Dealing in Second hand goods

[Kumar Kedia]

My client started a new business wherein he purchases the old vehicle from bank in an auction Bank gives release letter in the name of my client and he then finds the customer for the vehicle and sell it to the end customer. However, the RC of the vehicle is directly transferred from Bank to the end customer. In such a case, where the title of the goods is not transferred to my client as per Motor vehicle Act. Can the valuation be made under Rule 32(5).

AI Summary

Valuation Under Rule 32(5) CGST Rules Applies to Vehicle Auctions Without Title Transfer; Exemptions Support Client's Case. A client is involved in buying old vehicles from banks at auctions and selling them to end customers, with the vehicle's registration certificate (RC) transferring directly from the bank to the customer. The client queries whether valuation under Rule 32(5) of the CGST rules applies, as the title is not transferred to him. Respondents clarify that Rule 32(5) allows valuation based on the margin between purchase and selling prices, without requiring title transfer to the repossessor. Additionally, exemptions under Notification No.10/2017-Central Tax (Rate) apply to intra-State supplies of second-hand goods, supporting the client's case.