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Sec 24 (iii) conpulsory registration under certan cases

Registration 199 views 1 replies

Sejal Jain

10 Points Posted on 23 July 2018

If a company say X LTD is exclusively engaged in "exempted supply or non levy supply" .... and is taking directorship services (falling under RCM) ..Now if we see sec 23 -- persons not liable for registration..which.. says that person making 👆such kind of supply are not liable for registration!!! but while paying director fees the company on RCM have to compulsorily make registeration...So ultimately my question is whether the company is required to register or not..!!???
Please explain...
THANK YOU

Replies (1)

Pankaj Rawat

GST Practitioner

55067 Points Posted on 24 July 2018

1. As per notification 13/2017 CT (r)
Services supplied by a director of a
company or a body corporate to the
said company or the body
corporate.
But
As per sec 7(2) of IGST Act Supply EXCLUDES services supplied by an employee to the employer in the course of or in relation to his employment

First of all if you are paying fee to whole time director it falls under the employer & employees relationship so No RCM is applicable , ..
If paid to Sitting director then RCM is applicable

Now As per Notification 5/2017 CT

persons who are only engaged in making
supplies of taxable goods or services or both, the total tax on which is liable to
be paid on reverse charge basis by the recipient of such goods or services or
both under sub-section (3) of section 9 of the said Act as the category of persons
exempted from obtaining registration under the aforesaid Act