9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (11) TMI 1325 - AAR - GSTLevy of GST - GTA service - whether GST chargeable on actual amount of commission retained by him for arranging transport facility to their customers or he has to pay GST on the entire amount received from his customers without deducting the commission? - rate of GST - HELD THAT - The use of the phrase in relation to has extended the scope of the definition of GTA. It includes not only the actual transportation of goods, but any intermediate/ancillary service provided in relation to such transportation, like loading/unloading, packing/ unpacking, trans-shipment, temporary warehousing, etc. If these services are not provided as independent activities but are the means for successful provision of GTA Service, then they are also covered under GTA. In respect of those who provide agency services in transport, the liability is cast on the recipients in most of the cases or unless option to pay under forward charge has been exercised by the GTA. As per the lorry receipts issued by the applicant, he is rendering Goods Transport Agency services and his tax liability under GST law is The rate of tax on the GTA services is 5% (2.5% CGST 2.5% SGST) subject to satisfying the conditions as prescribed under notification no. 11/2017 - CT (Rate) dated 28.06.2017 as amended by notification no. 20/2017-CT (Rate) dated 22.08.2017 - In case, the said conditions are not satisfied, the rate of GST is 12% (6% CGST 6% SGST) and the applicant being the provider of Goods Transport Agency service has to pay the said tax.
Issues Involved:
1. Applicability of GST on the commission retained by the applicant for arranging transport facilities. 2. Rate of tax payable under GST for the services provided. Issue-wise Detailed Analysis: 1. Applicability of GST on the Commission Retained: The applicant, operating under the name M/s Chitra Transport, engages in arranging lorries for customers and retains a commission for this service. The primary question is whether GST should be paid on the entire amount received from customers or only on the commission retained. The Authority examined the nature of the applicant's services, noting that the applicant issues lorry receipts (LR) which include details such as GST registration, truck number, consigner and consignee names, nature of goods, and freight charges. The issuance of such consignment notes classifies the applicant as a "Goods Transport Agency" (GTA) under clause (ze) of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017. The issuance of a consignment note is crucial as it indicates the transfer of lien on the goods to the transporter, making them responsible for safe delivery. According to Notification No. 12/2017, services provided by a GTA are subject to GST unless specifically exempted. The applicant's service, being a GTA service, falls under the purview of GST. However, the GST liability on GTA services is generally discharged by the recipient under the reverse charge mechanism (RCM), as prescribed under Notification No. 13/2017-Central Tax (Rate) dated 28.06.2017. 2. Rate of Tax Payable: The rate of GST applicable to GTA services is contingent upon certain conditions. As per Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017, as amended by Notification No. 20/2017-Central Tax (Rate) dated 22.08.2017, the GST rate for GTA services is 5% (2.5% CGST + 2.5% SGST) provided the GTA does not avail input tax credit (ITC). If the GTA opts to avail ITC, the applicable GST rate is 12% (6% CGST + 6% SGST). For supporting services in transport not covered under the primary GTA service headings, the applicable GST rate is 18% (9% CGST + 9% SGST). The ruling clarified that the commission earned by the applicant from arranging transport services is not separately taxable under GST. Instead, the entire service provided by the applicant as a GTA is subject to GST, with the liability primarily falling on the recipient under RCM unless the GTA opts to pay GST under the forward charge mechanism. Conclusion: The applicant, providing GTA services, is required to issue consignment notes and is thus classified under the GTA category. The GST liability for these services is primarily on the recipient under RCM, with applicable rates being 5% or 12% depending on the ITC conditions. The commission retained by the applicant for arranging transport is not separately taxable but is included in the overall GST liability for the GTA services provided.
|
