Authority for Advance Ruling — ITC on GST paid on Hiring of Buses and Cars for employees – The applicant engaged in the business of supply of slide fasteners, chains, sliders, etc. In order to carry out its business of supply of its final product and for efficient functioning, the applicant engaged various contractual service providers who provide transportation services. As per the contracts, the contractor (a) shall provide transport services to employees of the appellant and deploy trained driver and helper for the buses. The Contractor raised invoices on the basis of usage classifying the activities under HSN 996413 viz Non-scheduled local bus and coach charter services, attracting GST at the rate of 18%. The applicant sought an advance ruling as to whether (i) the applicant is eligible to take ITC on GST charged by the Contractor for hiring of buses and cars (ii) the restriction on “Rent a Cab” service specified in Section 17 (5) (b)(iii) is applicable to ITC on GST charged by the Contractor for hiring of buses and cars.
Held that:- The Hon’ble Authority for Advance Ruling held that the applicant is eligible to take ITC on hiring of buses having approved seating capacity of more than thirteen persons after amendment w.e.f. 30.08.2018. Prior to 30.08.2018 ITC was not admissible. The applicant is not eligible to take ITC on hiring of cars. The restriction on “Rent-a-Cab” service is applicable to ITC for hiring of buses. However, after amendment from 30.08.2018, there is no restriction on hiring and renting of motor vehicles having approved seating capacity of more than thirteen persons. The restriction is applicable to ITC on hiring of cars. Even after amendment of CGST Act, from 30.08.2018, ITC is not available for hiring/renting of motor vehicles having approved seating capacity of not more than thirteen persons (including Driver).— Ykk India Private Limited, In Re… [2019] 11 TAXLOK.COM 113 (AAAR-Haryana)