SALIENT FEATURES OF GST - Handbook of GST Law & Procedures (CBIC) [October 2024] - GST

5. SALIENT FEATURES OF GST 5.1. GOODS AND SERVICES TAX (GST) LEVY. 5.1.1. GST is a dual levy with the Centre and States simultaneously levying it on a common tax base. The GST levied and administered by the Centre on intra-State (within a State) supply of goods and/or services is called the Central GST (CGST) and that levied by the States/Union territory is called the State GST (SGST)/UTGST. Similarly, Integrated GST (IGST) is levied and administered by Centre on every inter-state (from one State to another State) supply of goods and services. 5.1.2. The CGST and the SGST is levied simultaneously on every transaction of supply of goods and services made by registered persons, except the exempted goods and services, goods and services which are outside the purview of GST. Further, both are levied on the same price or value. Illustration I : The rate of CGST is 9% and that of SGST is 9%. When a wholesale dealer of steel in Uttar Pradesh supplies steel bars and rods to a construction company located within the same State for Rs. 100/-, the dealer would charge CGST of Rs. 9/- and SGST of Rs. 9/-, in addition to the basic price of the goods. He would be required to deposit Rs. 9/- as CGST component, which will go into the credit of Central Government account and Rs. 9/- as the SGST component, which will go into the credit of the concerned State Government, i.e. Uttar Pradesh here. Illustration II : An advertising company located in Mumbai supplies advertising services to a company manufacturing soap also located within the State of Maharashtra for Rs. 100/-. The tax rate for the said service is 9% CGST and 9% SGST. The ad company would charge CGST of Rs. 9/- and SGST of Rs. 9/- to the basic value of the service. He would be required to deposit Rs. 9/- as the CGST component, which will go into the Central Government account and Rs. 9/- as the SGST component which will go into the account of the concerned State Government, i.e. Maharashtra. Illustration III : The rate of CGST is 9% and that of SGST is 9%. When a wholesale dealer of Chemicals in Karnataka supplies his goods to a company located in Telangana for Rs. 100/-. As this is an inter-State supply, the dealer would charge IGST of Rs. 18/-, in addition to the basic price of the goods. He would be required to deposit Rs. 18/- as IGST which will go into the credit of Central Government account. The tax amount shall be apportioned between the Central Government and the State Government in the prescribed manner. 5.1.3. The following taxes/duties levied by the Central Government and State Government have been subsumed under GST - (i) Taxes levied and collected by the Centre: a. Central Excise duty b. Duties of Excise (Medicinal and Toilet Preparations) c. Additional Duties of Excise (Goods of Special Importance) d. Additional Duties of Excise (Textiles and Textile Products) e. Additional Duties of Customs (commonly known as CVD) f. Special Additional Duty of Customs (SAD) g. Service Tax h. Central Surcharges and Cesses so far as they relate to supply of goods and services. (ii) Taxes levied and collected by the States: a. State VAT b. Central Sales Tax c. Luxury Tax d. Entry Tax (all forms) e. Entertainment and Amusement Tax (except when levied by the local bodies) f. Taxes on advertisements g. Purchase Tax h. Taxes on lotteries, betting and gambling i. State Surcharges and Cesses so far as they relate to supply of goods and services. 5.1.4. GST is a tax levied on all types of supply of goods or services or both, made for a consideration and is for the purpose of business or furtherance of business. 5.1.5. The different types of supplies are (i) Taxable supply Supply of goods or services or both which is leviable to GST. (ii) Exempt supply Supply of goods or services or both which attracts nil rate of tax or which is wholly exempt from tax or is non-taxable supply. (iii) Inter-State supplies Where the location of the supplier and the place of supply is in different states. (iv) Intra-State supplies Where the location of the supplier and the place of supply is in same state. (v) Composite supplies Supplies consisting of two or more taxable supplies of goods or services or both, or any combination thereof. (vi) Mixed supplies Two or more individual supplies of goods or services, or any combination thereof, made in combination with each other for a single price. (vii) Zero rated supplies The following supplies of goods and/or services are zero rate supplies (a) export of goods and/or services; or (b) supply of goods and/or services to a Special Economic Zone (SEZ) Developer or a Special Economic Zone (SEZ) Unit. Under zero rating of supplies, the outward supplies as well as the inputs or input services used in supplying the supplies are free of GST. Meaning, the taxes paid on the supplies which are zero rated are refunded, the credit of inputs/ input services is allowed and wherever the supplies are exempted, or the supplies are made without payment of tax, the taxes paid on the inputs or input services i.e. the unutilized input tax credit is refunded. 