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CA Final · Indirect Tax Laws · Charge of GST

Kaveri Logistics of Chennai receives goods transport services from an unregistered individual. The Government has notified goods transport agency services for reverse charge. Under the charging section, who becomes liable to pay tax when the Government notifies a category of supply under reverse charge by sub-section (3)?

The recipient becomes liable. When a category of supply is notified for reverse charge under the charging section, the recipient pays the tax, and the Act's provisions apply to him as if he were the person liable for paying tax on that supply.

  1. AThe supplier, who must collect it from the recipient
  2. BThe recipient, as if he were the person liable to pay tax on that supplyCorrect
  3. CThe proper officer, who pays on behalf of the recipient
  4. DThe transporter's bank, through tax deduction

Explanation

Section 9(3) lets the Government notify categories of supply on which tax is paid on reverse charge by the recipient. All provisions of the Act then apply to the recipient as if he were the person liable for paying the tax on that supply. The supplier is therefore not the payer for that supply, so option A is wrong.

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