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TMI Blog2024 (8) TMI 374X X X X Extracts X X X X X X X X Extracts X X X X ..... ility for ITC, if they are used for making further supply of the same, even if on a later date. Thus, the applicant can claim ITC on cars used for demonstration purposes, provided they are subsequently used for making supply. Thus, applicant are entitled to avail Input Tax Credit on inward supply of motor vehicles which are used for demonstration purpose. However, this ruling shall not be applicable if depreciation is claimed on the tax component of the cost of demo cars or if the cars are not used for making further supply of such cars. - SMT. GAYATHRI P.G., AND SHRI. ABDUL LATHEEF, K, MEMBER Authorized Representative : Harikrishnan K.A., Senior Manager - Accounts. Mr. Nitin Vijaivergia, Authorized Representative. 1. M/s. SAI SERVICE PRI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tter is that the inward supply of motor vehicles for demo purpose by the applicant is in the course of furtherance of business and quoted Section 16 (1) and various sub-Sections of Section 2 of the CGST Act, 2017 in support of the claim that they are eligible for ITC in this regard. They substantiated these claims in the light of their business model and the nature of activity to which such cars are put to. Consequently, they argued that they are eligible for ITC in this regard and further, quoted the Judgment of the Hon'ble Supreme Court in 'Commissioner of Income Tax Vs Malayalam Plantations Ltd, Commissioner of Central Excise, Bangalore Vs. Millipore India (P) Ltd., Dwarikesh Sugar Industries, AAR Uttar Pradesh, Essel Propack Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t when used 'for' demo purpose. 5. Comments of the Jurisdictional Officer: The application was forwarded to the jurisdictional officer as per provisions of section 98 (1) of the CGST Act. The Jurisdictional officer has not submitted any remarks and hence it is presumed that the jurisdictional officer has no specific comments to offer. It is also construed that no proceedings are pending on the issue against the applicant. 6. Personal hearing The applicant was granted opportunity for personal hearing on 20/12/2023. Mr. Nitin Vijaivergia, authorized representative of the applicant appeared for personal hearing, which was conducted virtually. The representative reiterated the contentions made in the application and requested to issue t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngers; or (C) imparting training on driving such motor vehicles; 7.3. Thus, motor cars involved in the question are eligible for ITC only if these conditions are met. Therefore, the argument that demo cars are not used for transportation of persons doesn't make them eligible for ITC. However, we find that the applicant intents to make a further supply of such cars after the demo period. The fact that the cars were used for demo purpose doesn't alienate the cars from its eligibility for ITC, if they are used for making further supply of the same, even if on a later date. Thus, we are of the opinion that the applicant can claim ITC on cars used for demonstration purposes, provided they are subsequently used for making supply. Given th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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