1 [ No refund of unutilised input tax credit on account of zero rated supply of goods or of Integrated tax paid on account of zero rated supply of goods shall be allowed where such zero rated supply of goods are subjected to export duty. ] 5.1.6. Goods and Services tax (GST) is a destination based tax, levied as per Section 9 of the CGST Act, 2017 . It is levied at all stages right from manufacture up to final consumption with credit of taxes paid at previous stages available as setoff, called as Input Tax Credit (ITC). In other words, only value addition will be taxed and burden of tax is to be borne by the final consumer. 5.1.7. As per Section 7 of the CGST Act, 2017 , the term supply covers all forms of supply of goods or services or both that includes sale, transfer, barter, exchange, license, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business. It also includes import of service. 5.1.8. There are some transactions which do not meet the aforesaid two conditions of supply i.e consideration and for furtherance of business, but still such transactions are considered as supply of goods and/or services. For example, permanent sale or disposal of business assets, supply to related person (defined in Section 15 of CGST Act, 2017 ) or distinct person (Two or more units/firms holding different GST registrations in India associated with a single PAN, whether located in India or outside India), inter-State stock transfer of goods without consideration or import of services by a person from a related person or any of his other establishments located outside India in the course or furtherance of business. 5.1.9. The types of transaction/activities to be treated as deemed supply even if made without consideration and on which GST is levied, are covered in SCHEDULE I, which are as under 1) Permanent transfer or disposal of business assets where input tax credit has been availed on such assets. 2) Supply of goods or services or both between related persons or between distinct persons (Individuals with distinct GST Identification Numbers (GSTINs) associated with a single legal entity (single PAN), whether located within the same state, across two different states, or in a different country), when made in the course or furtherance of business: Provided that gifts not exceeding fifty thousand rupees in value in a financial year by an employer to an employee shall not be treated as supply of goods or services or both. 3) Supply of goods (a) by a principal to his agent where the agent undertakes to supply such goods on behalf of the principal; or (b) by an agent to his principal where the agent undertakes to receive such goods on behalf of the principal 4) Import of services by a person from a related person or from any of his other establishments outside India, in the course or furtherance of business. 5.1.10. Certain activities/transactions where there is a likelihood of a dispute whether it is to be treated as supply of goods or supply of services, are categorically classified in SCHEDULE II, which are as under 1) Transfer- (a) any transfer of the title in goods is a supply of goods; (b) any transfer of right in goods or of undivided share in goods without the transfer of title thereof, is a supply of services; (c) any transfer of title in goods under an agreement which stipulates that property in goods shall pass at a future date upon payment of full consideration as agreed, is a supply of goods. 2) Land and Building- (a) any lease, tenancy, easement, licence to occupy land is a supply of services; (b) any lease or letting out of the building including a commercial, industrial or residential complex for business or commerce, either wholly or partly, is a supply of services. 3) Any treatment or process which is applied to another person s goods is a supply of services. 4) Transfer of business assets- (a) where goods forming part of the assets of a business are transferred or disposed of by or under the directions of the person carrying on the business so as no longer to form part of those assets, such transfer or disposal is a supply of goods by the person; (b) where, by or under the direction of a person carrying on a business, goods held or used for the purposes of the business are put to any private use or are used, or made available to any person for use, for any purpose other than a purpose of the business, the usage or making available of such goods is a supply of services; (c) where any person ceases to be a taxable person, any goods forming part of the assets of any business carried on by him shall be deemed to be supplied by him in the course or furtherance of his business immediately before he ceases to be a taxable person, unless (i) the business is transferred as a going concern to another person; or (ii) the business is carried on by a personal representative who is deemed to be a taxable person. 