GST AAR: Supplying of Non-Battery Rickshaw Classifiable Under HSN 8703

Under HSN 8703 if an e-rickshaw is supplied without the battery classified as an electrically operated motor vehicle The West Bengal bench of the Authority for Advance Rulings (AAR) ruled that a three-wheeled electrically operated vehicle.

The petitioner AMWA moto LLP would be the entity involved inter-alia in the business as the wholesaler of the electrically functioned two-wheeled vehicles. The firm is engaged in the business of manufacturing and reselling electricity-functioned three-wheeled vehicles in West Bengal. The petitioner has approached the AAR bench asking for clarification on the GST rate subjected to be applied to the specified product.

A bench, Mr Brajesh Kumar Singh, Joint Commissioner, CGST, and CX MrJoyjitBanik, Senior Joint Commissioner, SGST referred to the judgment of the Orissa AAR to conclude that when the vehicle is only functioning on the battery power is supplied without the battery, that would be entitled as an electricity supply functioned vehicle and hence would be classified beneath tariff item 8703.

Since a battery-operated vehicle has no other source of propulsion, its power is solely generated by the rechargeable battery. The notification 12/2019-Central Tax (Rate) dated 31.07.2019 specifies that “Electrically operated vehicles” entail the use of only electrical power derived from an external source or from one or more electrical batteries installed on the vehicle. If the battery is not fitted to an e-rickshaw, it cannot run. There is no doubt about that. E-rickshaws with motors installed on them, but no battery, lose their original character and can be called chassis if they are supplied without batteries.