GOODS TRANSPORT AGENCY - GTA - REGISTRATION -

[NAMAN DOKANIA]

A GTA is having turnvoer of 50 lakhs. Is he not collecting any GST, as it is liable for reverse charge, There is no other service/goods which is being provided by them. So, is he liable for GST Registration??

[KASTURI SETHI]

Not required. See Section 23 (1)(a) of CGST Act.

SECTION 23. Persons not liable for registration. — (1) The following persons shall not be liable to registration, namely :––

(a) any person engaged exclusively in the business of supplying goods or services or both that are not liable to tax or wholly exempt from tax under this Act or under the Integrated Goods and Services Tax Act;

If a person is not liable to tax, registration for what purpose ?

[Sadanand Bulbule]

In this situation, it is like buying an expensive horse just beacuse some one has a horseshoe nail.

[Ganeshan Kalyani]

I agree with the view of Sri Kasturi Sir. 

There is exemption for the supplier to obtain registration where the liability to pay tax is on the recipient.

[KASTURI SETHI]

Sh.Ganeshan Kalyani Ji,

Sir

Thanks a lot for validation. Your support on merits matters a lot. 

[KASTURI SETHI]

Sh.Sadanand Bulbule Ji,

Sir,

Your replies  always increase  knowledge of English language, in addition to knowledge on GST matters.

This is your unique style of validation of others reply.

Thanks a lot. 

[Sadanand Bulbule]

Dear Sirji

We need to keep in mind the taste of visitors to TMI. Just to serve them a better flavour.

[Shilpi Jain]

As per Notification No. 5/2017-Central Tax - this GTA not liable to register under GST

In exercise of the powers conferred by sub-section (2) of section 23 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government hereby specifies the persons who are only engaged in making supplies of taxable goods or services or both, the total tax on which is liable to be paid on reverse charge basis by the recipient of such goods or services or both under sub-section (3) of section 9 of the said Act as the category of persons exempted from obtaining registration under the aforesaid Act.

AI Summary

GST registration exemption for suppliers whose tax liability is on the recipient under reverse charge prevents mandatory registration.
A supplier engaged exclusively in making supplies on which tax is payable by the recipient under the reverse charge mechanism is not required to obtain GST registration. This follows the principle that persons exclusively supplying items not liable to tax or wholly exempt are excluded from registration, and is reinforced by a government notification specifying that reverse charge only suppliers are exempt from registration; consequently a GTA whose sole supplies are subject to reverse charge need not register.