5) Supply of services- The following shall be treated as supply of services, namely: (a) renting of immovable property; (b) construction of a complex, building, civil structure or a part thereof, including a complex or building intended for sale to a buyer, wholly or partly, except where the entire consideration has been received after issuance of completion certificate, where required, by the competent authority or after its first occupation, whichever is earlier. (c) temporary transfer or permitting the use or enjoyment of any intellectual property right; (d) development, design, programming, customisation, adaptation, upgradation, enhancement, implementation of information technology software; (e) agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act; and (f) transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration. 6) Composite supply- The following composite supplies shall be treated as a supply of services, namely: - (a) works contract as defined in clause (119) of section 2 ; and (b) supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (other than alcoholic liquor for human consumption 2 [ and un-denatured extra neutral alcohol or rectified spirit used for manufacture of alcoholic liquor, for human consumption ] ), where such supply or service is for cash, deferred payment or other valuable consideration. 5.1.11. SCHEDULE III contains the list of activities/transactions which shall be treated neither as a supply of goods nor a supply of services, i.e. the Negative List supplies. Details of activities/transactions are as under (1) Services by an employee to the employer in the course of or in relation to his employment. (2) Services by any court or Tribunal established under any law for the time being in force. (3) (a) the functions performed by the Members of Parliament, Members of State Legislature, Members of Panchayats, Members of Municipalities and Members of other local authorities; (b) the duties performed by any person who holds any post in pursuance of the provisions of the Constitution in that capacity; or (c) the duties performed by any person as a Chairperson or a Member or a Director in a body established by the Central Government or a State Government or local authority and who is not deemed as an employee before the commencement of this clause. (4) Services of funeral, burial, crematorium or mortuary including transportation of the deceased. (5) Sale of land and, subject to clause (b) of paragraph 5 of Schedule II, sale of building. (6) Actionable claims, other than specified actionable claims. (7) Supply of goods from a place in the non-table territory to another place in the non-taxable territory without such goods entering into India. (8) (a) Supply of warehoused goods to any person before clearance for home consumption; (b) Supply of goods by the consignee to any other person, by endorsement of documents of title to the goods, after the goods have been dispatched from the port of origin located outside India but before clearance for home consumption. (9) 3 [ Activity of apportionment of co-insurance premium by the lead insurer to the co-insurer for the insurance services jointly supplied by the lead insurer and the co-insurer to the insured in co-insurance agreements, subject to the condition that the lead insurer pays the Central tax, the State tax, the Union territory tax and the Integrated tax on the entire amount of premium paid by the insured. ] (10) 4 [ Services by insurer to the reinsurer for which ceding commission or the reinsurance commission is deducted from reinsurance premium paid by the insurer to the reinsurer, subject to the condition that the Central tax, the State tax, the Union territory tax and the Integrated tax is paid by the reinsurer on the gross reinsurance premium payable by the insurer to the reinsurer, inclusive of the said ceding commission or the reinsurance commission. ] 5.1.12. Alcohol for human consumption is kept out of GST. Further, petroleum products viz. Petroleum Crude, Motor Spirit (Petrol), High Speed Diesel, Natural Gas and Aviation Turbine Fuel have temporarily been kept out. These commodities are presently subjected to Central Excise duty and VAT. GST Council shall decide the date from which they shall be included in GST. 5.1.13. Tobacco and tobacco products is leviable to GST. In addition, the Centre has the power to levy Central Excise duty on these products. 