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RCM Under GST On Goods & Services - Taxguru - in
RCM Under GST On Goods & Services - Taxguru - in
AUTHOR :CASUYASHANDCO
https://taxguru.in/goods-and-service-tax/rcm-gst-goods-services.html
There are two types of GST that apply to everyone. The first is a Forward Charge Mechanism (FCM) or Normal
Charge Mechanism in which supplier of goods and supplier of services is responsible for paying tax, and the
second is Reverse Charge Mechanism (RCM) in which recipient is accountable for payment of tax.
Section 9 of CGST Act, 2017 : Levy and Collection includes two major sec of Reverse Charge Mechanism
which is Sec 9(3) of CGST Act, 2017 and Sec 9(4) of CGST Act, 2017.
According to Section 9(3) of the CGST Act, 2017, the government announced a few particular kinds of supplies
of goods and services, or both, on the basis of which the receiver will be required to pay tax based on the reverse
charge mechanism.
This section depends on nature of supply and /or nature of supplier. The goods specified in the notification are –
Sr No. Supply of Goods Supplier of Goods Recipient of Goods
Sr Supplier of
Supply of Services Recipient of Services
Services
No.
Members of
Supply of services by the members of overseeing
13 Overseeing Committee to Reserve Bank of Committee Reserve Bank of India
India constituted by the
RBI
According to Sec 9(4) of CGST Act, 2017, on the recommendations of council government has notified a class
of registered person in respect of specified categories of goods or services or both received from an unregistered
supplier then such registered person shall pay the tax on reverse charge basis as the recipient of such supply of
goods or supply of services or both.
Such transactions are always intra-state sales since an unregistered provider is unable to undertake inter-state
sales.