Aishwarya Rathore –
Published on August 04, 2021, at 2:10 PM
The Kerala High Court, in dismissing an appeal, held that under Rule 138(14)(a) of the Kerala Goods and Services Tax Rules, 2017, used personal vehicles are exempted from the need of an E-way Bill.
A Division Bench of Justice S.V Bhatti and Justice Bechu Kurian Thomas accordingly upheld the decision of the Single Judge that allowed a petition challenging the detention of a used car by the appellant.
The respondents in this appeal had approached the Single Bench aggrieved by the detention of their Range Rover Car by the appellant while it was being transported from Coimbatore to Thiruvananthapuram.
The GST Department argued that such detection was required since the vehicle was transported without an E-way Bill, as mandated by Rule 138.
However, the Single Judge had allowed the petition, quashed the detention order of the appellant, and released the vehicle. This decision was challenged by the GST Department before the Division Bench.
It was also brought to the Court’s attention that the vehicle’s owners had paid the applicable IGST at the time of purchase and that it had run 43 km before being detained.
The Bench observed, “It must be remembered that goods that are classifiable as used for personal and household effect falls under Rule 138(14) (a) of the Kerala Goods and Services Tax Rules, 2017 and are exempted from the requirement of e-way bill.”
Furthermore, the Bench cited the Judgment of KUN Motor Company Private Ltd & Ors v. Assistant State Tax Officer.
Where it was ruled that “The goods having come into the purchaser’s possession, and the vehicle having been used, however negligible the distance travelled, it is his “used personal effect” and no taxable transaction can be alleged.”
Therefore, the Court while agreeing with the aforementioned decision held that used vehicles, even if it has run only negligible distances are to be categorized as ‘used personal effects.
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