Used car

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Anshuman Basu (Querist)
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08 August 2018 We are Pvt Ltd Company. We purchased Luxury car (BMW) in name of our company. We paid Insurance for car. Now question are – 1.Is we get ITC for car purchase, Insurance premium paid or Car maintenance Expenses?
2nd question is, If my company plan to sell the car (BMW) Is GST is applicable on sale of car? what is the procedure to Sale of Used car in point of GST regim ?

Vishakha Kejriwal.

Vishakha Kejriwal. (Expert)
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09 August 2018 Motor vehicles, subject to exception in Section 16(5)i.e when you are in business of motor vehicles, are ineligible credit u/s 16 of the CGST Act and so is input credit on insurance and maintenance. Further sale of car would be subject to GST and you need to raise a normal tax invoice.
It is to be noted that GST council has recommended to widen input credit ambit by allowing credit on repairs , maintenance of motor vehicles but the same remains to be notified as yet.

Anshuman Basu

Anshuman Basu (Querist)
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09 August 2018 MAM MY QUESTION WAS SHOULD I GET ITC WHEN PURCHASE OF CAR? 2nd question is, If my company plan to sell the car (BMW) Is GST is applicable on sale of car? what is the procedure to Sale of Used car in point of GST regim ?

Vishakha Kejriwal.

Vishakha Kejriwal. (Expert)
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09 August 2018 PL read the reply again ...I have stated it is ineligible credit....you will not get itc on purchase nor on insurance and repairs

Anshuman Basu

Anshuman Basu (Querist)
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09 August 2018 sorry and thanks mam but I particular want to know If my company plan to sell the car (BMW) Is GST is applicable on sale of car? what is the procedure to Sale of Used car in point of GST regim ?

Vishakha Kejriwal.

Vishakha Kejriwal. (Expert)
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09 August 2018 Sale of used car being business asset, when made by a registered person is liable to GST and is required to be paid at the applicable rate.

Anshuman Basu

Anshuman Basu (Querist)
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09 August 2018 thanks mam, It means We should charge GST+Cess in our Sale Invoice

Vishakha Kejriwal.

Vishakha Kejriwal. (Expert)
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09 August 2018 Yes you got it right

Anshuman Basu

Anshuman Basu (Querist)
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09 August 2018 Mam I am confused that some of expert said that No GST is applicable on sale of used car by a company or Firm (who is not involved in trading of cars as main business) and some of expert comments that GST is applicable .. As per schedule 1 of CGST Act , Permanent Disposal of business Assets will be treated as supply.
Mam what is the rule of sale 2nd hand car in name of the company?

Vishakha Kejriwal.

Vishakha Kejriwal. (Expert)
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09 August 2018 Please refer to Section 7(1)(d) of the CGST Act read with Schedule II clause 4 of the CGST Act.

Anshuman Basu

Anshuman Basu (Querist)
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09 August 2018 Mam actually I could not understand the schedule, i am requested you to give me your view in simple word so that I can understand...........

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