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TMI Blog2021 (8) TMI 1019X X X X Extracts X X X X X X X X Extracts X X X X ..... sions, a reference to the CGST Act would also mean a reference to the same provision under the MGS T Act. Further to the earlier, henceforth for the purposes of this Advance Ruling, the expression 'GST Act' would mean CGST Act and MGST Act. 2. FACTS AND CONTENTION - AS PER THE APPLICANT The submissions made by M/S Pooja Vaishnavi School Bus Services (Prop.: Shailesh Ramsunder Pande), the applicant is as under:- 2.1 M/s. Pooja Vaishnavi School Bus Services (Prop.: Shailesh Ramsunder Pande) entered in contract with M/s Ratan India Power Limited for supply of NON AC Buses for transportation of their staff under contract carriage. As I am supplying NON AC Buses, whether GST is applicable for the same contract and applicability of "SI No. 15 Heading 9964 of Notification No. 12/2017, dated: 28/06/2017 We are providing transportation of passengers excluding tourism, conducted tour, charter or hire of NON Air Conditioned Buses under a contract carriage with our customer. Whether GST is applicable on this service? B. Statement containing the Applicant's interpretation of law and /or facts 2.3 S. No. 15 (b) of Notification No. 12/2017-Central Tax (Rate) dated 28-06-2017 is reproduced ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icles as a leader of the tourist party, it shall be the duty of such leader of the party to keep the holder of the license informed of the movement of each vehicle, from time to time. (3) If a hirer so desires, he may engage a person possessing a valid driving license to drive the vehicle so hired during the period of the hire agreement. 2.5.5 A license holder may hire his vehicle for any person for his own use and the same will be regulated as per The Rent A Cab Scheme, 1989. The scheme gives the sense of hiring of a motor cab to a person for own use. Hire can be explained in the terms of the scheme that hiring of a motor cab by a license holder to any person for own use. In other words, the person can use the motor cab for own use only. Here, hire means to get the vehicle to own use therefore the person getting the vehicle will have effective control over the motor cab. Effectively, it is not simple hiring. In fact it is a right to use over the motor cab with effective control. Such hiring was neither taxable as services under the Finance Act, 1994 nor it is taxable as service under the CGST Act. In fact it was taxable as goods under the state VAT and similarly, it is taxable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... includes (i) a maxicab; and (ii) a motorcab notwithstanding the separate fares are charged for its passengers;" From the plain reading of SL no 15 heading 9964 of above Notification, exemption of taxes is available only on transportation of passengers by air in sub entry (a) and on Stage carriage as per sub entry (c). (Where as stage carriage is defined as per Section 2(40) of the Motor Vehicles Act, 1988 as : "Stage carriage" means a motor vehicle constructed or adapted to carry more than six passengers excluding the driver for hire or reward at separate fares paid by or for individual passengers, either for the whole journey or for stages of the journey : ) Therefore these two subentries does not apply in this supply. And Subentry (b) is about non-air-conditioned contact carriage other than radio taxi for transportation of passengers but excluded Tourism, Conducted tour, charter or or hire. In the present case. As per copy of Service Order dated 01.07.2019 acquired from supplier M/s. Pooja Vaishnavi School Bus Services, the said contract has a subject heading "Deployment of Staff buses for transport of staff under contract carriage at 5x270 MW TPP Nandgaon Peth, Amra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d services are covered by the definition of "rent-a-cab". In this regard, it is observed that the phrase "rent a-cab has not been defined in the CGST/SGST Act, 2017. In situations where statutory meaning of any term/phrase has not been provided words, entries and items in taxing statutes must be construed in terms of their commercial or trade understanding, or according to their popular meaning. Resort to rigid interpretation in terms of scientific and technical meanings should be avoided in such circumstances, as has been held by the Hon'ble High Court of Allahabad in the case of Godrej Consumer Products Limited Vs. Commissioner of Commercial Tax [2018 (13) G.S.T.L. 135 (All.)]