Transportation of Employees

[Kusalava InternationalLimited]

we are mfg co and provide transportation facility to employee from home to factory and factory to home for that we have purchased bus and given to one person(Unregistered Person) to run bus.For that we are paying every month bill to him.(including Diesel,Driver Salaries and his commission)

1.What is the rate of GST to be charged on Bill if he is registered?Please refer SAC Code.

2.Can we claim ITC on that bill?

AI Summary

Input tax credit denial for employee transport: GST may apply, but ITC eligibility depends on vehicle exclusion and supply characterisation.
Whether payment for employee pick up and drop services gives rise to GST and whether input tax credit is allowable turns on Section 17(5) of the CGST Act, which excludes motor vehicles and related services from ITC except when used for specified taxable supplies. Debate centres on whether employee transport is an excluded personal consumption, whether hiring transport services for business is eligible for ITC, and whether employer to employee conveyance constitutes a taxable supply under Schedule I when recoveries are made or deeming provisions apply. The position remains contested and fact dependent.