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BOMBAY GOODS TRANSPORT ASSOCIATION
18, Mehta Chambers, 2nd Floor, Kalyan Street, Masjid Bunder (E), Mumbai- 400009.
Phone: 022- 2371 9882, 2377 5415 . Fax : 2372 8681 . Website : www.bgta.in
Email : bgta@mtnl.net.in / bgta09@gmail.com / info@bgta.in, CIN No. U63011MH1964GAP012857

IN SERVICE TO THE NATION AND INDUSTRY SINCE 1949

BGTA/GST/2016-2017/124

04 July 2017

TO : ALL MEMBER TRANSPORT COMPANIES

GOODS AND SERVICE TAX

We have received calls from members informing that few customers are pressurizing them to register under GST or else they will not be able to continue business with them.

This circular is being issued by BGTA to all its members so that they can inform their customers the same.

1. As per list or services under reverse charge mechanism (RCM) issued on, 19.05.2017, transportation of goods by road was categorized under RCM. Why?

The main reason for this is that goods transport agencies (GTAs) are unable to claim the input credit on major of their costs. Keeping this in mind, the GST Council has ,decided that the GST payable at 5% on GTA service will be payable by the service receiver under RCM and the input credit will also be taken only by the service receiver.

2. Many customers are not clear that GST paid at 5% under RCM for services received from GTA is fully creditable by the service receiver as Input Tax Credit (ITC).

Kindly note customers paying 5% GST will be able to claim the same in full.

3. As per Notification No 5/2017-Central Tax, if the service provider is providing service to a registered GST entity and the category of service falls under RCM, the service provider does not need to register.

Based on point no 1, since the GTA service falls under RCM, thus the GTA does not have to register. Customers of GTA must note here that transporters are not registered under GST purely because of the nature of business & its classification under GST.

4. Apart from this if a GTA is registered under GST, his overall cost will increase due to various additional GST applicable for which they can’t take any Such costs will eventually increase freight. The GST Council has thus exempted GTA to keep the effect of GST neutral on service users.

We do hope this circular will give clarity to members & also their valuable customers in a smooth transition into GST. Should you still have any queries please email them to BGTA on info@bgta.in or call BGTA office.

JITENDRA R. PARIKH

HONORARY GENERAL SECRETARY

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17 Comments

  1. Naresh says:

    sir we body corporate registered under GST.we hire a taxi from an unregistered person on a fixed monthly charge i.e.upto 2000km rs.28500/-and in excess of 2000km @ RS 8/per km.for office use.is there any liability to pay RCM GST.

  2. vijay k jagdev says:

    I am a transporter ( GTA) registered with GST currently I am not taken (ITC) credit, we note on bill GST paid by consignor and paid directly through RCM
    but now we want to take credit and charge gst to party . what we can do further and can we take credit.

  3. PARABJIT SINGH says:

    I AM IN TRANSPORT BUSINESS AND PROVIDING TRANSPORT SERVICES TO GTA ( COMPANY HOW IS ISSUING CONSIGNMENT NOTE . THEN WE HAVE TO CHARGE THEM 12/% OR 18% GST as service provider or we have to follow RGM 5% RULE

  4. Ashish jain says:

    Sir I have query please reply it
    GTA service from registered person with no GST charged in Transport of goods Invoice And there is no tax on goods mean its free goods . At this case

    (1) pay 5% on RCM and can’t take ITC
    or
    (2) pay 5% on RCM and can take ITC
    or
    (3) pay 12% and can take ITC
    or
    what is the possible way to take ITC
    or
    need not want to worry about GST to pay.

  5. satendra Kumar says:

    dear sir
    transporter billty amount is 59600 & extra freight payment 15000 & no provide billty of 15000 so please tell me clerify amount of RCM

  6. DURVIJAN GUPTA says:

    example : lots of goods brought from xyz co.for “A” site and after finishing some goods remain at site now management decide to this goods send to another site from “A” to “B” site through transportation by road . my question is it GST applicable for this transportation or any RCM applicable ?????
    pls. clarify…..

  7. SANJEEV KUMAR says:

    SIR
    IF A TRANSPORT CHARGED IN HIS INVOICE GST ON DELIVERY CHARGES BUT NOT CHARGED GST ON BOOKING FREIGHT,
    THEN WE CLAIM GST AND ALSO PAY RCM GST
    I.E. BOOKING CHARGES : 3105.00
    DELIVERY CHARGES : 309.00
    IGST ON 309 @ 18% : 55.70
    TOTAL AMOUNT : 3469.70

    PLEASE CLARIFY THIS ENTRY

  8. K. Niranjan Prabhu. says:

    Transport charges Bill upto Rs.1,500/- and one consignment transport charge upto Rs.4,050/- is not chargeable to tax under RMC under GST. Is it ok sir.

  9. Rajesh Popli says:

    is some of cases when transporter carry good of non gst dealer of both side ( receiver and sender side) he has to pay gst then he has to register under gst under gta

  10. S. R. PATEL says:

    It means it is clear that if GTA provides services to any entity then GTA will not be required to take registration Under CGST act 2017 without applying the threshold limit of 20 lakhs. Is it correct.

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