GST CHARGED 5% AND CLAIMED ITC

[Deepak D]

Dear Sir/Madam,

One of my client providing the Renting services of Motor vehicles for transport of passengers charged 5% of GST and claimed Input Tax Credit. SCN received on this to either reverse the ITC or to pay differential output Tax any remedy for this pls help

AI Summary

Renting of motor vehicles: 5% GST requires forgoing ITC, or pay higher rate to retain input tax credit.
The reduced 5% GST rate for renting motor vehicles is conditional on a no ITC restriction except for credit on same-category vehicles; if full ITC was taken, the supplier may either charge the higher output rate (12%/18%) and retain ITC or stay at 5% and reverse ineligible ITC with interest, supporting any same-category credit with vehicle usage records, input invoices, allocation workings and notification extracts.