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Reverse charge applicable or not ?

08 November 2017

unragister person sale gold to ragister person in month of November 2017, in that situation reverse charge applicable or not??

if not applicable then please show a notification / circular number .

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B Vinay Reddy (Hyderabad ) (7842 Points)
Replied 08 November 2017

Dear Mr.Hardik
The above transaction is covered u/s 9(4) of CGST Act,2017
I.e., purchases made by Registered person from Unregistered persons

The above section 9(4) has been suspended till 31st of March 2018 as decided by 22nd GST Council Meeting.

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Hardik Patel (40 Points)
Replied 08 November 2017

thanks a lot sir.....

B Vinay Reddy (Hyderabad ) (7842 Points)
Replied 08 November 2017

Below is the extract of Press Release

6. The reverse charge mechanism under sub-section (4) of section 9 of the CGST Act, 2017 and under sub-
section (4) of section 5 of the IGST Act, 2017 shall be suspended till 31.03.2018 and will be reviewed by
a committee of experts. This will benefit small businesses and substantially reduce compliance costs

Parv Kumar (Student) (4037 Points)
Replied 08 November 2017

Rule 32(5) of the Central Goods and Services Tax (CGST) Rules, 2017, provides that where a taxable supply is provided by a person dealing in buying and selling of second hand goods or used goods as such or after such minor processing which does not change the nature of the goods and where no input tax credit has been availed on the purchase of such goods, the value of supply shall be the difference between the selling price and the purchase price and where the value of such supply is negative, it shall be ignored. This is known as the margin scheme.

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Parv Kumar (Student) (4037 Points)
Replied 08 November 2017

Also RCM on purchase from unregistered supplier is suspended from 13 Oct..

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RAJA P M ("Do the Right Thing...!!!") (128091 Points)
Replied 08 November 2017

Originally posted by : Hardik Patel
	unragister person sale gold to ragister person in month of November 2017, in that situation reverse charge applicable or not??if not applicable then please show a notification / circular number .

Reverse Charge not applicable for "Gold Jewellers" received/Purchased from End users...

Hardik Patel (40 Points)
Replied 08 November 2017

Sir can you send me a link ....i can't found on the GST council website....

Hardik Patel (40 Points)
Replied 08 November 2017

for that notification issued by the GST counciler.

RAJA P M ("Do the Right Thing...!!!") (128091 Points)
Replied 08 November 2017

14th July 2017 - New Delhi:

The government on Friday clarified that jewellers will not need to pay the Goods and Services Tax (GST) under reverse charge mechanism on old jewellery purchases from individuals. "Even though the sale of old gold by an individual is for a tax consideration, it cannot be said to be in the course or furtherance of his business, as selling old gold jewellery is not the business of the individual and hence does not qualify to be a supply in itself," the Finance Ministry said in a statement. The clarification came after Revenue Secretary Hasmukh Adhia on Thursday said that purchase of old gold jewellery by a jeweller from a consumer would be subjected to three per cent GST under reverse charge mechanism in terms of the provisions contained in the Central GST Act. However, if an unregistered supplier of gold ornaments sells it to registered supplier, the tax under reverse charge mechanism will apply. Section 9(4) of the said CSGT Act mandates that tax on supply of taxable goods (gold in this case) by an unregistered supplier (an individual in this case) to a registered person (the jeweller in this case) will be paid by the registered person (the jeweller in this case) under reverse charge mechanism. This provision, however, has to be read in conjunction with Section 2(105) read with Section 7 of the said Act. Section 2 (105) defines supplier as a person supplying the goods or services and Section 7 provides that a supply is a transaction for a consideration by a person in the course or furtherance of business.

https://indianexpress.com/article/business/economy/no-gst-on-sale-of-old-gold-jewellery-vehicles-by-individuals-4749629/

https://timesofindia.indiatimes.com/business/india-business/no-gst-on-sale-of-old-jewellery-cars-by-individuals/articleshow/59589873.cms

https://economictimes.indiatimes.com/news/economy/policy/sale-of-old-gold-jewellery-will-not-attract-gst-on-exchange/articleshow/59585077.cms

https://www.thehindu.com/business/Industry/no-gst-on-old-gold-sold-to-jewellers/article19272064.ece

https://www.businesstoday.in/current/economy-politics/3-per-cent-gst-individuals-sell-gold-jewellery-to-registered-jewellers/story/256429.H T M L