Section 2 of the Central Goods and Services Tax Act, 2017 (CGST Act) contains the definitions of important words and expressions used throughout the Act. It is one of the most important sections of the CGST Act because many provisions cannot be properly understood without first knowing how particular terms are legally defined.
The current text of the CGST Act maintained by India Code is updated through amendments including the Finance Act, 2026. Section 2 contains a large number of definitions covering terms related to supply, business, goods, services, registration, input tax credit, taxable persons, places of business, returns, reverse charge and several other GST concepts.
What is Section 2 of the CGST Act?
Section 2 is titled “Definitions.”
The opening words of Section 2 state that the definitions apply “unless the context otherwise requires.” This means that the meanings provided in Section 2 are the statutory meanings of those terms for the purposes of the CGST Act, subject to the context in which they are used.
The section contains definitions numbered from clause (1) onwards, covering a wide range of GST terminology. Some definitions have also been inserted, amended or substituted over time through various Finance Acts and GST amendment Acts.
Why is Section 2 Important Under GST?
GST legislation uses many technical terms that may have a different meaning in ordinary language.
For example, the word “goods” generally has a broad everyday meaning. However, under Section 2(52) of the CGST Act, “goods” has a specific statutory meaning.
Similarly, terms such as:
- Supply
- Business
- Goods
- Services
- Person
- Supplier
- Recipient
- Consideration
- Taxable person
- Taxable supply
- Exempt supply
- Input
- Input service
- Input tax
- Input tax credit
- Aggregate turnover
- Composite supply
- Mixed supply
- Reverse charge
have specific meanings under GST law.
Therefore, when reading another provision of the CGST Act, the meaning given to these terms under Section 2 should be considered.
Important Definitions Under Section 2 of CGST Act
Section 2 contains a large number of definitions. Some are highly technical and are mainly relevant to specific provisions, while others are used throughout the GST framework.
The following are some of the most important definitions.
Section 2(1): Actionable Claim
Section 2(1) provides that “actionable claim” has the same meaning as assigned to it in Section 3 of the Transfer of Property Act, 1882.
An actionable claim is therefore not independently defined in detail in the CGST Act. Its meaning is linked to the definition under the Transfer of Property Act.
This term becomes relevant because the GST treatment of certain actionable claims depends on the specific provisions of the GST law.
Section 2(5): Agent
An agent means a person who carries on the business of supply or receipt of goods or services or both on behalf of another person.
The definition specifically includes persons such as:
- Factor
- Broker
- Commission agent
- Arhatia
- Del credere agent
- Auctioneer
- Other mercantile agents
The name used for the person is not decisive if the person performs the relevant role described in the definition.
Section 2(6): Aggregate Turnover
Aggregate turnover is an important GST concept, particularly for determining registration-related thresholds and other compliance requirements.
It includes the aggregate value of:
- Taxable supplies
- Exempt supplies
- Exports of goods or services or both
- Inter-State supplies
The calculation is made for persons having the same PAN on an all-India basis.
However, certain amounts are excluded, including:
- Central tax
- State tax
- Union territory tax
- Integrated tax
- Cess
- Inward supplies on which tax is payable under reverse charge
Therefore, aggregate turnover should not be confused with the total amount appearing on a business’s invoices or bank statements.
Section 2(7): Agriculturist
An agriculturist means an individual or a Hindu Undivided Family undertaking cultivation of land:
- By their own labour;
- By the labour of their family; or
- By servants on wages payable in cash or kind or by hired labour under personal supervision or the personal supervision of a family member.
This definition is relevant to specific GST provisions concerning agriculturists.
Section 2(11): Assessment
Under Section 2(11), assessment means determination of tax liability under the CGST Act.
It includes:
- Self-assessment
- Re-assessment
- Provisional assessment
- Summary assessment
- Best judgment assessment
This definition is important because GST assessment is not limited to one particular type of tax determination.
Section 2(13): Audit
Audit means examination of records, returns and other documents maintained or furnished by a registered person.
The purpose includes verifying:
- Correctness of declared turnover
- Taxes paid
- Refund claimed
- Input tax credit availed
- Compliance with the CGST Act and the rules
Therefore, GST audit involves more than simply checking the amount of tax paid.
Section 2(17): Business
The definition of business under the CGST Act is considerably wider than the ordinary understanding of the word.
It includes activities such as:
- Trade
- Commerce
- Manufacture
- Profession
- Vocation
- Adventure
- Wager
- Similar activities
It can also include activities connected with or incidental to such activities.
