Important Keyword: GST RCM exemption 2017, section 9(4) GST relief, notification 38/2017 explanation, reverse charge GST India, GST compliance relief 2017,
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[F. No.349/74/2017(Pt.)]
Government of India
Ministry of Finance
Department of Revenue
Central Board of Excise and Customs
New Delhi, the 13th October, 2017
Notification No. 38/2017 – Central Tax (Rate): Seeks to exempt payment of tax under section 9(4) of the CGST Act, 2017 till 31.03.2018
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 (1) of section 11 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on being satisfied that it is necessary in the public interest so to do, on the recommendations of the Council, hereby makes the following amendment in the notification of the Government of India, in the Ministry of Finance (Department of Revenue), No.8/2017- Central Tax (Rate), dated the 28th June, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 680(E), dated the 28th June, 2017, namely:-
In the said notification, the proviso under Paragraph 1 shall be omitted.
2. The exemption contained in the notification No. 8/2017-Central Tax (Rate) dated the 28th June, 2017 as amended by this notification shall apply to all registered persons till the 31st day of March, 2018.
(Ruchi Bisht)
Under Secretary to the
Government of India
Note: - The principal notification No.8/2017-Central Tax (Rate), dated the 28th June, 2017 was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub- section (i) vide number G.S.R. 680 (E), dated the 28th June, 2017.
📚 Frequently Asked Questions (FAQs): Notification No. 38/2017 – Central Tax (Rate)
Q1: What is Notification 38/2017 in GST?
Answer:
It provides exemption from GST under Section 9(4) (reverse charge on purchases from unregistered suppliers).
This relief was given to reduce compliance burden and was applicable till 31 March 2018.
Q2: What is Section 9(4) in GST?
Answer:
Section 9(4) requires a registered buyer to pay GST when purchasing from an unregistered supplier.
This shifts tax liability from seller to buyer.
Q3: Was Section 9(4) removed permanently?
Answer:
No.
It was temporarily exempted through this notification and later modified.
Q4: Who benefited from this notification?
Answer:
All registered businesses purchasing from unregistered suppliers.
This included traders, manufacturers, and service providers.
Q5: What was the validity period?
Answer:
Till 31 March 2018.
After that, further changes were made through later notifications.
Q6: Does this apply to Section 9(3)?
Answer:
No.
Section 9(3) (specific notified services) still applies.
Q7: What is reverse charge mechanism (RCM)?
Answer:
RCM means the buyer pays GST instead of the seller.
It applies in specific cases under GST law.
Q8: Why was this exemption needed?
Answer:
Because applying RCM on every small purchase created huge compliance burden.
Q9: Is this notification still applicable today?
Answer:
No.
It was temporary and expired on 31 March 2018.
Q10: What replaced this system?
Answer:
Later, Section 9(4) was restricted to specific categories notified by government.
Q11: Do businesses need to review past compliance?
Answer:
Yes.
Incorrect application during this period may lead to audit issues.
Q12: Is documentation required for this exemption?
Answer:
No special documentation, but proper records should be maintained.
Download PDF: Notification No. 38/2017 – Central Tax (Rate)
More Information: https://taxinformation.cbic.gov.in/
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