Page 27 - GSTL_3rd September 2020_Vol 40_Part 1

2020 ] INPUT TAX CREDIT ON CASH CARRY VANS J9

INPUT TAX CREDIT ON CASH CARRY
VANS
By
Dr. Sanjiv Agarwal, FCA, FCS

The Advance Ruling on whether input tax credit
can be allowed on cash carry vans under GST law was
filed by M/s. CMS Info Systems Ltd. before the Advance
Ruling Authority, Maharashtra, The AAAR upheld that
view but then the dispute travelled to the High Court
which sent it back to the Appellate Advance Ruling Au-
thority for fresh consideration. The article maps the dispute.
Before Advance Ruling Authority
On the issue of whether input tax credit will be available on motor vehi-
cles used as cash carrying vans in cash management business, there was a differ-
ence of opinion between the members of AAR, the matter was referred to AAAR
for giving appropriate ruling. [2018 (13) G.S.T.L. 486 (A.A.R. - GST)].
Before Appellate Advance Ruling Authority
As a result of the difference of opinion in AAR the matter was referred to
AAAR.
Transportation of cash is done through security vans, popularly known
as cash carry vans. The applicant purchases motor vehicles and pays Goods and
Services Tax. Thereafter necessary fabrication is performed on such vehicles and
they are converted into cash carry vans. The applicant also pays GST on fabrica-
tion but the credit of such GST is not availed by the applicant presently. While
purchasing cash carry vans under pre-GST era, the applicant paid Central Excise
Duty as well as Value Added Tax. When these vans cannot be used further, the
applicant sells these motor vehicles as scrap. In certain cases, instead of purchas-
ing motor vehicles, the applicant prefers to hire these motor vehicles.
It was argued that what may be cash or money in general perception is
nothing but goods for the applicant as they are into business of its transportation.
This was not accepted because of the definition of goods/money under Central
Goods and Services Tax Act, 2017 is common to all.
As per Section 2(52) of CGST Act, 2017, ‘goods’ means every kind of
movable property other than money, clearly excludes money from the purview
of goods under the GST law. While ‘money’ means the Indian legal tender…….,
but shall not include any currency that is held for its numismatic value. Since the
cash carry vehicles are deployed to carry cash and bullion for other than for nu-
mismatic purposes, the cash carried by them is to be construed as money and not
goods. If ‘Money’ is not covered as ‘Goods’ in the definition of ‘Goods’ under
CGST Act, then it is not ‘goods’ for everyone and it cannot be said that it is not
‘goods’ for general perception and it is ‘goods’ for the appellant.
AAAR therefore, ruled that input tax credit is not available to CMS Info
Systems Limited on purchase of motor vehicles i.e. cash carry vans, which are
GST LAW TIMES  3rd September 2020  43