TaxTMI 
TaxTMI 
Friends,
My clients regulary import agri produce from foreign countries by vessels.
Is there any exemption available, wrt to levy of RCM on ocean freight?
Regards
R.Balakrishnan FCA
RCM on Ocean Freight for transport of Agri Produce
25 May 2019 
12 Replies 
3215 Views Asked by
RCM on ocean freight applies to imported services, creating potential double taxation and subject to legal challenge.
RCM on ocean freight for import of agricultural produce is treated as a taxable imported service subject to the reverse charge mechanism, attracting IGST under the notifications cited. Agricultural classification does not exempt ocean freight; tax arises under RCM whether CIF or FOB. This creates practical double taxation where IGST under RCM on the importer coincides with IGST as part of customs. Procedural issues include High Court stays limited to applicants, disputes over who is the recipient liable under RCM, and unresolved time and place of supply questions. (AI Summary)
RCM on ocean freight for import of agricultural produce is treated as a taxable imported service subject to the reverse charge mechanism, attracting IGST under the notifications cited. Agricultural classification does not exempt ocean freight; tax arises under RCM whether CIF or FOB. This creates practical double taxation where IGST under RCM on the importer coincides with IGST as part of customs. Procedural issues include High Court stays limited to applicants, disputes over who is the recipient liable under RCM, and unresolved time and place of supply questions. (AI Summary)