Section 9 of the Central Goods and Services Tax Act, 2017 is one of the most important provisions of the CGST Act because it provides the legal framework for the levy and collection of Central Goods and Services Tax (CGST) on intra-State supplies of goods or services or both.
Section 7 explains the scope of supply, while Section 8 explains the tax treatment of composite and mixed supplies. Section 9 then provides the basic charging mechanism through which CGST is levied on taxable intra-State supplies.
The section also contains provisions relating to:
- Levy of CGST on intra-State supplies
- Certain petroleum products whose CGST levy is deferred until a date notified by the Government
- Reverse charge mechanism
- Reverse charge on specified supplies received from unregistered suppliers
- Tax liability of electronic commerce operators for certain notified services
The exact tax rate applicable to a particular product or service is determined through the relevant rate notifications issued under the CGST framework. The statutory ceiling in Section 9(1) is 20%.
What is Section 9 of the CGST Act?
Section 9 is titled “Levy and collection.”
The provision establishes the levy of Central GST on taxable intra-State supplies.
In simple terms, when a transaction qualifies as an intra-State supply and is not otherwise excluded or exempted under the applicable GST provisions, CGST can be levied under Section 9.
Section 9 should therefore be read together with:
- Section 7 – Scope of supply
- Section 8 – Composite and mixed supplies
- Section 10 – Composition levy
- Section 11 – Exemption from tax
- Section 15 – Value of taxable supply
- Relevant GST rate notifications
- The CGST Rules, 2017
Text of Section 9 of CGST Act, 2017
The current statutory structure of Section 9 provides:
“Levy and collection.— (1) Subject to the provisions of sub-section (2), there shall be levied a tax called the central goods and services tax on all intra-State supplies of goods or services or both, except on the supply of alcoholic liquor for human consumption and un-denatured extra neutral alcohol or rectified spirit used for manufacture of alcoholic liquor, for human consumption, on the value determined under section 15 and at such rates, not exceeding twenty per cent., as may be notified by the Government on the recommendations of the Council and collected in such manner as may be prescribed and shall be paid by the taxable person.
(2) The central tax on the supply of petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas and aviation turbine fuel shall be levied with effect from such date as may be notified by the Government on the recommendations of the Council.
(3) The Government may, on the recommendations of the Council, by notification, specify categories of supply of goods or services or both, the tax on which shall be paid on reverse charge basis by the recipient of such goods or services or both and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods or services or both.
(4) The Government may, on the recommendations of the Council, by notification, specify a class of registered persons who shall, in respect of supply of specified categories of goods or services or both received from an unregistered supplier, pay the tax on reverse charge basis as the recipient of such supply of goods or services or both, and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods or services or both.
(5) The Government may, on the recommendations of the Council, by notification, specify categories of services the tax on intra-State supplies of which shall be paid by the electronic commerce operator if such services are supplied through it, and all the provisions of this Act shall apply to such electronic commerce operator as if he is the supplier liable for paying the tax in relation to the supply of such services.”
The section also contains provisos dealing with electronic commerce operators that do not have a physical presence in the taxable territory.
Section 9(1): Levy of CGST
Section 9(1) is the basic charging provision for CGST.
It provides that CGST shall be levied on intra-State supplies of goods or services or both, subject to the provisions of the Act.
Therefore, three important concepts need to be understood:
- There must be a supply.
- The supply must be an intra-State supply.
- The supply must be taxable under the applicable GST provisions.
The value on which CGST is levied is determined under Section 15 of the CGST Act, and the rate is notified by the Government on the recommendations of the GST Council, subject to the statutory maximum of 20%.
What is Intra-State Supply?
The concept of intra-State supply is important because CGST generally applies to intra-State supplies, while IGST generally applies to inter-State supplies.
The meaning of intra-State supply is provided through the Integrated Goods and Services Tax Act.
For example, if a supplier and the place of supply are within the same State, the transaction may generally be treated as an intra-State supply, subject to the specific place-of-supply provisions.
In an ordinary taxable intra-State transaction, the tax generally consists of:
CGST + SGST
For a Union Territory covered by the UTGST framework, the relevant combination is generally:
CGST + UTGST
CBIC explains that the Centre levies and administers CGST and IGST, while the respective States levy and administer SGST.
Example of CGST on an Intra-State Supply
Suppose a dealer in Delhi sells taxable goods to a customer in Delhi and the transaction qualifies as an intra-State supply.
If the applicable GST rate is 18%, the tax would ordinarily be divided between:
- CGST – 9%
- SGST – 9%
The actual rate depends on the applicable rate notification for the particular goods or services.