Importantly, the definition does not make the existence of a pecuniary benefit a necessary condition in every case.
The definition also covers certain activities of clubs, associations and societies, admission to premises for consideration, certain office-related services, specified race club activities and certain activities or transactions undertaken by governments or local authorities in their capacity as public authorities.
Section 2(19): Capital Goods
Capital goods means goods whose value is capitalised in the books of account of the person claiming input tax credit and which are used or intended to be used in the course or furtherance of business.
This definition is particularly important when dealing with input tax credit on assets used for business purposes.
Section 2(20): Casual Taxable Person
A casual taxable person is a person who occasionally undertakes transactions involving the supply of goods or services or both in the course or furtherance of business in a State or Union territory where the person has no fixed place of business.
For example, a business that normally operates from one State but temporarily undertakes taxable business activities in another State without having a fixed place of business there may fall within this definition, subject to the applicable GST provisions.
Section 2(21): Central Tax
Central tax means the Central Goods and Services Tax levied under Section 9 of the CGST Act.
This is the central component of GST charged under the CGST framework on supplies to which the CGST Act applies.
Section 2(24): Commissioner
The definition of Commissioner includes the Commissioner of Central Tax and the Principal Commissioner of Central Tax appointed under Section 3.
It also includes the Commissioner of Integrated Tax appointed under the Integrated Goods and Services Tax Act.
Section 2(26): Common Portal
The common portal means the common goods and services tax electronic portal referred to in Section 146.
The GST electronic portal plays an important role in GST registration, returns, payments and other electronic compliance activities.
Section 2(30): Composite Supply
A composite supply is a supply made by a taxable person to a recipient consisting of two or more taxable supplies of goods or services or both, or any combination of them, which are:
- Naturally bundled;
- Supplied in conjunction with each other in the ordinary course of business; and
- Include one principal supply.
Example of Composite Supply
Suppose a supplier provides goods along with packing, transportation and insurance as part of one naturally bundled transaction.
If the supply of goods is the principal supply and the other elements are ancillary to it, the transaction can constitute a composite supply.
Section 2 itself gives an illustration involving goods, packing, transportation and insurance.
The tax treatment of a composite supply is dealt with separately under Section 8.
Section 2(31): Consideration
Consideration in relation to the supply of goods or services or both includes payment made or to be made, whether in money or otherwise, in respect of, in response to or for the inducement of the supply.
It can be provided by:
- The recipient; or
- Any other person.
The definition also covers the monetary value of an act or forbearance connected with the supply.
However, certain government subsidies are excluded from the definition.
A deposit given in respect of a supply is not treated as payment for that supply unless the supplier applies the deposit as consideration for the supply.
Section 2(32): Continuous Supply of Goods
A continuous supply of goods refers to a supply of goods that is provided or agreed to be provided continuously or on a recurrent basis under a contract.
The supplier generally invoices the recipient on a regular or periodic basis.
The definition can cover supplies made through methods such as:
- Wire
- Cable
- Pipeline
- Other conduit
subject to the conditions provided under the law.
Section 2(33): Continuous Supply of Services
A continuous supply of services means a supply of services that is provided or agreed to be provided continuously or on a recurrent basis under a contract for a period exceeding three months with periodic payment obligations.
The definition also includes other supplies of services that may be specified by the Government through notification subject to prescribed conditions.
Section 2(34): Conveyance
Conveyance includes:
- Vessel
- Aircraft
- Vehicle
The term is relevant in various GST provisions, including provisions dealing with transportation and goods in movement.
Section 2(36): GST Council
The Council means the Goods and Services Tax Council established under Article 279A of the Constitution.
The GST Council plays an important role in India’s GST framework because many GST provisions and rates operate based on recommendations of the Council.
Section 2(37): Credit Note
A credit note means a document issued by a registered person under Section 34(1) of the CGST Act.
Credit notes are used in circumstances covered by Section 34, such as situations involving a reduction in taxable value or tax charged, subject to the conditions of the law.
Section 2(38): Debit Note
A debit note means a document issued by a registered person under Section 34(3) of the CGST Act.
It is relevant when the taxable value or tax charged in the original tax invoice is lower than the amount actually payable in circumstances covered by the law.
Section 2(39): Deemed Exports
Deemed exports means such supplies of goods as may be notified under Section 147.
Deemed exports are therefore different from ordinary exports of goods outside India. Their treatment is governed by the specific GST provisions and notifications applicable to them.
