Benefit of Third Proviso to Rule 28 in case of actual consideration

[Abhijeet Mane]

Hi If the Company A has recevied the actual consideration from related party (Let say 1000 Rs) for providing services. Related Party is eligible for Full ITC then also whether the Company A can take benefit of Third Proviso to Rule 28 and pay GST at any value including NIL Value

[Mary Bridges]

When Company A receives actual consideration from a related party (e.g., Rs 1000) for services and the related party is eligible for full ITC, Company A can indeed benefit from the third proviso to Rule 28. This allows GST to be paid on any value, including NIL, as long as the recipient is eligible for full ITC. Billing Software simplifies the invoicing process and ensures you're compliant with GST rules!

[Shilpi Jain]

If the recipient is eligible for full ITC then certainly nil is also a possible value. Circulars have clarified this view.

[Tarun Agarwalla]

I hope we may read 2nd proviso to rule 28(1) in place of third proviso.

thank you

AI Summary

Third Proviso to Rule 28 allows supplier to declare GST value, including nil, if recipient is eligible for full ITC. Where services are supplied to a related party that is eligible for full input tax credit, the supplier may invoke the Third Proviso to Rule 28 and declare GST on any value, including nil, despite actual consideration having been received; a respondent queried whether the Second Proviso to Rule 28(1) might instead apply.