Introduction: “Payment Aaya… Par Poora Nahi Aaya”

Rohit runs a small electrical supply business in Govind Nagar, Kanpur.

After months of effort, he finally secured a government order through GeM.

Delivery done. Invoice submitted. Everything perfect.

After 25 days, payment arrived.

He checked his bank account.

“₹9,74,000… par invoice toh ₹10,00,000 ka tha…”

Confused, he immediately called an Expert from Team Rokadh.

“Sir payment kam kyun aaya?”

The expert calmly replied:

“Rohit ji, aapka paisa kata nahi hai… adjust hua hai.”

Rohit paused.

“Matlab?”

“GST TDS, Income Tax TDS, aur GeM ka TCS deduct hua hai.”

That day, Rohit realized:

👉 Government business mein sirf supply karna kaafi nahi hota

👉 System samajhna zaroori hota hai

Section 1: Government Supply Business – Ground Reality

Let’s simplify.

Government supply means:

👉 Supplying goods/services to:

1. Central/State Government
2. PSUs
3. Municipal bodies
4. Government institutions

Real Story: Lucknow Trader

Imran from Lucknow started selling office furniture locally.

One day, someone told him:

“GeM pe aa jao… government buyer milenge.”

He hesitated.

Documentation, GST, portal… sab complicated lag raha tha.

But with guidance from Team Rokadh, he registered.

First order: ₹1.8 lakh

Second order: ₹6.5 lakh

Within 1 year → ₹45 lakh turnover

👉 Lesson: Government market bada hai, par structured hai

Section 2: GST in Government Supply – No Confusion Zone

Basic Rule (Very Important)

👉 GST applies on almost all supplies to government (unless specifically exempt)

Story: Delhi Supplier Mistake

A Delhi-based supplier quoted ₹5 lakh for goods.

He forgot to mention GST separately.

After delivery:

1. He had to pay GST from his own pocket

👉 Lesson:

✔ Always quote: “Price + GST extra”

✔ Or clearly mention “inclusive of GST”

GST Rates (Correct Understanding)

1. Goods → As per HSN (5%, 12%, 18%, etc.)
2. Services → Usually 18%

Practical Tip

👉 Wrong GST quoting = direct profit loss

Section 3: GST TDS by Government (Section 51)

When it Applies

If:

👉 Contract value exceeds ₹2.5 lakh

Then:

👉 Government deducts 2% GST TDS

(1% CGST + 1% SGST OR 2% IGST)

Story: Mumbai Contractor

A contractor in Mumbai completed a ₹20 lakh project.

Payment received: ₹19.6 lakh

He panicked.

Called Expert from Team Rokadh.

Expert explained:

“Sir, yeh aapka nuksaan nahi hai.”

“Yeh GST TDS hai jo government ne aapke naam pe deposit kiya hai.”

Important

✔ Visible in GST portal (Electronic Cash Ledger)

✔ Can be used to pay GST liability

👉 Lesson: TDS is not loss—it’s prepaid tax

Section 4: Income Tax TDS – Why Money Gets Deducted

Story Continues: Rohit from Kanpur

Rohit asked:

“Sir GST samajh aaya… par aur deduction kyun?”

Expert replied:

“Income Tax TDS bhi kata hai.”

Common Sections

1. Section 194C → Contracts (1% / 2%)
2. Section 194J → Professional services (10%)

Important Truth

👉 This TDS is NOT expense

✔ It appears in Form 26AS

✔ Adjustable in ITR

👉 Lesson: “Deduction ≠ Loss”

Section 5: TCS on GeM Portal (Income Tax Section 206C)

What Happens on GeM

GeM may deduct:

👉 TCS (Tax Collected at Source)

Story: Lucknow Seller

Imran saw 3 deductions:

1. GST TDS
2. Income Tax TDS
3. TCS

He got worried.

Expert from Team Rokadh explained:

“Sir ye sab final tax nahi hai… adjustment hai.”

Reality

✔ TCS reflects in 26AS

✔ Can be claimed in ITR

👉 Lesson: Government business mein deductions normal hai

Section 6: GeM Portal – The Real Game Changer

What is GeM?

👉 Government e-Marketplace for procurement

Story: Delhi Startup

A Delhi-based startup listed cleaning products on GeM.

Initially no orders.

They improved:

1. Product listing
2. Pricing
3. Documentation

Within 3 months:

👉 Bulk orders from departments

Key Benefits

✔ Direct access to government buyers

✔ Transparent bidding

✔ Nationwide reach

👉 Lesson: GeM is opportunity—but requires discipline

Section 7: OEM – The Deal Breaker

What is OEM?

👉 Original Equipment Manufacturer authorization

Story: Mumbai Supplier

A trader participated in a tender.

Lowest price.

Still rejected.

Reason:

👉 No OEM authorization

Reality

Many tenders require:

✔ OEM certificate

✔ Authorization letter

👉 Lesson: Documentation > Pricing

Section 8: Pricing Strategy – Where Profit is Made or Lost

Story: Kanpur Supplier Mistake

Rohit quoted lowest price.

Ignored:

1. GST
2. TDS
3. Transport cost

Result

👉 Payment received → Profit gone

Correct Strategy

✔ Add GST properly

✔ Consider deductions

✔ Maintain margin

👉 Lesson: “Lowest price ≠ Best deal”

Section 9: Cash Flow – Biggest Hidden Challenge

Story: Lucknow Contractor

Completed work.

Payment delayed 45 days.

Meanwhile:

1. GST payable
2. Labour payment pending

Reality

Government payments take time.

Solution

✔ Maintain working capital

✔ Plan tax payments

👉 Lesson: Cash flow planning is survival tool

Section 10: Case Studies (City-Based Real Insights)

Delhi Case

Supplier missed compliance → Tender rejected

Mumbai Case

Underpricing → Loss

Kanpur Case

GST mistake → Profit reduced

Lucknow Case

GeM understanding → Business growth

MSME Case

Registered on GeM → Expanded nationally

Section 11: Compliance Checklist

✔ GST registration

✔ Proper invoicing

✔ TDS tracking

✔ GeM compliance

✔ Income tax filing

Section 12: Common Mistakes

❌ Ignoring GST

❌ Not checking deductions

❌ No OEM

❌ Wrong pricing

❌ No planning

Section 13: Profitability Insight

Government business is:

✔ Stable

✔ Scalable

But only if:

👉 You understand system

Section 14: FAQs (Practical & Real)

GST

Is GST applicable?

👉 Yes

TDS

Why deducted?

👉 Legal compliance

GeM

Is it useful?

👉 Very

OEM

Required?

👉 Often

City Queries

Government supply Delhi?

Same rules

Kanpur GeM?

Same process

Lucknow tender?

Same system

Mumbai supply?

Same framework

Section 15: Final Thought

Government business is not complicated.

👉 It is disciplined

Final Conclusion

If you understand:

1. GST
2. TDS
3. GeM
4. Pricing

👉 You can scale your business massively

About Rokadh Financial Services Private Limited

We help businesses with:

✔ GST

✔ Income Tax

✔ GeM registration

✔ Compliance

🌐 www.rokadh.com