Gst exempt service
This query is : Resolved
25 August 2018
ABC is a Goods Transport Agency whose Claimed Input and Charge GST @12% on Service
He is also Provide commercial vehicle to Goods Transport Agency for Inter State Services, Can such services exempt from GST
Against which notification he claimed exemption
He is also Provide commercial vehicle to Goods Transport Agency for Inter State Services, Can such services exempt from GST
Against which notification he claimed exemption
Guest
Guest
(Expert)
26 August 2018
As per Notification Number 12/2017 CT (RATE) , Supply of vehicle on hire to GTA is exempt from payment of tax
27 August 2018
but this notification deal with Intra state Service but my queary related to Inter State service
27 July 2024
Under the GST framework in India, certain services provided by Goods Transport Agencies (GTA) are exempt from GST. However, there are specific conditions and notifications that outline these exemptions.
### **1. Exemption on Services Provided by Goods Transport Agency (GTA):**
Under GST, the exemption for services provided by a Goods Transport Agency (GTA) is primarily governed by the following:
- **Notification No. 12/2017 - Central Tax (Rate) dated 28th June 2017:**
This notification provides the list of services that are exempt from GST. Specifically, for GTA services, the relevant clause is:
- **Entry No. 21:** Services by way of transportation of goods by road except the services provided by a goods transport agency (GTA) in relation to transportation of goods by road, where the consideration charged for such services does not exceed Rs. 1500/- per consignment.
### **2. Conditions for Exemption:**
The exemption under Notification No. 12/2017 generally applies under the following conditions:
- **If the service is provided by a GTA:**
The GTA services are exempt if the transport is in relation to the following:
- **Transport of goods by road** (where the service provided falls under the definition of GTA).
- **The transport of goods by rail, vessel, or air**.
- **Transport of specific goods** such as agriculture produce, milk, etc. (where the exemption is specific).
- **Exemption Limit:**
The exemption applies to transportation services where the consideration charged does not exceed Rs. 1500/- per consignment.
### **3. Inter-State Services:**
For inter-state transportation services, generally, GST is applicable at a rate of 12% for GTA services unless specifically exempted by the above notification. The inter-state nature of the service does not typically affect the exemption directly.
### **4. Applicability of Exemption:**
If a Goods Transport Agency is providing services such as:
- **Transportation of goods by road** for an inter-state movement,
- **Providing commercial vehicles** to another Goods Transport Agency,
It is essential to determine whether:
- The specific service provided falls under the exemption clause mentioned in Notification No. 12/2017.
- If the service is not specifically exempt, GST would be applicable at the standard rate for GTAs, which is typically 12%.
### **5. Claiming Exemption:**
If the service is exempt:
- **Claiming Input Tax Credit (ITC):**
If the service provided by GTA is exempt, the input tax credit on inputs and input services related to exempt supplies is not available. The exemption status should be claimed based on the nature of services and the conditions specified in the notification.
### **6. Example Scenario:**
If ABC, a GTA, provides a commercial vehicle to another GTA for inter-state transportation, the GST rate and applicability would be as follows:
- **If the service falls under the exempt category:** No GST would be charged.
- **If it does not fall under exemption:** GST at 12% would apply.
### **Reference for Exemption Clauses:**
1. **Notification No. 12/2017 - Central Tax (Rate) dated 28th June 2017**
- **Entry No. 21:** Services by way of transportation of goods by road provided by a goods transport agency where the consideration charged for such services does not exceed Rs. 1500/- per consignment.
2. **Section 9(3) of the CGST Act:** Deals with reverse charge mechanism, where the recipient of the service is liable to pay GST.
**Conclusion:**
Ensure to check the specific nature of services being provided and refer to the latest notifications and updates from the GST Council or consult with a GST practitioner to confirm eligibility for exemptions and compliance.
### **1. Exemption on Services Provided by Goods Transport Agency (GTA):**
Under GST, the exemption for services provided by a Goods Transport Agency (GTA) is primarily governed by the following:
- **Notification No. 12/2017 - Central Tax (Rate) dated 28th June 2017:**
This notification provides the list of services that are exempt from GST. Specifically, for GTA services, the relevant clause is:
- **Entry No. 21:** Services by way of transportation of goods by road except the services provided by a goods transport agency (GTA) in relation to transportation of goods by road, where the consideration charged for such services does not exceed Rs. 1500/- per consignment.
### **2. Conditions for Exemption:**
The exemption under Notification No. 12/2017 generally applies under the following conditions:
- **If the service is provided by a GTA:**
The GTA services are exempt if the transport is in relation to the following:
- **Transport of goods by road** (where the service provided falls under the definition of GTA).
- **The transport of goods by rail, vessel, or air**.
- **Transport of specific goods** such as agriculture produce, milk, etc. (where the exemption is specific).
- **Exemption Limit:**
The exemption applies to transportation services where the consideration charged does not exceed Rs. 1500/- per consignment.
### **3. Inter-State Services:**
For inter-state transportation services, generally, GST is applicable at a rate of 12% for GTA services unless specifically exempted by the above notification. The inter-state nature of the service does not typically affect the exemption directly.
### **4. Applicability of Exemption:**
If a Goods Transport Agency is providing services such as:
- **Transportation of goods by road** for an inter-state movement,
- **Providing commercial vehicles** to another Goods Transport Agency,
It is essential to determine whether:
- The specific service provided falls under the exemption clause mentioned in Notification No. 12/2017.
- If the service is not specifically exempt, GST would be applicable at the standard rate for GTAs, which is typically 12%.
### **5. Claiming Exemption:**
If the service is exempt:
- **Claiming Input Tax Credit (ITC):**
If the service provided by GTA is exempt, the input tax credit on inputs and input services related to exempt supplies is not available. The exemption status should be claimed based on the nature of services and the conditions specified in the notification.
### **6. Example Scenario:**
If ABC, a GTA, provides a commercial vehicle to another GTA for inter-state transportation, the GST rate and applicability would be as follows:
- **If the service falls under the exempt category:** No GST would be charged.
- **If it does not fall under exemption:** GST at 12% would apply.
### **Reference for Exemption Clauses:**
1. **Notification No. 12/2017 - Central Tax (Rate) dated 28th June 2017**
- **Entry No. 21:** Services by way of transportation of goods by road provided by a goods transport agency where the consideration charged for such services does not exceed Rs. 1500/- per consignment.
2. **Section 9(3) of the CGST Act:** Deals with reverse charge mechanism, where the recipient of the service is liable to pay GST.
**Conclusion:**
Ensure to check the specific nature of services being provided and refer to the latest notifications and updates from the GST Council or consult with a GST practitioner to confirm eligibility for exemptions and compliance.
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