5.2. METHODS OF GST LEVY. 5.2.1. There are three methods of GST levy (i) Normal levy - The CGST and the SGST is levied simultaneously at the applicable rate on every transaction of supply of goods and services made by registered persons in the normal course of business. In the case of intra-state sales, Central GST and State GST are charged. All the inter-state sales are chargeable to the Integrated GST. The tax payment is on monthly basis and the taxpayer has to comply with all the prescribed provisions and procedures. (ii) Composition levy Composition levy scheme is a simple compliance scheme for small taxpayers with annual aggregate turnover not exceeding Rs. 1.50 Crore (Rs. 75 lakhs for Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura and Uttarakhand) in goods (including upto 10% value of services) during the previous financial year. As per Notification No. 2/2019-CT (Rate), dated 07.03.2019 , for service provider the turnover should not exceed Rs. 50 lakhs during the previous financial year and such supplier is not engaged in making any inter-State outward supply, who is neither a casual taxable person nor a non-resident taxable person, who is not engaged in making any supply through an electronic commerce operator. It is a voluntary and optional scheme. Under the Composition scheme the eligible manufacturer has to pay 1% (0.5% CGST + 0.5% SGST/ UTGST) of turnover, the eligible service providers (or goods and service suppliers) have to pay 6% (3% CGST + 3% SGST / UTGST) of turnover; the eligible supplier of Restaurant Services has to pay 5% (2.5% CGST + 2.5% SGST/UTGST) of turnover and the traders have to pay 1% (0.5% CGST + 0.5% SGST/UTGST) of the taxable turnover. (iii) Levy under Reverse Charge Mechanism In normal circumstances, the tax is payable on outward supplies, to be paid by the supplier of goods and/or services. However, in case of certain notified supply of goods and services, including imported goods and services, the tax is required to be paid on the inward supplies by the recipient of such goods and services instead of the supplier of such goods or services. All the provisions of the CGST Act, 2017 shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods and/or services. 5.2.2. The provisions and procedures in detail in respect of the above mentioned methods of levy are explained separately in this Chapter as well as other Chapters. 5.3. COMPOSITION LEVY. 5.3.1. The Composition Levy is an alternative method of levy of tax for small taxpayers whose turnover is up to the prescribed limit. To be eligible to opt for Composition levy, the turnover limit presently prescribed for the manufacturer should not exceed Rs. 1.50 Crore (Rs. 75 lakhs for Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura and Uttarakhand) and that for the service provider should not exceed Rs. 50 lakhs during the previous financial year. 5.3.2. The scheme is optional. The option for Composition Levy has to be given electronically in FORM GST CMP-02 , prior to the commencement of the financial year for which the option is exercised. 5.3.3. The taxpayer has to declare the stock of inputs and inputs contained in semi-finished or finished goods held in stock by him on the preceding date on which the Composition Levy starts and has to pay an amount equal to the input tax credit in respect of such stocks. The ITC on inputs shall be calculated proportionately on the basis of corresponding invoices on which credit had been availed by the taxpayer on such inputs. In respect of capital goods held in stock, the input tax credit involved in the remaining useful life in months shall be computed on pro-rata basis, taking the useful life as 5 years. The payment can be made by debiting electronic credit ledger, if there is sufficient balance in the electronic credit ledger, or by debiting electronic cash ledger. If any balance remains in the electronic credit ledger, it would lapse. The taxpayer has to furnish the statement for intimation of Input Tax Credit in FORM GST ITC-03 , within a period of sixty days from the commencement of the relevant financial year. 5.3.4. The following taxable persons are not eligible for the Composition Levy scheme: (a) A casual taxable person - A person who occasionally undertakes supplies in a State or Union Territory where he has no fixed place of business; (b) A Non-Resident Taxable Person - A person who occasionally undertakes supplies but has no fixed place of business or residence in India; (c) A person engaged in providing inter-state (from one State to another) supply of goods and services or both; (d) A person engaged in supply of non-taxable goods i.e. goods which are not taxable under GST law; (e) A person engaged in supply of goods through an Electronic Commerce Operator (E-Commerce) who is required to collect Tax at source (TCS) under Section 52 of the CGST Act, 2017; (f) A person engaged in manufacturing of goods notified under Section 10(2)(e) of the CGST Act, 2017, viz., Ice Cream and other edible Ice, Pan Masala, Aerated Water, Tobacco and manufactured Tobacco substitutes, Fly Ash Bricks, Fly Ash aggregates, Fly Ash Blocks, Brick Fossil Meals or similar Siliceous earthen building bricks and earthen or roofing tiles. 