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Rate of tax on RCM liability

Akshay Jain (Tax Consultant) (1024 Points)

21 June 2020

Sir, I purchased cement from a dealer which is 28% and after 1 month he gave invoice for transportation on RCM basis @ 5% with ITC. Now, the question is I have also issued bills only for cement how may I issue bill for transportation charges. will it @ 5% or any other.

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7 Replies

prasad Nilugal ( GST Practitioner & Accounts ) (14801 Points)
Replied 21 June 2020

Is Transporter GTA ( Goods Transport Agency ) and issue consignment note ?.

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KRISSHNAN KP (4215 Points)
Replied 21 June 2020

You may issue bill @ 28%

1 Like

Pankaj Rawat (GST Practitioner) (55052 Points)
Replied 21 June 2020

Dear Akshay
There are 2 transactions involving in your query
1. You Purchase Cement on which GST being charged @ 28% which is fine .

2. Now you got the transportation bill @ 5% GST .

In 2nd transaction , the bill for transportation is from Dealer or from GTA ?????

Assuming that you got bill from Dealer not from GTA : Then no RCM is applicable , you can claim ITC of 5% being charged on bill.
Note : The correct way for billing ,Dealer must have added the transportation expenses in bill for the cement .

Assuming you got the Bill from GTA :
Then in term of Notification 13/2017 CT (R) , You are liable to do RCM .
Note : Ask GTA not charge 5% GST on bill as RCM is applicable & you as registered taxpayer is liable to do RCM.

Akshay Jain (Tax Consultant) (1024 Points)
Replied 21 June 2020

He is not transporter and he had issued bill for transportation @ 5%

Pankaj Rawat (GST Practitioner) (55052 Points)
Replied 22 June 2020

then can claim itc , no need to do rcm

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Bhavika Kothari (CA) (1258 Points)
Replied 26 June 2020

Since the dealer is not GTA you can directly claim ITC. Also you can ask the dealer to pay liability as it is not an RCM transaction

Akshay Jain (Tax Consultant) (1024 Points)
Replied 18 July 2020

Sir he is not GTA, he have transport division saparately and he issued bill on RCM basis.

my query is I have issued only tax invoice of cement and freight bill is issuing after 10 to 15 days will I give
1) bill of supply and not charging GST @ 5% or
2) charging GST @ 5% or
3) if not above which kind of bill to be issued to party
i.e. is freight Bill saparately issued is exempted ?