falling under schydule 3 things is it liable for rcm u/s 9(4)

[NEAR STAND]

respected sir when we are falling under SCHEDULE 3 beause of we sale our building after complition and thats why we have not paid rcm under sec. 9(4) for labour which was from unregistrd so whether we should pay or not rcm

[KASTURI SETHI]

W.e.f. 1.4.19 only specific services have been brought under Section 9(4) for the purpose of RCM. Only promotors have been brought under RCM vide Notification No.6/19-CT(R) dated 29.3.19 effective from 1.4.19. Prior to 1.2.19, RCM was applicable to all supplies received from unregistered persons.

[NEAR STAND]

But sir before 13/10/2017 9(4) is applicable so our clients get notice to pay rcm on labor actually our clients sale whole building after completion

Then is it required to pay rcm because our service was falling under schedule 3 ??

Please sir give ur feedback

[KASTURI SETHI]

Section 9(4) was kept in abeyance for the period from 13.10.17 to 30.9.19. Notification No.8/17-CT(R) dated 28.6.17 and 32/17-IT(R) dated 13.10.17 have been rescinded w.e.f. 1.2.19 due to amendment in Section 9(4) of CGST Act.

Exemption to all registered persons was allowed w.e.f. 13.10.17 vide Notification No.38/17-CT(Rate) dated 13.10.17. Now the question arises for the period prior to 13.10.2017. You have received manpower supply from an unregistered person. This service is different and does not fall under Schedule-III. So tax is payable under RCM for the period from 1.7.17 to 12.10.17.

When tax is not payable (How to save tax as per GST Law)

(1) Under RCM tax is payable when payment is made to the supplier or 60 days from the date of issue of invoice. Thus if tax invoice was issued to the supplier (of manpower) on or after 14.8.17 and if payment was not made before 13.10.17, the time of supply will be on or after 13.10.17.Hence GST will not be payable under RCM.

So the date of issue of invoice and date of making payment both are very important for you in order to save tax as per GST law.

AI Summary

Reverse charge may apply to manpower from unregistered suppliers unless Schedule exemptions or time of supply rules defer liability.
RCM applicability depends on timing and character of the supply: manpower from unregistered persons did not fall under Schedule III and attracted RCM for the period from 1 July 2017 to 12 October 2017, whereas registered-person exemptions and later amendments removed RCM for specified services; invoice date and payment date determine whether RCM is triggered or avoided under time-of-supply rules.