The important point is that Section 9 provides the statutory basis for the CGST component of such an intra-State taxable supply.
Section 9 and GST Rates
Section 9(1) does not itself provide a separate GST rate for every product or service.
Instead, it provides that CGST shall be levied at rates notified by the Government on the recommendations of the GST Council, subject to the statutory ceiling of 20%.
The applicable rate is therefore determined by the relevant CGST rate notification and its amendments.
This is why the GST rate for a particular product or service should not be determined merely by reading Section 9.
The relevant classification, HSN or SAC, rate notification and any applicable exemption notification must also be checked.
Maximum Rate Under Section 9(1)
Section 9(1) states that the rate of CGST shall not exceed 20%.
This is the statutory maximum specified in the charging section.
However, this does not mean that every taxable supply is charged at 20%.
The actual rate applicable to a particular supply is notified by the Government on the recommendations of the GST Council.
Therefore:
20% = statutory maximum under Section 9(1)
Actual GST rate = rate notified for the particular supply
Supplies Excluded From Section 9(1)
Section 9(1) specifically excludes the supply of alcoholic liquor for human consumption from CGST.
The current wording also excludes un-denatured extra neutral alcohol or rectified spirit used for manufacture of alcoholic liquor for human consumption.
Therefore, these supplies are not subject to CGST under the charging provision of Section 9(1).
The GST treatment of a particular product should nevertheless be determined by examining the exact nature of the product and the applicable law.
Section 9(2): Petroleum Products
Section 9(2) deals with five petroleum products:
- Petroleum crude
- High speed diesel
- Motor spirit, commonly known as petrol
- Natural gas
- Aviation turbine fuel (ATF)
CGST on the supply of these products is to be levied with effect from such date as may be notified by the Government on the recommendations of the GST Council.
This means Section 9(2) does not itself specify an immediate levy date for these products.
The effective date is to be notified by the Government.
Why is Section 9(2) Important?
The five petroleum products listed in Section 9(2) have a special statutory treatment under the CGST Act.
Instead of simply applying Section 9(1), the Act specifically provides that CGST on their supply shall be levied from a date to be notified by the Government on the recommendations of the GST Council.
Therefore, Section 9(2) must be considered when studying the GST treatment of these petroleum products.
Section 9(3): Reverse Charge Mechanism
Section 9(3) deals with the Reverse Charge Mechanism (RCM).
Normally, under GST, the supplier is responsible for charging and paying the tax on a taxable supply.
Under reverse charge, the recipient becomes liable to pay the tax for specified supplies.
Section 9(3) authorises the Government, on the recommendations of the GST Council, to notify categories of goods or services or both on which tax shall be paid by the recipient under reverse charge.
The recipient is then treated as the person liable to pay tax in relation to that supply.
What is Reverse Charge?
Reverse charge means that the liability to pay GST shifts from the supplier to the recipient for supplies covered by the applicable reverse charge provisions.
For example, where a particular service is notified for reverse charge under Section 9(3), the recipient may become responsible for paying the applicable CGST instead of the supplier.
The reverse charge mechanism is therefore an exception to the normal supplier-paid tax model.
Example of Section 9(3)
Suppose a particular category of service has been notified by the Government for payment of tax under reverse charge.
A registered business receives that service from a supplier.
If the transaction falls within the notified category and all applicable conditions are satisfied, the recipient becomes liable to pay the GST under reverse charge.
The recipient then follows the applicable rules regarding payment, documentation, reporting and input tax credit.
The specific categories subject to reverse charge can change through notifications, so the applicable notification should always be checked for the relevant transaction.
Section 9(4): Reverse Charge on Supplies From Unregistered Persons
Section 9(4) deals with reverse charge in relation to supplies received from unregistered suppliers.
The provision allows the Government, on the recommendations of the GST Council, to notify:
- A class of registered persons; and
- Specified categories of goods or services or both
for which tax on supplies received from an unregistered supplier is payable by the recipient under reverse charge.
This provision is different from Section 9(3).
Section 9(3)
Reverse charge can apply to specified categories of supplies notified by the Government.
Section 9(4)
The provision concerns specified supplies received from an unregistered supplier by a notified class of registered persons.
Therefore, it is incorrect to assume that every purchase made by a registered person from an unregistered person automatically attracts reverse charge.
The applicable notification and conditions must be examined.