Section 2(44): Electronic Commerce
Electronic commerce means the supply of goods or services or both, including digital products, over a digital or electronic network.
This definition provides the legal foundation for dealing with supplies made through electronic networks.
Section 2(45): Electronic Commerce Operator
An electronic commerce operator means a person who owns, operates or manages a digital or electronic facility or platform for electronic commerce.
This definition is particularly relevant to businesses operating online marketplaces and platforms.
Section 2(47): Exempt Supply
An exempt supply means a supply of goods or services or both that:
- Attracts a nil rate of tax;
- Is wholly exempt from tax under Section 11 of the CGST Act or Section 6 of the IGST Act; or
- Is a non-taxable supply.
The definition therefore covers more than supplies that are simply notified as exempt.
Section 2(52): Goods
Section 2(52) defines goods as every kind of movable property other than:
- Money; and
- Securities.
However, the definition includes certain items such as:
- Actionable claims
- Growing crops
- Grass
- Things attached to or forming part of land that are agreed to be severed before supply or under a contract of supply
This definition is important because GST treatment often depends on whether a transaction involves goods or services.
Section 2(56): India
For the purposes of the CGST Act, India includes the territory of India as referred to in Article 1 of the Constitution, along with specified maritime zones and airspace.
The definition covers:
- Territorial waters
- Seabed and sub-soil underlying such waters
- Continental shelf
- Exclusive Economic Zone
- Other maritime zones covered by the relevant law
- Airspace above the territory and territorial waters
Therefore, the statutory definition is broader than simply referring to India’s land territory.
Section 2(59): Input
Input means any goods other than capital goods used or intended to be used by a supplier in the course or furtherance of business.
This distinction is important because capital goods are separately defined under Section 2(19).
Section 2(60): Input Service
Input service means any service used or intended to be used by a supplier in the course or furtherance of business.
Input services are an important part of the input tax credit framework.
Section 2(61): Input Service Distributor
The definition of Input Service Distributor (ISD) has been amended over time.
Under the current provision, an Input Service Distributor refers to an office of the supplier of goods or services or both that receives tax invoices for input services, including specified services liable to tax under reverse charge provisions, for or on behalf of distinct persons and is liable to distribute the input tax credit in the manner provided under Section 20.
The current definition reflects amendments effective from 1 April 2025, making it important to rely on the current statutory text rather than older GST articles.
Section 2(62): Input Tax
Input tax in relation to a registered person includes Central Tax, State Tax, Integrated Tax and Union Territory Tax charged on supplies made to that person.
It also includes specified taxes relating to imports and reverse charge supplies covered under the relevant provisions.
However, tax paid under the composition levy is excluded from the definition of input tax.
Section 2(63): Input Tax Credit
Input Tax Credit (ITC) means the credit of input tax.
In simple terms, ITC is the credit available to an eligible registered person in respect of input tax, subject to the conditions and restrictions provided under the GST law.
The detailed eligibility and conditions for taking ITC are primarily dealt with under Section 16 and related provisions.
Section 2(68): Job Work
Job work means any treatment or process undertaken by a person on goods belonging to another registered person.
The person carrying out the treatment or process is called the job worker.
Job work is an important GST concept because special provisions apply to goods sent for job work, including provisions under Section 19 and Section 143.
Section 2(74): Mixed Supply
A mixed supply means two or more individual supplies of goods or services, or any combination of them, made together by a taxable person for a single price, where the supply does not qualify as a composite supply.
Example of Mixed Supply
Suppose a single package contains:
- Canned food
- Sweets
- Chocolates
- Cakes
- Dry fruits
- Aerated drinks
- Fruit juices
and all of these are supplied for one single price, while each item can independently be supplied and is not dependent on another item.
This can constitute a mixed supply when the statutory conditions are satisfied.
The tax treatment of mixed supplies is covered under Section 8.
Composite Supply vs Mixed Supply
The distinction between composite supply and mixed supply is important under GST.
| Basis | Composite Supply | Mixed Supply |
|---|---|---|
| Nature | Two or more taxable supplies naturally bundled | Two or more individual supplies supplied together |
| Principal supply | Present | Not applicable |
| Natural bundling | Required | Not required |
| Single price | May be involved | Supplied for a single price |
| Tax treatment | Taxed as the principal supply | Taxed according to the applicable rule for mixed supply |
The distinction should be determined based on the actual nature of the transaction and the statutory definitions.
