Providing Vehicles to Principal GTA to Be Covered Under Rental Services and Not Eligible for Exemption | AAR

Case Details: Tanuja Jangir, In re - [2025] 172 taxmann.com 272 (AAR-RAJASTHAN)

Judiciary and Counsel Details

• Mahipal Singh, Member (Central Tax) & Mahesh Kumar Gowla, Member (State Tax)
• Rahul Lakhwani, Adv. & C.A. Megha Dhankar for the Petitioner.

Facts of the Case

The applicant, engaged in rental services of transport vehicles, provided vehicles to a Principal Goods transportation agency (‘GTA’), which had transportation contracts with consignees/consignors. The Principal GTA directly dealt with consignees/consignors, issued e-way bills and consignment notes, and was responsible for the transportation service. The applicant merely supplied vehicles upon request and invoiced the Principal GTA for the subcontracted service, without direct involvement in the transportation process. Since the transportation contract was between the consignee/consignor and the Principal GTA, the applicant’s role was confined to renting vehicles, making it distinct from a Goods Transport Operator. The applicant sought exemption under Entry No. 18 of Notification No. 12/2017-Central Tax (Rate), dated 28-06-2017, on the ground that its services fell under transportation of goods by road other than through a GTA.

AAR Held

The Hon’ble AAR held that the applicant’s services constituted rental of transport vehicles, covered by Notification No. 11/2017-Central Tax (Rate), dated 28-06-2017. The Principal GTA, as the issuer of consignment notes, was classified as a GTA, while the applicant did not fulfil this requirement. As services involving transportation of goods by road, other than through a GTA, were exempt under Entry No. 18, the applicant’s rental service was outside its scope. The exemption under Notification No. 12/2017-Central Tax (Rate), dated 28-06-2017, was not applicable.

List of Cases Referred to

• Gunesh Logistics v. Commissioner of C.Ex. & Service Tax, Jaipur-I MANU/CE/0514/2019 (para 6).