TMI Blog2019 (2) TMI 1081X X X X Extracts X X X X X X X X Extracts X X X X ..... otor vehicles which are designed to carry passengers, irrespective of their capacity to carry passengers. The contentions of the applicant that hiring of buses which can carry large number of passengers would not qualify under rent-a-cab is found to be untenable and the activitiy of the contractor in the instant case, providing buses or cars on hire to the applicant, is specifically covered under the meaning of rent-a-cab , which makes the impugned supply as ineligible for ITC in terms of Section 17(5) of the CGST/HGST Act, 2017. It clearly stands established that the services of the Contractor for hiring of buses/cars for transportation of employees qualify as rent-a-cab services. Further, it is also observed that nothing has been brought on record to suggest that the impugned service is not a service which is obligatory for an employer to provide to its employees under any law for the time being in force; or that such inward supply of services is being is used by the applicant for making an outward taxable supply of the same category of services or as part of a taxable composite or mixed supply. The applicant is not eligible for input tax credit of GST charged by the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : a. The Contractor shall provide transport Services to employees of the Applicant from Factories to Kakarwali, Rewari by way of a buses b. The Contractor shall deploy trained personnel viz. driver and helper buses to provide transportation Services to employees of the Applicant from Factories to Kakarwali, Rewari. The said driver and helper shall be employee of the Contractor and remain under supervision and control of the Contractor. c. The Applicant shall inter-alia pay a monthly fees of ₹ 1,48,000/- and applicable tax to the Contractor for provision of Input Service. d. The Contractor shall provide point to point Transportation Services to employees of the Applicant by ensuring that driver only take routes approved by the Applicant. Any alteration in the transportation Services by the Applicant shall require that Applicant gives prior information to Contractor about the alteration. 4. In furtherance of the aforesaid Agreement, the Contractor raised invoices on the Petitioner on the basis of usage i.e. running of the buses or cars or monthly payments for specified routes of such buses or cars, as the case may be. The said invoices are raised on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... RITY 8. We have carefully gone through the application for advance ruling and submissions made by the applicant. The applicant is registered taxpayer and has entered into agreement for hiring commercially licensed vehicles for transportation of their employees. The question raised by the applicant is whether they are eligible to avail input tax credit of GST paid by the contractor on the services rendered by them to the applicant. 9. As per Section 16 of the of the CGST/HGST Act, 2017, every registered person shall, be entitled to take credit of input tax charged on any supply of goods or services or both to him which are used or intended to be used in the course or furtherance of his business. However, on this availment of input tax credit (ITC), there are exceptions prescribed under Section 17(5) of the CGST/HGST Act, 2017, which provides that: (5) Notwithstanding anything contained in sub-section (1) of section 16 and subsection (1) of section 18, input tax credit shall not be available in respect of the following, namely:- (a) . (b) the following supply of goods or services or both- (i) food and beverages, outdoor catering, beauty treatme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... autiques du B arn, former French aircraft manufacturer Controller anti-lock brake, see Anti-lock braking system NATO reporting name for the Lisunov Li-2 aircraft Taxicab , a type of vehicle for hire with a driver Tractor unit of an articulated lorry, known in Britain as an artic cab As per Oxford dictionary, Cab means: 1. A taxi. 2 . The driver s compartment in a lorry, bus, or train. As per Merriam-webster dictionary, cab means 1: a light closed carriage pulled by a horse 2: a vehicle that carries paying passengers : TAXICAB 3: the covered compartment for the engineer and the controls of a locomotive or for the operator of a truck, tractor, or crane As per Cambridge dictionary, https://dictionary.cambridge.org/dictionary/english/cab , a taxi (= car with a driver whom you pay to take you where you want to go) the separate part at the front of some vehicles in which the driver sits: From all the above definitions, it emerges that in common parlance, cab refers to a vehicle which has been taken on hire/rent, along with driver, for going from one place ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facts, Legislature not having made distinction between renting and hiring for levy of Service Tax, Rent-a-Cab Scheme Operator liable therefor - Sections 65(91), 65(105)(o), 68 and 73(1) of Finance Act, 1994 Sections 74 and 75 of Motor Vehicles Act, 1988 - Section 35G of Central Excise Act, 1944 as applicable to Service Tax vide Section 83 of Finance Act, 1994. [paras 14.2, 14.3] Therefore, the contentions of the applicant that due to different in the phrases hire and rent , in their case the impugned would not quality as rent-a-cab , have no grounds, as the proposition pronounced in the above cited case law clearly points out that hiring and renting are synonyms. 15. In view of above, it clearly stands established that the services of the Contractor for hiring of buses/cars for transportation of employees qualify as rent-a-cab services. Further, it is also observed that nothing has been brought on record to suggest that the impugned service is not a service which is obligatory for an employer to provide to its employees under any law for the time being in force; or that such inward supply of services is being is used by the applicant for making an outward taxa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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