ABC client Purchased hand made mask and sanitizer....is ABC liable to charge RCM and claim input credit of RCM tax???
Replies (3)
Quick Summary
This discussion clarifies the applicability of the Reverse Charge Mechanism (RCM) on purchases from unregistered dealers (URD) for items like handmade masks and sanitiser. It explains that RCM is not applicable to these goods as they are not currently specified under Section 9(3) of the CGST Act 2017, and Section 9(4) is deferred. Furthermore, Notification 20/2020 exempts these items, meaning no RCM liability arises and input tax credit cannot be claimed.
Above purchase not comes under section 9(3) of CGST act 2017 and section 9(4) deferred till notification issued by department. Hence no rcm liabilities aries and no input claim
Section 9(4) of the CGST Act 2017 i.e. REVERSE CHARGE MECHANISM ( RCM ) is now applicable only on specified goods. Hand Sanitizer and Mask is not a specified product yet. Therefore, RCM not applicable.