Chapter 3

CGST Act, 2017

Reverse Charge & ECO Sec 2(98) : Reverse Charge
means the liability to pay tax by the recipient of supply of
Sec 9(3) Reverse Charge in Sec 9(4) Reverse Charge in case of supply by Sec 9(5) Electronic Commerce goods or services or both instead of the supplier of such goods
notified cases Unregistered to Registered Operator or services or both under section 9(3) or 9(4), or under section
5(3) or 5(4) of the Integrated Goods and Services Tax Act.

Forward Charge Reverse Charge Payment by ECO

involving an ECO
PMT 06 PMT 06 in anymanner
` 18000 Payment of GST
` 18000
C.G. C.G.
SR
SP
Invoice Invoice
GPS
Value 1,00,000 Value System
Supplier GST 18000 Recipient Supplier 1,00,000 Recipient
@ 18%
A person Any person

Supplier has to assess the tax & transfer to Recipient Recipient has to assess the tax and Supplier will not charge GST in invoice. Supplier and Recipient both does not assess the liability.
Assessment
ECO will assess the liability like supplier
Payment to C.G. Supplier is liable to make payment to Govt. Recipient is liable to make payment to Govt. ECO is liable to make payment to Govt.
Registration Supplier has to register under GST Recipient has to register under GST ECO has to register under GST
Due date of Monthly [In some cases quarterly] Monthly [In some cases quarterly] Monthly [In some cases quarterly]
Payment
Time of Goods- Sec 12(2) of CGST Goods- Sec 12(3) of CGST Goods- Sec 12(2) of CGST
Supply Service - Sec 13(2) of CGST Service - Sec 13(3) of CGST Service - Sec 13(2) of CGST
Mode of by using By using electronic cash ledger Recipient cannot use his electronic credit ledger for by using
Payment - Electronic credit ledger payment of GST on such supply, but after payment of GST under RCM, he can take - Electronic credit ledger
- Electronic Cash ledger input tax credit as per the provision of ITC. - Electronic Cash ledger
Note :- 1) No RCM in case of Exempted supply, Nil rated Supply
2) All provisions shall apply to recipient under RCM
Legal Provision Sec 9(3) : Reverse Charge under notified cases
The Government may, on the recommendations of the Council,
Ü by notification, specify categories of supply of goods or services or both,
Ü the tax on which shall be paid on reverse charge basis by the recipient of such goods or services or both and all the provisions of this Act shall apply to such recipient as if he is the person liable for paying the tax
in relation to the supply of such goods or services or both.
GST
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 Summary of RCM
Transport and Motor vehicle Sector Insurance & Banking Service Sector
1. GTA Services in
person who pays freight is Notified person who is liable to 9. Insurance Service by an Insurance Agent to a person carrying insurance Insurer carrying life or
GTA(who a) Any registered factory. pay freight agent business located in taxable territory general insurance business.
relation to Note : GTA liable in following cases
transportation by has not paid to
b) Any registered Society
1. If notified person located in non- 10. Recovery Services by any recovery agent to a banking company,Financial Such banking company,
of goods CGST 6% c) Any Co-operative Society agent
& SGST 6%), d) Any person registered taxable territory. Institution or NBFC in a taxable territory. Financial institution or NBFC
by road 2. If person liable to pay freight is
under GST not falling under notified 11. Members of
Overseeing Supply of Service by Members of Overseeing committee Reserve Bank of India (RBI)
e) Body corporate or; categories. committee to Reserve Bank of India (RBI)
f) firm, (including LLP &AOP) 3. If department or establishment of 12. Individual Direct Selling a banking company A banking company or a
government or local authority
g) Any CTP. government agency opt for DSAs Services by Agents (DSAs) other than to or a non-banking non-banking financial
registration only for the purpose a body corporate, financial company company, located in the
partnership or LLP taxable territory.
of Deducting TDS u/s 51
* Service by GTA to unregistered person (including CTP) other than above = Exempt (Sl.21A) 13. Business Services supplied by Business Facilitator to A banking company Banking company located
Facillator located in the taxable territory. in Taxable Territory
2. Renting Renting of any motor any person other than body Any body Any body corporate
of motor vehicle designed to by corporate to
corporate located in taxable 14. Agent of Services supplied by An agent of Business Correspondent (BC) Business correspondent
vehicle carry passengers (does not issue an invoice charging
territory Business to A business correspondent, located in the taxable territory located in Taxable Territory
where the cost of CGST @ 6 % Correspondent
fuel is included in and SGST 6% to the service Un-organised to Organised Service Sector
the consideration recipient)
charged . 15. Sponsorship Sponsorship Service by any person to any body corporate Such body corporate or
or partnership firm located in taxable territory. Partnership Firm located
Legal Service Sector in a Taxable territory.
3. Legal Legal Services provided by an individual / senior /firm of advocates Any business entity located 16. Director of Services by director of a company to the said company Such company or body
Service to business entity directly or indirectly. in the taxable territory company or body corporate or body corporate corporate
4. Arbitral Services by Arbitral Tribunal to business entity in a taxable territory Any business entity located Security
17. Services Supply Security Any person to a registered person Registered Person
Tribunal in the taxable territory services by other than to (other than - department located in Taxable
