RCM on AMC (Agricultural Market Cess)

[Rajendra Prasad]

Dear Sir,

Whether RCM is applicable on AMC (Agricultural Market Committee Cess) paid to Agricultural Market Committee towards purchase of Agricultural Produce. Please clarify.

[KASTURI SETHI]

RCM is not applicable. Section 9(3) & (4) of CGST Act, 2017 read with relevant notifications for specified goods and services talks of Central Goods & Services Act only and not other allied Acts. Cess mentioned by you is being collected under State Agricultural Produce Marketing Act. This State Act is out of CGST Act.

AI Summary

Reverse Charge Mechanism Not Applicable to Agricultural Market Committee Cess Under CGST Act, Sections 9(3) and 9(4) Clarified. A query was raised regarding the applicability of Reverse Charge Mechanism (RCM) on Agricultural Market Committee Cess (AMC) paid to the Agricultural Market Committee for purchasing agricultural produce. The response clarified that RCM is not applicable to AMC. The Central Goods and Services Tax (CGST) Act, 2017, specifically sections 9(3) and (4), along with relevant notifications, only cover specified goods and services under the CGST Act, not other acts. The cess in question is collected under the State Agricultural Produce Marketing Act, which is not covered by the CGST Act.