Suggestions on GST Implementation Issues 28.09.2017 by ICAI Indirect Tax Committee
Law Related Issues
Section 9(4) of CGST Act, 2017 provides that a registered person will be liable to GST on
reverse charge if he receives supply of goods/services from unregistered person.
In case, an employee consumes services/goods on behalf of his company from an
unregistered person and claims reimbursement from the company as it is a business
expense, then, in such cases it appears that the services/goods are consumed by the
Company (registered person) through its employees from an unregistered person. Therefore
section 9(4) will get invoked and company will be liable to GST on reverse charge.
It is suggested that a suitable clarification be provided if tax under reverse charge is
payable on following reimbursements for business purposes if taken from unregistered
a) Conveyance of Employees through local conveyances like Taxi etc.
b) Food Expenses
c) Expenses for other goods/services consumed by the employee on company’s behalf.
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