(as a security a body of Govt. / local authority/ Territory
Government Service Sector Govt. authority/ registered
personnel) corporate
5. Govern- Any Services provided by Government or Local authority to business entity Any business entity located person u/s 10.)
ment other than 1 renting of immovable property/ 2 Service by Department of in the taxable territory
Post 3 Service in relation to Aircraft, Vessel inside or outside precincts of Copyright Service Sector
port or airport. 4 transportaion of goods or passengers transfer or permitting use or enjoyment of a copyright Music company,
18. Copyright
6. Govern- Renting of immovable property by Govt or local authority Any registered person relating to original literary, dramatic, musical works producer or the like,
service
ment to any registered person by An Author, Music composer, Photographer, Artist located in the taxable
to Music company, producer or the like territory
Construction Service Sector
19. Copyright Transfer or permitting use or enjoyment of a copyright A Publisher located in the
7. Sec 9(3) 5B. Construction Transfer of development rights or Floor Space Index (FSI) Promotor relating to original literary work by an author to publisher taxable territory
(FSI etc.) by any person to promotor for construction of a project
Construction Long term lease of land (30 years or more) by any person to promotor Other Service Sector
5C. Promotor
(lease) against consideration in the form of upfront amount for construction 20. Lending of Lending of securities by lender to borrower Borrower i.e. a person
of a project security who borrows the securities
Value of Inputs and Input services purchase from registered Promotor
8. Sec 9(4) 19. 21. Import Any service supplied by Any person from a non taxable Any person located in
supplier is less than 80% (i.e. purchase from unregistered person ) service territory to Any person other than non taxable online taxable territory
20. In case of Cement supplied by unregistered person (i.e. recipient (NTOR)
Construction Promotor
purchase from unregistered person )
22. Transportation Transportation of goods by a vessel
21. In case of Capital Goods supplied by unregistered person (i.e. Promotor in vessel from a place outside India up to the by Person located in to Importer Importer
purchase from unregistered person ) customs station of clearance in India non-taxable territory
GST
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 N/N 13/2017-CT (Rate) Analysis of GTA services & options available to it
RCM Notified Services N/N 4/2017-UTT (Rate) Dated 28th June, 2017
N/N 4/2017-IT (Rate) GTA Service
Sector :- Transportation and Renting of Motor Vehicle Payment of GST@ 12% Payment of GST@ 5%
1 GTA:- Supply of Services in relation to transportation of goods by road
Person liable to pay Tax (6%+6%) (2.5%+2.5%)
To
Person in taxable territory with full ITC of GTA without ITC to GTA
By
Where a person liable to pay freight is
Mentioned in (a) to (g) i.e.
Goods Transport Agency
who has not paid a) Any factory registered under or governed by factories u factory
Act, 1948 uSociety registered GTA Services to GTA services to Service provided Service provided
central tax at the rate
of 6% (CGST 6% & SGST 6%) b) Any society registred under Societies Registration Act, uCo-operative Society Any Registered any unregistered to registered to unregistered
1860 or under any other law for time being in force in any u Any registered person
(inserted by N/N 22-2017 part of India person under GST Person person person
C.T. (Rate) under GST
c) Any co-operative society established by or under any;
uBody Corporate
d) Any person registered under CGST Act, under IGST
Act, under SGST Act or UTGST Act uPartnership Firm or Reverse charge If services
AOP GST is If services
e) Any body corporate established, by or under any law; or
GTA Service Service is applicable & provided to
f) Any partnership firm (Including LLP) whether uCTP payable provided
provided recipient who notified person
under normal provided to
registered or not under any law including association of
persons to other
to any other pays the freight (above a to g)
g) Any Casual Taxable Person charge by notified person unregistered
Goods Transport Agency (GTA) above (a to g) unregistered is liable to GST located in
GTA person
Defined in para 2(ze) of N/N “Provided that nothing contained in this entry shall apply to services provided by a goods person. taxable
12/2017 means any person who transport agency, by way of transport of goods in a goods carriage by road, to, -
provides service in relation to (a) a Department or Establishment of the Central Government or State Government or Union Territory
transport of goods by road AND territory; or GST is payable Exempt
issues Consignment Note, by (b) local authority; or (c) Governmental agencies,
whatever name called.
Which has taken registration under the Central Goods and Services Tax Act, 2017 only for the under normal Reverse charge Exempt
Amended purpose of deducting tax under section 51 and not for making a taxable supply of goods or charge by GTA is applicable above
services. (N/N 29/20180CT (R) dt 31/12/2018)
notified person is
liable to pay GST
Exemption:- Sl.No. 21A (of notification 12/2/2017) :- Service provided by GTA to an unregistered person
Exemption is available for Services provided by a goods transport agency to an unregistered person, including an
unregistered casual taxable person, other than the following recipients, namely: -
(a) any factory
(b) any Society
(c) any Co-operative Society
(d) any body corporate
(e) any partnership firm whether registered or not under any law including AOP
(f) any casual taxable person registered under the GST Act.

