Page 15 - CHAPTER 3 (1).cdr
P. 15
CCP 03.14.26.00
From the following information determine the person liable to pay Goods &
Service tax if both Supplier and Recipient are located in India -
1) Mr. Atul is an agent of Life Insurance Co. The insurance company pays CH 3
commission (excluding tax) ` 6 Lakh to him. Mr. Atul claims that no GST is
Reverse Charge & ECO
leviable on services provided by him as his value of taxable service does not
exceed ` 20 lakhs.
2) XYZ Ltd. availed services of Vimal Goods transport agency for transportation
of goods by road from factory located in New Delhi to its Jaipur depot and
paid freight of `1, 00,000.
3) Infra structural support services provided by Government to a business
entity: ` 14 Lakh
4) Renting of immovable property services provided by Government to
unregistered business entity: ` 18 Lakh
Answer:- The provisions applicable are as per section 9(3) of CGST Act and 5(3) of
IGST Act, the Government via notification 17/2017 CT and Notification No. 14/2017 of
IGST Act.
1. In this case Life Insurance Company will be liable to pay GST on reverse charge
basis. Hence, GST liability shall be `. 6, 00,000 i.e., on the value of commission.
Mr. Atul's claim that his turnover does not exceeds `. 20 Lakhs has no relevance
here, because under reverse charge threshold limit is not available.
2. If GTA pays tax @ 12% with ITC: In such case normal charge is applicable and
GTA is liable to pay tax
If GTA pays tax @ 5% without benefit of ITC:- Then reverse charge
shall be applicable and GST shall be paid by XYZ Ltd. since it is liable to pay
freight for transportation of goods.
3. Any service provided by Government or local authority to business entity in a
taxable territory the goods & service tax is payable by business entity.
4. Any service by way of renting of immovable property provided by Government or
local authority to unregistered business entity then goods & service tax is payable
by Government
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CA Final GST Questioner