Section 2(75): Money
The definition of money includes Indian legal tender and foreign currency and certain specified instruments when used to settle an obligation or exchange with Indian legal tender.
The definition includes instruments such as:
- Cheques
- Promissory notes
- Bills of exchange
- Letters of credit
- Drafts
- Pay orders
- Traveller cheques
- Money orders
- Postal or electronic remittances
It does not include currency held for its numismatic value.
Section 2(77): Non-Resident Taxable Person
A non-resident taxable person means a person who occasionally undertakes transactions involving the supply of goods or services or both, whether as principal, agent or otherwise, but has no fixed place of business or residence in India.
This definition is relevant to businesses or persons located outside India who undertake taxable activities in India under the circumstances covered by GST law.
Section 2(78): Non-Taxable Supply
Non-taxable supply means a supply of goods or services or both that is not leviable to tax under the CGST Act or the IGST Act.
This is different from an exempt supply, although both may have specific consequences under the GST framework.
Section 2(80A): Online Gaming
The current CGST Act defines online gaming as offering a game on the internet or an electronic network and includes online money gaming.
This definition was inserted with effect from 1 October 2023.
Section 2(80B): Online Money Gaming
Online money gaming refers to online gaming where players pay or deposit money or money’s worth, including virtual digital assets, with the expectation of winning money or money’s worth.
The definition covers games, schemes, competitions or other activities or processes regardless of whether the outcome is based on skill, chance or both.
Section 2(82): Output Tax
Output tax means the tax chargeable under the CGST Act on taxable supplies of goods or services or both made by a taxable person or the person’s agent.
However, it excludes tax payable under the reverse charge mechanism.
This distinction is important when calculating tax liability and considering input tax credit.
Section 2(83): Outward Supply
Outward supply means the supply of goods or services or both made or agreed to be made by a taxable person in the course or furtherance of business.
It can include supply by:
- Sale
- Transfer
- Barter
- Exchange
- Licence
- Rental
- Lease
- Disposal
- Other modes
The definition is important when dealing with GST returns and reporting of outward supplies.
Section 2(84): Person
The definition of person is broad and includes:
- Individual
- Hindu Undivided Family
- Company
- Firm
- Limited Liability Partnership
- Association of persons
- Body of individuals
- Certain corporations
- Government company
- Foreign body corporate
- Cooperative society
- Local authority
- Central Government
- State Government
- Society
- Trust
- Artificial juridical person
This broad definition ensures that GST provisions can apply to different types of legal and business entities.
Section 2(85): Place of Business
Place of business includes a place from which business is ordinarily carried on.
It can also include:
- Warehouse
- Godown
- Place where goods are stored
- Place where goods or services are supplied or received
- Place where books of account are maintained
- Place where business is carried on through an agent
This definition is important for GST registration and determining business locations.
Section 2(86): Place of Supply
Place of supply means the place of supply referred to in Chapter V of the Integrated Goods and Services Tax Act.
Therefore, the detailed rules for determining the place of supply are primarily found in the IGST Act.
Section 2(90): Principal Supply
Principal supply means the supply of goods or services that constitutes the predominant element of a composite supply and to which other supplies forming part of that composite supply are ancillary.
The concept of principal supply is especially important when determining the tax treatment of a composite supply under Section 8.
Section 2(93): Recipient
The recipient of a supply means the person who receives the goods or services or both, subject to the specific rules provided in the definition.
Where consideration is payable, the recipient is generally the person liable to pay that consideration.
Where no consideration is payable for goods, the recipient can be the person to whom the goods are delivered, made available, or whose possession or use is provided.
For services without consideration, the recipient is generally the person to whom the service is rendered.
Section 2(94): Registered Person
A registered person means a person who is registered under Section 25.
However, a person having a Unique Identity Number (UIN) is excluded from this definition.
Section 2(98): Reverse Charge
Reverse charge means the liability to pay tax by the recipient of the supply instead of the supplier, in the circumstances covered by the relevant provisions of the CGST Act or IGST Act.
Under normal GST transactions, the supplier generally charges and pays the applicable tax. Under reverse charge, the liability can shift to the recipient when the law specifically provides for it.
Section 2(101): Securities
Securities have the same meaning as assigned to them under Section 2(h) of the Securities Contracts (Regulation) Act, 1956.
The definition is important because securities are excluded from the definitions of both goods and services under the CGST Act.
Section 2(102): Services
The definition of services is broad.
It means anything other than:
- Goods
- Money
- Securities
However, it includes activities relating to the use of money or its conversion by cash or another mode from one form, currency or denomination to another where a separate consideration is charged.