GST
REVISION GST
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 2 Services provided by way of renting of any motor vehicle designed Person liable to pay tax
to carry passengers where the cost of fuel is included in the : Any body corporate
by N/N 29/2019 CT-(R) located in the taxable
consideration charged from the service recipient, Amended
dt 31/12/2019
territory.
By To
Any person other than a body corporate, Anybody corporate located
(who supplies the service to a body corporate and does not in the taxable territory.
issue an invoice charging CGST at the rate of 6 % and SGST
6% to the service recipient)

Clarification on Reverse Charge Mechanism (RCM) on renting of motor vehicles (circular no.
130/2019-GST)
Suppliers of service by way of renting of any motor vehicle designed to carry passengers where the
cost of fuel is included in the consideration charged from the service recipient have an option to pay
GST either at
Ü 5% with limited ITC (of input services in the same line of business) or
Ü 12% with full ITC.
Clarifications in the circular:
1. when any service is placed under RCM, the supplier shall not charge any tax from the service
recipient.
2. a. where the supplier of the service charges GST @ 12% from the service recipient, the service
recipient shall not be liable to pay GST under RCM; and,
b. where the supplier of the service does not charge GST @ 12% from the service recipient, the
service recipient shall be liable to pay GST under RCM

RCM shall be applicable only if all the below given conditions are satisfied:
a. Supplier is not a body corporate
b. Supplier does not issue invoice charging GST @12%
c. Service Recipient is a body corporate located in the taxable territory.

GST
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 Sector :- Legal
3 Legal Service:- Service Supplied by way of legal service
directly or indirectly Person liable to pay
By To tax : Any business
Üan Individual advocate including a senior to any business entity entity located in the
advocate or located in the taxable taxable territory.
Üfirm of advocates territory

Explanation.- "legal service" means any service provided in relation to advice, consultancy or
assistance in any branch of law, in any manner and includes representational services before any court,
tribunal or authority.".

“Senior advocate” [para 2(zzd)N/N 12/2017] has the

Representation By Senior Advocate
meaning assigned to it in section 16 of the Advocates Act,
1961”.
As per Section 16 of the Advocates Act, 1961 an advocate may, with
his consent, be designated as senior advocate if the Supreme Court
or a High Court is of opinion that by virtue of his ability of standing at
B.E (Vsmart)
the Bar or special knowledge or experience in law] he is deserving of liable to pay tax

such distinction.

