Page 134 - GSTL_16th July 2020_Vol. 38_Part 3

372 GST LAW TIMES [ Vol. 38
(ii) where received by a taxable person engaged
(A) in the manufacture of such motor vehicles, ves-
sels or aircraft, or
(B) in the supply of general insurance services in re-
spect of such motor vehicles, vessels or aircraft
insured by him;
(b) the following supply of goods or services or both
(i) food anil beverages, outdoor catering, beauty treatment,
health services, cosmetic and plastic surgery, leasing,
renting or hiring of motor vehicles, vessels or aircraft re-
ferred to in clause (a) or clause (aa) except when used for
the purposes specified therein, life insurance and health
insurance :
Provided that the input tax credit in respect of such
goods or services or both shall be available where an in-
ward supply of such goods or services or both is used by
a registered person for making an outward taxable sup-
ply of the same category of goods or services or both or
as an element of a taxable composite or mixed supply;
(ii) membership of a club, health and fitness centre; and
(iii) travel benefits extended to employees on vacation such
as leave or home travel concession :
”Provided that the input tax credit in respect of such
goods or services or both shall be available, where it is
obligatory for an employer to provide the same to its
employees under any law for the time being in force.”
6. The availability of ITC as per the provision of second proviso to Sec-
tion 17(5)(b) is available only on the condition that such goods or service or both
is obligatory for an employer to provide to its employees under any law for the
time being in force. Since, the applicant has not been able to cite any law under
which the service of providing the facility of transportation to his employees is
obligatory under any law, therefore ITC will not be available to him.
7. Further the rate of tax on renting of motor cab services as per the No-
tification No. 20/2017 (State/Central Tax), dated 22-8-2017 & Circular No.
130/49/2019-GST, dated 31-12-2019 is as under :-

Description of the supply Rate Conditions
(per cent)
Transport of passengers by motor cab 5 With limited ITC (of
where the cost ol fuel is included in input services in the
the consideration charged from the same line of business)
service recipient.
12 With full ITC.

8. In view of the foregoing, we pass the following ruling.
RULING
(1) The applicable rate of tax on renting of Cabs as per Notification No.
20/2017, dated 22-8-2017 is 5% with limited ITC (of input services in
the same line of business) and 12% with full ITC.

GST LAW TIMES  16th July 2020  134