Nobody notice that there is a big flaw on which GST is calculated?

Yes punit I am asking the same thing 'Is B's GST calculation on 150 is correct' because 150 includes the GST added by the previous party "Person A" so logically it should not be considered to calculate GST and rather 100+26.24 = 126.24 should be considered. This 126.24 is the total amount without GST from both parties Person A and Person B.

The basic context of my question is that does the intermediatory party use the purchase price which already includes GST from the buyer to calculate output GST or do they first exclude the GST part which was added by the supplier and then adds their margin without GST and then use that figure to calculate GST on the prescribes GST rate.

There is no flaw. Every business pays GST on the value they add, and final GST is paid by the consumer. Person A sells you for 100, and charges 18 as GST. You sell it for 150 plus GST, your value addition is Rs 50, not Rs 32. You are wrongly taking the margin as 32. It is 50.

Person A: 100 + GST = 100 + 18 = 118

Person B: 150 + GST = 150 + 27 = 177

Person B's margin = 150 - 100 = 50

Or, Person B's margin = 177 - 118 - net GST paid by person B = 59 - 9 = 50

Reena is Right. Purchase price of B is 100, if he wants to add his margin 32 he will sale 132+ gst .

Ok, so now person B will only give rupee 9 as GST (output tax) according to your example?

because 27 is the total GST on price before GST is added from Person A and Person B 100 + 50 = 27 (considering 18% as GST).

so 18/- is the Input Tax Credit and now Person B has to give only rupee 9 /- as output tax ?