“Business Entiry” [para 2(n)N/N 12/2017] means any person carrying out business.
“LLP” [explanation (e)N/N 22/2017 C.T. (Rate) ] A "Limited Liability Partnership" formed and registered
under the provisions of the Limited Liability Partnership Act, 2008 shall also be considered as a
partnership firm or a firm.

4 Arbitral Tribunal:- In respect of services provided to agreed Person liable to pay tax :
to be provided Business entity in Taxable
By To territory is liable
Arbitral Tribunal Business entity in taxable territory
Note :
1) Arbitral Tribunal is a private tribunal constituted by parties in disputes where one or more person ( Arbitrator)
are refered by the parties to resolve the dispute in themselves and by who's decision they agreed to bound

Reliance Industries
ARBITRATOR

GST
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 Sector :- Government Service provided by Govt. /LA
5 Any Services supplied by Person liable to pay tax : Business entity in
Taxable territory is liable Normally all services 1 ) Service by department Renting of immovable
By To provided to Business of post like speed post, property
Ü Central Govt. Ü State Govt.
Ü Union Territory Ü Local authority Business entity in a taxable etc.
except entity in territory 2) service in relation to
(a) Renting of immovable property, and taxable Service provided Service to
(b) (i) Services by the department of
Explanation :- “renting of immovable property” vessel /aircraft at
territory means allowing, permitting or granting access,
RCM is applicable & under to person unregistered
post by way of speed post, express
entry, occupation, use or any such facility, wholly port/airport
parcel post, life insurance and agency reverse charge Business 3 ) G o o d s / P a s s e n g e r registered person
services provided to or partly, in an immovable property, with or
without the transfer of possession or control of Entity is liable to pay tax
a person other than Central Transportation service
Government State Government the said immovable property and includes
or Union Territory or local authority. letting, leasing, licensing or other similar
arrangements in respect of immovable
(ii) Services in relation to an aircraft or a Note: Above services fall under RCM is Applicable, Normal
vessel, inside or outside the precincts property.'. (N/N 15/2018 - CT (Rate) dt
of a port or an airport 26/06/2018) 1) Also refer Exemption Normal change & Govt. or registered person charge is
(iii) Transport of goods or passengers chapter for details local authority is liable to is liable to pay applicable
2) If business entity is in pay tax. tax
Non-taxable territory,
Entry No 5A of Notification
then under normal
6 Services supplied by renting of immovable property Person liable to pay tax change Govt./LA is liable
By To : Any registered person to pay tax.
Any registered person under
Ü Central Govt. Ü State Govt. in taxable territory
Ü Union Territory Ü Local authority
GST *LA - Local Authority

GST
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 Sector :- Construction
Entry No 5B of Notification
7 Services supplied by way of transfer of development Person liable to
rights or Floor Space Index (FSI) (including additional FSI) pay tax :- Promoter
for construction of a project .

By To
Any Person Promoter

Entry No 5C of Notification
8 Long term lease of land (30 years or more) against Person liable to pay
consideration in the form of upfront amount (called tax :- Promoter
as premium, salami, cost, price, development
charges or by any other name) and/or periodic rent
for construction of a project
By To
Any Person Promoter

Explanation:-
(a) the term “project” shall mean a Real Estate Project (REP) or a Residential Real Estate Project (RREP);
(b) The term “Residential Real Estate Project (RREP)” shall mean a REP in which the carpet area of the
commercial apartments is not more than 15 per cent. of the total carpet area of all the apartments in the
REP.
(c) “floor space index (FSI)” shall mean the ratio of a building’s total floor area (gross floor area) to the size
of the piece of land upon which it is built.”

GST
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 Sector :- Banking and Insurance 13 Services supplied
Person liable to pay
9 Insurance Agent:- Person liable to pay tax : Any person carrying any insurance
By To tax : A banking company
business located in taxable territory e.g. LIC or GIC
Service Supplied located in the taxable
“Insurance Agent” means an insurance agent licensed under section 42 A banking company located
By To who receives or agrees to receive payment by way of commission or other Business Facilitator territory.
remuneration in consideration of his soliciting or procuring insurance in the taxable territory.
Insurance Agent Any person carrying business [including business relating to the continuance, renewal or revival of
insurance business policies of insurance.] “2(o) “business facilitator or business correspondent” means an intermediary appointed under the
Comment :- Many insurance companies who are selling their policies through business facilitator model or the business correspondent model by a banking company or an insurance
ECO operator not being licensed as Insurance agent under sec 42 of company under the guidelines issued by the Reserve Bank of India;”
Carrying Insurance Business Insurance Act, for them reverse charge shall not be applicable. - Thus the role of business facilitators is to ensure greater financial inclusion and increasing the outreach of
banking sector as they are appointed by Banks as an intermediary.

