Important Keyword: Notification No. 06/2024-Central Tax (Rate), GST on Metal Scrap, reverse charge, GST scrap rate, GST 2024 updates, Finodha GST Help,
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Table of Contents
[F. No. CBIC-190354/149/2024-TO(TRU-II)]
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
(Department of Revenue)
New Delhi, the 8th October, 2024
Notification No. 06/2024 – Central Tax (Rate): Seeks to amend Notification No. 4/2017 – Central Tax (Rate) dated 28.06. 2017..
GST [TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB- SECTION (i)]
G.S.R….(E).- In exercise of the powers conferred by sub-section (3) of section 9 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, hereby makes the following further amendments in the notification of the Government of India, Ministry of Finance (Department of Revenue), No. 4/2017- Central Tax (Rate), published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 676(E), dated the 28th June, 2017, namely:-
In the said notification, in the Table, after S. No. 7 and the entries relating thereto, the following S. No. and entries shall be inserted, namely: –
| (1) | (2) | (3) | (4) | (5) |
| “8. | 72, 73, 74, 75, 76, 77, 78, 79, 80 or 81 | Metal scrap | Any unregistered person | Any registered person”. |
2. This notification shall come into force on the 10th day of October, 2024.
(Amreeta Titus)
Deputy Secretary
Note: – The principal notification No. 4/2017-Central Tax (Rate) was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 676(E), dated the 28thJune, 2017 and was last amended by notification No. 19/2023-Central Tax (Rate), dated the 19th October, 2023, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 780(E), dated the 19th October, 2023.
📚 Frequently Asked Questions (FAQs): Notification No. 06/2024 – Central Tax (Rate)
Q1: 💬 What is Notification No. 06/2024 – Central Tax (Rate) about?
Answer:
Notification No. 06/2024-Central Tax (Rate), issued on 8th October 2024, introduces reverse charge provisions for the supply of metal scrap. It amends Notification No. 4/2017 to state that if a registered person purchases metal scrap from an unregistered person (under Chapter 72 to 81 of GST Tariff), the tax must be paid by the registered buyer under reverse charge mechanism (RCM).
Q2: 🔄 What is reverse charge mechanism (RCM) under GST?
Answer:
Reverse charge mechanism means that the recipient of goods or services (instead of the supplier) is liable to pay GST. In this case, registered buyers purchasing metal scrap from unregistered sellers must pay GST directly.
Q3: 🧾 Which HSN codes are covered under this notification?
Answer:
The HSN codes covered under this amendment include Chapter 72 to 81, which typically includes various metal scrap items like iron, steel, copper, nickel, aluminum, zinc, lead, tin, and other base metals.
Q4: 🔍 Who is liable to pay GST for metal scrap under this notification?
Answer:
Under Notification No. 06/2024, when metal scrap is supplied by an unregistered person to a registered person, the liability to pay GST lies with the registered recipient.
Q5: 🛠️ When does this amendment come into effect?
Answer:
This amendment comes into effect from 10th October 2024 as per the notification issued by the Central Government.
Q6: 🤔 Why was this amendment introduced?
Answer:
The amendment was introduced to plug revenue leakage and ensure tax compliance in the scrap trading sector, which involves high-value cash transactions, often from unregistered sources.
Q7: 🧮 What GST rate is applicable under this reverse charge?
Answer:
While the notification specifies the supply nature under RCM, the actual GST rate applicable for different metal scraps varies (mostly 18%). It’s advisable to consult HSN-specific rates or a GST Expert via www.Finodha.in.
Q8: 📜 What was the original Notification No. 4/2017-Central Tax (Rate) about?
Answer:
Notification No. 4/2017 initially notified the categories of goods and services liable to reverse charge. Notification 06/2024 inserts a new entry to include metal scrap supplied by unregistered persons.
Q9: 🧑💼 How can Finodha help with compliance related to metal scrap GST?
Answer:
Finodha offers comprehensive support for GST compliance, reverse charge entries, return filing, and audit support. You can consult GST professionals at www.Finodha.in or explore their GST services at https://finodha.in/gst-compliance/.
Q10: 💼 I am a scrap dealer. Do I need GST registration now?
Answer:
If you supply scrap to registered buyers and are currently unregistered, you may not be liable to register solely due to this notification. However, frequent transactions may still make you liable. You should assess your turnover and consult https://finodha.in/online-gst-registration/.
Q11: 📝 Will this impact e-invoicing requirements?
Answer:
If you’re an unregistered seller, e-invoicing does not apply. However, the registered buyer must maintain proper documentation, including self-invoice under reverse charge, and account for tax under GSTR-3B.
Q12: 🔄 Is ITC available on tax paid under RCM for metal scrap?
Answer:
Yes, the registered buyer who pays GST under reverse charge can claim Input Tax Credit (ITC) subject to other eligibility conditions under Section 16 of the CGST Act.
📢 Expert Tip from Finodha:
To ensure full compliance with RCM and accurate tax credit availability, it’s wise to maintain separate accounts and consult professionals through Finodha’s GST team.
🟢 For personalized assistance, visit:
GST Expert at www.Finodha.in
Or directly consult for GST Return: https://finodha.in/gst-return-filing/
🔗 Related Finodha Services:
✔ GST Compliance: https://finodha.in/gst-compliance/
✔ GST Registration: https://finodha.in/online-gst-registration/
✔ GST Return Filing: https://finodha.in/gst-return-filing/
✔ MSME Registration: https://finodha.in/online-udyam-udyog-aadhar-msme-registration/
✔ GST Expert Help: www.Finodha.in
Download PDF: Notification No. 06/2024 – Central Tax (Rate)
More Information: https://taxinformation.cbic.gov.in/
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