GST on Hiring of Commercial Vehicles

The company is not liable to pay GST under RCM (Reverse Charge Mechanism) in this scenario. The contractor is already registered under GST and will charge GST @ 18%, so the company is only required to pay the GST amount to the contractor. However, the company can claim ITC (Input Tax Credit) for the 18% GST amount paid to the contractor, provided they are also registered under GST and the goods transported are used for business purposes. Reference: - Section 2(17) of the CGST Act, 2017 defines "recipient of supply" as the person liable to pay consideration for the supply. - Section 2(93) of the CGST Act, 2017 defines "registered person" as a person who is registered under GST. - Section 9(3) of the CGST Act, 2017 states that the recipient of supply is liable to pay tax under RCM only if the supplier is not registered. - Section 16 of the CGST Act, 2017 allows a registered person to claim ITC on inward supplies. Notification: - Notification No. 13/2017-Central Tax (Rate) dated 28.06.2017, which notifies the GST rates for goods transport services..