The section also clarifies that services include facilitating or arranging transactions in securities.
Section 2(102A): Specified Actionable Claim
The current definition of specified actionable claim includes actionable claims involved in or by way of:
- Betting
- Casinos
- Gambling
- Horse racing
- Lottery
- Online money gaming
This provision was inserted with effect from 1 October 2023.
Section 2(105): Supplier
A supplier means the person supplying the goods or services or both.
The definition also includes an agent acting on behalf of the supplier.
The current provision contains additional rules relating to persons who organise or arrange the supply of specified actionable claims, including certain digital or electronic platforms.
Section 2(107): Taxable Person
A taxable person means a person who is registered or liable to be registered under Section 22 or Section 24.
Therefore, the concept of a taxable person is directly connected with GST registration provisions.
Section 2(108): Taxable Supply
A taxable supply means a supply of goods or services or both that is leviable to tax under the CGST Act.
Not every transaction involving goods or services automatically becomes a taxable supply. The relevant provisions, exemptions and other conditions must be considered.
Section 2(109): Taxable Territory
Taxable territory means the territory to which the provisions of the CGST Act apply.
This definition is relevant when determining whether a transaction falls within the territorial scope of the Act.
Section 2(112): Turnover in State or Union Territory
Turnover in State or turnover in Union territory refers to the aggregate value of specified taxable and exempt supplies made within a State or Union territory by a taxable person, along with specified exports and inter-State supplies made from that State or Union territory.
Central tax, State tax, Union territory tax, Integrated tax and cess are excluded from the calculation.
Section 2(114): Union Territory
Section 2(114) defines Union territory for the purposes of the CGST Act.
The definition refers to the Union Territories covered under the Act and treats each territory specified in the provision as a separate Union territory for the purposes of the legislation.
Section 2(117): Valid Return
A valid return means a return furnished under Section 39(1) on which the self-assessed tax has been paid in full.
Therefore, simply submitting a return does not necessarily make it a valid return for purposes where the statutory definition requires payment of the self-assessed tax in full.
Section 2(117A): Virtual Digital Asset
The CGST Act provides that virtual digital asset has the same meaning as assigned to it under Section 2(47A) of the Income-tax Act, 1961.
This definition was inserted with effect from 1 October 2023.
Section 2(118): Voucher
A voucher means an instrument where there is an obligation to accept it as consideration or part consideration for a supply of goods or services or both.
The goods or services to be supplied, or the identities of potential suppliers, must be indicated on the instrument itself or in related documentation, including its terms and conditions.
Section 2(119): Works Contract
A works contract means a contract for activities such as:
- Building
- Construction
- Fabrication
- Completion
- Erection
- Installation
- Fitting out
- Improvement
- Modification
- Repair
- Maintenance
- Renovation
- Alteration
- Commissioning
of an immovable property, where transfer of property in goods is involved in the execution of the contract.
The definition is important because GST specifically treats works contract as a supply of services under the relevant provisions.
Section 2(120): Undefined Terms
Section 2(120) provides an important interpretational rule.
Words and expressions used in the CGST Act but not defined in the Act, and which are defined in the:
- Integrated Goods and Services Tax Act
- Union Territory Goods and Services Tax Act
- Goods and Services Tax (Compensation to States) Act
will have the meanings assigned to them in those respective Acts.