Mr. S Just For Knowledge:-

Policy 1. Types of services supplied by Business Facilitators - Business Facilitators provide various services which
Holder includes:-
Insurance a. Identification of borrowers and fitment of activities
Agent b) Collection and preliminary processing of loan applications including verification of primary informtion/data
c) creating awareness about saving and other products and education and advice on managing money and debt
counselling
10 Recovery Agent:- Service Supplied Person liable to pay tax : Banking company or d) processing and submission of application of banks
financial Institution or Non- banking financial e) promotion and nurturing Self-Help Groups/Joint Liability groups
By To Institutions located in taxable territory f) Post -sanction monitoring
g) Monitoring and hand holding of Self-Help Groups/Joint Liability Groups/Credit Groups/Other, and
Ü a Banking company or h) Follow up for recovery
Recovery Agent
Ü a Financial Institution or 2. The bank pays to business facilitation in form of commission for providing such services, so as per amendment
Ü NBFC bank are liable for payment of GST as receiver of service on commission paid by them
Mr. X is
recovery agent 14 Services supplied Person liable to pay tax : A
business correspondent, located
RECOVERY VAN By To in the taxable territory
An agent of Business A business correspondent,
Correspondent (BC) located in the taxable territory
11 Direct selling Agent :- Person liable to pay tax : A banking company or
Services supplied a non-banking financial company, located in the Analysis:-
taxable territory. 1. Business correspondent - Are appointed by bank after conducting thorough due diligence Business
correspondents can be NGOs/MFIs set-up under Societies/Trust Acts, Societies registered under Mutually Aided
By To Co-operative Societies Acts or the Cooperative Societies Acts of States, registered NBFCs not accepting public
Individual Direct Selling Agents (DSAs) deposits and post officers
other than a body corporate, partnership A banking company or a non-banking financial 2. Business correspondent supplies all types of services which are provided by business facilitator and in addition
or limited liability partnership firm. company, located in the taxable territory. they are also engaged into providing small value credit and recovery of the same.
3. The bank pays them in the form of commission or fees for providing such services. These business correspondent
12 Supply of Services have also appointed their agents and paying them commission or fees
Person liable to pay As per the amendment, business correspondents will be liable for the payment of GST as receivers of services on
By To tax : Reserve Bank of commission paid by the business correspondents to their agent.
Members of Overseeing committee Reserve Bank of India (RBI) India (RBI)

Note : Overseeing Committee formed by RBI which aimed to vet resolution of all types of loans
would harm customers as well as banks
GST
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 Sector :- Copyright and development right
Entry No 9 of Notification
15 Supply of services by way of transfer or permitting the use or Person liable to pay tax : A
enjoyment of a copyright covered under section 13(1)(a) of the Publisher music company,
Copyright Act, 1957 relating to original literacy, dramatic, musical producer or the like, located
or artistic works (Covered by Separate entry in 9A)
in the taxable territory
By To
An Author, Music Composer, A Music company, producer
(Covered by Separate entry in 9A)
photographer, artist or the like, located in the taxable territory

}
Musical Artistic Dramatic

Lyrics of Song Painting by Painter Acting by Actor

Entry No 9A of Notification
16 Supply of services by way of transfer or permitting the use or Person liable to pay tax : A
enjoyment of a copyright covered under section 13(1)(a) of the Publisher located in the
Copyright Act, 1957 relating to original literary works taxable territory
Newly Inserted by N/N 22/2019 CT-(R) dt 30/09/2019
Literary
By To
An Author A Publisher located in the
taxable territory Books by Author

Conditions:- (Reverse charge is not applicable in following cases)

Provided that nothing contained in this entry shall apply where, -
(i) the author has taken registration ,and filed a declaration, within the time limit with the jurisdictional GST
commissioner that
Ü he exercises the option to pay central tax on the service under forward charge and
Ü to comply with all the provisions as they apply to a person liable for paying the tax in relation to the supply
of any goods or services or both and
Ü that he shall not withdraw the said option within a period of 1 year from the date of exercising such option;
(ii) the author makes a declaration, on the invoice issued by him in Form GST Inv-I to the publisher.
Note:-Thus, where the author is registered and he make a declaration to pay the tax to proper officer then
publisher is not required to pay tax & Author will pay tax under forward charge.

