Transport of goods on road is taxable in gst ?

[PN ELAMPARRUTHY]

A registered person own vehicle used for his business purpose to trnasporting of goods, in free time he used same vehicle for transport of goods for other charing only transport cost 

[Ryan Vaz]

Applicable Law / Notifications

• Section 7, CGST Act, 2017 – Scope of supply

• Section 9, CGST Act, 2017 – Levy of GST

• Section 2(26), CGST Act, 2017 – Definition of Goods Transport Agency (GTA)

• Notification No. 12/2017–CT (Rate) dated 28-06-2017, Entry 18 – Exemption for transport of goods by road (other than GTA / courier)

• Section 17(2) & Rule 42, CGST Rules, 2017 – ITC reversal for exempt supplies

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Short Practical Answer

GST depends on whether you are acting as a Goods Transport Agency (GTA) or not.

• If you are NOT issuing a consignment note ?
  Transport of goods by road is exempt from GST, even if you charge transport cost.

• If you ARE issuing a consignment note ?
  You become a GTA, and GST will apply (5% or 12% depending on ITC option).

[Sadanand Bulbule]

"Consignment Note" is the statutory backbone to qualify as GTA & tax liability.Otherwise he remains as Goods Transport Operator[GTO] and enjoys GST exemption like any other lorry owner.

[Shilpi Jain]

If its transportation of goods and you are charging cost, and you are issuing consignment note or any document that has details similar to those contained in a consignment note then GST is liable.

If you have taken credit of GST paid on your vehicle (which was purchased within 5 years) you shoudl file a declaration  in notified annexure, that you will pay GST under FCM. If you require the recipient to pay GST then that is also an option. FCM has 2 rates possible 5% or 18%.

[Shilpi Jain]

Based on your and your customers requirement you can chose an option FCM/RCM and continue that for the FY

[KASTURI SETHI]

GTO is NOT GTA and vice versa.

[KASTURI SETHI]

In continuation to above, technically both are different concepts.

[PN ELAMPARRUTHY]

Notification No. 12/2017–CT (Rate) dated 28-06-2017, Entry 18 – Exemption for transport of goods by road (other than GTA / courier), this is will not to the transport operator ? . Just issuing transport charges alone, mostly they URP catergory.

[KASTURI SETHI]

              Your query stands already replied by Sh.Sadanand Bulbule, Sir.

AI Summary

Road freight transport without consignment note (non-GTA) stays GST-exempt; issuing consignment note triggers GTA status and GST liability. Transport of goods by road constitutes a supply under sections 7 and 9 of the CGST Act, 2017, but is exempt under Notification No. 12/2017-CT (Rate), Entry 18, when provided otherwise than by a goods transport agency (GTA) or courier; consequently, a transport operator who does not issue a consignment note is treated as a non-GTA goods transport operator and no GST is payable on the transport charges. Where the operator issues a consignment note, the operator qualifies as a GTA under section 2(26) and GST becomes payable at the applicable rate (with rate depending on the input tax credit option), with input tax credit reversal implications for exempt supplies under section 17(2) read with Rule 42.