Changes to Reverse Charge Mechanism (RCM) for Metal Scrap

Ministry of Finance has issued Notification No. 06/2024-Union Territory Tax (Rate) on 8th October 2024, amending the Union Territory Goods and Services Tax (UTGST) rates under section 7(3) of the UTGST Act, 2017. This notification modifies the existing provisions concerning the reverse charge mechanism (RCM) for transactions involving metal scrap. Specifically, it mandates that sales of metal scrap by unregistered persons (covering categories 72, 73, 74, 75, 76, 77, 78, 79, 80, or 81) will fall under the RCM, meaning that registered purchasers will be responsible for paying the tax instead of the sellers. This change is intended to clarify tax responsibilities and enhance compliance in the metal scrap industry. The revised regulations will take effect on 10th October 2024. This notification updates the earlier Notification No. 4/2017-Union Territory Tax (Rate), initially published on 28th June 2017, with the most recent amendment occurring in October 2023.
MINISTRY OF FINANCE(Department of Revenue)
Notification No. 06/2024-Union Territory Tax (Rate) | Dated: 8th October, 2024
G.S.R. 615(E).— In exercise of the powers conferred by sub-section (3) of section 7 of the Union Territory Goods and Services Tax Act, 2017 (14 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), notification No. 4/2017- Union Territory Tax (Rate), published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 713(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.
[F. No. CBIC-190354/149/2024-TO(TRU-II)
AMREETA TITUS, Dy. Secy.
Note: – The principal notification No. 4/2017- Union Territory Tax (Rate) was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 713(E), dated the 28thJune, 2017 and was last amended by notification No. 19/2023- Union Territory 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. 782(E), dated the 19th October, 2023.