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 on GTA services: nil rate applies for transport of agricultural produce and specified goods. Whether the Reverse Charge Mechanism applies to outward transportation for exempt agricultural products is answered by Notification No.12/2017-C.T. (Rate) sl.21, which provides that services by a goods transport agency for carriage of agricultural produce and specified goods (including milk, salt, food grains, organic manure, registered newspapers, relief materials and defence equipment), and certain low-consideration consignments, are chargeable to nil rate of tax.