Sector :- Security Services

17 Security Services A registered person, located
By To in the taxable territory
Security services (services provided by a registered
way of supply of security personnel) person
provided by any person other than a
body corporate
GST
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 Provided that nothing contained in this entry shall apply to, (Exceptions) –
(I) (a) a Department or Establishment of the Central Government or State Government or Union territory; or
(b) local authority; or
(c) Governmental agencies; which has taken registration under the Central Goods and Services Tax Act,
2017 (12 of 2017) only for the purpose of deducting tax under section 51 of the said Act and not for
making a taxable supply of goods or services; or
(ii) a registered person paying tax under section 10 of the said Act.

Comment :-
(I) Service must be supply of security personnel - The entry cover the security service which is provided by
way of supply of security personnel. Therefore it cover only supply of man power for security purpose, such
as supply of security man at society/offices/ commercial spaces/bunglows/bouncers/bodygaurd, etc.
Hence there must be supply of man or women for security.
(ii) Following security service are not cover under RCM :-
a) Dog sniffer b) Investigation Service c) Background check d) CCTV security/IT enable equipment
security
(iii) if the services are provided by body corporate, those will continue to be liable under forward charge
(iv) Body corporate as define in section 2(11) of company Act, 2013
Example:- Company, Public Company, One person company, foreign company
(v) Body corporate does not include an individual, HUF, A firm (including LLP), AOP or BOI, cooperative
society, society.
(vi) Service must be received by Registered person other than specified.

Sector:- Miscellaneous
18 Director of company:- Services supplied
Person liable to
By To
pay tax : Company or
Director of a Company or Body Said Company or Body Body Corporate is liable
Corporate Corporate
Note 1
Director of Company Explanation
Whole time director Employee of the Company
Non-Executive director Can’t be called as employee of Company. Hence sitting fees, commission is taxable

Directors Company
In the pictorial image director is providing
services to a company and this is covered
under the ambit of reverse charge.

19 Sponsorship Service:- Service Supplied in relation to sponsorship service Person liable to pay tax :
By To Body Corporate or
partnership firm in
Any person Any body corporate or partnership taxable territory is liable
firm located in taxable territory
GST
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 Sponsored By Sponsored By
Sponsored By Sponsored By
V’Smart
NOKIA Academy

V’Smart Academy
TATA Motors
Brook Bond
Lakme

20 Lending of securities:- Services of lending of Person liable to pay tax :

securities under Securities Lending Scheme, Newly Inserted by N/N 22/
2019 CT-(R) dt 30/09/2019
Borrower i.e. a person who
1997 of SEBI borrows the securities
By To
Lender Borrower
( i.e. a person who deposits the securities registered in ( i.e. a person who borrows the securities under
his name or in the name of any other person duly the Scheme through an approved intermediary
authorised on his behalf with an approved intermediary of SEBI).
for the purpose of lending under the Scheme of SEBI)

Reverse Charge under IGST

RCM Notified Services (Notified in IGST) N/N 10/2017-IGST (Rate) Dated 28th June, 2017

21 Import of Services:- Any service supplied Person liable to pay tax :

By To Any person located in
taxable territory
Any person from a non Any person other than non taxable
taxable territory online recipient (NTOR)
Note 1:- When any service provided by a person in non taxable territory to a person in a taxable territory then it
amounts to import of services (Inter-State Supply) and subject to IGST
Note : Non taxable online recipient (NTOR) is discussed in the chapter of place of supply under IGST
Act, 2017

Transportation by Vessel
22 In respect of services provided or agreed to be provided by way of Person liable to pay tax :
transportation of goods by a vessel from a place outside India up to Importer as defined in
the customs station of clearance in India clause (26) of Section 2 of
By To the Customs Act, 1962
located in the taxable
Person located in
Importer territory
non-taxable territory

GST
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 Legal Provision
Sec 9(4) (CGST) Reverse Charge - when supply of goods or services by unregistered
person to registered person
The central tax in respect of the
supply of specified a specified
category of goods or class of
services or both by a to registered
supplier, who is not person
registered, shall be paid by such person on reverse charge basis as the
recipient of such supply of goods or services or both and
all the provisions of this Act shall apply to such recipient
as if he is the person liable for paying the tax in relation to the supply
of such goods or services or both.

