Important Keyword: Notification No. 16/2023 - Union Territory Tax (Rate), UTGST Notification 16/2023, F. No. CBIC-190354/195/2023-TO (TRU-II)-CBEC, Section 7(5) UTGST Act 2017, Notification No.17/2017-Union Territory Tax (Rate), Notification No. 17/2021 –Union Territory Tax (Rate), Notification No. 16/2023- Union Territory Tax (Rate).
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[F. No. CBIC-190354/195/2023-TO (TRU-II)-CBEC]
Government of India
Ministry of Finance
(Department of Revenue)
New Delhi, 19th October, 2023
Notification No. 16/2023 - Union Territory Tax (Rate): Seeks to amend Notification No 17/2017- Union territory Tax (Rate) dated 28.06.2017.
[TO BE PUBLISHED IN THE GAZZETE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUBSECTION (i)]
G.S.R (E).-In exercise of the powers conferred by sub-section (5) of section 7 of the UTGST Act, 2017 (14 of 2017), the Central Government, 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.17/2017-Union Territory 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. 708(E) dated the 28th June, 2017, namely:-
In the said notification,
(i.) in clause (i), for the words “omnibus or any other motor vehicle”, the words “or any other motor vehicle except omnibus” shall be substituted;
(ii.) after clause (i), the following clause shall be inserted, namely:-
“(ia) services by way of transportation of passengers by an omnibus except where the person supplying such service through electronic commerce operator is a company.”;
(iii.) in the Explanation, after item (c), the following item shall be inserted, namely, -
“(d) “Company” has the same meaning as assigned to it in clause (20) of section 2 of the Companies Act, 2013(18 of 2013).”.
2. This notification shall come into force with effect from the 20th day of October, 2023.
(Rajeev Ranjan)
Under Secretary to the Government of India
Note:- The principal notification No.17/2017-Union Territory Tax (Rate), dated the 28th June, 2017 was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 708 (E), dated the 28th June, 2017 and was last amended by notification No. 17/2021 –Union Territory Tax (Rate), dated the 18th November, 2021 vide number G.S.R. 815(E), dated the 18th November, 2021.
📚 Frequently Asked Questions (FAQs): Notification No. 16/2023 - Union Territory Tax (Rate)
Q1: What is the objective of Notification No. 16/2023 - Union Territory Tax (Rate)?
Answer:
The objective of this notification is to amend the original Notification No. 17/2017 – Union Territory Tax (Rate). It brings clarity to the taxability of passenger transportation services, specifically related to the use of omnibuses under UTGST. These amendments are based on the recommendations of the GST Council.
Q2: What specific change has been made regarding omnibuses in this notification?
Answer:
The words “omnibus or any other motor vehicle” have been changed to “or any other motor vehicle except omnibus”. This effectively excludes omnibuses from the general provision and sets a separate taxability condition for them under clause (ia).
Q3: What does the new clause (ia) state?
Answer:
Clause (ia) has been inserted to specify that:
"Services by way of transportation of passengers by an omnibus except where the person supplying such service through electronic commerce operator is a company."
This means passenger transport by omnibuses is exempt, unless the supplier is a company operating through an e-commerce operator.
Q4: What is the definition of “Company” as per this notification?
Answer:
The notification explicitly refers to the Companies Act, 2013. According to the newly added item (d) in the Explanation:
“Company” has the same meaning as assigned in clause (20) of section 2 of the Companies Act, 2013 (18 of 2013).
This provides a legal basis for distinguishing companies from other types of suppliers.
Q5: When does Notification No. 16/2023 come into effect?
Answer:
This notification is effective from the 20th of October, 2023.
Q6: Who is likely to benefit from this amendment?
Answer:
This change benefits non-corporate operators of omnibuses who provide passenger transport services and are not operating via electronic commerce operators. They now enjoy GST exemption under the Union Territory Tax Act. Companies using e-commerce platforms to offer such services, however, remain taxable.
Q7: How should GST-registered businesses comply with this notification?
Answer:
Businesses involved in passenger transport services must review the nature of their entity (whether they are a company or not) and their mode of operation (direct or via e-commerce). Based on this, they should adjust their GST compliance processes accordingly.
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Q8: Where can I get assistance with GST Registration or Return Filing?
Answer:
You can get expert help at Finodha’s portal:
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Q9: Are there any related amendments in UTGST notifications?
Answer:
Yes, this is part of a series of updates aligned with the GST Council’s decisions. You may also explore:
Notification No. 17/2023 – Union Territory Tax (Rate)
Notification No. 15/2023 and prior changes that apply to service-based GST norms
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Download PDF: Notification No. 16/2023 - Union Territory Tax (Rate)
More Information: https://taxinformation.cbic.gov.in/
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