GST ON RCM SUSPENSION DATE

[Greeshma Vp]

The payment of GST on Reverse Charge basis for supplies by Unregistered person to registered person has been suspended till 31.03.2018 vide notifications dated 13.10.2017. Is there a clarity on the date of applicability of this suspension. One view is that the notification is prospective in nature and hence GST is to be remitted on Unregistered dealer supplies received till 12.10.2017. Request experts to please give your views on this.

In case the notification is applicable only from 13.10.2017, please also give your views on whether the date of receipt of supply, date of invoice or the date of payment is to be reckoned to determine if GST under RCM is to be remitted .

[Suyog Vaze]

Good question Greeshma. I have the same query, awaiting experts opinion.

In my opinion the notification applies retrospectively. Firstly, the date of its applicability is not given, so according to me any notification where there is no clarity, interpretation beneficial to the assessee shall prevail. Secondly, if we read the press release the RCM on supplies from unregistered person has been suspended for review by experts, so according to me since the RCM provision had lot of hardships for businesses, the intent behind the notification is to make good the hardship faced by businesses, so it can be very well be concluded that the government wanted to make good the hardship from the appointed day and not from 13.10.2017.

[Rajagopalan Ranganathan]

Sir,

Notification is executive legislation. It can have only prospective effect. If the government wants to give retrospective effect it can do it only through Finance Bill/Finance Act. Regarding payment of tax it shall be paid before filing the monthly return (GSTR-3).

[Suyog Vaze]

Thank you Sir for your valuable insights.

[Greeshma Vp]

Thank you Sir.

[KASTURI SETHI]

I concur with the views of Sh.Ranganathan Sir.

[Ganeshan Kalyani]

The effect of the change in the Notification is always prospective unless specifically mentioned. So the change is with effect from 13.10.2017. Thanks.

[Himansu Sekhar]

In a tweet message, it has been clarified that the Notf. will be prospective in nature. since it was on reverse charge basis, the Point of taxation will apply .

[Kaladhara Saralaya]

In my opinion RCM regulations are postponed till 31-03-2018 as GST Regime messed up the GST law by frequent notifications. Law can't be amended overnight like this. Better not pay rather than seeking refund later. No way they can levy penalties as they Govt brought the law half backed. Sites were not working properly due to the in efficient infrastructure etc etc. How can they hold us responsible for all this mess created by them?

AI Summary

Reverse Charge suspension affects GST liability for supplies from unregistered persons; applicability debated as prospective or retrospective. Suspension of Reverse Charge Mechanism liability for supplies by unregistered persons pauses GST collection on those inward supplies until the suspension end date; contributors disagree whether the suspension is prospective from issuance or retrospectively beneficial to taxpayers, and note that an official clarification indicates prospective effect while point of taxation rules mean tax under reverse charge is to be accounted for and paid before filing the monthly return (GSTR 3).