Notification No. 13/2019 - Integrated Tax (Rate) Explained

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Notification No. 13/2019 - Integrated Tax (Rate): which seeks to exempt the hiring of Electric buses by local authorities from GST.

GST: [TO BE PUBLISHED IN THE GAZZETE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]

G.S.R (E).- In exercise of the powers conferred by sub-section (1) of section 6 of the Integrated Goods and Services Tax Act, 2017 (13 of 2017), the Central Government, on being satisfied that it is necessary in the public interest so to do, on the recommendations of the Council, hereby makes the following further amendments in the notification of the Government of India, in the Ministry of Finance (Department of Revenue) No.9/2017- Integrated Tax (Rate), dated the 28th June, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section

(i) vide number G.S.R. 684 (E), dated the 28th June, 2017, namely:-

In the said notification, in the Table, against serial number 23, in the entries in column (3), after clause (a), the following clause shall be inserted, namely: -

(3)

‘(aa) to a local authority, an Electrically operated vehicle meant to carry more than twelve passengers; or Explanation.- For the purposes of this entry, “Electrically operated vehicle” means vehicle falling under Chapter 87 in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) which is run solely on electrical energy derived from an external source or from one or more electrical batteries fitted to such road vehicle.’.

2. This notification shall come into force with effect from the 1^st of August, 2019.

(Gunjan Kumar Verma)
Under Secretary to the
Government of India

Note: -The principal notification No. 9/2017 - Integrated Tax (Rate), dated the 28^th June, 2017 was published in the Gazette of India, Extraordinary, vide number G.S.R. 684 (E), dated the 28^th June, 2017 and was last amended by notification No. 4/2019 – Integrated Tax (Rate), dated the 29^th March, 2019 vide number G.S.R. 257(E), dated the 29^th March, 2019.

📚 Frequently Asked Questions (FAQs): Notification No. 13/2019 - Integrated Tax (Rate)

Q1: What is Notification No. 13/2019 – Integrated Tax (Rate)?

Answer:
It is a GST notification that exempts IGST on hiring of electrically operated buses when supplied to local authorities, effective from 1 August 2019.

Q2: Which notification has been amended?

Answer:
It amends Notification No. 9/2017 – Integrated Tax (Rate) dated 28 June 2017 by inserting a new clause under Serial No. 23.

Q3: Who can claim the GST exemption?

Answer:
The exemption applies only when electric buses are supplied to local authorities, such as:
Municipal Corporations
Urban Transport Bodies
State Transport Authorities

Q4: What type of buses are covered?

Answer:
Only electrically operated vehicles:
Carrying more than 12 passengers
Falling under Chapter 87 of the Customs Tariff Act
Running solely on electrical energy 🔋

Q5: Does this apply to diesel or CNG buses?

Answer:
❌ No. The exemption is strictly limited to electric buses only. Diesel, petrol, or CNG buses remain taxable.

Q6: Is this exemption available for outright purchase of buses?

Answer:
No. The notification applies only to hiring of electric buses, not direct sale or purchase.

Q7: From which date is the exemption effective?

Answer:
The exemption is applicable from 1 August 2019 onwards.

Q8: Is GST registration required for suppliers?

Answer:
Yes. Suppliers must be GST registered. If you’re not registered yet, start here 👉
🔗 https://finodha.in/online-gst-registration/

Q9: How should suppliers report such exempt supplies in GST returns?

Answer:
Exempt supplies must be reported under Table 8 of GSTR-1 and Table 3.1(c) of GSTR-3B.
👉 File accurately with Finodha GST Return Filing
🔗 https://finodha.in/gst-return-filing/

Q10: Can ITC be claimed on inputs used for hiring electric buses?

Answer:
❌ No. Since the output supply is exempt, Input Tax Credit is not available under Section 17(2) of CGST Act.

Q11: What is the policy intent behind this notification?

Answer:
To:
Promote electric mobility
Reduce pollution 🌱
Lower public transport costs
Support government EV initiatives

Q12: Does this exemption apply under CGST also?

Answer:
Yes. A corresponding CGST notification exists providing similar exemption for intra-state supplies.

Q13: Can private companies claim this exemption?

Answer:
Only if the recipient is a local authority. Supplies to private companies are taxable.

Q14: What happens if buses are hired for mixed use?

Answer:
If buses are not exclusively supplied to local authorities, GST exemption may be denied. Proper contracts are essential.

Q15: How can Finodha help in compliance?

Answer:
Finodha assists with:
GST compliance review
Return filing & reporting
Advisory on exemptions
👉 Consult now: https://finodha.in/gst-compliance/

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