RCM-Applicability to a Trader

[swamynathan pitchai]

Dear sir

A is the manufacturer at GJ.

B is the End user at TN ordered a product X on A.

B intend to transport X from A's place at GJ to B's project site at MH.

Trading firm C (Only GST registered - sole proprietorship firm) @ KA intend to take this order from B. Since C does not have vehicles C wants to utilise the service of GTA. Hence C introduces a GTA D and offload the order. C is the authorised agent of D to promote their business formally entered an agreement.

C receives the order from B and offload to D

D will raise the bill to C and C will raise the bill to B.

Waybill would be issued to D by A & B & Consignment not would be issued by D

Opinion from the experts needed how this transaction could be made through . who has to charge GST? if so what would be the %

Thanks for support

AI Summary

Reverse Charge Mechanism under GST: B to Pay 5% IGST on Freight Costs for Multi-Party Transaction Involving GTA A discussion on the applicability of Reverse Charge Mechanism (RCM) under GST for a transaction involving multiple parties: A, the manufacturer in Gujarat; B, the end user in Tamil Nadu; C, a trading firm in Karnataka; and D, a Goods Transport Agency (GTA). B orders a product from A, and C, acting as an intermediary and agent for D, facilitates transportation to B's project site in Maharashtra. The expert opinion suggests that B, bearing the freight costs, should pay Integrated GST (IGST) at 5% under RCM. Further clarification is sought on the billing process for C and D.