208.            P supplied goods to Q through an agent A. Tax liability arising on supply of taxable goods is Rs. 1 lac and on exempt goods is Rs. 25,000. Who shall be liable to pay tax- principal or agent? And by what amount?

As per section 86 of CGST ACT, principal & agent are jointly & severally liable to pay tax on taxable goods supplied by agent on behalf of principal. Since the tax liability on taxable goods is Rs. 1 lac, both principal & agent are jointly & severally liable. Tax to be paid will be Rs. 1 lakh on taxable supply only.