The question before the AAR was whether charging of battery is a supply of goods or a supply of services.
The ruling may seem to be negative for those setting up battery-charging units if the instant case is considered as precedent in the court of law but experts said some companies may find it positive since ITC is available.
Charging batteries used in electric vehicles will attract 18 per cent GST, according to the Karnataka Authority for Advance Ruling (AAR). The AAR, while hearing a case of Chamundeswari Electricity Supply Corporation Ltd, said input tax credit will be allowed for the company.
The question before the AAR was whether charging of battery is a supply of goods or a supply of services. The supply of goods would attract no GST, while the supply of services would attract 18 per cent GST.
The ruling may seem to be negative for those setting up battery-charging units if the instant case is considered as precedent in the court of law but experts said some companies may find it positive since ITC is available. If nil GST were imposed, ITC would not have been given taxes paid on inputs for setting up the station and supply of electricity, according to a Business Standard report.
“The ruling may be viewed as a positive ruling by some industry players as treating EV charging activity as a taxable service will help them in availing input tax credit,” said Harpreet Singh, partner indirect tax at KPMG, according to the report.
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