pure agent problem gst

[indranil basu]

There is a matter of Auto Rickshaw Dealer ,their sales bills as followsSELLING TO REGISTERED BUYER

Auto Rickshaw 120000

Insurance 20000

Registration at Rto 10000

GST rate is 12 %

Current billing process

Auto Rickshaw 120000

GST 14400

Insurance 20000

Registration at Rto 10000

TOTAL INVOICE VALUE 164400

ABOVE CONCEPT BASED ON PURE AGENT OF (WE HAVE AGREEMENT FOR PURE AGENT MATTER ) RULE 33

Insurance 20000

Registration at Rto 10000

PROBLEMS WE ARE FACING CURRENTLY

IN GSTR 1 WE WRITE AS FOLLOWS

TAXABLE VALUE 120000

GST 14400

INVOICE VALUE 164400(120000+14400+20000+10000)

NOW DEPARTMENT IS ASKING FOR REVERSAL OF EXEMPT SUPPLY FOR 30000 AS FOLLOWS

Insurance 20000

Registration at Rto 10000

ON OTHER SIDE THE BUYER IS FACING THE BELOW PROBLEM

THE BUYER IN HIS GSTR 2A HAVING TWO BILLS

OUR BILL RS 164400

AND INSURANCE COMPANY BILL 19000(TAXABLE VALUE ) +1000(GST) = 20000 SHOWING

NOW IN REGISTERED BUYER GSTR 3B

ONE INPUT RS 14400+1000 (INSURANCE)

AND INWARDS NIL RATED SUPPLY 30000

SUGGESTION WE RECEIVED TO BILL CUSTOMER

Auto Rickshaw 120000

GST 14400

AND THE FOLLOWING AS REIMBURSEMENT EXPENSES

Insurance 20000

Registration at Rto 10000

BUT IN THE SUGGESTION THE PROBLEM IS THAT - THE BANK FINANCE IS CURRENTLY GOING ON 164400 BUT IF WE TAKE THE SUGGESTION THE BANK FINANCE WILL BE 134400 BECAUSE BANK MANAGER IS CONSIDERING THE INVOICE VALUE

PLEASE GIVE ME THE SUGGESTION ,WE MUST HAVE TO SHOW INVOICE 164400 FOR FINANCE

Regards,

INDRANIL BASU

Contact no. +91 7003556438

[email protected]

AI Summary

Auto Rickshaw Dealer Challenges GST Billing Under Rule 33; Issues with Insurance, Registration Fees, and Pure Agent Concept An auto rickshaw dealer is facing issues with GST billing due to the pure agent concept under Rule 33 of the CGST Rules. The dealer includes insurance and registration fees in the invoice, but the tax department demands reversal of exempt supply for these amounts. The suggestion to bill these as reimbursement expenses affects bank financing, which considers the total invoice value. Replies clarify that no ITC reversal is needed as these exclusions don't qualify as exempt supply. The dealer must ensure they qualify as a pure agent, meaning only actual expenses are reimbursed without markup. The concept impacts GST valuation and aggregate turnover.