Taxpayer owns some trucks. He use it for (A)transportation of his own goods i.e. coal, (B) For purely transportation services of sister concerns in which he issued consignment note (C) provide his trucks to GTA who secure work from companies and deploy taxpayers trucks. (D) Provides his trucks to companies directly and issue consignment note.
In case of (A) he sales at FOR basis, therefore pays outward tax @ 5% (i.e. rate of coal) with ITC.
In case of (B) he issues FCM bills @ 12%
In case of (C) he declare it as exempt supply considering entry no 22 of exemption notification.
In case of (D) he issues RCM invoices.
Whether treatment in above mentioned cases are correct? Please Guide.
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Taxability for transporter
Replies (8)
Quick Summary
No.... In case (B) when he is raising bills in FCM then in case (D) he cannot issue bill under RCM .
GTA cannot exercise both the option FCM & RCM in FY .
GTA cannot exercise both the option FCM & RCM in FY .
Okay 👍
in case of C treatment is correct ?
in case of C treatment is correct ?
Yes...(C) is correct (Ref. NOTIFICATION 12/2017 CT rate
And (A)
(A) is also correct . As in term of Section 8 of CGST Act it Composit Supply and Tax rate is applicable the tax rate of principal Supply.
Thank 😊
The treatment in the above-mentioned cases appears to be correct. However, it is advisable to consult with a tax professional or seek guidance from the relevant tax authorities to ensure compliance with the applicable tax laws and regulations.
The correct cases are (A) &(C)
(A) Transportation of own goods: Taxpayer pays outward tax @ 5% with ITC.
(C) Providing trucks to GTA: Taxpayer considers it as an exempt supply under entry no. 22 of exemption notification.
In case (B) where the taxpayer is issuing bills under Forward Charge Mechanism (FCM), it is not possible to issue bills under Reverse Charge Mechanism (RCM) in case (D) for providing trucks directly to companies. GTA cannot exercise both FCM and RCM options in the same financial year.
To learn more about Forward Charge Mechanism Under GST click here
To learn more about Reverse Charge Mechanism Under GST click here
For more detailed information, visit Swipe Blogs.
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