CHAPTER VII

Concept of Aggregate Turnover in GST

(1) Turnover, in common parlance, is the total volume of a
business. The term ‘aggregate turnover’ has been defined in
GST law as under:

“Aggregate turnover” means the aggregate value of all
taxable supplies (excluding the value of inward supplies on
which tax is payable by a person on reverse charge basis),
exempt supplies, exports of goods or services or both and
inter-State supplies of persons having the same Permanent
Account Number, to be computed on all India basis but
excludes central tax, State tax, Union territory tax, integrated
tax and cess.

(2) The aggregate turnover is a crucial parameter for deciding
the eligibility of a supplier to avail the benefit of exemption
threshold of Rs. 20 Lakhs [Rs. 10 Lakhs in case of special
category States except J & K] and for determining the
threshold limit for composition levy. Let us dissect the
definition in small parts to understand the meaning clearly.
There are certain terms used in the definition which need a bit
of elaboration.

(3) It may be noted that the inward supplies on which the recipient
is required to pay tax under Reverse Charge Mechanism
(RCM) does not form part of the ‘aggregate turnover’. The
law stipulates certain supplies like, Goods Transport Agency
services, services received from outside India, to name a few,
where the recipient of service is made to pay the tax. The
value of such supplies on which tax is paid, would not form
part of the ‘aggregate turnover’ of recipient of such supplies.
However, the value of such supplies would continue to be part
of the ‘aggregate turnover’ of the supplier of such supplies.

(4) The second element of value which would not be included in
the ‘aggregate turnover’ is the element of central tax, state
tax, union territory tax and integrated tax and compensation
cess.

(5) The value of exported goods/services, exempted goods/
services, inter-state supplies between distinct persons having
same PAN would be added to ‘aggregate turnover’.

(6) Last but not the least, such turnover is to be calculated by
taking together the value in respect of the activities carried
out on all-India basis.

(7) The aggregate turnover is different from turnover in a State.
The former is used for determining the threshold limit for
registration as well as eligibility for Composition Scheme.
However, the composition levy would be calculated on the
basis of turnover in the State.