Rate of GST and ITC

[Kaustubh Karandikar]

Does HUF have the option of charging 5% on car rental if it does not take ITC? It has mixed income. Office rent and car hire. So, on office rent it will charge 18% and take ITC? On car hire it will charge 5% and not take ITC? Such differential treatment is permissible for a single assessee – depending on the nature of income?

[KASTURI SETHI]

Dear Sir,

For correct rate of tax, pl. go through the definition of the phrase, " mixed supply" under Section 2(74) and Section 8(b) of CGST Act, 2017. Also peruse the decisions of AAR, West Bengal reported as 2019 (2) TMI 1605 - AUTHORITY FOR ADVANCE RULING, WEST BENGAL in ref. Sarj Education Centre and AAR, Haryana reported as 2019 (2) TMI 1002 - AUTHORITY FOR ADVANCE RULING, HARYANA in ref. Awla Infra.

Peruse all the above conjointly.

[Ganeshan Kalyani]

In my view, Sri Karandikar Sir, must be testing our knowledge or inducing us to participate so that the visitor of this page would be benefited with the answers. Otherwise , he has vast experience in Indirect taxation that he may not require to raise query. Rather he will start answering the queries of the querist.

It would be more interesting to see him participating and guiding the querist in issues in taxation.

[KASTURI SETHI]

I agree with Sh.Ganeshan Kalyani Ji. Karandikar Sir is a learned person. GST law still being in infancy, he must be testing us in the guise of having third opinion, otherwise I am view of the view that he has answers on his tips. It is clear from the high level of his drafting while framing the questions.

[Kaustubh Karandikar]

Respected Shri Ganeshan and Shri Kasturi ji

Thanks for the compliments which i am not eligible for and thanks for the time to time guidance on GST issues. But let me humbly say that i myself treat all the time as learner and as rightly said by you, GST being a new born baby, it is always possible to have different views on a particular issue. The whole purpose of putting a query for discussion is to get the views from the knowledgeable persons like you. Thanks.

[KASTURI SETHI]

Respected Sir,

I agree with you. Learning is a lifelong process. I am of the view that if you contribute as an expert, it will further boost the popularity of TMI.

AI Summary

Mixed supply characterisation determines whether different GST rates and ITC positions apply to distinct supplies by the same assessee. Whether an HUF may charge different GST rates and adopt different ITC positions for car hire and office rent depends on supply characterisation under the mixed supply concept in Section 2(74) and Section 8(b) of the CGST Act and on the cited Advance Ruling decisions; each supply must be examined on its facts to determine if supplies are distinct or constitute a composite/mixed supply, which dictates the applicable rate and ITC treatment.