GST to be paid on free diesel filled-in vehicles: AAR

Nov 1, 2022 | GST FAQ, News | 0 comments

GST to be paid on free diesel filled-in vehicles: AAR

The Uttarakhand Authority for Advance Ruling (AAR), ruled that GST is to be paid on the value of Free Diesel filled in the vehicle.

The application under Sub-Section (1) of Section 97 of the Central Goods and Service Tax Act, 2017 and Uttarakhand State Goods and Service Tax Act, 2017, filed by M/s Gurjinder Singh Sandhu (Proprietor M/s New Jai Hind Transport Service), applicant.

The applicant has sought an advance ruling on the classification of goods or services, the applicability of a notification issued under the provisions of this Act, the determination of the value of the supply of services, and the determination of the liability to pay tax on any goods or services, therefore, in terms of Section 97(2) (c) of CGST/SGST Act, 2017, the present application was admitted for consideration by the Authority.

The Bench consisting of Anurag Mishra and Rameshwar Meena ruled that “We observe the input i.e. fuel, to run and operate the vehicle, provided free of cost by the recipient of the service, for transportation of goods, shall form part of the value of supply given Section 15 of the COST Act, 2017, as the cost of this input has to be paid by the supplier of services but incurred by the recipient (as per the terms and condition of the agreement) as for levy of GST, cost of all the inputs, whether provided free of cost or not has to be included in the value of supply.”

“Given the above facts and discussion held above we hold that the value of free diesel filled by the service recipient will be subjected to the charge of GST by adding the free value diesel in the value of GTA service, under the Central Goods and Services Tax Act, 2017 & Uttarakhand Goods and Service Tax Act, 2017” the Authority ruled.

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