9 SCC 1.
Vatika Township prospectivity	For amendments + Explanations.
Mafatlal unjust enrichment	For refund disputes.
Absolute-exemption no-collection rule	Explanation to s. 8.
Council-recommendation pre-condition	For all exemptions.

4. Amendment Timeline

DATE	CHANGE
01.07.2017	Chapter III in force per Notif 3/2017-UT(T).
28.06.2017	Operative Notifications — 1/2017, 11/2017, 4/2017, 13/2017, 17/2017, 2/2017, 12/2017 UT(T)(R).
05.07.2017	Notification 18/2017-UT(T)(R) — SEZ exemption.
13.10.2017	Original s. 7(4) RCM suspended via parallel UT notification.
01.02.2019	UTGST Amendment Act 2018 — substituted s. 7(4).
29.03.2019	Notification 7/2019-UT(T)(R) — real-estate RCM under substituted sub-section.
01.01.2022	Notif 17/2021-UT(T)(R) — restaurant added to ECO framework.
Various amendments to rate notifications	Periodic.

5. Forms

FORM	PURPOSE
Tax invoice (Rule 46)	Show CGST + UTGST particulars.
GSTR-1 / GSTR-3B	Standard returns via s. 21 framework.
Form REG-01	Registration in UT.
Bill of Entry	For imports (IGST framework).
Form RFD-01	Refund applications.
Self-invoice (Rule 36)	For RCM on unregistered.

6. Due-Date Footprint

TRIGGER	TIMELINE
Tax payment	Time of supply per CGST ss. 12-14 via s. 21.
GSTR-3B monthly	20th / 22nd / 24th.
GSTR-1 monthly	11th; QRMP IFF 13th.
Rate-notification effective dates	Per notification.

7. Filing Frequency / Reporting

Monthly GSTR-1 — POS-wise intra-UT reporting.
Monthly GSTR-3B — Tables 3.1(a)/(b)/(c)/(d).
Quarterly QRMP option.
Annual GSTR-9 / 9C.

8. CBIC Notifications

NOTIF	SUBJECT
Notif 1/2017-UT(T)(R)	Goods rate.
Notif 11/2017-UT(T)(R)	Services rate.
Notif 4/2017-UT(T)(R)	RCM goods.
Notif 13/2017-UT(T)(R)	RCM services.
Notif 17/2017-UT(T)(R)	ECO framework.
Notif 2/2017-UT(T)(R)	Exempt goods.
Notif 12/2017-UT(T)(R)	Exempt services.
Notif 18/2017-UT(T)(R)	SEZ exemption.
Notif 7/2019-UT(T)(R)	Real-estate RCM under substituted s. 7(4).
UTGST Amendment Act 2018	Substituted s. 7(4).

9. Sectoral Pointers

SECTOR	POINTERS
Intra-UT manufacturers / traders	CGST + UTGST framework.
Real-estate promoters in UTs	Substituted s. 7(4) + Notif 7/2019-UT(T)(R).
E-commerce in UTs	s. 7(5) + Notif 17/2017-UT(T)(R).
Healthcare / education in UTs	Exempt under Notif 12/2017-UT(T)(R).
SEZ in UTs (Chandigarh SEZ)	Notif 18/2017-UT(T)(R) + zero-rated framework.
Petroleum / alcohol	Deferred / outside GST.

10. Practitioner Quick-Reference

SITUATION	ANSWER
Maximum UTGST rate?	20% per s. 7(1).
Petroleum?	Deferred per s. 7(2); not yet notified.
RCM under s. 7(4)?	Notified class (real-estate) per Notif 7/2019.
ECO services in UT?	s. 7(5) + Notif 17/2017 framework.
Absolute exemption + collection?	Barred per Explanation to s. 8.
Council recommendation required?	Yes pre-condition for exemption.

11. Cross-Chapter Coordination

Chapter I (ss. 1-2) — Definitional foundation.
Chapter II (ss. 3-6) — Officer administration.
Chapter IV (ss. 9-10) — Payment + ITC transfer.
Chapter V (s. 11) — Officers assist.
Chapter VI (ss. 12-13) — Demands.
Chapter VII (ss. 14-16) — Advance ruling.
Chapter VIII (ss. 17-20) — Transitional.
Chapter IX (ss. 21-26) — s. 21 applies CGST framework.
CGST s. 9 + 11 — Parallel charging + exemption.
IGST s. 5 + 6 — Inter-State framework.
SGST Acts — Parallel for UT-with-Legislature.

12. File-Link Navigation

FILE	COVERAGE
00 - Chapter III Index.docx (this file)	Chapter-level index.
Section 7 - Levy and collection.docx	UTGST charging section.
Section 8 - Power to grant exemption from tax.docx	UTGST exemption power.

13. External Anchors

Article 246A — Concurrent GST competence.
Article 269A — Apportionment context.
CGST Act ss. 9, 11 — Parallel framework.
IGST Act ss. 5, 6 — Inter-State framework.
Council recommendations — Pre-condition.
Operative notifications — Goods + services rate; RCM; ECO; exempt; SEZ.

14. Key Takeaways

Section 7 is UTGST charging section — every UTGST liability traces here.
Maximum rate 20% cap is outer constitutional boundary.
RCM under s. 7(3) per Notif 4/2017 + 13/2017-UT(T)(R).
Substituted s. 7(4) post FA 2018 narrowed scope to notified class (real-estate per Notif 7/2019).
ECO deemed-supplier under s. 7(5) mirrors CGST s. 9(5).
Petroleum deferred under s. 7(2); not yet notified.
Section 8 exemption power mirrors CGST s. 11 + IGST s. 6.
Dilip Kumar strict-then-liberal exemption construction applies.
Absolute-exemption no-collection rule per Explanation to s. 8.
Mohit Minerals doctrinal anchor applies for RCM scope + Council recommendations persuasive.
Vatika Township prospectivity for amendments.
Coordinate UTGST notifications with parallel CGST notifications.
For maximum-rate disputes, 20% cap is outer boundary.
For audit defence, exhibit Council recommendation + Notification framework.
Periodic CBIC notification review essential.

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