5.3.5. Section 10 of the CGST Act, 2017 is the charging section which provides for levying the tax at the prescribed rate on the turnover of the eligible taxpayers who have opted for Composition Levy scheme. The tax rates prescribed are (a) An eligible manufacturer has to pay 1% (0.5% CGST + 0.5% SGST/ UTGST) of turnover in a state or Union Territory. (b) All eligible service providers (or goods and service suppliers) have to pay 6% (3% CGST + 3% SGST / UTGST) of turnover in a State or Union Territory. (c) An eligible person engaged in making supply of Restaurant Services [Supply of food or any other article for human consumption or any drink (other than alcoholic liquor for human consumption)], has to pay 5% (2.5% CGST + 2.5% SGST/UTGST) of turnover in a state or Union Territory. (d) All other eligible suppliers, i.e. traders, have to pay 1% (0.5% CGST + 0.5% SGST/UTGST) of the taxable turnover in a State or Union Territory. 5.3.6. The taxpayers who have opted for the Composition Levy Scheme have to file return in FORM GSTR-04 on annual basis and the tax has to be paid on quarterly basis before 18th of the month succeeding the quarter relating to supplies. The intimation of payment of tax has to be made electronically in FORM GST CMP 01 . 5.3.7. The taxpayers who have opted for the Composition Levy Scheme cannot issue taxable invoice under GST law but has to issue bill of supply. He has to mention the words Composition Taxable Person not eligible to collect tax on supplies at the top of every bill of supply issued by him. 5.3.8. The taxpayers who have opted for Composition Levy Scheme can neither collect GST from the customers nor can claim Input Tax Credit on the purchases. Also, the recipient of supply of goods and services from such taxpayers cannot claim Input Tax Credit on the tax paid on such supplies. 5.3.9. The option for Composition Levy shall lapse from the day on which the taxpayer s aggregate turnover during the financial year exceeds the threshold limit. Once the taxpayer reaches the threshold limit, he shall file an intimation for withdrawal from the scheme in FORM GST CMP-04 within seven days of the occurrence of such event. After furnishing the said intimation, the taxpayer may electronically furnish on the common portal, a statement in FORM GST ITC-01 containing details of the stock of inputs and inputs contained in semi-finished or finished goods held in stock by him on the date on which the option is withdrawn, within a period of thirty days from the date from which the option is withdrawn. 5.3.10. The aggregate turnover shall be computed on the basis of turnover on all India basis, which shall be aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis), exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number, excluding Central tax, State tax, Union territory tax, integrated tax and cess. 5.3.11. If it is found that the taxpayer was not eligible to pay tax under Composition Scheme or has contravened the provisions of the Act or provisions of this Chapter, jurisdictional officer may issue a notice to such person in FORM GST CMP-05 to show cause within fifteen days of the receipt of such notice as to why the option to pay tax under this scheme shall not be denied. The taxpayer shall submit reply in FORM GST CMP-06 . The proper officer shall issue an order in FORM GST CMP-07 within a period of thirty days of the receipt of such reply, either accepting the reply, or denying the option to pay tax under Composition scheme from the date of the option or from the date of the event concerning such contravention, as the case may be. 5.3.12. Consequent to an order of withdrawal of option in FORM GST CMP-07 , the taxpayer may electronically furnish at the common portal, a statement in FORM GST ITC-01 containing details of the stock of inputs and inputs contained in semi-finished or finished goods held in stock by him on the date on which the option is denied, within a period of thirty days from the date of the order passed in FORM GST CMP-07 for availing Input Tax Credit on such stocks. 5.4. REVERSE CHARGE MECHANISM. 5.4.1. Section 9(3) and 9(4) of the CGST Act, 2017 provide for levy of GST on reverse charge basis. That is, the liability to pay tax is on the recipient of the goods and services instead of the supplier of such goods or services, in respect of notified categories of supply. 5.4.2. Normally, the supplier of goods or services is liable to pay GST. However, in specified cases like imports and other notified supplies, the liability may be cast on the recipient under the Reverse Charge Mechanism. For example - (i) An agriculturist sells 100 kg Shelled Cashew Nuts to a GST registered person @ Rs. 200/- per kg. The total value of the supply would be Rs. 20,000/-. Shelled Cashew Nuts sold by an Agriculturist directly to a GST registered person is notified under Notification No. 4/2017-CT (Rate), dated 28.06.2017 , as amended, for payment of tax under Reverse Charge Mechanism (RCM). As such, the liability to pay tax in this case shifts to the recipient of such Cashew Nuts, i.e. the GST registered person. The applicable rate of tax on Cashew Nuts is 5%. Thus, the said GST registered person will pay tax of Rs. 1000/- (Rs. 500/- CGST + Rs. 500/- SGST) on such goods received. (ii) A trader