TMI Blog2021 (10) TMI 1120X X X X Extracts X X X X X X X X Extracts X X X X ..... d Tax or any other taxes paid, on such goods. In other words, since the applicant has been availing the benefit of the said notification and paying GST at a concessional rate, they shall not avail Input Tax Credit. Other issues are withdrawn by the applicant - application disposed off. - GST-ARA-103/2019-20/B-81 - - - Dated:- 25-10-2021 - SHRI. RAJIV MAGOO, AND SHRI. T. R. RAMNANI, MEMBER PROCEEDINGS (Under Section 98 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017) The present application has been filed under Section 97 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017 [hereinafter referred to as the CGST Act and MG ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... F.Y. 2020-21 as in F.Y. 2019-20 our total margin will be less than ₹ 1.5 crores. At the outset, we would like to make it clear that the provisions of both the CGST Act and the MGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to any dissimilar provisions, a reference to the CGST Act would also mean a reference to the same provision under the MGST 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 2.1 Applicant purchases second hand cars (goods) and after minor processing on it such as change of tyres, change of battery, painting, den ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purchase price In view of it Margin = Sales Price-Purchase Price As the applicant has admitted that they are paying tax as per Notfn No. 8/2018, ITC cannot be claimed on processing cost incurred 3.2 Q.2. Whether tax is to be calculated on margin or the margin is inclusive of tax? Answer : Tax is to be calculated on Margin 3.3 Q. 3) Can applicant claim Input Tax Credit on other indirect expenses incurred for the purpose of business such as rent, commission, professional fees, telephone etc.? Answer : - Notification No. 8/2018 restricts the availment of ITC of any taxes paid on such goods therefore apparently, ITC can be claimed on other indirect expenses incurred for the purpose of business strictly as per Section 16 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 1, 2 and 4 and the same has been accepted by us. 5.3 Therefore, the only question before us is whether the applicant can claim Input Tax Credit on other indirect expenses incurred for the purpose of business such as rent, commission, professional fees, telephone etc. 5.4 The Applicant has submitted that for its transactions (buying and selling of second hand cars), it applies GST rate as per Notification No 8/2018- Central Tax (Rate) dated 25/01/2018. 5.5 The said notification is reproduced as under:- Notification No. 8/2018 -Central Tax (Rate) New Delhi, the 25th January, 2018 G.S.R. (E).- In exercise of the powers conferred by sub-section (1) of section 11 of the Central Goods and Services Tax Act, 2017 (12 of 2017 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... engine capacity of 1500 cc or more and of length of 4000 mm Explanation , - For the purposes of this entry, the specification of the motor vehicle shall be determined as per the Motor Vehicles Act, 1988 (59 of 1988) and the rules made there under. 9% 3 8703 Old and used motor vehicles of engine capacity exceeding 1500 cc, popularly known as Sports Utility Vehicles (SUVs) including utility vehicles. Explanation . - For the purposes of this entry, SUV includes a motor vehicle of length exceeding 4000 mm and having ground clearance of 170 mm. and above. 9% 4. 87 All Old ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such goods . In other words, since the applicant has been availing the benefit of the said notification and paying GST at a concessional rate, they shall not avail Input Tax Credit, as queried. 06. In view of the extensive deliberations as held hereinabove, we pass an order as follows: ORDER (Under Section 98 of the Central Goods and Services Tax Act, 2017 and the Maharashtra Goods and Services Tax Act, 2017) For reasons as discussed in the body of the order, the questions are answered thus - Question 1:- How to calculate margin on sale of second hand goods? Whether A) Margin = Sales price - Purchase price OR B) Margin = Sales price - (Purchase price Processing cost) If B is correct we cannot claim I ..... X X X X Extracts X X X X X X X X Extracts X X X X
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