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Unregistered Dealer Pays Freight to GST

Rahul Agarwal (Chartered Accountant ) (147 Points)

01 August 2019

If an Unregistered dealer (URD) supplies some good to Registered person through GTA and pays freight to GTA. But as per Notification 13/2017 the person who pays freigh to GTA is deemed to be recipient of service. So who will pay GST under RCM as supply of service to an unregistered dealer by a GTA is exempt under Notification 32/2017 CT(Rate).

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6 Replies

Yash Dharavat (CA) (36 Points)
Replied 01 August 2019

Section 24(iii) of CGST Act contemplates every person responsible to pay tax under reverse charge to get the registration. Hence, in the above case, the URD will have to get registered.

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Rahul Agarwal (Chartered Accountant ) (147 Points)
Replied 01 August 2019

URD is not a person like company/partnership firm so it is not liable to pay tax under RCM as per 13/2017 but is recipient of service as it has paid freight and GTA supplies goods to a registered person.

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Shivam RC (Student) (23683 Points)
Replied 01 August 2019

Who have paid the freight to GTA ??? Registered Dealer or URD ???

nitin joshi (student) (32 Points)
Replied 01 August 2019

He is not liable to pay gst under rcm for service provided by gta as he is exempt from rcm as per entry no 21A

Rahul Agarwal (Chartered Accountant ) (147 Points)
Replied 01 August 2019

URD pays freight and as URD is not liable to pay tax under RCM and is also exempt under entry 21A who will pay tax if the goods are supplied to a company by URD through GTA.

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Pankaj Rawat (GST Practitioner) (55047 Points)
Replied 01 August 2019

1. RCM is applicable to one who paying to GTA , so here for GTA the Recepient is URD

2. As per the query , The supplier who is an URD paying to GTA , & in Term of Notification 32/2017 CT (R) it's exempted

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