Classification of service— In the instant case, the applicant has filed an application of the Chhattisgarh Goods & Services Tax Act, 2017 seeking advance ruling on:-

(i) Whether the services taken by the applicant from the owner of the Goods transportation vehicle, are exempt or taxable?

(ii) If such services are taxable, what will be the classification of such services?

(iii) If such services are taxable, whether the applicant is liable to pay the tax thereon under reverse charge mechanism as per Sec 9(3) of Central Goods and Services Tax, 2017?

(iv) If the applicant is liable to pay the tax on reverse charge basis, then what is the rate at which tax would be applicable?

(v) If the supply is taxable, whether the applicant will be able claim ITC for the GST paid on this supply.

The applicant has in their application submitted that they would be issuing consignment notes while providing the services of Transportation of goods. Thus the applicant is a Goods Transport Agency GTA and it is in this context, they have sought advance ruling as regards taxability, its classification, rate of tax and eligibility to Input tax credit, on the services of receipt of transportation vehicles on hire from the persons who own such Goods Transportation Vehicle to be used for providing the said services of Transportation of goods.

As per Notification no. 12/2017-Central Tax (Rate) dated 28.06.2017 (sr.no.22), if the GTA hires a means of transportation of goods, GST payable would be Nil on such transaction. We thus come to the considered conclusion that the service by way of giving on hire a means of transportation of goods to the applicant GTA, is exigible to Nil rate of GST.

Held that— 

i. The services by way of giving on hire to the Applicant (goods transport agency) a means of transportation of goods, is taxable at Nil rate as per entry No. 22 (b) of Notification No. 12/2017- Central Tax (Rate) dated 28.06.2017.

ii. The above service is classifiable under Heading No. 9966; Rental services of transport vehicles with or without operators.

iii & iv. Since, such supply is taxable at Nil rate as above, no liability under Reverse Charge Mechanism shall arise upon the Applicant under Notification No. 13/2017-Central Tax (Rate) dated 28.06.2017.

v. As the instant supply is taxable at Nil rate, there is no question of taking any Input tax credit.