Section 86 makes an agent who buys or sells goods for a principal answerable, along with the principal, for the GST on those goods.
Key points
- Under section 86 of the CGST Act, 2017, where an agent supplies or receives taxable goods on behalf of a principal, the agent and the principal are jointly and severally liable to pay the tax on those goods.
- The section concerns goods only; supply of goods by a principal to an agent is itself a deemed supply under Schedule I, para 3.
The provisions
86Liability of agent and principal
Statutory text
Where an agent supplies or receives any taxable goods on behalf of his principal, such agent and his principal shall, jointly and severally, be liable to pay the tax payable on such goods under this Act.
*Enforced w.e.f. 1st July, 2017.
Statutory text as published on the CBIC tax information portal, as on 03.10.2026; the numbered notes record each amendment. Official source
Common questions
- Is an agent liable for GST on goods it sells for a principal?
- Yes. Section 86 of the CGST Act makes the agent and principal jointly and severally liable for tax on goods the agent supplies or receives on the principal's behalf.
Commentary and case notes checked against the judgments and CBIC sources on 04.10.2026.
What it means
Whether a person is an "agent" within section 2(5) depends on whether it supplies or receives goods on the principal's behalf, as explained in Circular 57/31/2018-GST — for instance, an auctioneer or commission agent who invoices in its own name. Agents dealing in goods on behalf of others must register under section 24 regardless of turnover.