Applicability of cess reject coal purchased from URP

This query is : Resolved

Venkateshwarlu Pulluri (Querist)
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16 January 2025 Good afternoon sir/s,

Is cess applicable which is purchased from URPs and sold out by a registered person

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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16 January 2025 Cess is levied only on specified goods categorized as demerit goods. These include:
Tobacco products (e.g., pan masala, cigarettes)
Motor vehicles (luxury cars)
Aerated waters
Coal and similar solid fuels

The registered person purchasing these goods from URPs must be engaged in supplying the notified goods. They are required to pay GST and any applicable cess under the reverse charge mechanism (RCM) when procuring from URPs.

If the Registered Person is under the composite scheme, cess would not be applicable.