DEAR SIR
WE ARE 100% EOU PVT LTD COMPANY, WE FROM COMPOSITION DEALER, WE ARE RECEIVING BILL FOR BOTH FABRICATION CHAREGES WITH MATERIALS ( ie MATERILAS + LABOUR ) EXAMPLE PAINTING CHARGES WITH COST OF PAINT AND GST NOT CHARGED IN THE BILL
1. IN THIS SCENARIO HOW CAN WE MAKE ACCOUNTING ENTRY.
2. RCM IS APPLICABLE ?
Composition Dealer Inquiry: Accounting for Fabrication Charges Without GST; Confirm RCM Non-Applicability; Verify Vendor Composition Option. A private limited company operating as a 100% Export Oriented Unit (EOU) and a composition dealer inquired about accounting entries for bills received for fabrication charges, including materials and labor, where GST was not charged. The response clarified that as a composition dealer, GST cannot be collected, and the transaction should be recorded as a normal purchase without GST. It was also advised to verify if the vendor can opt for composition. Additionally, it was confirmed that Reverse Charge Mechanism (RCM) is not applicable in this scenario. (AI Summary)
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