Facts of the Case:

In this case, the applicant is a registered GST assessee and operates as a licensed Container Train Operator (CTO) on the Indian Railways network. The applicant provides transportation services of goods in containers by rail, and in addition to moving loaded containers, they also transport empty containers to support logistics operations.

The applicant currently charges 12% GST (6% CGST + 6% SGST) for both loaded and empty container movements under Entry 9(iv) of Notification No. 11/2017-CT(R), which prescribes GST for “transport of goods in containers by rail by any person other than Indian Railways.” However, customers argued that empty container transportation should instead fall under Entry 9(i), which prescribes 5% GST for “transport of goods by rail (other than services in item (iv)).”

The applicant contended that empty containers should qualify as “goods” under Section 2(52) of the CGST Act and therefore should attract the 5% rate. They also highlighted industry inconsistencies, noting that some operators (such as CONCOR) charge 5%, while others charge 12%, leading to widespread ambiguity. The applicant therefore sought an advance ruling on the correct GST rate applicable to the transportation of empty containers.

Issue:

What is the correct GST rate applicable to transportation of empty containers by rail?

Held that:

The Authority examined the relevant entries under Notification No. 11/2017-CT(R). It noted that Entry 9(iv) specifically applies only when goods are transported in containers by rail by a person other than Indian Railways. In the case of empty containers, no goods are transported in the container; rather, the container itself is the good being transported. Therefore, the essential condition for Entry 9(iv)—that goods must be transported inside containers—is not fulfilled for empty container movements.

The Authority emphasized that Entry 9(i) is a general entry covering all “transport of goods by rail” except those expressly falling under Entry 9(iv). Since transportation of empty containers does not fit the specific entry, it necessarily falls under the general entry. To determine whether empty containers constitute “goods,” the AAR referred to the definition in Section 2(52) of the CGST Act and to past CBIC clarifications under the service tax regime, which consistently treated empty containers as movable property and therefore “goods.” The Authority thus concluded that empty containers qualify as “goods,” and their transportation by rail attracts the GST rate under Entry 9(i), i.e., 5%, subject to the prescribed condition.

Case name:  M/s. Hasti Petro Chemical & Shipping Limited dated 24.11.2025

To read the complete judgement 2025 Taxo.online 3193