RCM on URD purchase of vehilce spares machinery spares, LPGS and Oxygen cylinders

This query is : Resolved

Quick Summary

This discussion clarifies whether GST under Reverse Charge Mechanism (RCM) applies to purchases from unregistered dealers (URDs) for a sole trader in mining. It confirms that RCM generally does not apply to vehicle servicing, machinery spares, LPG, or oxygen cylinders. The supplier is responsible for charging GST on these items, not the buyer under RCM, unless specific notified services or goods are involved.

Srinivasa Joshi

Srinivasa Joshi (Querist)
Follow

20 September 2025 Respected Sir
Good afternoon
I am working as an accountant in sole trader, doing screening and crushing of Mine materials, purchasing and servicing from URDS our vehicle running at mine top for carrying spares, spares/parts for our machinery is also purchasing from URDs
welding and cuttting and brazing we need LPGS and oxygens getting from URDS.
I need experts help in this regard whether all above materials attracts GST under RCM. please guide
Thanking you
Yours sincerely
Srinivasa Joshi

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
Follow

20 September 2025 Royalty for Mining Rights: The royalty, license fees, and other charges you pay to the government for the right to mine or use natural resources are considered a supply of service. GST on these services is payable under RCM, and the tax rate is generally 18%. This is a mandatory RCM liability for all mining leaseholders.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
Follow

20 September 2025 Vehicle Servicing and Spare Parts
Services: As per GST law, there is no blanket RCM on services received from an unregistered dealer. The RCM applies only to specific notified services. Generally, motor vehicle repair and servicing are not on this list.

Goods (Spare Parts): Similar to services, there is no general RCM on the purchase of goods from a URD. It only applies to specific goods, like cashew nuts or tobacco leaves, which are not relevant to your business. Therefore, you are not liable to pay GST under RCM on the purchase of vehicle spare parts.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
Follow

20 September 2025 LPG (Liquefied Petroleum Gas): The GST rate on commercial LPG cylinders is 18%. However, there is no RCM notification for the purchase of LPG. The supplier (e.g., the gas company) is responsible for charging and remitting the GST on these sales.

Oxygen: The supply of oxygen is also subject to GST, but like LPG, it does not fall under the RCM category. The supplier will charge you the applicable GST on the invoice.

Spares like welding cutting tools and other spares are also not liable under RCM.

Srinivasa Joshi

Srinivasa Joshi (Querist)
Follow

21 September 2025 THANK YOU SIR FOR YOUR VALUABLE GUIDANCE

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
Follow

21 September 2025 You are welcome.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
Follow

21 September 2025 Good luck....

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now