registered under GST takes services of Goods Transport Agency (GTA) for transportation of goods. The amount paid by the trader for transportation is Rs. 10,000/-. Transportation of goods service provided by GTA is notified under Notification No. 13/2017-CT (Rate), dated 28.06.2017 for payment of tax under the reverse charge mechanism. Therefore, the trader has to pay tax @ 5% on Rs. 10,000/-, i.e. Rs. 500/- (Rs. 250/- CGST + Rs. 250/- SGST). (iii) In case transportation service is provided to passengers by a radio-taxi through e-commerce platform (aggregator), viz., Ola, Uber, etc., then in such cases the reverse charge will apply to the e-commerce operator and he will be liable to pay GST at the applicable rate. 5.4.3. As per Section 9(3) of CGST Act, 2017, the Government on the recommendations of the GST Council notifies the categories of supply of goods and/or services, the tax on which is required to be paid on reverse charge basis by the recipient of such goods and/or services. Section 9(4) of CGST Act, 2017 provides that in respect of the supply of taxable goods and/or services by unregistered supplier (who is not registered under GST), to a registered person, the tax shall be paid by the recipient on reverse charge basis. 5.4.4. All the provisions of the CGST Act, 2017 shall apply to such recipient as if he is the person liable for paying the tax in relation to the supply of such goods and/or services. 5.4.5. Initially from 01.07.2017 to 12.10.2017, in terms of Notification No. 8/2017-CT (Rate) dated 28.06.2017 exemption from payment of tax on reverse charge basis was given if total value of the purchases in a day by a taxpayer from all unregistered persons was less than Rs. 5000/-. From 13.10.2017 to 31.01.2019 the exemption from payment of tax under reverse charge mechanism (RCM) on purchases from unregistered persons was extended till 31.09.2019 without any capping of value, vide various Notifications amending the said Notification No. 8/2017-CT (Rate) dated 28.06.2017. 5.4.6. However, by the amendment carried out in the Act through CGST (Amendment) Act, 2018, with effect from 01.02.2019 the RCM on purchases from unregistered persons was made applicable to only notified persons. Accordingly, vide Notification No. 07/2019-CT (Rate) dated 29.03.2019 , the Builders and Promoters in Real Estate have been notified as persons liable to pay tax under reverse charge on the purchase of goods, viz., Cement and Capital Goods, and services or both which constitute the shortfall from the minimum value of goods or services or both required to be purchased by the promoter for construction of project, i.e. 80% of inputs and input services shall be purchased from the registered persons and on shortfall of purchases tax shall be paid by the builder on reverse charge basis. 5.4.7. In terms of Notification No. 09/2017-CT (Rate), dated 28.06.2017 , Government entities who are TDS Deductors under Section 51 of CGST Act, 2017 , need not pay GST under reverse charge in case of procurements from unregistered suppliers. 5.4.8. The recipient of goods and/or services making payment of tax under reverse charge has to issue invoice or payment voucher on goods and/or services received from a supplier. 5.4.9. The payment of tax under reverse charge is required to be made in cash only. The reason of this provision is that the definition of output tax under Section 2(82) of CGST Act, 2017 categorically excludes tax payable under reverse charge basis and as per Section 49(4) of the CGST Act, 2017, the payment through the electronic credit ledger by utilizing the Input Tax Credit is allowed to be made towards output tax only. 5.4.10. The taxpayer making payment under reverse charge is required to issue a self-invoice (invoice in his own name), which are required to be uploaded in GSTR-1 for taking Input Tax Credit. 5.4.11. The benefit of exemption from registration for the small scale suppliers with turnover less than the stipulated threshold limit, is not available if they are liable to pay tax under reverse charge. Such suppliers are compulsorily required to obtain registration, as provided in Section 24(iii) of the CGST Act, 2017. 5.4.12. The persons engaged only in supplying goods and/or services on which tax is liable to be paid under reverse charge basis by the recipient, is not required to obtain registration. 