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Gta exemption

Adil aziz (student) (59 Points)

23 May 2016

Plz tell when we are eligible for exemption of Rs 750 and 1500. in simple words.

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CA PRAMOD SARAOGI (Chartered Accountant) (1113 Points)
Replied 25 May 2016

Situation 1 - If GTA is liable to pay Service Tax

If the aggregate Lorry Hire in a goods carriage going to a single consignee does not exceed Rs. 750 then exemption is available. For example Consignor A has consigned goods to C and the Lorry Freight is Rs. 600 and in the same carriage Consignor B has also booked the Goods to Consignee C for a Freight of Rs. 700. The aggregate freight in the same goods carriage in the name of the same consignee is more than Rs. 750 although the consignors are different persons , not eligible for exemption.

Situation 2 - If GTA is liable to pay Service Tax

If the total freight payable for all the consignments in a goods carriage does not exceed Rs. 1500 then no service tax is payable.

For instance in a goods carriage Consignor A booked for Consignee B - Freight Rs. 800 Consignor D booked for Consignee E - Freight Rs. 200 , Consignor F booked for Consignee G - Freight Rs. 100 Consignor H booked for consignee I - Freight Rs. 300. Here the aggregate amount of freight booked in a single goods carriage is not more than 1500 (800+200+100+300) , the GTA is not liable to pay any Service tax even if the freight in respect of goods consigned by A exceeded Rs. 800

2 Like

Sivaraman A R (.) (1038 Points)
Replied 03 February 2019

Dear CA Pramod Saraogi,

I liked your reply because yours was the only one which was more clear , different and connecting the exemption in law. O also saw other example on thorough searching in internet, but they were quoting unclear and sometime from Service Receiver RCM view point.

This Rs 750/1500 limit is available in GST regime also.

But I have slight doubt and found contradiction in what you have clarified.

In the first part you said, aggregate frieght is more than Rs 750 and hence taxable . OK I admit

But in second part you said it is exempted quoting Rs 1500. It is right as far as Rs 1500 category is concerned. But here also it exceeded Rs 750 (When Consignor A himself booked for Rs 800). Even without aggregation it exceeded Rs 750. So I feel it is also taxable.

I feel if you have quoted example like this (see below), then it would be exempted. Not breached both Rs 750 (to a single consignee) and Rs 1500 (single carriage total)

consignor A booked for consignee B Freight ₹ 600,

consignor C booked for consignee D Freight ₹ 400

consignor E booked for consignee F Freight ₹ 450

Aggregate Rs 1450

Please correct if what I have written is wrong.

Also I have given another query on this matter in caclub, please give your valuable comment there also.

https://www.caclubindia.com/forum/gst-gta-rcm-750-1500-confusion-501853.asp

Regards,

Siva