To understand this point lets read the law as below:-
As per Section 17(5) of CGST Act Input tax credit shall not be available in respect of the following, namely:—
motor vehicles and other conveyances except when they are used–
(i) for making the following taxable supplies, namely:—
(A) further supply of such vehicles or conveyances ; or
(B) transportation of passengers; or
(C) imparting training on driving, flying, navigating such vehicles or conveyances;
(ii) for transportation of goods;
Now the point is whether Bike and Scooty cover in “motor vehicle” or not?
As per Section 2(76) of CGST ACT :- “motor vehicle” shall have the same meaning as assigned to it in clause (28) of section 2 of the Motor Vehicles Act, 1988;
As per clause (28) of section 2 of the Motor Vehicles Act, 1988:- “motor vehicle” or “vehicle” means any mechanically propelled vehicle adapted for use upon roads whether the power of propulsion is transmitted thereto from an external or internal source and includes a chassis to which a body has not been attached and a trailer; but does not include a vehicle running upon fixed rails or a vehicle of a special type adapted for use only in a factory or in any other enclosed premises or a vehicle having less than four wheels fitted with engine capacity of not exceeding twenty-five cubic centimeters
Here cubic centimeters mean CC engine capacity, Hence Bike and scooty having engine capacity more than specified limit will be covered in motor vehicle and ITC will be not eligible as per section 17(5) CGST ACT.
CA UMANG GARG