Providing partial relief to the Indian Railways and a few other transport operators, the Goods and Services Tax (GST) Council has decided to put certain interstate movements within the same entity under the exempt category that will not attract the integrated GST. The Council, in its Sunday meeting, decided to exempt interstate movement of any mode of conveyance — trains, buses, trucks, tankers, trailers, vessels and containers — from GST in case of carrying goods or passengers, or both, and for repair and maintenance. The caveat here is that such mode of conveyance should not be for the purpose of further supply. The railways have repair and maintenance workshops, such as in Bhopal, at a few locations which cater to the entire country. Had the repair and maintenance not been put under the exempt category, all wagon or locomotive movement for these services would have attracted integrated GST.
As reported by FE, the Indian Railways had earlier approached the Council seeking either a dispensation, exemption or lower rate of taxes for certain services, such as own material movement and coach repairing works, for which it will not be able to recover the amount as no input credit would be available. “We had asked for revisions of many such services; some have been accepted and some have been not,” said a senior railways official requesting not to be named. The next meeting of the Council is scheduled on June 18.
Apart from not receiving relief on the own material movement, the national carrier has also not got exemption from uploading data for each ticket on the GST Network. The railways usually procures material for own use, such as tracks or cables, at centralised level and are kept at depots. These are then supplied depending on demand from any of the 17 railway zones. However, there will not be any transaction involved in such cases it is liable to attract integrated GST. “We are still in the process of working out the details and assessment of losses are yet to be made,” the railway official added.