Gujarat High Court ruling on levy of IGST on Ocean freight under reverse charge by CA Somil Bhansali

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In this video recent ruling of Gujarat High Court (HC) is discussed. The issue involved was whether IGST can be separately levied and collected from Indian importer on ocean freight where Customs duty together with IGST has been already discharged by such importer.

 

https://www.youtube.com/watch?v=Nqy64hm-kUo

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IN GST HOW IMPORTER BEING LIABLE TO PAY GST UNDER RCM ON OCEAN FREIGHT.

In term of Section 13(9) of IGST Act the POS of services of Transportation of goods , other than by way of mail or courier, shall be the place of Destination of such goods. (So the POS is India)
As per Notification 10/2017 IGST : Supplier is located in Non Taxable Territory & Recepeint the Importer is in taxable territory is liable to pay GST.

Rate of Tax : Notification 8/2017 read with corrigendum to IGST Notification 8/2017 , specifies the rate & taxable value on which GST is to paid by importer on RCM .

BUT AS PER MY VIEW ABOVE NOTIFICATION CANNOT BE OVERRIDE THE SECTION 5(3) which provides "liability to pay tax on RCM is on Receptient of Goods or Services or both" & here the Importer cannot be cover under Recepeint, as shipping line is providing services to exporter.(No GST as both supplier & Recipient in non taxable Territory)

So In my View if Govt really wants collect GST on this , must make liable to pay GST by Shipping line company by compulsory Obtaining registration by shipping co. in taxable territory.

Or has to ammend the Section 5(3) of IGST to like erstwhile Section 68 of Finance Act 1994.


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