Rcm on freight charges

This query is : Resolved 

11 February 2019 If registered dealer Purchases MAIZE, DE. OILED RICE BRAN, RICE, AND GWAR ETC. from a registered dealer of other state for manufacturing of Cattle Feeds and paid freight charges to transporter whether he is liable to deposit RCM on freight charges paid for purchases of Maize, Rice, Gwar, De. Oiled Rice Bran etc. Pls Reply



11 February 2019 yaa. exempt as per notification 12/2017 as amended.

11 February 2019 Exempt

No GST on freight charges in India is applicable for the following:

Transport of agricultural produce
Transport of milk, salt, food grains including rice, flour, pulses
Transport of organic manure
Transport of newspapers or magazines registered with the Registrar of Newspapers
Transport of relief materials for victims of natural or man-made disasters, calamities, accidents or mishaps
Transport of defence or military equipment
Transport of any goods, where the gross amount charged for transportation for a consignment transported in a single carriage is less than Rs. 1,500

20 July 2025 Regarding RCM on freight charges paid by a registered dealer for interstate purchase of raw materials like Maize, De-oiled Rice Bran, Rice, and Gwar:

Key points:
GST on freight services by a GTA (Goods Transport Agency) is subject to Reverse Charge Mechanism (RCM) if the freight charges exceed Rs. 750 per consignment.
The recipient of service (you, the registered dealer) has to pay GST under RCM on freight charges paid to the transporter if the transporter does not pay GST on these services.
In your case:
You are purchasing goods interstate (from another state).
Freight charges are paid to the transporter.
Freight service by GTA is covered under RCM.
So, yes, you are liable to deposit GST under RCM on freight charges paid to the transporter for the interstate movement of goods.
The GST rate is usually 5% (2.5% CGST + 2.5% SGST or 5% IGST, depending on place of supply).
Practical Points:
If the transporter is registered and charges GST on the invoice, you do not pay RCM; instead, you claim input tax credit.
If the transporter is unregistered or does not charge GST, then you pay GST on freight under RCM.
Summary:
RCM on freight is applicable if the freight provider is unregistered or does not charge GST.
It applies irrespective of the goods being raw materials like Maize, Rice, etc.
The liability to pay GST on freight under RCM lies with the registered recipient (you).


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