Category: Reverse Charge

Section 12 and 13 of the CGST Act provide that the time of supply in case of supplies liable to payment of GST on reverse charge basis is on actual payment to supplier. Hence, unless payment is made, reverse charge is not payable.

(ICAI FAQ PUBLICATION 06-09-2017  REVERSE CHARGE : FAQ NO. 37)

No, if POS is not in the State of the recipient, there is no occasion for the State of recipient to accept tax on reverse charge basis. In the absence of a specific provision in law, such supplies remain untaxed.

(ICAI FAQ PUBLICATION REVERSE CHARGE: FAQ NO. 36)

Yes, provisions identical to section 9(3) and 9(4) of the CGST Act are available in section 5(3) and 5(4) of the IGST Act.

(ICAI FAQ PUBLICATION REVERSE CHARGE : FAQ NO. 35)

Yes, GST in India is a dual-tax and the provisions of the CGST Act are mirrored in SGST/UTGST Act.

(ICAI FAQ PUBLICATION REVERSE CHARGE : FAQ NO. 34)

No, should be available to recipient. However as per provisions, supplier who has paid the tax erroneously is free to claim refund.

(ICAI FAQ PUBLICATION REVERSE CHARGE: FAQ NO. 33)

No, even if supplier has somehow paid tax, reverse charge liability must be discharged by the recipient. The recipient must not claim credit of tax paid by supplier.

(ICAI FAQ PUBLICATION REVERSE CHARGE : FAQ NO.32)

There is no recourse back to the supplier in case of default by recipient to discharge reverse charge liability.

(ICAI FAQ PUBLICATION 06-09-2017 REVERSE CHARGE : FAQ NO. 31)

Recipient is free to reduce the GST charged from the value of invoice and pay only the net amount but liable to discharge the reverse charge obligation separately.

(ICAI FAQ PUBLICATION REVERSE CHARGE : FAQ NO.30)

There is no provision in section 34 of the CGST Act or Rule 52 of the CGST Rules, 2017 regarding reversal of tax paid. Equity demands that relief be allowed to the recipient who has paid the tax so that the recipient may apply for refund under section 54 of the CGST Act and not issue credit note or revised invoice for which there is no provision. This relief to claim refund will be subject to credit not being availed by the recipient on the tax so paid.

(ICAI FAQ PUBLICATION 06-09-2017 REVERSE CHARGE : FAQ NO. 29)

Reverse charge is applicable only when there is a supply. Supply ‘agreed to be made’ is regarded as a supply only in case of supply under section 7(1)(a) and 7(1)(c). Even though actual supply is yet to take place, in the case of supplies covered by these two provisions, tax would be payable on award of contract or issue of PO because this itself amounts to supply. However, Table 4 of GSTR-2 requires reference to be made to invoice in respect of supplies liable to reverse charge but Rule 52 does not provide for issuance of invoice earlier than the time of payment. As such the absence of machinery provisions to pay tax at the time of contract / PO, it appears that the liability fails.

(ICAI FAQ PUBLICATION 06-09-2017 REVERSE CHARGE: FAQ NO.28)