RESPECTED SIR , ONE OF MY CLIENT START A NEW BUSINESS OF PRODCUTION OF OIL & LUBRICANT . HE NOT PURCHASED NEW MACHINERY BUT TOOK ON RENTAL A OLD MACHINERY. HE WILL PAY RENT PER MONTH TO HIS OWNER. IN THIS POSITION MY CLIENT IS LIABLE TO PAY GST ON RENT ? IF YES , WHAT IS RATE OF GST ? AND HSN CODE? IF OWNER OF MACHINERY IS REGISTER DEALER & HE GIVE A BILL FOR RENT CAN WE TAKE ITC ? IF NOT REGISTERED CAN WE LIABLE FOR RCM ? 

Reply:- GST is not applicable on rent paid by the recipient of services on Reverse charge mechanism basis. GST is payable by the person who has given the machinery on rent. In case the service provider charges GST, ITC is admissible to your client if he follows the conditions laid under Section 16 of GST Act. Rate of tax shall be the same as applicable on new machinery.