RCM on Rent for Composite Dealer

[Praveen VR]

We have Clients who are composite dealers, hence cannot claim Input Tax Credit. With the RCM on Rent rule being incorporated, Should we still pay this (RCM on rent) without having any chance of adjustment against outward tax liability payment. If we pay this RCM payment, is there any chance of recovery or do we have an exemption for Composite dealers from paying RCM on rent

AI Summary

Reverse charge on rent remains payable by composition dealers despite ineligibility for input tax credit, increasing their cost.
Reverse charge on rent under GST is included within the statutory definition of input tax, but composition scheme taxpayers are barred from claiming input tax credit; accordingly composition dealers must pay RCM on rent and cannot recover it or adjust it against outward liability, making such RCM a cost of establishment.