In re JBM Ecolife Mobility Surat P Ltd (GST AAR Gujarat)
In In re JBM Ecolife Mobility Surat Pvt. Ltd., the Authority for Advance Ruling Gujarat examined the GST classification and applicable tax rate for services involving operation and maintenance of electric buses under a Gross Cost Contract (GCC) model. The applicant, a GST-registered entity, was engaged in supplying, operating, and maintaining electric buses for Surat under a concession agreement initially with Surat Municipal Corporation and later assigned to Surat Sitilink Limited. The applicant provided end-to-end services, including procurement of buses, deployment of personnel, maintenance, and charging infrastructure, with consideration calculated on a per-kilometre basis.
The applicant argued that its services were classifiable under SAC 996601 as rental services of transport vehicles with operators and sought clarity on whether concessional GST rates (5%/12%) applicable to renting of motor vehicles with fuel included would apply, considering that the buses operated on electricity. The central issue was whether electricity could be treated as “fuel” for the purpose of Entry No. 10(i) of Notification No. 11/2017-Central Tax (Rate), which allows concessional rates where fuel cost is included in consideration.
The Authority first confirmed that the nature of services provided—renting buses with operators where the service recipient determines routes and schedules—falls under SAC 996601. It then examined the relevant GST rate entries under Notification No. 11/2017, particularly Entry 10(i), which applies to renting of motor vehicles with fuel cost included, and Entry 10(iii), a residual category covering other rental services of transport vehicles with operators.
