IGST Notification on Continuation/Exercise of RCM/FCM Option by GTA

The Ministry of Finance, through Notification No. 06/2023-Integrated Tax (Rate) issued on 26th July 2023, introduces amendments in GST for Goods Transport Agencies (GTA). The notification focuses on the continuation/exercise of the Reverse Charge Mechanism (RCM) and Forward Charge Mechanism (FCM) options by GTAs, as per the recommendations of the GST Council’s 50th meeting held on 11th July 2023. Notification also introduces Form for exercising option by a Goods Transport Agency intending to revert under reverse charge mechanism  to be filed before the commencement of any financial year to be submitted before the jurisdictional GST Authority.

The notification states that GTAs can now exercise the option to pay GST under forward charge until March 31 of the preceding Financial Year, instead of March 15. The option can be exercised starting from January 01 of the preceding Financial Year.

MINISTRY OF FINANCE
(Department of Revenue)

Notification  No. 06/2023- Integrated Tax (Rate) | Dated: 26th July, 2023

G.S.R. 538(E).—In exercise of the powers conferred by sub-sections (1), (3) and (4) of section 5, subsection (1) of section 6 and clauses (iii), (iv) and (xxv) of section 20 of the Integrated Goods and Services Tax Act, 2017 (13 of 2017), read with sub-section (5) of section 15, sub-section (1) of section 16 and section 148 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, and on being satisfied that it is necessary in the public interest so to do, hereby makes the following further amendments in the notification of the Government of India, in the Ministry of Finance (Department of Revenue), No. 8/2017-Integrated Tax (Rate), dated the 28th June, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 683(E), dated the 28th June, 2017, namely:-

In the said notification, –

(A)in the Table,-

(i) against serial number 3, in column (3), in item (ie), following explanation shall be inserted, namely:-

” Explanation. –This item refers to sub-items of the item (iv), (v) and (vi), against serial number 3 of the Table as they existed in the notification prior to their omission vide notification No. 03/2022-Integrated Tax (Rate) dated13^th July,2022.”;

(ii) against serial number 9,in column(3), in item (iii), in sub-item (b), in the entries under column (5), in condition (2),-

(a) for the words, figures and letters ―on or before the 15^th March of the preceding Financial Year”, the words, figures and letter ―on or after the 1^st January of the preceding Financial Year but not later than 31^st March of the preceding Financial Year” shall be substituted;

(b)after the fourth proviso, the following proviso shall be inserted, namely:-

” Provided also that the option exercised by GTA to itself pay GST on the services supplied by it during a Financial Year shall be deemed to have been exercised for the next and future financial years unless the GTA files a declaration in Annexure VI to revert under reverse charge mechanism on or after the 1^st January of the preceding Financial Year but not later than31st March of the preceding Financial Year.”;

(iii) against serial number 24, in column (3),in item (i), in the Explanation, in clause (i),sub-clause (h) shall be omitted;

(B) in Annexure V, –

(i) in para 2, for the words ―end of the financial year for which it is exercised”, the words and figures ―the start of the financial year for which I exercise option to revert under reverse charge mechanism by filing Annexure VI on or before the due date” shall be substituted;

(ii) in note to the Annexure, for the words, figures and letters ―The last date for exercising the above option for any financial year is the 15^th March of the preceding financial year”, the words, figures and letters ―The above option for any Financial Year shall be exercised on or after 1^st January of the preceding Financial Year but not later than 31^st March of the preceding Financial Year” shall be substituted;

(C) after Annexure V, the following Annexure shall be inserted, namely:-

[F. No. –CBIC-190354/133/2023-TO(TRU-II)-CBEC]
RAJEEV RANJAN, Under Secy.
“Annexure VI

FORM

Form for exercising option by a Goods Transport Agency intending to revert under reverse charge mechanism  to be filed before the commencement of any financial year to be submitted before the jurisdictional GST Authority.

Reference No.-

Date: –

1. I/We_____________ (name of Person), authorized representative of M/s………………………………… had exercised
option to pay GST on the services of GTA in relation to transportation of goods supplied by us during, the

financial year………………. under forward charge by filing Annexure V on………………….. ;

2. I hereby declare that I want to revert to reverse charge mechanism for Financial Year…. ;

3. I understand that this option once exercised shall not be allowed to be changed within a period of one year from the date of exercising the option and will remain valid till the end of the financial year for which it is exercised.

Legal Name: –
GSTIN: –
PAN No.
Signature of Authorized representative:
Name Authorized Signatory:
Full Address of GTA:

(Dated Acknowledgment of jurisdictional GST Authority)

Note: The above option for any Financial Year shall be exercised on or after 1^st January of the preceding Financial Year but not later than 31^st March of the preceding Financial Year”.

2. This notification shall come into force with effect from the 27^th July,2023.

Note : The principal notification number 08/2017 – Integrated Tax (Rate), dated the 28th June, 2017 was published in the Gazette of India, Extraordinary, vide number G.S.R. 683 (E), dated the 28th June, 2017 and last amended vide notification number 05/2023-Integrated Tax (Rate), dated the 9^th May, 2023published in the official gazette vide number G.S.R. 349(E), dated the 9^th May, 2023.