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GST RCM on GTA for only NIL rated supply person

Vidyadhar Hegde (Article Assistant) (20 Points)

24 July 2021

My friend is a dealer in animal feeds which is NIL rated supply.

He will buy from a manufacturer (intra-state) and hire a lorry (unregistered transporter) for transportation of feeds from the manufacturer location to his godown. The hire charges will be around Rs.10,000 to Rs.12,000 per trip.

So he needs to pay GST under RCM?

If yes, whether he can claim ITC and get a refund on ITC later?

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9 Replies

Deepak Kumar (791 Points)
Replied 25 July 2021

I think no required to pay GST on RCM Because your supply is Nill Rated supply and this supply not attract Rcm liablity Because you have supply only Nill rated Goods not Taxable goods.if you are both supply Nill rated or taxable then you have pay RCM in this case. its my openion

CA. Sourav Sarkar (Chartered Accountant ) (24578 Points)
Replied 25 July 2021

No RCM is not applicable

Vidyadhar Hegde (Article Assistant) (20 Points)
Replied 25 July 2021

Thanks for your response.🙂

Anshuman Basu (account -GST) (1546 Points)
Replied 25 July 2021

If u are registered in GST and services received from gta (ur/rd) then rcm is applicable. your out put service is exem is not a matter

Vidyadhar Hegde (Article Assistant) (20 Points)
Replied 25 July 2021

Then can we claim ITC ? and can we get refund?

CA Altamush Zafar (GST Consultant) (15907 Points)
Replied 25 July 2021

RCM will be applicable if you are registered under GST and you are taking services from a GTA

Since your outward supply is exempt ITC will not be available and therefore no refund.

Vidyadhar Hegde (Article Assistant) (20 Points)
Replied 25 July 2021

Sir,

"Anyone who provides consignment note for goods delivery is treated as GTA and a mere bill is not consignment note"

In the given case told earlier. The individual lorry owner cum driver won't provide consignment note and not even bill. Just he will collect money based on the kilometre and load capacity of the vehicle.