ITC is available on inward supply of motor vehicles used for demonstration purpose


Last updated: 27 November 2024

Court :
Kerala AAR

Brief :
The Kerala AAR, in the case of Sai Service (P.) Ltd., In re [Advance Ruling No. KER/09/2024 dated January 10, 2024] held that where demo cars are crucial for sales promotion, since, prospective customers prefer to test drive cars before they make a decision, therefore, demo cars are put to use for furtherance of business as envisaged under Section 16 of the Central Goods and Service Tax, 2017 ("the CGST Act"). Hence, the Assessee is entitled to avail Input Tax Credit ("ITC") on inward supply of motor vehicles which are used for demonstration purpose.

Citation :
Advance Ruling No. KER/09/2024 dated January 10, 2024

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Bimal Jain
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