Sale of old commercial vehicle

[Syamaprasad Menon]

How the sale of a used commercial goods carrier, TATA Ace, bought during the VAT regime, claiming ITC, with the sale value exceeding the WDV by a few thousand, can be legitimately accounted - the rate of GST - will compensation cess need be levied etc

[KASTURI SETHI]

If input tax credit under GST or Cenvat credit under Cenvat Credit Rules or ITC under State VAT has been availed on old and used motor vehicles, exemption from payment GST Compensation is not available. Compensation Cess is leviable w.e.f.25.1.18. See Notification No. 1/2018-C.C. (Rate), dated 25-1-2018. Rate of cess depends on engine capacity.

[KASTURI SETHI]

In this scenario, input tax credit/Cenvat Credit/VAT credit has been availed, hence margin scheme for valuation purpose is not available.Notification No. 1/2018-C.C. (Rate), dated 25-1-2018 refers.

[Syamaprasad Menon]

thanks for the response

AI Summary

Selling Used TATA Ace with Input Tax Credit? GST Compensation Cess Applies, Check Notification No. 1/2018-C.C. (Rate) Details. A user inquired about the GST implications on selling a used commercial vehicle, specifically a TATA Ace, purchased during the VAT regime with input tax credit claimed. The replies clarified that if input tax credit was availed, the seller is not exempt from GST Compensation Cess, which is applicable from January 25, 2018, as per Notification No. 1/2018-C.C. (Rate). The rate of cess depends on the engine capacity, and the margin scheme for valuation is not applicable in this case.