5.4.13. The registered taxpayer making payment under reverse charge can take input tax credit on the tax paid under reverse charge on the eligible goods and services after making the payment of tax. 5.4.14. The goods on which GST is payable on reverse charge basis, i.e. the tax is required to be paid by the GST registered recipient, notified in Notification No. 4/2017-CT (Rate), dated 28.06.2017 , as amended, are as under- (i) Cashew nuts not shelled or peeled, Bidi wrapper leaves (Tendu), Tobacco leaves and Raw cotton, purchased by any registered person from any Agriculturist; (ii) Essential oils other than those of citrus fruit, namely, peppermint (Mentha piperita), other mints: Spearmint oil (ex-mentha spicata), Water mint-oil (ex-mentha aquatic), Horsemint oil (ex-mentha ylvestries), Bergament oil (ex-mentha citrate), supplied by unregistered person to registered person; (iii) Silk Yarn, supplied by a person manufacturing silk yarn from raw silk or silk worm cocoons; (iv) Lottery supplied by State Government, Union Territory or any local authority to Lottery distributor or selling agent; (v) Used vehicles, seized and confiscated goods, old and used goods, waste and scrap supplied by Central Government, State Government, Union territory or a Local authority to any registered person; (vi) Priority Sector Lending Certificate supplied by any registered person to any registered person. 5.4.15. The services on which GST is payable on reverse charge basis notified in Notification No. 13/2017-CT (Rate), dated 28.06.2017 , are as under- (i) Goods Transport Agency Services supplied by a Goods Transport Agency (GTA) in respect of transportation of goods by road to any factory, any registered society, any Cooperative society, any person registered under CGST/ IGST / SGST/or UTGST Act, any Body Corporate, any partnership firm, any casual taxable person located in the taxable territory. (ii) Legal Services provided by an individual advocate or firm of advocates to any business entity located in the taxable territory. (iii) Arbitral Services supplied by an arbitral Tribunal to a business entity located in the taxable territory. (iv) Sponsorship Services provided by way of Sponsorship Service to any Body Corporate or partnership firm. (v) Services supplied by the Central Government, State Government, Union territory or local authority to a business entity, excluding renting of immovable property service, services by the Department of posts, services in relation to an aircraft or a vessel, inside or outside the precincts of a port or an airport and transport of goods or passengers. (vi) Services supplied by the Central Government, State Government, Union territory or local authority by way of renting of immovable property to a person registered under CGST. (vii) Services by way of renting of residential dwelling to a registered person. (viii) Services supplied by any person by way of transfer of development rights or Floor Space Index (FSI) (including additional FSI) for construction of a project by a promoter. (ix) Long term lease of land (30 years or more) by any person against consideration in the form of upfront amount (called as premium, salami, cost, price, development charges or by any other name) and/or periodic rent for construction of a project by a promoter. (x) Services supplied by a Director of a company or a Body Corporate to the said company or the Body Corporate. (xi) Services provided by an Insurance Agent to person carrying on insurance business. (xii) Supply of Services by a music composer, photographer, artist or the like by way of transfer or permitting the use or enjoyment of a copyright relating to original dramatic, musical or artistic works to a music company, producer or the like. (xiii) Supply of services by an author by way of transfer or permitting the use or enjoyment of a copyright relating to original literary works to a publisher. (xiv) Supply of services by the members of Overseeing Committee to Reserve Bank of India. (xv) Services supplied by individual Direct Selling Agents (DSAs) other than a body corporate partnership or limited liability partnership firm to bank or non-banking financial company (NBFCs). (xvi) Services provided by Business Facilitator (BF) to a banking company. (xvii) Services provided by an agent of Business Correspondent (BC) to Business Correspondent (BC). (xviii) Security Services (services provided by way of supply of security personnel) provided to a registered person. (xix) Services provided 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, provided to a body corporate. (xx) Services of lending Securities under Securities Lending Scheme, 1997 (Scheme). Securities and Exchange Board of India (SEBI), as amended. 5.4.16. In addition, the following two services have been notified in Notification No. 10/2017-Integrated Tax (Rate) dated 28.06.2017 (i) Any service supplied by any person who is located in a non-taxable territory to any recipient in India, other than non-taxable online recipient. (ii) Services supplied by a person located in non-taxable territory by way of transportation of goods by a vessel from a place outside India up to the Customs Station of clearance in India. ***************** NOTES:- 1 . Inserted by Section 128 of The Finance Act (No. 2) Act, 2024 No. 15 of 2024 dated 16.08.2024. 2 . Inserted by Section 114 of The Finance (No. 2) Act, 2024 No.15 of 2024 dated 16th August, 2024. 3 . Inserted by Section 149 of The Finance (No. 2) Act, 2024 No.15 of 2024 dated 16th August, 2024. 4 . Inserted by Section 149 of The Finance (No. 2) Act, 2024 No.15 of 2024 dated 16th August, 2024.