Assessee can avail ITC only on tax paid on services for leasing/ renting/ hiring of motor vehicles for women's safety

Last updated: 23 October 2024

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The Authority of Advance Ruling (AAR) in Tamil Nadu has ruled that businesses can claim Input Tax Credit (ITC) on services for leasing, renting, or hiring motor vehicles used to transport women employees for their safety. This is permissible if it's a legal obligation under the Tamil Nadu Shops and Establishments Act, 1947, particularly for travel between 8 pm and 6 am. The ITC is available from May 28, 2019, provided all conditions under Section 16 of the CGST Act are met.

Court :
AAR, Tamil Nadu

Brief :
The AAR, Tamil Nadu in the case of M/s. CMA CGM Global Business Services (India) (P.) Ltd., In Re [Order No. 15/ARA/2024 dated July 15, 2024] ruled that an Assessee is eligible to avail input services in respect of leasing/ renting/ hiring of motor vehicles of motor vehicles to provide transportation facility to ensure safety and security of women employees as per Tamil Nadu Shops and Establishments Act, 1947 subject to satisfying and fulfilling the eligibility and conditions provided under Section 16 of Central Goods and Services Tax Act, 2017 ("the CGST Act"). Further, Input Tax Credit ("ITC") shall be available to the Assesseeonly on the tax paid on services or renting, leasing or hiring of motor vehicles for providing transport facilities to women employees alone who are arriving or leaving workplace between 8 pm to 6 pm. Lastly, ITC on the same shall be available to the Assessee from May 28, 2019 onwards only on satisfying and fulfilling the eligibility provided under Section 16 of the CGST Act.

Citation :
Order No. 15/ARA/2024 dated July 15, 2024

Daily Limit Reached