RCM on Rent for Exempted Commodity

[Praveen VR]

We seek your advice on the following query.

We have Clients who are selling only Exempted commodities and, hence do not come under the GST payment gambit. With the RCM on Rent rule being incorporated, should we still pay this (RCM on rent) without any chance of adjusting against outward tax liability payment. If we pay this RCM payment, is there any chance of recovery or do we have an exemption to pay RCM on rent for this category of GST dealers

AI Summary

Reverse charge on rent applies to registered recipients; registration status determines RCM liability and obligations.
Liability for tax on rent under the Reverse Charge Mechanism falls on the recipient when that recipient is registered; registered dealers who deal exclusively in exempt supplies must pay RCM on rent where applicable, and surrendering registration removes that RCM obligation. Recipients who receive services subject to RCM must obtain compulsory registration and discharge RCM even if their outward supplies are exempt, whereas persons not registered because they only make exempt or non-taxable supplies are not liable under RCM.