Applicability of RCM to Labour Sub-Contractor

[Arunachalam M]

Dear Members,

Our query is One of the Construction Company is doing construction of building in govt projects using service of Labour Sub contractor (Unregistered Dealer).

We need to be clear whether we can go ahead using by paying GST under RCM for URD LabouSub Contractor.

Any Notifications or Circulars in favour or against using RCM for Labour Sub contract under URD.

Requesting Experts guidance and advise on this issue.

Thanks and regards,

Arunachalam M

AI Summary

Construction Firm's Use of Unregistered Labour Subcontractor Exempts RCM Under GST; Confirmed by Notification 12/17-CT(R) A construction company engaged in government projects is using an unregistered labour subcontractor and seeks clarity on the applicability of Reverse Charge Mechanism (RCM) under the Goods and Services Tax (GST). Experts in the forum agree that RCM is not applicable in this case. The service provided is pure labour, which is exempt under Notification 12/17-CT(R) and subsequent amendments. Additionally, the subcontractor's services are not covered by RCM as per Notification 13/2017. The main contractor is not considered a promoter under RERA, further negating RCM applicability.