TaxTMI 
TaxTMI 
If a government entity receives construction services from CPWD (a government agency), the CPWD is liable to pay tax under the Forward Charge Mechanism (FCM), or the government entity under the Reverse Charge Mechanism (RCM).
RCM applicability of Government Entity
10 Oct 2024 
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Reverse charge mechanism applies where Central Government department supplies services to a separate government entity, not covered by exemption.
Supplies from CPWD, a Central Government department, to an entity established by statute are subject to the Reverse Charge Mechanism where the recipient is a separate government entity; Government-to-Government exemption notifications cover services between Central/State/UT/Local Authorities but do not extend to "government entity" or separate government companies, so the recipient may be liable under RCM. (AI Summary)
Supplies from CPWD, a Central Government department, to an entity established by statute are subject to the Reverse Charge Mechanism where the recipient is a separate government entity; Government-to-Government exemption notifications cover services between Central/State/UT/Local Authorities but do not extend to "government entity" or separate government companies, so the recipient may be liable under RCM. (AI Summary)