Important GST Terms Defined Under Section 2
For quick reference, some of the most frequently used definitions can be summarised as follows:
| Section 2 Clause | Term | Simple Meaning |
|---|---|---|
| 2(5) | Agent | Person supplying or receiving goods/services on behalf of another |
| 2(6) | Aggregate Turnover | Specified turnover calculated on an all-India PAN basis |
| 2(11) | Assessment | Determination of tax liability |
| 2(13) | Audit | Examination of records and returns for GST compliance |
| 2(17) | Business | Broad range of commercial and specified activities |
| 2(19) | Capital Goods | Goods capitalised in books and used for business |
| 2(20) | Casual Taxable Person | Person occasionally supplying in a State/UT without fixed place of business |
| 2(30) | Composite Supply | Naturally bundled supplies with a principal supply |
| 2(31) | Consideration | Payment or monetary value connected with a supply |
| 2(45) | Electronic Commerce Operator | Person operating an electronic commerce platform |
| 2(47) | Exempt Supply | Supply attracting nil rate or wholly exempt, including non-taxable supply |
| 2(52) | Goods | Movable property subject to statutory exclusions and inclusions |
| 2(59) | Input | Goods other than capital goods used for business |
| 2(60) | Input Service | Services used for business |
| 2(63) | Input Tax Credit | Credit of eligible input tax |
| 2(68) | Job Work | Treatment or process on goods belonging to another registered person |
| 2(74) | Mixed Supply | Multiple individual supplies sold together for one price |
| 2(75) | Money | Legal tender and specified monetary instruments |
| 2(78) | Non-Taxable Supply | Supply not leviable to tax under CGST/IGST law |
| 2(82) | Output Tax | Tax chargeable on taxable outward supplies, excluding specified reverse charge tax |
| 2(83) | Outward Supply | Supply made or agreed to be made in business |
| 2(84) | Person | Broad range of individuals and legal entities |
| 2(93) | Recipient | Person receiving or liable for the supply |
| 2(94) | Registered Person | Person registered under Section 25, excluding UIN holder |
| 2(98) | Reverse Charge | Tax liability shifted to recipient where law provides |
| 2(102) | Services | Anything other than goods, money and securities, subject to statutory inclusions |
| 2(105) | Supplier | Person supplying goods or services |
| 2(107) | Taxable Person | Person registered or liable for registration under specified provisions |
| 2(108) | Taxable Supply | Supply leviable to tax under the CGST Act |
| 2(119) | Works Contract | Specified contract relating to immovable property involving transfer of goods |
Difference Between Important Section 2 Definitions
Some definitions under Section 2 are closely related and are often confused with one another.
Goods vs Services
Goods generally cover movable property subject to the statutory definition.
Services cover anything other than goods, money and securities, subject to the specific wording of Section 2(102).
This distinction is fundamental to GST because several provisions apply differently depending on whether a transaction involves goods or services.
Taxable Supply vs Exempt Supply
A taxable supply is a supply that is leviable to tax under the CGST Act.
An exempt supply includes supplies attracting a nil rate, wholly exempt supplies and non-taxable supplies as covered by the statutory definition.
Therefore, these terms should not be used interchangeably.
Input Tax vs Input Tax Credit
Input tax refers to specified GST charged on supplies made to a registered person and certain other taxes covered by the definition.
Input tax credit means the credit of input tax.
The two terms are related but do not mean exactly the same thing.
Composite Supply vs Mixed Supply
A composite supply involves supplies that are naturally bundled and includes a principal supply.
A mixed supply involves two or more individual supplies sold together for a single price but does not qualify as a composite supply.
This distinction affects the applicable tax treatment under Section 8.
Why Should Businesses Understand Section 2?
A business may encounter Section 2 definitions in almost every area of GST compliance.
For example, when determining whether a person is required to register, the business may need to understand aggregate turnover, taxable person, person and business.
When claiming ITC, terms such as input, input service, input tax, capital goods and input tax credit become important.
When determining the tax treatment of a package, the definitions of composite supply, mixed supply and principal supply can become relevant.
Similarly, businesses involved in online marketplaces, job work, construction, exports, imports or cross-border services may need to understand additional definitions under Section 2.
Important Points to Remember About Section 2
- Section 2 of the CGST Act is titled Definitions.
- It provides statutory meanings for important GST terms.
- The definitions apply unless the context otherwise requires.
- Some definitions refer to provisions contained in other laws.
- Some definitions have been amended after the original enactment of the CGST Act.
- New definitions have also been inserted over time.
- Terms such as goods, services, supply-related concepts, input tax credit, supplier, recipient and taxable person are fundamental to understanding GST.
- The meaning of a term under ordinary language may differ from its statutory meaning under the CGST Act.
- For current compliance, the latest version of the Act and applicable rules and notifications should be checked.
- Section 2 should be read together with the substantive provisions of the CGST Act and other GST laws.
Conclusion
Section 2 of the CGST Act, 2017 provides the legal meanings of a wide range of terms used throughout the GST law. From aggregate turnover, business, goods and services to input tax credit, supplier, recipient, taxable person, reverse charge and works contract, these definitions form the foundation for understanding many other provisions of the Act.
The importance of Section 2 goes beyond simply knowing the meaning of individual words. A correct understanding of these statutory definitions is often necessary to determine how other GST provisions apply to a particular transaction or business activity.
Since several definitions have been amended or inserted over time, including provisions relating to online gaming, Input Service Distributor, specified actionable claims and virtual digital assets, readers should rely on the current statutory text when dealing with present-day GST compliance.
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