GST IMPACT ON DEALER OF SECOND HAND VEHICLE

[NAMAN DOKANIA]

A dealer registered under gst purchases second hand vehicles and sale that after adding his margin in two ways described below:

1. Purchase seocnd hand vehicle in his own name and then sale that to customer

2. Purchases second hand vehicle and sale that without incorporating his name and just acts an intermediary and just earns the margin as income.

In these two cases please help me with the updated law on the taxability and whether can he take any itc on the improvements made in the car before selling it off in both thses cases??

AI Summary

GST on margin scheme taxable on dealer's margin; ITC on vehicle denied, R&M credit allowed.
GST on second hand vehicle dealings depends on the dealer's role: where acting as intermediary, GST is leviable on the dealer's margin; where dealer buys and resells, the margin scheme applies so tax is charged on margin. Notifications limit input tax credit on the vehicle itself but permit credit for repairs and maintenance, and availing ITC on the vehicle may disqualify the dealer from the margin scheme and trigger tax on full value.