ITC on Motor Cycle

Position from 01.02.2019 : Section 17(5) of CGST Act

As per Section 17(5) of CGST Act Input tax credit shall not be available in respect of the following, namely:—

Position Before 01.02.2019 : Section 17(5) of CGST Act

As per Section 17(5) of CGST Act Input tax credit shall not be available in respect of the following, namely:—

motor vehicles and other conveyances except when they are used–

(i) for making the following taxable supplies, namely:—

(A) further supply of such vehicles or conveyances ; or

(B) transportation of passengers; or

(C) imparting training on driving, flying, navigating such vehicles or conveyances;

(ii) for transportation of goods;

Meaning of Motor vehicles

As per Section 2(76) of CGST  ACT :- “motor vehicle” shall have the same meaning as assigned to it in clause (28) of section 2 of the Motor Vehicles Act, 1988;

As per clause (28) of section 2 of the Motor Vehicles Act, 1988:- “motor vehicle” or “vehicle” means any mechanically propelled vehicle adapted for use upon roads whether the power of propulsion is transmitted thereto from an external or internal source and includes a chassis to which a body has not been attached and a trailer; but does not include a vehicle running upon fixed rails or a vehicle of a special type adapted for use only in a factory or in any other enclosed premises or a vehicle having less than four wheels fitted with engine capacity of not exceeding twenty-five cubic centimeters

Input tax Credit on Motor Cycle

ITC on Motor  Cycle, bike Scooter etc Available : when engine capacity is upto 25 Cubic Centimeters

ITC on Motor  Cycle, bike Scooter Not Available :when engine capacity is exceeding 25 Cubic Centimeters