GST breather for Railways

GST breather for Railways; no tax on transfer of goods for self-consumption

No exemption would be available if the dealing is classified as a decent


In a welcome break for the Indian Railways, no goods and services tax (GST) are going to be applicable on inter- or intra-state transfer of equipment/materials (without transfer of title) for self-consumption. This is often a serious relief for the railways, with annual internal consumption calculable to be concerning Rs 20,000 crore.
In a notification to field units on July 11, the railways said,

Transfer of goods/stores from one state/Union Territory (UT) associateother|to a different} state/UT is taken into account to be an exempted activity.

The notification cited section 7 (1) of the CGST Act 2017, along side clause 1(b) the Schedule II of the CGST Act, 2017 for the said exemption.
Experts supported this, claiming that according to the GST Act, transfer of products by any government — Centre or state — or government agency to an analogous government unit, is exempt from the taxation.

Transfer of such equipment (without transfer of title) qualifies as a service as per the CGST Act.

Railways claiming transfer of products as a service.

But here’s the catch: GST consultants said the railways claiming transfer of products as a service could lead on to disputes.

The offer dealings between 2 interstate branches might not essentially be accepted as a transfer of right in goods (defined as ‘service’), and a lot of likely to be treated because of the transfer of products.

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Certicom Consulting [ Kedia Arpana & Co ] is a group of Chartered Accountants in the business of Small Business Setup & Statutory Compliance including for Professionals for the past 15 years. We have been an established and popular company with an excellent track record for the best customer satisfaction.

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Certicom Consulting

Certicom Consulting [ Kedia Arpana & Co ] is a group of Chartered Accountants in the business of Small Business Setup & Statutory Compliance including for Professionals for the past 15 years. We have been an established and popular company with an excellent track record for the best customer satisfaction.

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