Summary: The Ministry of Finance (Department of Revenue) has issued Notification No. 10/2026-Central Tax (Rate), dated 27 October 2026, prescribing a special procedure for the payment of central tax on operation and maintenance services supplied by concessionaires under specified road and highway concession arrangements. The Central Government has issued the notification on the recommendations of the GST Council, exercising its powers under Section 148 of the Central Goods and Services Tax Act, 2017. The notification applies to registered concessionaires who supply operation and maintenance services to the concessioning authority during the concession period. Such concessionaires are required to pay central tax on the amount charged or debited from the escrow account maintained under the concession agreement towards operation and maintenance expenses. The tax is payable in the tax period in which the relevant expenditure is charged or debited from that account. The notification thus expressly identifies the escrow-account charge or debit as the basis for determining the amount and period of payment of central tax for the specified services. For this purpose, the notification defines a concession agreement as an arrangement under the Toll-Operate-Transfer model. Under this model, the concessionaire receives exclusive rights to demand, collect and appropriate toll on a road or highway, undertakes its operation and maintenance during the concession period, and pays the concession fee upfront. The concessioning authority may be the Central Government, a State Government, a Union territory, a local authority, a Governmental Authority or a Government Entity. The notification comes into force on 1 November 2026.
MINISTRY OF FINANCE
(Department of Revenue)
Notification No. 10/2026-Central Tax (Rate) | Dated: 27th October, 2026
G.S.R. 948(E).— In exercise of the powers conferred by section 148 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, hereby notifies the following class of registered person, namely: –
(i) Concessionaire under a concession agreement, who supplies operation and maintenance services to the concessioning authority during the concession period,
as the registered persons, who shall pay central tax on the supply of such operation and maintenance services on the amount charged or debited from the Escrow Account, maintained in accordance with the concession agreement, towards operation and maintenance expenses incurred by such registered persons, in a tax period in which such expenditure is so charged or debited.
2. Explanation:- For the purpose of this notification,-
(i) “Concession Agreement” means an agreement entered into between a concessionaire and the concessioning authority under the Toll-Operate-Transfer model, whereby the concessionaire is granted the exclusive rights to demand, collect and appropriate toll in respect of a road or highway and is required to operate and maintain such road or highway during the concession period where the concessionaire is required to pay the concession fee upfront;
(ii) “Concessioning authority” means the Central Government, State Government, Union territory, local authority, Governmental Authority or Government Entity which enters into the Concession Agreement.
3. This notification shall come into force with effect from the 1st day of November, 2026.
[F. No. 190354/142/2026-TRU Section-CBIC]
MD. ADIL ASHRAF, Under Secy.
