2026-VIL-67-AAR
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SGST Advance Ruling Authority

GST – Tamil Nadu AAR - Eligibility of Input Tax Credit on Leasing/Renting/Hiring of Motor Vehicles for Transportation of Women Employees - The applicant procures services of leasing/renting/hiring of motor vehicles for passenger transportation and provides the same to its women employees working in shifts - Whether the tax paid on input services in respect of leasing/renting/hiring of motor vehicles to provide transportation facility to ensure safety and security of women employees as per Tamil Nadu Shops and Establishments Act, 1947 is eligible to be availed as input tax credit – HELD - The provisions of Section 17(5)(b) of the CGST Act, 2017 provides that the input tax credit in respect of such goods or services shall be available where it is obligatory for an employer to provide the same to its employees under any law for the time being in force - As per the provisions of the Tamil Nadu Shops and Establishment Act 1947, it is obligatory on the part of the applicant to provide transport facilities to women employees working beyond 8.00 PM. Since the Tamil Nadu Shops and Establishment Act, 1947 makes it obligatory for the applicant to provide transportation facilities to women employees working in shifts, the input tax credit on the leasing/renting/hiring of motor vehicles for this purpose is eligible to be availed by the applicant – The applicant is eligible to avail input tax credit on the services of leasing/renting/hiring of motor vehicles to provide transportation facility to ensure safety and security of women employees as per the Tamil Nadu Shops and Establishments Act, 1947 - Whether the entire ITC be availed by the applicant for providing the transport facility in all shifts considering the safety of women as mandated under the Tamil Nadu Shops and Establishment Act, 1947 – HELD – The input tax credit shall be available to the applicant only on the tax paid on services of leasing, renting or hiring of motor vehicles for providing transport facilities to women employees who are arriving or leaving the workplace between 8:00 PM to 6:00 AM, as this has been made obligatory under the Notification of the Government of Tamil Nadu. The input tax credit cannot be availed for the transportation of male employees or women employees not working in the specified night shift - If eligible, can ITC be availed for services received from the date of introduction of proviso to Section 17(5)(b)(iii) of CGST Act, 2017 – HELD - The input tax credit on leasing, renting or hiring of motor vehicles meant for transportation of women employees between 8:00 PM to 6:00 AM shall be available to the applicant from 28.05.2019 onwards, which was the date of the original Notification issued by the Government of Tamil Nadu making it obligatory on employers to provide transportation facilities to women employees working in shifts. The provisions of Section 17(5)(b) of the CGST Act, as amended, came into effect from 01.02.2019, but the obligation was mandated on employers earlier by the Government of Tamil Nadu. The availment of such ITC shall be subject to satisfying and fulfilling the eligibility and conditions as stipulated under Section 16 of the CGST Act, 2017, including the time limit for availing ITC prescribed under Section 16(4) of the Act.
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