Reverse Charge on Transport

[Rohit Bhura]

In case of Transport the Gst is payable by Consignee under reverse Charge. Would the Consignee deduct the GST amount while making the payment or it will paidby his own pocket.

Eg.

If a Transport has issued me a Consignment Note for a freight of 50,000 then should i pay him 50,000 and pay 2500 GST on my own or should i pay him 47500 and deposit remaining 2500 to government.

[KASTURI SETHI]

100% liability is upon Service Receiver. Service Receiver will pay GST on full amount of freight. You cannot treat amount of freight cum-tax. You can pay and take ITC, if otherwise admissible.

[Rohit Bhura]

Will the service receiver get ITC for the GST paid by him under RCM for the services of GTA

[KASTURI SETHI]

No. It is clearly mentioned in the list of services under RCM that " No ITC". I rectify my mistake. I have mentioned everywhere against so many replies that ITC is not available.

I am thankful to you for pointing out my error. Error should not have happened.

[Rohit Bhura]

Yes sir, i saw that in schedule. But to Various twitter question to @askGst_goi the reply is ITC can be claimed. https://twitter.com/rohitbhura/status/884114598479241218

[KASTURI SETHI]

FAQs on twitter or anywhere have no statutory value. I have found discrepancies in various sites. First any service should fall in the list eligible ITC and thereafter we are to see whether it is in course or furtherance of business.If we cannot cross first stage (barrier), how can we talk of second stage i.e. in course or furtherance of business.

[Ramesh Kothari]

Depend upon your terms of quote whether cost include or exclude tax on that basis who will bear it

Ramesh Kothari

 

AI Summary

Reverse charge on transport: receiver must pay GST under RCM and generally cannot claim input tax credit.
Reverse charge on goods transport services places the entire GST liability on the service recipient under RCM; the receiver must pay GST separately and cannot treat freight as tax-inclusive. Contract terms may determine who bears the economic cost, but they do not change statutory RCM liability. Input tax credit for GST paid under RCM on GTA services is generally barred where the schedule expressly disallows ITC; non-statutory guidance cannot override the statutory list.