In order to get clarity regarding this concept we need to go through registration provisions under CGST Act.


It provides that every supplier shall be liable to be registered under this Act in the State or Union territory, other than special category States, from where he makes a taxable supply of goods or services or both, if his aggregate turnover in a financial year exceeds twenty lakh rupees.

Below is the list of states which are assigned special status under Goods and Services Tax Law: Arunachal Pradesh, Assam, Jammu & Kashmir, Manipur, Meghalaya Mizoram, Nagaland, Sikkim , Tripura , Himachal Pradesh , Uttarakhand.


It provides that the following persons shall not be liable to registration, namely-

(a) any person engaged exclusively in the business of supplying goods or services or both that are not liable to tax or wholly exempt from tax under this Act or under the Integrated Goods and Services Tax Act;

(b) The Government may, on the recommendations of the Council, by notification, specify the category of persons who may be exempted from obtaining registration under this Act.


Notwithstanding anything contained in sub-section (1) of section 22, the following categories of persons shall be required to be registered under this Act,–

(i) persons making any inter-State taxable supply;

(ii) casual taxable persons making taxable supply;

(iiipersons who are required to pay tax under reverse charge;

It is clear from the above that Section 24 is superseding/overriding provisions of section 22 and not the provisions of section 23

So if an entity is providing only exempt supplies it is not required to get registration as per Section 23 irrespective of mandatory registration specified under Section 24 as Section 24 is overriding only Section 22 but not Section 23.

Similarly, if the Govt., by notification, specify the category of persons, who may be exempted from obtaining registration under Section 23, provisions of section 24 shall not apply on those persons.

Hence, a conclusion may be drawn that a person engaged in Supplying Exempted supplies is not required to get registered for paying liability under Reverse Charge.

Provide your views in the Comments Section.

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  1. ksnmurthy07 says:

    The interpretation provided may not be correct. Section 23 specifically deals with a situation where the entire turnover of the Company is exempted and if such turnover is exceeding the threshold limit for registration, even in such cases, in view of the provisions of Section 23 they need not be registered. However, Section 24 deals with a totally different scenario – if the supplies specified in that section are made, then registration is mandatory – the notwithstanding clause is with reference to the turnover spedcified as a threshold limit for registration. In view of this, even if the turnover under the specified scenario under Section 24 is Rupee One, they are obliged to take registration and the threshold limits specified under Section 22 are not applicable.

  2. Rajendra Khandelwal says:

    In your article I think we have to assess the provision of Sub section (2) of section 22 of CGST Act which says “Every person who, on the day immediately preceding the appointed day, is registered or holds a license under an existing law, shall be liable to be registered under this Act with effect from the appointed day.
    So if a person already registered under service tax act due to RCM then he has to compulsory migrate in GST.
    Further in my opinion every specified persons has to get registered under GST if it has liability to pay RCM

    1. ANILKUMAR2301 says:

      So According to you, If a person is already registered under the Previous Laws then he is liable to pay RCM. If a person is not registered in earlier tax regime and he is supplying only exempt supplies then RCM is not required?

  3. R. Ranganathan says:

    Tax is payable under reverse charge mechanism only by the receiver of the goods and/or services. Therefore a supplier of goods need not pay tax under reverse charge. Moreover if goods are unconditionally exempt or chargeable to nil rate of tax neither the supplier nor the receiver is liable to pay the tax.


    Sir, we sincerely request your goodself please let us clarify our doubt. That we have taken GST registration in this month. We are suppling 0201 Meat of Bovine Animals Fresh and chilled to some parties who are in Hyderabad. I am collecting the material from small merchants and send by 4 wheeler to hyderabad. The GST percentage on our good are zero or nil rated. Please suggest are we provide REVERSE CHARGE BILL when we purchase from small retailers. Kidndly suggest Sir. Thank you.

    1. ANILKUMAR2301 says:

      The provisions of RCM are dealt in Sec 9(3) and Sec 9(4) of CGST Act.If the services taken by a registered party is covered under Sec 9(3) then RCM is payable.But when you are only supplying exempt goods, According to me there is no requirement to get registration.And hence when you are not a registered party,then the question of RCM does not arise.

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