reverse charge in GTA services

[VINOD KUMAR]

Dear expertsWho will pay the service tax in the following cases:-1. services provided by GTA to a SSI unit engaged in manufacturing of goods. Both the consignor and consignee are having clearances below ₹ 90 Lacs and are not registered both under central excise and service tax. Then how they can pay ST. 2. On GTA services where both the consignor and the consignee are proprietary firms. Please reply. Thanks and regards.

AI Summary

Reverse Charge Mechanism: Service Receiver Pays Tax for GTA Services, Except Proprietary Concerns; Factories Must Register. A discussion on the reverse charge mechanism for service tax in Goods Transport Agency (GTA) services involves queries about who is responsible for paying the service tax. In cases where services are provided to a Small Scale Industry (SSI) unit with clearances below 90 lakhs, the service receiver must pay the tax under reverse charge, regardless of registration status. However, if the freight payer is a proprietary concern, reverse charge does not apply. Additionally, factories covered under the Factories Act must register and pay the tax unless the transportation is under Goods Transport Operator (GTO) instead of GTA.