Order Date – 12 November 2024

Parties: M/s BMW India Pvt. Ltd. Vs The Appellate Authority for Advance Ruling for the State of Haryana and another

Facts –

• The Petitioner, M/s BMW India Pvt. Ltd., being aggrieved by the order rejecting Input Tax Credit on vehicles, which have been initially used as demo vehicles filed the writ petition.

Issue –

• Whether Input Tax Credit can be availed on vehicles used as demo vehicles?

Order –

• The Divisional Bench of Hon’ble High Court observed the Circular No.231/25/2024-GST (F.NO.CBIC-20001/6/2024-GST], dated 10.09.2024, which discussed the availability of Input Tax Credit on demo vehicles, which are motor vehicles for transportation of passengers having approved seating capacity of not more than 13 persons in terms of clause(a) of section 17(5) of Haryana Goods & Services Tax Act, 2017.
• Further, it deals with the availability of the Input Tax Credit on demo vehicles in cases where such vehicles are capitalized in the books of account by the authorized dealers.
• The observations of not giving benefit of Input Tax Credit to vehicles, which have been initially used as demo vehicles, is accordingly, set-aside in view of the extension of grant of availability of Input Tax Credit with respect to the demo vehicles, as clarified by the aforesaid circulars.