E-Rickshaws Defined as Motor Vehicles, Mandating Registration and Attracting 28% GST Under Specific Classification Rules

The SC clarified the legal distinction between electric rickshaws and powered cycle rickshaws. The ruling determined that E-Rickshaws are motor vehicles requiring registration, and their inner tubes are classified under HSN Code 4013. The authority concluded that E-Rickshaws attract a 28% GST rate, different from powered cycle rickshaws, based on their unique regulatory and technical characteristics.

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Issues:
Interpretation of the term 'three wheeled powered cycle rickshaw' under Tariff Notification, distinction between an electric rickshaw and a powered cycle rickshaw, classification of inner tubes of butyl rubber used in e-rickshaw.

Analysis:
The application sought an advance ruling on the interpretation of the term 'three wheeled powered cycle rickshaw,' the difference between an electric rickshaw and a powered cycle rickshaw, and the classification of inner tubes of butyl rubber used in e-rickshaw. The ruling authority admitted the application under Section 97(2) of the CGST/SGST Act, as it pertained to the classification and applicable GST rate of the mentioned products.

A report submitted by the Joint Commissioner highlighted the distinction between 'three wheeled powered cycle rickshaw' and 'E-Rickshaw,' categorizing the inner tubes of butyl rubber used in E-Rickshaw under HSN Code 4013 with an 18% duty. During the personal hearing, the applicant's representative appeared, while no one represented the Revenue.

The ruling authority examined the relevant notifications and regulations, emphasizing that E-Rickshaws are distinct from powered cycle rickshaws. It was noted that E-Rickshaws are motor vehicles under the Motor Vehicle Act, requiring registration with State Transport Authorities. The authority referenced SSI exemption notifications and legal interpretations to clarify the definition of 'powered cycle rickshaw.'

Based on the analysis, the authority concluded that E-Rickshaws and powered cycle rickshaws are not the same but distinct items. Consequently, the tires used in E-Rickshaws are classified under Chapter Heading 4013 of the GST Tariff, attracting a 28% GST rate.

In summary, the ruling provided clarity on the classification and taxation of products related to electric rickshaws and powered cycle rickshaws, emphasizing the legal distinctions between the two categories and their respective regulatory frameworks.

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