GST PAYABLE ON NON-AC VEHICLES HIRED TO INDIAN ARMY-NOT EXEMPT AS CONTRACT CARRIAGE
RAJASTHAN AUTHORITY FOR ADVANCE RULING
GOODS AND SERVICES TAX
Case Title: M/s Pawanputra Travels
(GST AAR RAJASTHAN)
Advance Ruling No.RAJ/AAW2018-19/24
Date of Judgement/Order- 2nd November 2018
IMPORTANT PARAGRAPHS
Para No. 5.
(d)- The applicant does not satisfy the condition prescribed in clause (a) nor specified in clause (b) of clause (7) of section 2 of the Motor Vehicles Act, 1988 and accordingly, they cannot be considered as ‘non-air conditioned contract carriage’ and are hence not eligible for exemption under the serial no. 15 of the exemption notification no. 12/2017 Central Tax (Rate) dated 28.06.2017.
Thus, the essential ingredient of a contract carnage is that it plies under a contract for a fixed set of passengers, and does not allow any other passenger to board or alight from the carnage at will.
A ‘contract carnage’ carries passengers as a group and cannot pick up passengers en-route.
(e) Even if the contract is assumed as ‘non-airconditioned contract carriage’, even then, serial no. 15 of the exemption notification no. 12/2017 Central Tax (Rate) dated 28.06.2017 does not exempt it from GST, as the “hired” non-airconditioned contract carriage are ‘excluded’ from exemption as specifically mentioned in the said notification.
(f) It is hence concluded that the service provided by the applicant falls under ‘rent a cab’ service which attracts:-
IGST @ 5% (SGST @ 2.5% and SGST @ 2.5%) provided that credit of input tax charged on goods and services used in supplying the service, other than the input tax credit of input service in the same line of business (i.e. service procured from another service provider of transporting passengers in a motor vehicle or renting of a motor vehicle) has not been taken
Or
IGST @ 12% (SGST @ 6% and SGST @ 6%) if input tax credit is to be availed
RULING
Para No. 6. In view of the foregoing, we rule as under:-
The Service provided by the applicant is not exempted under Notification No. 12/2017 dated 28.06.2017 as this Service does not fall under ‘nonairconditioned contract carriage’ category. The service provided is ‘rent a cab’ Service, which attracts IGST @ 5% (CGST @ 2.5% and SGST @ 2.5%) provided that credit of input tax charged on goods and services used in supplying the service, other than the input tax credit of input service in the same line of business (i.e. service procured from another service provider of transporting passengers in a motor vehicle or renting of a motor vehicle) has not been taken Or IGST @ 12% (CGST @ 6% and SGST @ 6%) if input tax credit is availed.
