Security Service by Other than body corporate to SEZ

[KUMAR Narasimhan]

Security Service done by other than body corporate to SEZ unit.

SEZ unit has to pay the tax under RCM. Please confirm, am I right?

AI Summary

GST Reverse Charge Not Applicable for SEZ Security Services; Zero-Rated Under IGST Section 16(1)(b). GSTR-1 Filing Issues Noted. A query was raised regarding the applicability of Goods and Services Tax (GST) under the Reverse Charge Mechanism (RCM) for security services provided to a Special Economic Zone (SEZ) unit by entities other than body corporates. It was clarified that SEZs are generally not liable to pay GST under RCM, as per departmental communication. The service is considered zero-rated under Section 16(1)(b) of the IGST Act, implying no tax liability for the service provider. However, an FAQ suggests SEZ units might be deemed suppliers under RCM, though this lacks statutory authority. The discussion also noted technical issues with GSTR-1 filings related to SEZ transactions.