Can composition dealer purchased the goods from unregistered dealer has to pay tax under reverse charge on that
Reply—As per CGST (Amendment) Act, 2018, provision of Section 9(4) has been amended and now Reverse charge is not applicable on all inward supplies received from a unregistered supplier. There are some specific services under Real estate only on which provision of RCM u/s 9(4) is applicable. Refer notification No.07/2019-Central Tax (Rate) Dated 29th March, 2019.
Provision of Section 9(4) of CGST Act, i.e. Reverse charge mechanism in case of purchases made from unregistered person was Operative upto 12.10.2017. There is no such restriction on composition dealers to purchase goods only from registered dealers. Therefore, a composition dealer can purchase goods from unregisterd dealers and shall not be liable to pay tax under reverse charge.
Posted Date: Jun 05, 2020