GST on Hamali charges

[Kavali Ramanjeneyulu]

One Kiranam trader incurred expenditure on Hamali workers. Is RCM applicable on Hamali charges during the period from July 2017 to 13/10/2017 in terms of Notfn no 8/2017-CT dt 28/6/2017 issued under sec 9(4) of CGST Act. Please clarify.

[KASTURI SETHI]

Your query is for the period from July, 17 to 13.10.17 under Section 9(4) of CGST Act. Hamali Charges are taxable even now. No exemption is available under RCM.

Hamali charges are expenses on account of loading and unloading of goods from the truck. These are part of GTA services. If invoice is raised inclusive of hamali charges, GST will be paid @5% under RCM. If charged separately, it will fall under manpower supply and RCM will not be applicable. Under FCM, rate will be 18%.

Section 9(4) of CGST Act is not applicable here. Section 9(3) of CGST Act read with Notification No.13/17-CT(R) dated 28.6.17 is applicable for the purpose of RCM. Manpower supply is not under RCM. Only Security Service is under RCM.

Also see reply filed against Issue ID 112601 dated 15.8.17.

AI Summary

Reverse charge on hamali charges: inclusive hamali treated as GTA attracting RCM; separate manpower supply excluded.
Hamali for loading and unloading is treated as part of GTA services when invoiced inclusive with transport and thus attracts reverse charge under the RCM notification; if charged separately as manpower supply, reverse charge does not apply and the supply is subject to forward charge at the standard manpower supply rate. Security services remain within RCM while manpower supply is excluded.