# RCM on Legal, Arbitral, Sponsorship and Government Services

The following services are notified under Section 9(3) for RCM (Notification No. 13/2017-CTR):

## Entry 2 — Legal Services

Supplier	Service	Recipient (liable under RCM)
Individual advocate (incl. senior advocate) / firm of advocates	Legal services — advice, consultancy, assistance, representational services before any court/tribunal/authority — directly or indirectly	Business entity located in taxable territory (TT)

## Entry 3 — Arbitral Tribunal

Supplier	Service	Recipient
An arbitral tribunal	Any service	Business entity located in TT

## Entry 4 — Sponsorship

Supplier	Service	Recipient
Any person other than a body corporate	Sponsorship service	Body corporate or partnership firm located in TT

Note: If the sponsorship supplier is itself a body corporate → forward charge applies.

## Entry 5 — Services by Government/Local Authority

Supplier	Service	Recipient
CG / SG / UT / Local authority	All services EXCEPT the following: <br>1. Renting of immovable property <br>2. Department of Posts & Ministry of Railways (Indian Railways) services <br>3. Services in relation to aircraft/vessel inside or outside precincts of port/airport <br>4. Transport of goods or passengers	Business entity located in TT

## Entry 5A — Renting of Immovable Property by CG/SG/UT/LA

Supplier	Service	Recipient
CG (excluding Ministry of Railways) / SG / UT / Local authority	Renting of immovable property	Person registered under the CGST Act, 2017

## Entry 5AA — Renting of Residential Dwelling

Supplier	Service	Recipient
Any person	Renting of residential dwelling	Registered person

## Entry 5AB — Renting of Commercial Property by Unregistered Person

Supplier	Service	Recipient
Unregistered person	Renting of any immovable property other than residential dwelling	Registered person (except composition dealer)

## Clarification — DDA and 'Local Authority' Status

Under Section 2(69) of the CGST Act, a 'local authority' must be an elected self-governing body legally entitled to or entrusted with the control/management of a municipal or local fund.

Delhi Development Authority (DDA) is NOT a local authority because it does not satisfy the test of an elected self-governing body.
Consequence: Services by DDA do not get the Entry 5 / 5A treatment for local authorities.

## Parliament/State Legislatures/Courts/Tribunals

Provisions of the RCM notification that apply to CG/SG also apply to Parliament, State Legislatures, Courts and Tribunals.

Worked example

### Example 1

Example 1 (Advocate): Mr. X, an individual advocate, gives legal advice to ABC Pvt Ltd. ABC Pvt Ltd is liable under RCM.

### Example 2

Example 2 (Sponsorship): A partnership firm sponsors a corporate event of XYZ Ltd. The firm is the supplier (non-body-corporate) and XYZ Ltd is body corporate → XYZ pays GST under RCM.

### Example 3

Example 3 (Govt renting): Municipal Corporation rents an office building to a registered trader. Trader pays GST under RCM (Entry 5A).

### Example 4

Example 4 (Residential dwelling): A registered company takes a flat on rent from an individual to use as a guest house. Company pays GST under RCM under Entry 5AA.

### Example 5

Example 5 (Commercial renting by unregistered): Mr. P (unregistered) rents his shop to a registered trader (regular scheme). Trader pays GST under RCM (Entry 5AB). Note: if the trader were a composition dealer, RCM under 5AB would not apply.

### Example 6

Example 6 (DDA): DDA leases land to a builder. Since DDA is NOT a local authority, Entry 5A treatment does not apply; standard provisions are followed.

⚠️ Common exam mistakes

Applying RCM on sponsorship even when the supplier is a body corporate — RCM applies only when supplier is NOT a body corporate.
Forgetting that legal services by senior advocates are also covered under the same RCM entry as individual advocates.
Applying RCM under Entry 5 on renting of immovable property by Government — renting is excluded from Entry 5 and covered separately under 5A.
Assuming DDA = local authority — it is NOT.
Applying RCM under Entry 5AB when the registered recipient is under composition scheme — composition dealers are excluded.

Reference: Entries 2, 3, 4, 5, 5A, 5AA, 5AB — Notification No. 13/2017-CTR dated 28.06.2017 (as amended); Section 2(69) of CGST Act for 'local authority'

Now that you've read this — what's next?

Move from understanding → mastery in 3 clicks. Each option below picks up from this lesson's topic.

🔥 Drill 5 Qs on this → ✍️ Adaptive practice →

RCM on Legal, Arbitral, Sponsorship & Government Services

Worked example

⚠️ Common exam mistakes