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Sr. No. 1 of notification under Central Tax and Sr. No. 2 of notification under Integrated Tax provides that tax will be payable by the recipient of service in respect of services provided by GTA to specified person.

The entry in both the notification reads as follows:





Category of  Services

Supplier  of service

Recipient of Service

Supply of Services by a goods transport agency (GTA) in respect of transportation of goods by road to -

(a) any factory registered under or governed by the Factories Act, 1948 (63 of 1948); or

(b) any society registered under the Societies Registration Act, 1860 (21 of 1860) or under any other law for the time being in force in any part of India; or

(c) any co-operative society established by or under any law; or

d) any person registered under the Central Goods and Services Tax Act or the Integrated Goods and Services Tax Act or the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act; or

(e) any body corporate established, by or under any law; or

(f) any partnership firm whether registered or not under any law including association of persons; or

(g) any casual taxable person.

Goods Transport Agency (GTA)

(a) Any factory registered under  or governed by the Factories Agency Act, 1948 (63 of 1948); or (GTA)

(b) any society registered under the Societies Registration Act, 1860 (21 of 1860) or under any other law for the time being in force in any part of India; or

(c) any co-operative society established by or under any law; or

(d) any person registered under the Central Goods and Services Tax Act or the Integrated Goods and Services Tax Act or the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act; or

e) any body corporate established, by or under any law; or

(f) any partnership firm whether registered or not under any law including association of persons; or

(g) any casual taxable person; located in the taxable territory.


Clause (a) of the explanation given below the notification provides that the person who pays or is liable to pay freight for the transportation of goods by road in goods carriage, located in the taxable territory shall be treated as the person who receives the service for the purpose of this notification. Therefore if recipient is located in non-taxable territory, the tax will be payable by GTA as entry number 1 referred above is not applicable.

Meaning of 'goods transport agency'

'Goods transport agency' is defined in para 2(ze) of notification 12/2017- Central Tax (Rate) as follows:-

(ze) 'Goods transport agency' means any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name called. The clause 2(zd) of notification 12/2017-Central Tax (Rate) defines 'goods carriage' as meaning assigned to it in clause (14) of Section 2 of Motor Vehicle Act. It means vehicle shall have permit to transport goods.

The essential ingredients

The definition contemplates satisfaction of following ingredients for any agency to be termed as a 'goods transport agency'

Meaning of 'transport of goods by road' and 'issue of Consignment note'

The Act provides that both the conditions, namely, transport of goods by road and issue of consignment note must be satisfied. Normally, when a person deposits the goods with any transporter for the purpose of transport to a given destination, the transporter issues the lorry receipt or consignment note to the person depositing the goods. The name of the consignee is mentioned on such note. The original copy of the lorry receipt is sent by the person depositing the goods to the consignee to enable him to collect the goods from the transporter.

Say A intends to transport the goods from Mumbai to Jaipur, A will deposit the goods with a transporter say 'Z' who will issue the consignment note in favour of consignee, i.e., 'B' in Jaipur. A will send the original copy of the consignment note to B to enable him to collect the goods from the office of 'Z' situated in Jaipur. The definition contemplates that the consignment note must be issued by goods transport agency.

Issue of consignment note is made mandatory

It is mandatory for every goods transport agency which provides service in relation to transport of goods by road to issue a consignment note to the recipient of service containing the prescribed particulars.

Meaning of Goods

Section 2(52) defines 'goods' as follows:

(52) "goods" means every kind of movable property other than money and securities but includes actionable claim, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or under a contract of supply;

Following is evident from above definition

  • Only movable property shall be considered as goods.
  • The definition of 'goods' specifically excludes securities and money
  • Actionable claim will be considered as goods.
  • Growing crops, grass and things attached to or forming part of the land will be considered as goods.

To see the rate of tax payable in case of GTA service. Please see the attached video.


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Category GST, Other Articles by - CA Somil Bhansali  



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