Difference Between Section 9(3) and Section 9(4)
| Section 9(3) | Section 9(4) |
|---|---|
| Deals with specified categories of goods or services | Deals with specified supplies received from unregistered suppliers |
| Government notifies categories of supply | Government specifies class of registered persons and categories of supplies |
| Recipient pays tax under reverse charge | Recipient pays tax under reverse charge when the notified conditions apply |
| Does not depend simply on supplier being unregistered | Specifically involves supplies from an unregistered supplier |
This distinction is important when determining whether a transaction is covered by reverse charge.
Section 9(5): Tax Liability of E-Commerce Operators
Section 9(5) deals with certain services supplied through an electronic commerce operator (ECO).
The Government may, on the recommendations of the GST Council, notify categories of services for which tax on intra-State supplies is to be paid by the electronic commerce operator when those services are supplied through the operator.
In such cases, the law treats the electronic commerce operator as if it were the supplier liable to pay the tax in relation to the notified services.
What is an Electronic Commerce Operator?
An electronic commerce operator is a person who owns, operates or manages a digital or electronic facility or platform for electronic commerce.
Examples can include online platforms that facilitate specified services.
However, Section 9(5) does not automatically make every e-commerce operator responsible for GST on every transaction.
The Government must notify the categories of services to which Section 9(5) applies.
Difference Between Section 9(3), 9(4) and 9(5)
These provisions all involve situations where the person ordinarily responsible for paying GST may differ from the normal supplier.
| Provision | Main Concept | Person Paying Tax |
|---|---|---|
| Section 9(3) | Specified supplies under reverse charge | Recipient |
| Section 9(4) | Specified supplies from unregistered suppliers | Notified class of recipient |
| Section 9(5) | Specified services supplied through an ECO | Electronic commerce operator |
This distinction is particularly important for businesses using online platforms.
Section 9 and E-Commerce Businesses
Businesses operating through e-commerce platforms should carefully determine whether their transactions fall under:
- Normal supplier-paid GST;
- Section 9(3) reverse charge;
- Section 9(4) reverse charge; or
- Section 9(5) ECO liability.
The mere fact that a sale or service is conducted through the internet does not automatically mean that Section 9(5) applies.
The specific nature of the service and the relevant notification must be examined.
Section 9 and Value of Supply
Section 9(1) states that CGST is levied on the value determined under Section 15.
Therefore, Section 9 and Section 15 work together.
Section 9 answers the basic question:
“Is CGST leviable on this taxable intra-State supply?”
Section 15 helps answer:
“What is the value on which the tax is calculated?”
The value of taxable supply is therefore not determined independently of the valuation provisions.
Example of Value and CGST
Suppose a taxable intra-State supply has a value of ₹1,00,000 and the applicable CGST rate is 9%.
The CGST component would be:
₹1,00,000 × 9% = ₹9,000
The corresponding SGST, assuming the same overall GST rate and no special treatment, would generally be another ₹9,000.
The total GST would therefore be ₹18,000.
This is a simplified illustration. Actual tax calculation may require consideration of discounts, inclusions, exclusions, valuation rules and other applicable provisions.
Section 9 and Exempt Supplies
Section 9 provides the charging mechanism for taxable supplies, but not every supply is necessarily taxable.
Certain goods and services may be exempted through notifications issued under the GST law.
Section 11 gives the Government power to grant exemptions from tax in specified circumstances.
Therefore, while analysing a transaction, it is not enough to ask whether it is a supply under Section 7.
The taxpayer should also check whether the supply is:
- Taxable;
- Nil-rated;
- Exempt;
- Non-taxable; or
- Otherwise outside the scope of GST.
Section 9 and Section 7
Section 7 and Section 9 are closely connected.
Section 7
Determines the scope of supply.
Section 9
Provides the levy and collection of CGST on taxable intra-State supplies.
The basic sequence can therefore be understood as:
Section 7 → Is there a supply?
Section 8 → Is it composite or mixed supply?
Section 9 → Is CGST leviable?
Section 15 → What is the taxable value?
Rate Notification → What is the applicable rate?
This sequence provides a useful starting framework for analysing GST transactions.
Section 9 and Section 8
Section 8 deals with composite and mixed supplies.
It determines whether the tax treatment of a bundled transaction follows the principal supply or the highest applicable rate.
Section 9 then provides the charging mechanism for CGST.
For example, if a transaction is determined to be a mixed supply under Section 8 and the applicable tax treatment is identified, Section 9 provides the statutory basis for levying CGST on the taxable intra-State supply.
Section 9 and Section 10
Section 10 deals with the composition levy.
A registered person who satisfies the conditions of the composition scheme may pay tax under the composition provisions instead of paying tax under the normal charging mechanism of Section 9(1), subject to the provisions of the Act.
