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TMI BlogSupplier charged Lower GST rate, Goods and Services Tax - GSTX X X X Extracts X X X X X X X X Extracts X X X X ..... Supplier charged Lower GST rate, Goods and Services Tax - GST X X X X Extracts X X X X X X X X Extracts X X X X ..... e Reply: Liability to pay output tax lies upon the supplier. So, Mr. B is liable to pay differential taxes @ 6%. Subject to contractual terms & understanding between A & B, B can raise debit-note u/s 34 upon A to recover differential taxes @ 6%. However, A needs to be aware & vary of the fact that ITC cannot be availed against 'any tax paid in accordance with the provisions of sections 74, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 129 and 130' as per Section 17 (5) (i). Please also see Rule 53 (3) of the CGST Rules, 2017 in this regard. These are ex facie views of mine, the same should not be construed as professional advice / suggestion. Reply By KASTURI SETHI: The Reply: The supplier ('B') is to collect GST from the buyer (A) and deposit into Govt.'s account. Ultimately, differential (6%) is borne by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e buyer. Reply By Padmanathan Kollengode: The Reply: I agree with views of Amit Ji in toto. Mr. B the seller is liable. Whether or not Mr. A pays the differential tax to Mr.B is a whole together different issue and it is subject to contractual obligations and civil suit remedies. Practically Mr. B can issue debit note to Mr.A, and Mr. A can avail ITC on the same. Reply By Padmanathan Kollengo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de: The Reply: Just for academic interest, the jurisprudence in this regard seems to originate from below judgements: In Tata Iron and Steel Company v. State of Bihar 1958 (2) TMI 29 - SUPREME COURT, the Constitution Bench of the Supreme Court, while considering the provisions of the Bihar Sales Tax Act, 1947 observed that the primary liability to pay sales tax, so far as the State is concerned, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is on the seller. Though sales tax legislation may permit the seller who is a registered dealer to collect the sales tax as a tax from the purchaser that does not do away with the primary liability of the seller to pay the sales tax.upheld in George Oakes (Private) Ltd. v. State of Madras, 1961 (4) TMI 78 - SUPREME COURT and Khazan Chand vs. State of Jammu and Kashmir, 1984 (2) TMI 301 - SUPREME ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... COURT. This principle was reiterated by Supreme Court in Central Wines v. Special Commercial Tax Officer (1987 (1) TMI 442 - SUPREME COURT Reply By Shilpi Jain: The Reply: Agreed that the primary liability to the department is of the seller which can be collected from the buyer, also being subject to the contract terms. There have been decisions which have held that the tax liability can be col ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lected from the buyers as it is an indirect tax. Thereby, it is always advised that the contract terms are made clear at the inception itself regarding the quantum of tax payable by the buyer. Some where the interest of the recipient also has to be kept in mind to ensure that the tax component is not kept open, left to be demanded by the seller whenever he gets a demand, more so when he would no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... longer be eligible to take credit (including scenarios mentioned by Amitji) X X X X Extracts X X X X X X X X Extracts X X X X
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