Question ID : 42264

Clarification regarding Taxability of service under Forward Charge or Reverse Charge

Recently a test Van for stamping of weighment bridge was hired from Indian Railway. Accordingly, the D.M.E.(0&F), E.Rly., Asansol intimated to pay the following amount towards hire charge of Test van: Particulars Amount in Rs Hire charge of Test Train 4,18,050 GST @ 5% 20,903 Total 4,38,953 The Clarification is being required regarding 1. Whether GST is Payable under Forward charge or Reverse charge for this service as per Sl. No. 5 of Notification No. 13/2017, Central Tax (Rates), dated 28.06.2017, services supplied by Railway (Central Government) to a business entity excluding renting of immovable property and transport of goods and passengers shall come under Reverse Charge Mechanism. So this being renting of movable property is covered under Entry 5 and hence RCM is applicable.

Test VAN is not an immovable property. Hence GST is applicable on forward charge basis.