. Hence, we first proceed to examine as to what is rent-a-cab. 11. As per information available on website https://en.wikipedia.org/wiki/Cab, Cab means Cab or CAB may refer to: * Transport [edit] * Cab (locomotive), the driving compartment of a locomotive Cab car * Cabin (truck), an enclosed space in a truck where the driver is seated * Cabriolet (carriage) (obsolete), a type of horse-drawn carriage * Causeway Bay Station, Hong Kong; MTR station code CAB Civil Aeronautics Board * Constructions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... motor vehicles which are designed to carry passengers, irrespective of their capacity to carry passengers. The activity of the contractor in the instant case, providing buses on hire to the M/s. Ratan India Power Ltd, is specifically covered under the meaning of "rent-a-cab", 15. In view of above, it clearly stands established that the services of the applicant for hiring of buses for transportation of employees qualify as "rent-a-cab" services. Therefore in view of above rulings and facts the Service provided by the applicant is not exempted under Notification No. 12/2017 dated 28.06.2017 as this Service does not fall under 'non-air-conditioned contract carriage category. The service provided is hire service or rent a cab' Service, Therefore serial no. 15 of the exemption notification no. 12/2017-Central Tax (Rate) dated 28.06.2017 does not exempt it from GST, as the "hired" non-air-conditioned contract carriage are excluded' from exemption as specifically mentioned in the said notification. Hence above notification is not applicable in the above contract. 04. HEARING 4.1 Preliminary hearing in the matter was held on 28.01.20120 Shri Sachin Bhoyar, CA of applicant and Shri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment with RIPL for supplying Non-AC buses to transport staff of RIPL and the buses are owned by the applicant. Further, the applicant also incurs expenses on fuel and maintenance of the buses and for all these services provided by the applicant, they are paid fixed hire cost plus fixed fuel cost at predetermined rates of fuel plus mileage. 5.5 We also find that it is RIPL which controls the deployment of the buses. A perusal of the agreement reveals that the applicant shall deploy the buses (already inspected by RIPL) or as per instructions of the Admn. Dept. of RIPL. Thus the applicant cannot run the buses on their own because the overall control of the buses is with RIPL. Further, as per the agreement, Insurance Charges, etc., will be paid by the applicant whereas toll tax, etc will be paid by RIPL. Thus while the ownership of the buses lies with the applicant, the buses shall be operated strictly as per the instructions of RIPL. Therefore in the subject case, there is a clear transfer of right to use the buses by way of effective control as is seen from the fact that the buses are plying strictly as per RIPL's instructions. 5.6.1 Serial no. 15 of the exemption notification no. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assengers; 5.7.2 Thus, the essential ingredient of a contract carriage is that it plies under a contract for a fixed set of passengers, and does not allow any other passenger to board or alight from the carriage at will. A 'contract carriage' canies passengers as a group and cannot pick up passengers en-route. 5.7.3 Since the rent-a-cab has not been defined under GST Act, we need to analyse the same word taking the help of Motor Vehicle Act, 1988. Dictionary meaning of Rent a cab is "Taxi" "motor vehicle" or "vehicle" means any mechanically propelled vehicle adapted for use upon roads whether the power of propulsion is transmitted thereto from an external or internal source and includes a chassis to which a body has not been attached and a trailer; but does not include a vehicle running upon fixed rails or a vehicle of a special type adapted for use only in a factory or in any other enclosed premises or a vehicle having less than four wheels fitted with engine capacity of not exceeding thirty-five cubic centimeters; "Radio taxi" means a taxi including a radio cab, by whatever name called, which is in two-way radio communication with a central control office and is enabled for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icle or renting of a motor vehicle) has not been taken. [Please refer to Explanation no. (iv)] Or 6 - 5.8.2 The subject case is clearly covered by Entry Sr. No. 10 of Notification No. 11/2017 - CT (Rate) dated 28.06.2017 in as much as there is a Rental services of transport vehicles with or without operators. All activities of Renting of any motor vehicle/transport vehicle which is designed to carry passengers where the cost of fuel is included in the consideration charged from the service recipient are chargeable to either 2.5% GST or 12% GST depending on availment of Cenvat Credit. Therefore in the subject case since there is a Renting of any motor vehicle/transport vehicle which is designed to carry passengers where the cost of fuel is included in the consideration charged from the service recipient i.e. RIPL, the applicant will have to pay GST @ 12% , if credit of input tax charged on goods and services used in supplying the service, other than the input tax credit of input service in the same line of business (i.e. service procured from another service provider of transporting passengers in a motor vehicle or renting of a motor vehicle) has not been taken. 06. In view of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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