Section 10 itself states that the composition levy operates in lieu of the tax payable under Section 9(1), while remaining subject to specified provisions including Section 9(3) and Section 9(4).
Therefore, Section 9 is the normal charging provision, while Section 10 provides a special taxation mechanism for eligible taxpayers.
Section 9 and Section 11
Section 9 establishes the levy of CGST.
Section 11 deals with the power to grant exemption from tax.
Therefore, even if a transaction falls within the broad charging framework of Section 9, the applicable exemption notification must also be checked.
This is why GST treatment should not be determined by looking at Section 9 alone.
Section 9 and Reverse Charge
One of the most important features of Section 9 is that it does not always require the supplier to pay the tax.
Sections 9(3) and 9(4) provide for specified reverse charge situations.
Under normal GST:
Supplier → Charges and pays GST
Under reverse charge:
Recipient → Pays GST
The exact application depends on the relevant notification and statutory conditions.
Is GST Charged Under Section 9 on Every Supply?
No.
Section 9 provides the levy of CGST on taxable intra-State supplies, but several factors need to be examined before determining whether tax is actually payable.
These include:
- Whether there is a supply under Section 7.
- Whether the supply is intra-State.
- Whether the supply is taxable.
- Whether the supply is exempt.
- Whether a specific exclusion applies.
- Whether the transaction falls under reverse charge.
- Whether composition levy applies.
- Whether a special notification affects the transaction.
Therefore, Section 9 is the charging provision, but it should be read together with the rest of the GST framework.
Is CGST Applicable to Inter-State Supplies?
CGST is generally associated with intra-State supplies.
Inter-State supplies are generally subject to Integrated Goods and Services Tax (IGST) under the IGST Act.
Therefore, a business should determine the nature of the supply before deciding whether CGST or IGST applies.
CBIC explains that IGST is levied and collected by the Centre on inter-State supplies, while CGST and SGST apply to the intra-State GST structure.
Special Point About Online Money Gaming
GST legislation introduced specific provisions relating to online gaming, online money gaming and specified actionable claims from 2023.
These amendments also affected the registration and valuation framework for online money gaming and related supplies.
The Supreme Court in a judgment dated 27 May 2026 considered challenges involving online gaming, fantasy sports, casinos, betting and gambling and the relevant CGST provisions, including Sections 7, 9 and 15. The Court upheld the relevant statutory framework concerning the taxation of actionable claims arising from betting and gambling and related valuation provisions.
Because this area involves specific statutory definitions, valuation provisions and amendments, the tax treatment of online gaming should be analysed using the current provisions rather than relying only on the general wording of Section 9.
Important Points About Section 9 of CGST Act
The key points are:
- Section 9 is the main levy and collection provision for CGST.
- Section 9(1) provides for CGST on taxable intra-State supplies of goods or services or both.
- CGST is levied on the value determined under Section 15.
- The statutory maximum rate under Section 9(1) is 20%.
- The actual rate is notified by the Government on the recommendations of the GST Council.
- Supply of alcoholic liquor for human consumption is excluded from the CGST levy under Section 9(1).
- The current provision also excludes specified un-denatured extra neutral alcohol or rectified spirit used for manufacture of alcoholic liquor for human consumption.
- Section 9(2) deals with petroleum crude, high speed diesel, petrol, natural gas and aviation turbine fuel.
- Section 9(3) provides for specified reverse charge supplies.
- Section 9(4) provides for specified reverse charge situations involving supplies from unregistered suppliers.
- Section 9(5) provides for tax liability of electronic commerce operators on specified notified services supplied through them.
- Section 9 should be read together with Sections 7, 8, 10, 11 and 15 and the relevant notifications and rules.
Conclusion
Section 9 of the CGST Act, 2017 provides the fundamental legal framework for the levy and collection of Central Goods and Services Tax on taxable intra-State supplies of goods or services or both. Section 9(1) establishes the normal CGST levy, subject to the exclusions and conditions provided in the Act, while the applicable rate is notified by the Government on the recommendations of the GST Council.
Section 9 also contains important special mechanisms. Section 9(2) deals with specified petroleum products, Section 9(3) provides for reverse charge on notified categories of supplies, Section 9(4) covers specified supplies received from unregistered suppliers by notified classes of registered persons, and Section 9(5) deals with specified services supplied through electronic commerce operators.
For determining the actual GST liability on a transaction, Section 9 should not be read in isolation. The taxpayer must also consider the scope of supply under Section 7, classification under Section 8 where applicable, exemptions, composition provisions, valuation under Section 15, the relevant GST rate notifications and other applicable rules and notifications.
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