TaxTMI 
TaxTMI 
2026 (7) TMI 629
X X X X Extracts X X X X
X X X X Extracts X X X X
....2017') are in pari materia and have the same provisions in like matter and differ from each other only on a few specific provisions. Therefore, unless a mention is particularly made to such dissimilar provisions, a reference to the CGST Act, 2017 would also mean reference to the corresponding similar provisions in the WBGST Act, 2017. RULING 1. This appeal has been filed by Mr. Zahid Hossain, Assistant Commissioner of Revenue, Shibpur Division, Howrah Commissionerate, CGST & CX against the Ruling passed by the West Bengal Authority for Advance Ruling (hereinafter referred to as, the WBAAR) vide Order No. 26/WBAAR/2025-26 dated 16.01.2026 in respect of the application for Advance Ruling filed by M/s Navya Electric Vehicle Private Limited (GSTIN:19AAICN1800C1ZW). 2. The concerned respondent, M/s Navya Electric Vehicle Private Limited (applicant before the WBAAR), stated to be engaged in the supply of electric three-wheeler passengers and goods transport vehicles (e-rickshaws), filed an application before the WBAAR under sub section (1) of section 97 of the CGST Act and the rules made there under seeking an advance ruling in respect of following question: Whether the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....blies combine together make E-rickshaw in CKD SKD as per Rule 2(a) of the Interpretative Rules to the First Schedule to the Customs Tariff Act, 1975. iv. On the basis of recommendations of this Committee, an Office Order bearing no. C.No. VIII/ICD/TKD/6AG/104/2013/pt Dated 12.03.2014 was issued, where it was clarified that: A. As per Rule 2(a) of the Interpretative Rules to the First Schedule to the Customs Tariff Act, 1975, five (05) major components or assemblies provide the essential characteristics to make a complete e-rickshaw in CKD (Completely Knocked Down) and SKD (Semi Knocked Down) condition classifiable in Tariff code 8703. B. The components are: a) Transmissions b) Motor c) Axles d) Chassis e) Controller C. The order further provides that where, in addition to the motor, any two of the essential components specified above are absent, the goods may be treated as parts of an e-rickshaw. Conversely, it stipulates that the presence of the motor along with any three of the other essential components shall be regarded as constituting a complete e-rickshaw in CKD or SKD condition. v. The ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....components/assemblies were imported, the same would be considered to have the essential character of an E-Rickshaw." We have in our hand the orders passed by the Customs, Excise & Service Tax Appellate Tribunal, New Delhi in the case of M/s Y.C. Electric Vehicle vs. Principal Commissioner, Customs (Import), New Delhi (ICD, TKD) and the Customs, Excise & Service Tax Appellate Tribunal, Eastern Zonal Bench, Kolkata in the case of Commissioner of Customs (Port) vs. M/s Jade Korea Pine Life. In both the cases the respective tribunal while passing the order relied solely on the aspect of essential character of Rule 2(a) supra. In the former case the Tribunal put emphasis on a conjoint reading of the office order mentioned Paragraph 4.5 and Rule 2(a) and allowed the import of parts and accessories of e-rickshaw as import of vehicle since the criterion of essential character of vehicle as per Rule 2(a) was satisfied with the components imported. In the latter case, the Tribunal ordered that due to absence of import of essential components of e-rickshaw the relevant consignment could not be considered as import of e-rickshaw. It failed the essential character test of Rule....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Rule 2(a) read with the office order C.No. VIII/ICD/TKD/6AG/104/2013/pt Dated 12.03.2014 issued by ICD, TKD, New Delhi. 7) The above office order has identified five components viz. transmissions, motor, axles, chassis and controller that provide the 'essential character' of a complete e-rickshaw. 8) According to the office order as mentioned above, absence of any two components along with motor does not fulfil the 'essential character' test of a complete vehicle. Alternately it suggests that presence of motor along with three other essential components fulfils the criteria of finished e-rickshaw even in a CKD condition. viii. So, three-wheeler vehicle (e-rickshaw) in a CKD condition can be regarded as finished vehicle : A. if the CKD parts contain any three of the four components fulfilling the 'essential character' of e-rickshaw viz. transmissions, axles, chassis and controller along with motor. B. if the consignment carries appropriate and proportionate numbers of components capable of building such numbers of e-rickshaws. Ruling of the WBAAR 6. Accordingly, the WBAAR, in its Order No. 26/WBAAR/2025-26 dated 16.01.2026 ruled tha....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ns with defining e-rickshaw in terms of Section 2A of the Motor Vehicles Act, 1988, viz. "2A. e-cart and e-rickshaw.-(1) Save as otherwise provided in the proviso to sub-section (1) of section 7 and sub-section (10) of section 9, the provisions of this Act shall apply to e-cart and e-rickshaw. (2) For the purposes of this section, "e-cart or e-rickshaw" means a special purpose battery powered vehicle of power not exceeding 4000 watts, having three wheels for carrying goods or passengers, as the case may be, for hire or reward, manufactured, constructed or adapted, equipped and maintained in accordance with such specifications, as may be prescribed in this behalf." Thus the definition specifies (e-cart and) e-rickshaw as 'a special purpose battery powered vehicle of power not exceeding 4000 watts, having three wheels for carrying goods or passengers, as the case may be'. It may be noted thus that this definition holds battery power not exceeding 4000 watts as the prime requirement for a three wheel vehicle to be defined as an e-rickshaw. C. It then pulls in Rule 2(a) of the General Rules for the Interpretation of the Harmonized System that reads: ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....D SKD condition classifiable at 8703 and are covered under the provisions of Motor Vehicles Act, 1988." It then says: "However if along with motor any two of the essential components mentioned above are missing then it may be considered as parts of electric rickshaw falling under CH 8708 and will not attract the provisions of Motor Vehicles Act, 1988." No provision or reasoning is found in support of the above content to allow exclusion of any of the five major components that provide essential characteristics to make a complete e-rickshaw. F. Further, the ruling did not consider or did not bring to consideration four (4) aspects: (i) The Heading 8703.80 viz. the description "Other vehicles, with only electric motor for propulsion" read with the Explanatory Notes to the Heading 8703 that Vehicles propelled by one or more electric motors powered by electric accumulator packs are known as Electric Vehicles (EVs)" is already available in the nomenclature to define "e-rickshaw (and e-kart)". (ii) HSN Explanatory Notes to Heading 8706 excludes (a) Chassis fitted with engines and cabs, whether or not the cab is complete (e.g. without ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of E-Rickshaws would also be applicable to the components which are determined as representing the essential character of the complete E-Rickshaw" appears to be erroneous and need further examination. H. From the above it may be concluded that the ruling has failed to consider all aspects and instead of relying upon the HSN Explanatory Notes and limiting to the GST Council recommendations, has fully depended on a decade old Office Order of ICD Tughlakabad Customs that is silent on reasoning behind exclusion of any of the component that itself says to form essential characteristics of e-rickshaw and appealable to that extent. 9. The appellant has also made a prayer for Condonation of delay in filing the Appeal where the appeal has been filed beyond the stipulated time as per sub-section (2) of section 100 of the CGST Act, citing the grounds that the impugned WBAAR order dated 16.01.2026 was dispatched on 03.02.2026 and the same was received on 18.02.2026 by the appellant's office. In this context, the DGGI, KZU, had made a development of an Intelligence pertaining to E-rickshaws, that Manufacturers and traders appear to be in connivance with each other and they are supp....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ing which conclusively demonstrate that the absence of one or more components does not deprive the article of its essential character. iv. The WBAAR's identification of the operative threshold 'motor plus any three of the other four essential components' is not the Authority's own innovation but is prescribed by C.No. VIII/ICD/TKD/6AG/104/2013/pt dated 12.03.2014 issued by ICD, TKD, New Delhi. v. Further, the afore-said Office Order has received judicial approval vide the judgment of Hon'ble Delhi High Court in the case of Rama Krishna Sales Pvt. Ltd. Versus Union of India, 2019 (366) E.L.T. 273 (Del.) vi. The CBIC Circular No. 179/11/2022-GST dated 03.08.2022 established two propositions: a. The essential character approach to electrically operated vehicles, and, b. GST rate of 5% applies to an electric vehicle 'whether or not fitted with a battery pack' 13. The respondent also opposed the reasons to appeal as submitted by the appellant on following grounds: a. The contention that 'no component may be excluded' is contracry to Rule 2(a) itself. b. Heading 8703.80 and the explanatory notes to Heading 8703 does not su....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rticle notwithstanding the vehicle is supplied in an unassembled condition. 19. We are in agreement with the broad proposition that Rule 2(a) may apply in an appropriate case involving supply of an e-rickshaw in completely knocked down or semi-knocked down condition. However, we are unable to agree with the specific test adopted by the Authority for Advance Ruling for determining when such classification should apply. 20. Rule 2(a) extends the scope of a tariff entry to an incomplete, unfinished, unassembled or disassembled article which possesses the essential character of the complete article. The rule does not provide that supply of certain specified components, even if major or critical in nature, would by itself amount to supply of the complete article. 21. The test adopted by the Authority for Advance Ruling, namely supply of a motor together with any three out of four identified components, does not emerge from the language of Rule 2(a), the Customs Tariff or the relevant GST rate notification. The said criterion effectively introduces a classification standard which is not contemplated by the statute. 22. In our considered view, the proper application of Rule 2(....
X X X X Extracts X X X X
X X X X Extracts X X X X
....icles (Amendment) Rules, 1993, every [manufacturer or importer] of motor vehicles [including trailers, semi trailers and modular hydraulic trailer] [including registered association (identified by the concerned State Transport Department) for E-rickshaw wherever applicable] shall submit the prototype of the vehicle to be manufactured or imported by him for test... for granting a certificate by that agency as to the compliance of provisions of the Act and these rules." In this context, the Hon'ble Delhi Court in M/s Rama Krishna Sales Pvt. Ltd. versus Union of India and Ors, while acknowledging that "an e-rickshaw is clearly a motor vehicle", has pointed out that a "plain reading of [Rule 126 of the Central Motor Vehicles Rules, 1989] indicates that it is applicable in respect of a manufacturer or an importer of motor vehicles. 29. Rule 2(a) of the Interpretative Rules (General Rules for interpretation as set out in the First Schedule to the Custom Tariff Act, 1975) states that: "Any reference in a heading to an article shall be taken to include a reference to that article incomplete or unfinished, provided that, as presented, the incomplete or unfinished article has the....