Amount Recovered From Employees

[tasvir sharma]

Hi Experts,

we are manufacturer,

No GST charged by the company on account of telephone recovery made from employees

GST Applicable on it or Not.

Regards

Tasvir Sharma

[Rajagopalan Ranganathan]

Sir,

The telephone Service Supplier would have charged gst on the supply of the service. Therefore you will collect the entire amount including gst charged by the service supplier. Therefore if you charge gst again you have to deposit the same into Government Account which will amount charging gst for the second time on the same service supplied which, in my opinion, is not permissible under law.

[KASTURI SETHI]

FAQ dated 31.3.17

Q23. Are there any activities which are treated as neither a supply of goods nor a supply of services?

Ans. Yes. Schedule-III of the model GST law lists certain activities such as (i) services by an employee to the employer in the course of or in relation to his employment, (ii) services by any Court or Tribunal established under any law, (iii) functions performed by members of Parliament, State Legislatures, members of the local authorities, Constitutional functionaries (iv) services of funeral, burial, crematorium or mortuary and (v) sale of land and (vi), actionable claims other than lottery, betting and gambling shall be treated neither a supply of goods or supply of services.

[Ganeshan Kalyani]

Please clarify your query further.

[KASTURI SETHI]

Yesterday I posted extract of FAQ as additional knowledge. I agree with the views of Sh.Ranganathan, Sir.

There cannot be double taxation.

[CSSANJAY MALHOTRA]

Amount recovered from Employees for Mobile use signifies the usage of Mobile by employee for his personal purposes. Company is not eligible for ITC as per Section 17(5) of CGST Act, as these services are for personal consumption and not to be used in furtherance of business.

If ITC is availed and afterwards GST is collected from Employees, the same is to be deposited as is treated as Supply.

[Ganeshan Kalyani]

GST is applicable as it is supply.

AI Summary

GST on employee telephone recovery: may attract tax; ITC disallowed for personal use and deposit required if treated as supply
The issue is whether employee telephone recoveries are a supply attracting GST or a non-taxable reimbursement when the service provider has charged tax; opinions diverge. Key operative points: characterization as supply makes GST collectible and may require deposit of tax if ITC was wrongly availed, while services for personal consumption are ineligible for input tax credit.