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Issue Id: - 116501
Dated: 22-6-2020

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Dear Sir/ Madam

What is the SAC code for renting of Cranes, Hydras,Forklifts with operator and the gst rate applicable to it , read with Notification 20/2019 Central Tax (Rate) dated 30.09.2019 wef 1.10.2019?

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Showing Replies 1 to 12 of 12 Records

1 Dated: 22-6-2020
By:- Ganeshan Kalyani

HSN 9966, rental services of transport vehicles with operators, GST @18%.

Refer sr. no.10 of Notification no.11/2017-CTR dated 28.06.2017,

2 Dated: 22-6-2020

It is a fact that cranes, hydra and forklifts cannot run/ply on road like transport vehicles like truck, bus, car etc. So cranes, hydra, forklifts are machinery and not motor vehicles . Their use is restricted and entirely different than that of motor vehicles like car, bus, trucks etc.Here HSN 9973 will be relevant. I have gone through all the replies posted by Sh.Alkesh Jani Ji in respect of Issue ID 116499 raised by you. I am of the view that Sh.Alkesh Jani Ji has understood the issue very well and his replies are correct, these being full of legal force.

3 Dated: 23-6-2020
By:- Alkesh Jani

Shri Kasturji Sir,

Thanks for sharing your valuable views.

With regards

4 Dated: 23-6-2020

I endorse the views of Shri Kasthuri.

5 Dated: 25-6-2020

Dear Querist,

I have re-looked into the query raised by you in two Issue Ids.

Prior to issuance of Notification No.20/19-CT(R) dated 30.9.19 effective from 1.10.19, HSN 9973 covered leasing or rental services of goods with or without operator. After issuance of above Notification, HSN 9973 covers leasing or rental service of goods with out operator only. The words, "with or' stands omitted w.e.f. 1.10.19 vide Notification No.20/19-CT(R). Here is a question of classification of renting of machinery and equipments with operator.

Relevant extract of Notification No.20/19-CT(R) dated 30.9.19

"(h) against serial number 17, in column (3), for item (viii), the following shall be substituted;

“(viii) Leasing or rental services, without operator, other than (i), (ii), (iii), (iv), (vi), and (viia) above.”

Services/goods mentioned against serial no.(i),(ii),(iii) and (viia) of Notification No.11/17-CT(R) are with operator. Thus leasing of renting of goods with operator is covered under (viia) of Serial No.17 of Notification No.11/17-CT(R) as amended and GST rate will be same applicable to supply of like goods involving transfer of title in goods and this is already effective from 1.1.19 vide Notification No.27/18-CT(Rate) dated 31.12.18 (Serial No.1(i)(b)(e) refers.For example :- If the rate for supply of goods is 28% , the same rate will be applicable for leasing or renting of goods i.e. machinery and equipments If Compensation cess is leviable on these goods, that will also paid on this service. Also go through Schedule-II Serial No.1 (a) which may be applicable depending upon the terms and conditions of the agreement.

HSN will remain 9973 and sub-heading no.will be 997319. Leasing or renting with operator is not out of scope of 9973 because of exclusion clause mentioned.

6 Dated: 25-6-2020
By:- Alkesh Jani


Do Cranes, Hydra, Forklifts are registered with RTO?

7 Dated: 25-6-2020

These goods may be registered as motor vehicles under Motor Vehicle Act with RTO even then these will be called machinery & equipments as their function /purpose is not carrying passengers. These goods have specific purpose which is other than transportation of passengers.

8 Dated: 25-6-2020
By:- Alkesh Jani


Explanation after Section 17 (6) of CGST Act, 2017 will be applicable here?

With Regards

9 Dated: 25-6-2020

Dear Alkesh Jani Ji, All the replies posted by you on this issue do not lose its sheen. Very useful information and analysis given by you which will help in arriving at correct and concrete decision on the issue. We only lay the foundation for the querist for this purpose.

10 Dated: 26-6-2020


Thank you for your reply.

In your reply you said that after amendment vide Notification 20/2019 Cgst (Rate), sac code 9973 applies only for without operator cases.But later you said that with operator cases are also still being covered under 9973.

Item vii(a) is inserted vide Notification 27/2018 Cgst (Rate). At that time Sac code 9973 applies to both with or without operator cases.I agree with this.Later vide Notification 20/2019 Sac code 9977 restricted to Without operator by amending Heading.Hence (viia) also restricted to without operator cases from that date.This is evident from the following -

In the Notification 20/2019 serial no (viii) is substituted with following

"(viii) Leasing of rental services, without operator,other than (i),(ii),(iii),(iv),(vi) and (viia) above."

This is to give effect the amendment made to heading and omission of (v) and (vii) items in the 20/2019 notification.

Had the item vii(a) applies to with or without operator, cbic would have amended vii(a) with the words with or without operator.This implies that item vii(a) applies to without operator cases only.This is also evident from website service classification page.

This is supported by revised explanatory notes.

Sir, I have to classify service of renting of cranes,Hydras,forklifts etc., construction equipments as per the current position in GST law. According to us we can use Sac code 997313 or 997319 as per annexure.When we go through the revised explanatory notes there it is mentioned clearly as without operator.We provide above service with operator.Hence we are not able to classify our service under 997313 and 997319.With out this we cannot apply rates provided under notification 11/2017 as amended from time to time.

Further Annexure: Scheme of Classification of Services issued under 11/2017 is not revised by the Cbic.There exists a conflict between annexure and explanatory notes.But cbic-gst website updated the headings.

Provided further that there is a difference in sac codes and description from 997312 to 997317 between explanatory notes and annexure.This is because 997312 is not given in explanatory notes.In this case we want to follow annexure as it is issued as a part of notification. But it is not updated in line with 20/2019 notification.

Kindly do the needful.

11 Dated: 26-6-2020

"(viii) Leasing of rental services, without operator,other than (i),(ii),(iii),(iv),(vi) and (viia) above."

Dear Sir,

You have laid emphasis on the phrase , "Without operator" whereas I am laying emphasis on the phrase, 'Other Than'. In my view, goods/services falling under (i),(ii),(iii),(iv) and (viia) above are covered with operator as these are excluded from the list of 'without operator' by way of the phrase, 'Other Than'.

After the issuance of notification dated 30.9.2019, HSN 9973 says/stands for 'without operator' only as the words, "with or' stands omitted w.e.f. 1.10.19. I agree to the extent that there is incongruence and Board should issue clarification in order to avoid litigation.

12 Dated: 27-6-2020

Dear Sir

We specifically exclude some thing only when they are included in the first hand.

Even i too agree that there is a need of clarification pending from CBIC wrt 9966 and 9973

Thank you one and all for all your response.


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