Both the parties are unregistered

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

18 July 2017 An unregistered dealer purchases some taxable items from another unregistered dealer.

Here whether the unregistered (buyer) dealer is required to get registered under GST Act and pay GST under reverse charge method?

Thanks.

CA Shubhanshu Jain

CA Shubhanshu Jain (Expert)
Follow

18 July 2017 No, Unregistered dealer is not required to get himself registered

because reverse charge under section 9(4) [from unregistered dealer] is applicable when registered dealer purchase some goods from unregistered dealer. But if unregistered dealer is purchasing from unregistered dealer then 9(4) is not applicable and hence no requirement of payment of tax under reverse charge and hence not required to get registered under GST

Amol S Joglekar

Amol S Joglekar (Expert)
Follow

18 July 2017 No.Not required to do so

Querist : Anonymous

Querist : Anonymous (Querist)

18 July 2017 Both of you-Thanks a lot!

Amol S Joglekar

Amol S Joglekar (Expert)
Follow

18 July 2017 you are most welcome......

Amol S Joglekar

Amol S Joglekar (Expert)
Follow

18 July 2017 there is one remote possibility in your query..... read section 24(iii) which says the following
categories of persons shall be required to be registered under this Act,––
(iii) persons who are required to pay tax under reverse charge;
Just for Brain storming session :.... notification no. 13/2017 dated 28/06/2017 regarding the persons required to pay GST on RCM..... this gives the list of persons availing the various services as mentioned in the said notification...... by virtue of this notification if a person is required to get registered.... then s/he is no more an unregistered dealer and then answer to your query may turn out to be different....
Your views please.

Message likes : 1 times

Querist : Anonymous

Querist : Anonymous (Querist)

18 July 2017 It appears, in this case, the buyer is required to pay GST under reverse charge and so he would have to get registered.

CA Shubhanshu Jain

CA Shubhanshu Jain (Expert)
Follow

18 July 2017 No you are not required to registered above provision is applicable only in case where a dealer whether registered or unregistered receives any services from Goods transport agency, advocates etc. i.e from persons whose services are notified specifically for reverse charge but if unregistered dealer is purchasing from unregistered dealer then registration is not required.