rcm on services by director

[Madhavan iyengar]

A Managing Director of the Company X has rented out his flat to the Company X for a rent of rs. 15000 per month this flat will be used as a guest house/ training centre by Company X

query

a) whether the Company X is required to discharge GST on RCM basis in above case

[Alkesh Jani]

Sir,

Who is the owner of the flat and who is receiving the rent?

[Madhavan iyengar]

Dear Alkeshji

owner of the flat : Owner of Flat is Managing director of the Company

who is receiving the rent: Managing Director is receiving the rent from company

[Alkesh Jani]

Sir,

In this regards, my point of view is that, the services of Director to the company is Directorship service and renting of immovable property to the company is distinguishable, therefore, no way it can be termed as Directorship services. In the present case, RCM for renting of immovable property is not applicable.

Thanks

[Mahadev R]

I wish to concur with Alkesh Jani

AI Summary

Company X Renting Director's Flat Not Subject to GST Reverse Charge Mechanism, Participants Agree A Managing Director of Company X rented his flat to the company for Rs. 15,000 per month to be used as a guest house or training center. The query was whether Company X must discharge GST on a reverse charge mechanism (RCM) basis for this arrangement. A participant clarified that renting property is distinct from directorship services, and thus, RCM is not applicable in this case. Another participant concurred with this interpretation, suggesting that the transaction does not fall under RCM obligations for GST.