RCM on GTA Services

[Arif Kathiria]

Sir,

Our Client is dealing in exempted product, via notification no. 2/2017 dt 28.06.2017, Raw material used in produce are agricultural commodity.

My Question is

Whether RCM is applicable on outward transportation, and also in other services ?

[Rajagopalan Ranganathan]

Sir,

Vide sl. No. 21 of Notification No.12/2017-C.T. (Rate) dated 28.6.2017 as amended

Heading 9965 or Heading 9967: - Services provided by a goods transport agency, by way of transport in a goods carriage of -

(a) agricultural produce;

(b) goods, where consideration charged for the transportation of goods on a consignment transported in a single carriage does not exceed one thousand five hundred rupees;

(c) goods, where consideration charged for transportation of all such goods for a single consignee does not exceed rupees seven hundred and fifty;

(d) milk, salt and food grain including flour, pulses and rice;

(e) organic manure;

(f) newspaper or magazines registered with the Registrar of Newspapers;

(g) relief materials meant for victims of natural or man-made disasters, calamities, accidents or mishap; or

(h) defence or military equipments.

are chargeable to 'nil' rate of tax.

[KASTURI SETHI]

I am also of the same view. No need of further elaboration as opined by Sh. Ranganathan, Sir.

AI Summary

Reverse Charge Mechanism not applicable on transportation services for agricultural commodities under Notification No. 12/2017-C.T. (Rate). A query was raised regarding the applicability of Reverse Charge Mechanism (RCM) on outward transportation and other services for a client dealing in exempted products, specifically agricultural commodities. The first response clarified that under Notification No. 12/2017-C.T. (Rate) dated 28.6.2017, services provided by a goods transport agency for transporting certain goods, including agricultural produce, are subject to a 'nil' rate of tax. The second response concurred with this interpretation, affirming that RCM is not applicable in this context.