Supply of Goods or services - Sale of Demo Cars - Reimbursement...

Supply of Goods or services - Sale of Demo Cars - Reimbursement of Loss on Sale of Demo Car - The AAR noted that the classification of the demo vehicle at the point of sale remains consistent with its classification at the point of purchase. The tax rate applicable at the time of sale would be the same as that applied at the time of its inward supply, aligning with Sections 8702 and 8703 of the Customs Tariff Act, 1975. - The Authority held that the reimbursement amount for the loss on the sale of demo cars from Mercedes Benz constitutes a supply of services. Specifically, this reimbursement is considered a service of 'agreeing to tolerate an act' under GST, which is taxable.