Real Estate Sector N/N 07/2019 CT(R) dt 29/03/2019

1 value of inputs and input services purchased from Person liable to pay
registered supplier is less than 80% tax:- Promoter
By To
Purchase from unregistered person Promoter

Note:- Reverse Charge is applicable only to the extent of shortfall to make it 80%
2 In case of Cement Person liable to pay
tax:- Promoter
By To
Supplied by unregistered person Promoter

3 In case of Capital Goods Person liable to pay

tax:- Promoter
By To
Supplied by unregistered person Promoter

Note : Above reverse charge is applicable in a case

(i) Promotor is opting for 1% or 5% scheme of N/N 11/2017
(ii) Promoter has to pay GST under section 9(4) of the CGST Act, at the rate of 18% on all such inward supplies
(to the extent short of 80% of the inward supplies from registered supplier).
(iii) Where cement is received from an unregistered person, the promoter shall pay tax on supply of such cement
on, under section 9(4) of the CGST Act, at the applicable rate which is 28% (CGST 14% + SGST 14%) at
present.
(iv) Moreover, GST on capital goods shall be paid by the promoter on reverse charge basis, under section 9(4)
of the CGST Act at the applicable rates.
GST
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 Legal Provision (c) S e r v i c e b y U n r e g i s t e r e d P l u m b e r,
Housekeeper etc :
Sec 9 (5) - CGST liability of E-commerce operator
services by way of house-keeping, such as
The Government may, on the recommendations of the Council,
plumbing, carpentering etc,
Ü by notification, specify categories of services house-keeping,
except where the person supplying such plumbing, carpentering
Ü the tax on intra-State supplies of which shall be paid by the electronic commerce operator if such services services provider
service through electronic commerce operator is
are supplied through it, and
liable for registration under sub-section (1) of
Ü all the provisions of this Act shall apply to such electronic commerce operator as if he is the supplier liable
section 22 of the said Central Goods and Services
for paying the tax in relation to the supply of such services:
Tax Act. (Inserted by N/N 23/2017)

Proviso Provided that where an electronic any person representing such electronic Note: The reverse charge provisions as discussed in this chapter are also applicable under IGST Act,
commerce operator does not have a commerce operator for any purpose in the UTGST Act & SGST Act.
physical presence in the taxable territory, taxable territory shall be liable to pay tax

Proviso Provided further that where an electronic such electronic commerce operator shall
commerce operator does not have a appoint a person in the taxable territory for the Analysis :
physical presence in the taxable territory purpose of paying tax and such person shall
and also he does not have a be liable to pay tax. 9(5) ECO
representative in the said territory,

Definition
Sec 2(45) : E Commerce Operator - means any person who owns, operates or manages Passenger transport by Renting by rooms by Hotels, Housekeeping services
digital or electronic facility or platform for electronic commerce cab/motor cycle Inns, etc.

}
Notified ECO N/N 17/2017 - CT (Rate)- 28th June, 2017 All supplies made through
It has notified the following categories of services supplied involving an ECO ECO (Whether supplier is Supplier is registered under Supplier is not registered
registered or not ECO is GST under GST
in anymanner
through ECO for this purpose - Payment of GST

(a) Transportation of Passengers by Cab etc.: SR

liable to Pay 100% tax.)
Services by way of transportation of passengers by a SP
Supplier himself is liable to ECO is liable to pay tax on
GPS
radio-taxi, motorcab, maxicab and motor cycle. System
pay tax. all supplier made through
A person Any person it.

(b) Renting of Accommodation by unregistered Hotels :

Services by way of providing accommodation in hotels, involving an ECO
Payment of GST in anymanner
inns, guest houses, clubs, campsites or other commercial
places meant for residential or lodging purposes,
except where the person supplying such service
through electronic commerce operator is liable for
registration under section 22(1) of the CGST Act.

Any person

All Important Clarifications are given at the end of Module

GST
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 GST
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