service recipient have any consequential effect?

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This discussion clarifies the implications for a company paying GST under Reverse Charge Mechanism (RCM) for security services when the registered service provider fails to file their GSTR-1. The key takeaway is that the service recipient's correct discharge of RCM liability, including payment and disclosure in GSTR-3B, protects their Input Tax Credit (ITC). While the supplier's non-compliance may lead to departmental scrutiny, it doesn't automatically penalise the recipient if they have fulfilled their obligations and maintained proper documentation.

Marimuthu

Marimuthu (Querist)

25 March 2024 Dear Experts,
1 A company is availing the security services from a GST registered person,
2 Since the RCM is applicable, the company is discharged its lability.
3 Now the query is
4 Whether the service provider needs to FILE GSTR 1 on invoice wise basis.
5 If the service provider not filed, will the service recipient have any consequential effect?
6 Pls clarify

RAJA P M

RAJA P M (Expert)

25 March 2024 Is that service provider (security service person) corporate...??? or other than corporate...??? what about receiver...??? is receiver is corporate...???

Marimuthu

Marimuthu (Querist)

25 March 2024 Service provider : Partnership Firm registered under GST
Service Receiver: Corporate Sir

RAJA P M

RAJA P M (Expert)

25 March 2024 In this case rcm applicable.

Message likes : 1 times

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)

15 August 2025 If you’ve correctly discharged tax under RCM for security services, your entitlement to ITC is not impacted by the supplier’s failure to file GSTR-1. Your compliance—payment via cash ledger, disclosure in GSTR-3B, and maintenance of invoice and payment proof—is what matters.
Advice for the Recipient:
Disclose RCM correctly under Table 3.1(d) of your GSTR-3B.
Keep proper evidence—invoice, contract, proof of payment, etc.—to substantiate your RCM and ITC position during assessments.
If the supplier persisting in non-filing raises red flags in your GSTIN record, consider issuing a GST demand notice or reminding them to file GSTR-1 to maintain seamless ITC flow.
In essence, while the supplier’s default may invite departmental queries, there’s no automatic downstream penalty for the recipient who has otherwise complied in good faith.

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