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Commission paid to directsellers(unregistered under gst)

V.DANNY MARY REFUGIYA (CA IN PRACTICE) (39 Points)

05 November 2018

Respected Sirs,

commission paid to directsellers(Unregistered under GST) whether liable for Gst, is such direct sellers covered under the definition of Agent if Yes are they liable to get compulsory registration under sec 24(vii) of CGST Act.

Thanks

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4 Replies

Pankaj Rawat (GST Practitioner) (55032 Points)
Replied 06 November 2018

The key ingredient for determining Agent
under GST would be whether the invoice for the further supply of goods on behalf of the principal is
being issued by the agent or not. Where the invoice for further supply is being issued by the agent in his name then he is liable to have compulsory registration Under Section 24 CGST Act.

For More explanation on this regard kindly Refer Circular 57/37/2018 dt.4/09/2018

V.DANNY MARY REFUGIYA (CA IN PRACTICE) (39 Points)
Replied 07 November 2018

Respected Sir,

Thank you for your reply,in my case the Direct sellers(Unregistered) engages himself in the activity of introducing another consumer and gets commission for the service done... Please clarify how GST is charged on such commission is the Company liable to pay GST under Reverse Charge Mechanism as per sec 9(4)... where Notification No:22/2018 has deferred applicability of Sec 9(4).

Thank You

Pankaj Rawat (GST Practitioner) (55032 Points)
Replied 08 November 2018

AS YOU YOURSELF CLARIFIED THAT THE CO. IS NOT LIABLE PAY GST ON RCM.

AS PER SECTION 22 CGST ACT IF YOUR AGGREGATE TURNOVER IS LESS THEN 20LAC PER ANNUM , YOU ARE NOT LIABLE TO OBTAIN REGISTRATION IN GST, HENCE NO GST WILL CHARGED ON COMMISSION RECED BY YOU AS A URD .

AS PER SECTION 32 CGST ACT THE PERSON WHO IS NOT REGISTERED CANNOT COLLECT TAX IN RESPECT OF SUPPLY OF SERVICES & GOODS