In re Dream Road Technologies Pvt. Ltd (GST AAR Haryana)
Q1. Whether GST Rate and HSN applicable to the monthly lease fees received from customers for leasing pre-owned Cars would be determined in accordance with serial no. 17 (viia) of Notification No. 11/2017-Central Tax (Rate) dated 28- 06-2017 read with Notification No. 08/2018-Central Tax (Rate) dated 25th January 2018? If not, then what would be said GST rate and HSN so applicable on the said transaction?
A1. No, The applicable rate of tax on the supply made by the applicant is to determined in accordance with serial no. 17(vi) of Notification No. 11/2017-Central Tax (Rate) dated 28-06-2017 as amended.
Q2. Whether Compensation cess applicable to the monthly lease fees received from customers for leasing of pre-owned Cars would be determined in accordance with serial no. 42A of Notification No. 01/2017- Compensation cess (Rate) dated 28th June 2017? If not, then what about the said Compensation cess so applicable on the said transaction?
A2. No, The applicable rate of tax is as Notification No. 01/2017-Compensation cess (Rate) dated 28th June 2017.
FULL TEXT OF THE ORDER OF AUTHORITY FOR ADVANCE RULING,HARYANA
APPLICANT’S ELIGIBILITY FOR SEEKING AN ADVANCE RULING:
To file an application before the Authority of Advance Ruling, the applicant must satisfy the conditions prescribed under the Central Goods and Services Tax Act, 2017 (hereinafter referred to as CGST Act, 2017), Goods and Services Tax (Compensation to States) Act, 2017 and Haryana Goods and Services Tax Act, 2017 (hereinafter referred to as HGST Act, 2017). Since the provisions of both the Acts are parimateria, any reference to provisions of CGST Act, 2017 in this order should be construed as a reference to corresponding provisions of the HGST Act, 2017 as well. Section 97(2) of the CGST Act, 2017 prescribes that an Advance Ruling may be sought inter alia on the questions of (b) applicability of a notification issued under the provisions of this Act. (e) Determination of the liability to pay tax on any goods or services or both.
Proviso with reference to the Section 98(2) of CGST Act, 2017 states that where the questions raised in the application is already pending or decided in any proceedings in the case of the applicant under any provision of this Act, the application may be rejected by the Advance Ruling Authority after providing an opportunity of being heard to the applicant. In the present case, the applicant has undertaken in form ARA-0.1 that the issue is neither pending nor decided in any proceedings under any of the provisions of the Act. Besides the applicable fees in the case stands paid. So, he is eligible to seek an Advance Ruling under the above provisions and the case is being heard on merits.
Statement of facts as per ARA-01:-
1. M/s Dream Road Technologies Private Limited (hereinafter referred to as the “Applicant”) is a Car leasing Company with the name “PumPumPum”. The Applicant provides the private number (White Plate) of pre-owned cars on lease to the individuals.
2. The Applicant is engaged in providing pre-owned vehicles obtained from different modes of supply on operating leases to its customers.
3. The Applicant enters into different Motor Vehicle Lease Agreements (“MVLA”) with its customers depending upon the type of customer. For instance, in the case of individual customers, normal Lease Agreements shall be executed. However, for other than individual clients two agreements are entered one is Master Lease Agreements and the other is a Tri-Party Agreement.
4. The applicant raises an invoice to its customers on a predefined basis depending upon the dimension and engine capacity of cars being provided on lease.
5. The pre-owned cars as provided to the customers on lease are obtained from any one of the following three modes of su 1 :-
