The Maharashtra Authority of Advance Ruling (AAR) in the case of M/s Tata Motors Limited vide Advance Ruling No. GST-ARA-83/2020-21/B-112 dated 01.12.2022, has held that the supply of Tata garbage tipper vehicles to Municipalities shall attract 28% GST.
In this case the applicant Tata Motors, is in the business of manufacturing and selling motor vehicles, chassis for vehicles and part thereof. The applicant manufactures commercial vehicles as well as well as passenger vehicles. The Applicant will be manufacturing Tata Ace Garbage Tipper vehicles and variants, which will be supplied to municipal corporations, municipalities, urban development bodies, gram panchayats, and contractors to whom government bodies have awarded operation and maintenance contracts under the Swachh Bharat Mission. It is for the collection and disposal of household garbage. The Garbage Tipper vehicle is specially designed in such a way to enable access to small lanes for garbage collection and tipping the same into a compactor or at dumping sites as decided by the government.
The applicant sought an advance ruling in respect to classification of Tata Ace Garbage Tipper vehicle with its variants and GST rate applicable to garbage tipper vehicles.
The applicant submitted that a garbage tipper vehicle would fall under Tariff Item 8705.90.00 and would attract 18% IGST.
The jurisdiction officer contended that the compactor and loading device do not preclude the vehicle from classification within heading 8704. The removable container body is no less a body for the transport of goods than a fixed body or dumper body on a refuse truck. A motor vehicle designed to transport refuse with a removable container body is no less a refuse truck than one designed with a fixed body. Compacting refuse collectors are classified as motor vehicles under heading 8704.
The AAR noted that for motor vehicles used for the transport of goods, 28% IGST has been specified under Sr. No. 166 under Schedule IV of IGST Rates by Notification No. 1/2017-integrated Tax (Rate) dated June 28, 2017. Further, the AAR observed that garbage tipper vehicles can be used for the transportation of goods. The starting words of Entry 8704 are “Motor Vehicles for the Transport of Goods.” Thus, the rate of tax applicable shall be 28%; as only refrigerated vehicles are taxable at 18%; and all trucks covered under heading 8704 are taxable at 28%.
