ITC availability on electronic vehicle

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This discussion clarifies whether GST paid on electric two-wheelers is eligible for Input Tax Credit (ITC). The consensus is that ITC is generally not available for vehicles used for personal transport. Electric vehicles are considered motor vehicles under the Motor Vehicles Act 1988, which means they fall under the category where ITC is restricted.

janak kumar singhal

janak kumar singhal (Querist)
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04 July 2021 Sir,
My client want to buy electronic two wheeler vehicle. Whether gst paid on such vehicle is available as input under GST or not. Please guide.
further, I also want to know whether such electronic vehicle is covered under motor vehicle definition or not?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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04 July 2021 Input under GST not available for such vehicle used for personal transport.
It's covered under motor vehicles definition.

CMA Poornima Madhava

CMA Poornima Madhava (Expert)
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04 July 2021 Here is the definition of motor vehicle as per Motor Vehicles Act 1988:
(28) “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 4[twenty-five cubic centimetres]; 1[twenty-five cubic centimetres];"

So, I feel even EVs would be covered under this definition and hence no ITC.