Suggestions on GST Implementation Issues 28.09.2017 by ICAI Indirect Tax Committee

Law Related Issues

18. Type of tax liability of person liable to pay tax under reverse charge scheme

Under CGST Act, Section 9(3) / 5(3) of IGST Act, 2017 requires tax to be paid by recipient
in case of receipt of supply notified by the government and Section 9(4) / 5(4) requires tax
to be paid by registered person on receipt of supply of goods or services from an
unregistered person.

Issue

Suppose, a recipient of supply of goods and services having registration at Delhi receives
supply from an unregistered person who is based at Haryana. Supposing, the place of
supply being Haryana as per the GST laws and the Location of supplier is at Haryana, the
transaction is an intra state supply within Haryana, and hence H-SGST & H-CGST shall be
charged on such transaction. But how the person registered at Delhi will pay the tax to the
Government as supply from the prospective of supplier is intra state whereas from the
prospective of recipient it is procurement in Haryana and goods brought to his registered
office at Delhi.

Suggestion

It is suggested that suitable clarification be provided in the law for such transactions else
it would create hardship for the recipient to get themselves registered in the States from
where the supply is procured.

Read Suggestions on GST Implementation Issues 28.09.2017 by ICAI Indirect Tax Committee

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