GST RCM Case Study

X and Company, a Mining Company  has made following sale during the Financial Year 2017-18 and paid tax as per the details given below:-

Table -I

The dealer is a Mining company and during the Financial Year he has paid a sum of Rs. 180000.00 as Royalty to the State Government but X and Company has not paid the RCM on it and since RCM is not paid No ITC of the same is taken. The amount of RCM is as under:-

Table -II

Suppose X and Company has paid the RCM then his tax Liability would have been discharged as under:-

Table – III

Now due to this Technical Mistake the Dealer has received order to pay the following Demand

Result of Case study :- A non-financial Technical Mistake can have the negative effect of such a volume in the Goods and Service Tax.

The Government should give relief to these Affected Dealers.