Input tax credit

[Ashwin Bhalakiya]

I have query related to Input tax credit, we intend to hire a Cab for our Marketing manager for area survey (i.e., furtherance of business) and doing contract with Cab provider.

We would like to know whether GST charge by service provider will be eligible for input tax credit.????? Please advise.

[KASTURI SETHI]

Not allowed. ITC is allowed only on those motor vehicles with seating capacity of more than 13 persons (including driver) See the decision of AAR, Maharashtra reported as 2020 (9) TMI 352 - AUTHORITY FOR ADVANCE RULING, MAHARASHTRA in the case of Tata Motors Ltd.

[Amit Agrawal]

I agree with Shri Kasturi Sethi Ji.

Kindly also check liability (if any) under RCM under Serial No. 15 of Notification No. 13/2017- Central Tax (Rate) (as amended till date.

These are ex facie views of mine and the same should not be construed as professional advice / suggestion.

[Padmanathan KV]

No. The ITC on renting or hiring of motor vehicle (having seating capacity of less than 13 passengers) is not available in terms of section 17(5)(b)(i) of CGST Act, 2017.

AI Summary

Eligibility of Input Tax Credit on GST for Cab Services Limited by Section 17(5)(b)(i) of CGST Act 2017 A query was raised regarding the eligibility of claiming input tax credit (ITC) on GST charged by a cab service provider for business purposes. The consensus among the respondents was that ITC is not allowed for hiring motor vehicles with a seating capacity of less than 13 persons. References were made to the Authority for Advance Ruling in Maharashtra and section 17(5)(b)(i) of the CGST Act, 2017. Additionally, it was suggested to check potential liabilities under the Reverse Charge Mechanism (RCM) as per Notification No. 13/2017-Central Tax (Rate).