TaxTMI 
TaxTMI 
2026 (4) TMI 357
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....on 97 of KGST Act, 2017 read with Rule 104 of KGST Rules, 2017. 2. The applicant submits that they wish to purchase second-hand cars from unregistered dealers and, after undertaking minor repairs, sell the said vehicles to their customers, who are also unregistered persons. Further, the applicant submits that their aggregate annual turnover is likely to exceed Rs.40 lakh. 3. In view of the above, the applicant has sought advance ruling in respect of the following questions: a) Whether Marginal Scheme is Applicable to me on used car purchase and sale? b) HSN Code and Rate of Tax and Assessable Value? c) Any other Suggestion? 4. Admissibility of the Application:- The applicant, under column 13 of the applic....
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....ng the same. ii. Whether ownership of the second-hand cars is transferred by the applicant to the buyer at the time of sale, along with sample documents substantiating the said transactions. iii. The manner in which the change in ownership of second-hand/used cars is accounted for in the books of accounts. 7.2 Further, personal hearings were fixed on 21.08.2025, 20.11.2025, 18.12.2025 and 16.01.2026. However, neither the applicant nor any authorised representative appeared on the scheduled dates to represent the case or to furnish clarifications in respect of the queries raised by this Authority. FINDINGS & DISCUSSION 8. At the outset we would like to make it clear that the provisions of the CGST Act, 2017 and the....
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.... wherein the term "goods" is defined as under:- Section 2(52) of the CGST Act, 2017:- "Goods" means- "every kind of movable property other than money and securities but includes actionable claim, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before supply or under a contract of supply." Accordingly, motor vehicles, including second-hand cars, being movable property, squarely fall within the ambit of "goods" as defined under the said provision. Therefore, this Authority holds that the applicant is engaged in the business of dealing in second-hand goods. 13. Under Rule 32(5) of the CGST Rules, 2017 provides that- "Where a taxable supply is provided by a ....
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....e), dated 25.01.2018, as amended, it is observed that the said notification provides for payment of GST on the value representing the difference between the selling price and the purchase price in respect of old and used motor vehicles, subject to the condition that no input tax credit has been availed on such vehicles, and further stipulates that any negative value shall be ignored. 16. In the present case, the applicant has stated that minor repairs are carried out on the used cars prior to their sale. However, the applicant has not furnished any details regarding the nature, extent or percentage of such repairs, nor clarified whether the repairs are undertaken by the applicant themselves or through third-party service providers. In th....
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....nded. However, the applicant has not furnished particulars relating to engine capacity, vehicle length, and fuel type, which are essential for determination of the exact applicable rate of tax. 20. As regards valuation, in terms of the impugned notification, the taxable value shall be the difference between the selling price and the purchase price of the second-hand motor vehicles, and where such difference is negative, the same shall be ignored. 21. In view of the foregoing, we pass the following RULING i. "Margin Scheme" is not defined or mentioned anywhere under the CGST Act, 2017. However, considering the nature of business of the applicant, namely purchase and sale of second-hand cars, the valuation of such supplies is gove....