2026-VIL-08-AAR
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SGST Advance Ruling Authority

GST – Chhattisgarh AAR - Applicability of GST on Diesel and Petrol charges invoiced separately on a per kilometer basis for providing Fleet operation services – Applicant is engaged in fleet operations and would be providing services such as repair and maintenance, insurance, drivers, and fuel charges to clients based on a per kilometer basis. The applicant would raise separate invoices for the services and the fuel charges - Whether the invoice for diesel and petrol charges, invoiced separately on a per kilometer basis, would be considered a supply of goods and liable to VAT, or liable to GST – HELD - GST is not leviable on diesel and petrol charges as these petroleum products are currently outside the purview of GST as per the provisions of Section 9(2) of the CGST Act, 2017. Petroleum products, including petrol and diesel, continue to be taxed under the pre-GST regime - The transaction in question cannot be treated as a composite supply as defined under Section 2(30) of the CGST Act, 2017, and the concept of bundled services is not relevant. The opinion of the applicant that when diesel is used as part of a bundled service (like fleet management or transport service billed per kilometer), the transaction may be considered a composite supply of service, is not sustainable under law - The fuel component (diesel and petrol) is to be treated independently for tax purposes, and VAT is applicable on such fuel charges, but Input Tax Credit is not eligible on the VAT paid, in terms of the provisions of Sections 16 and 17 of the CGST Act, 2017- Ordered accordingly - Whether the fuel component, when not bundled with the service and invoiced distinctly, is to be treated independently for tax purposes – HELD - Since GST is presently not applicable on fuel charges (fuel component) comprising of petroleum products, the fuel component is to be treated independently and is subject to the existing taxation structure, which includes Central Excise Duty and VAT.
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