GST on reverse charge on GTA in respect of supply to SEZ units.

[HARISH RADHAKRISHNAN]

I am a unit in the SEZ and I have received goods in the SEZ through the local transport bill is more than rs 1500. I am now supposed to pay tax on reverse charge basis on the GTA charges.

As an SEZ I am eligible for an exemption from tax as the supply to SEZ is ZERO RATED for which the Service provider i.e. transport operator in this case should execute a bond for claiming the exemption.

However in terms of the RCM procedure the SEZ unit is the service provider hence this is a case of supply of service to yourself and therefore not taxable at the hands of the SEZ unit . In case this is not a correct position to hold can the SEZ unit use his SEZ Bond cum LUT for claiming this exemption.

Thanks

AI Summary

SEZ Units Liable for GST Under RCM for GTA Services as Per Notification 13/2017-CT, LUT or Refund Required. A discussion on the Goods and Services Tax (GST) reverse charge mechanism (RCM) for Goods Transport Agency (GTA) services supplied to Special Economic Zone (SEZ) units highlights a query about tax liability. The SEZ unit, which typically benefits from zero-rated supplies, questions its tax obligations under RCM. Alkesh Jani clarifies that under Notification 13/2017-CT, the SEZ unit is liable to pay tax, necessitating a Letter of Undertaking (LUT) or tax payment with a refund claim. Other forum participants, Kasturi Sethi, Subramanian Vijayakumar, and Dr. Mariappan Govindarajan, agree with Jani's interpretation.