CASH PAID ON WRONG RCM

[KERAGODEGOPALARAO ANANTHARAO]

We have RCM on expenses which are not covered under GST. We availed credit of RCM paid as it's paid in cash. In audit it's an objection as wrongly claimed as such to the extent of RCM claimed to be paid again. Is it correct?

AI Summary

Debate on Reverse Charge Mechanism error under GST: Is repaying availed credit necessary or just a disclosure issue? A discussion on a forum addresses a query about the incorrect payment of Reverse Charge Mechanism (RCM) under the Goods and Services Tax (GST) for expenses not covered by GST. An audit raised objections to the credit availed for RCM paid in cash, suggesting it needs to be repaid. While one participant agrees with the audit's objection, others argue that the situation is revenue-neutral and may only constitute a disclosure error. References to case law suggest that input tax credit (ITC) for taxes wrongly paid under RCM may be permissible. Participants discuss the potential for appeal and share relevant legal precedents.