GST ON ROYALTY UNDER RCM, Goods and Services Tax - GST

[Sadanand Bulbule]

Dear experts

It is admitted fact that GST on royalty is to be paid under RCM by Mining Lease holders. However in few districts of Karnataka, mining activities have been fully controlled by the Monitoring Committee appointed by the Hon'ble Supreme Court. As such they are under the obligation to strictly follow the terms and conditions imposed by such committee. One of the conditions is such mining lease holders have to pay Royalty, Forest Development Cess and GST directly to the committee and in turn it would remit it to the respective Government departments.

The question is since the mining lease holders have already paid GST on royalty under "Forward charge mechanism [FCM]", the GST Authorities are fastening once again tax liabiIity under RCM despite bringing to their knowledge the said legal position.

What is the remedy for such double liability? Explore the solutions.

Posts / Replies

[UPENDRA PANDYA]

Respected Sir,

I am also facing the similar situation. I would like to get some help. My question is Can we claim back the Input tax Credit on RCM of Royalty for minerals paid to government , here in GSTR-3B table for the current Filing period? (For F.Y. 2024-25). I.e. we are here paying the RCM on royalty in table 3 of GSTR-3B we are giving information for RCM of 18% on Royalty for the month and at the same time we are adjusting or treating it as ITC in table no. 4 of GSTR-3B return. against Sale of minerals (5% gst rate)? Since we will be Is it allowable legally as per rules?

Because if I remember correctly, as per the last judgment passed by the Honorable court , has mentioned that refund cannot be claimed back for inverted rate structure. under this case.

I would be happy to receive the Guidance.