Page 11 - Ch3_RCM

ii Legal Provision:-
As per section 9(3) of CGST Act, if services are provided by Goods Transport Agency (GTA) for
transportation of goods by road to any partnership firm whether registered or not under any law,
then GST is payable on reverse charge basis by recipient.
Discussion & Conclusion:-
Ü In given case, Safe Trans is transporting goods of Kapil & Co. which is a partnership firm.

Ü Thus, Kapil & Co. is liable to pay GST under reverse charge & it shall apply for compulsory
registration u/s 24.
Assumption:-

It is assumed that GTA has not exercised the option to pay tax under forward charge on services of
transportation of goods supplied by it.

CCP 03.03.13.00
State, with reason, the person liable to pay GST in each of following independent cases:-

Assume recipient is located in taxable territory.
(I) Rental income received by Tamil Nadu State Government from renting an immovable property to
Mannappa Pvt. Ltd. (Turnover of the company was 22 lakhs in the preceding F. Y.) [ Study ₹
Mat- but with Central Govt. instead of State Govt.]

(ii) Legal Fees received by Mr. Sushrut, a senior advocate, from M/s. Tatva Trading Company having
turnover of 50 lakhs in preceding financial year. [Study Mat– with advocate instead of senior ₹
advocate] [CA Inter Old - May 18 Exam]
Answer:-
i Legal Provision:-

As per section 9(3) of CGST Act, if service of renting of immovable property is provided by the Central
Government [excluding the Ministry of Railways (Indian Railways)], State Government, Union
territory or local Authority to any registered person located in the taxable territory, then GST is

payable under reverse charge by recipient.
Discussion & Conclusion:-
Ü In the given case, Mannappa Pvt. Ltd. is registered under GST as the turnover of the company was `
22 lakhs in the preceding financial year which is exceeding threshold limit for registration u/s 22 of
CGST Act.

Ü So, here, the State Government of Tamil Nadu provided service of renting of immovable
property to a registered person located in taxable territory.
Ü Therefore, Mannappa Pvt. Ltd. is liable to pay GST under reverse charge.

ii Legal Provision:-
As per section 9(3) of CGST Act, if legal services are supplied by a senior advocate to any business
entity located in the taxable territory, then GST is payable on reverse charge basis by recipient.
Discussion & Conclusion:-

Ü In the given case, Mr. Sushrut is a senior advocate & he is supplying legal services to M/s. Tatva
Trading Company i.e. a business entity.
Ü Thus, M/s. Tatva Trading Company is liable to pay GST under reverse charge.

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