The 'Reverse Charge Mechanism' (RCM) under GST applies when: MCQ with Answer and Explanation

The 'Reverse Charge Mechanism' (RCM) under GST applies when:
A. A registered person buys from an unregistered person (for specified goods/services)
B. Only for imports
C. For exports
D. A registered person buys from another registered person
Answer: Option A
Solution (By JKSSB Mock Tests)
RCM is applicable in certain cases including supplies by unregistered persons to registered persons (though now mostly suspended except specific notified items). Also for specified services like legal, goods transport agency, etc.

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Practice More Accountancy and Book Keeping Questions

Question #1
The 'Fraud' in an audit context refers to:
A. Any error
B. Negligence
C. Intentional act by one or more individuals among management, those charged with governance, employees, or third parties involving deception to obtain an unjust or illegal advantage
D. Unintentional misstatement

Correct Answer: Option C


Explanation:
Fraud is intentional; error is unintentional.

Question #2
The 'Banking Cash Transaction Tax' (BCTT) was a:
A. TDS
B. Indirect tax
C. GST component
D. Direct tax on cash withdrawals above certain limit (now abolished)

Correct Answer: Option D


Explanation:
BCTT was a direct tax on cash withdrawals from banks, abolished in 2009.

Question #3
Tax evasion is:
A. Government policy to waive taxes
B. Illegal non-payment or underpayment of taxes
C. Legal use of tax laws to reduce liability
D. Postponement of tax payment legally

Correct Answer: Option B


Explanation:
Tax evasion involves illegal practices like hiding income or inflating expenses to avoid paying true tax liability.