Threewheeled motor vehicle Toto is classifiable under HSN 8703 - GST

Threewheeled motor vehicle Toto is classifiable under HSN 8703 - GST

WEST BENGAL AUTHORITY FOR ADVANCE RULING

The Ruling as follows : 4.1 The applicant describes the goods it supplies are electrically operated three-wheeled vehicles, commonly known as "Toto". It is e-rickshaw, as defined in section 2A (2) of the Motor Vehicles Act, 1988 (hereinafter the MV Act). According to the above provisions of the MV Act, an e-rickshaw is a three-wheeled special-purpose battery-powered vehicle of power not exceeding 4000 watts. Explanation to Entry No. 242A of Schedule I to Notification No. 1/2017-Central Tax (Rate) dated 28/06/2017 (State Notification No. 1125-FT dated 28/06/2017), as amended from time to time (hereinafter collectively called the Rate notification), defines the term „electrically operated vehicle‟ to mean “vehicles which run solely on electrical energy derived from an external source or from one or more electrical batteries fitted to such road vehicles and shall include E-bicycles”.

4.2 A combined reading of the provisions of section 2A (2) of the MV Act and Entry No. 242A of Schedule I of the Rate Notification establishes that the battery pack is an essential character of an e-rickshaw. An electrically operated three-wheeled vehicle is run entirely on electrical energy, derived from an external source or one or more electrical batteries fitted to such vehicles. If the battery pack is withdrawn, it will no longer be a three-wheeled electrically operated vehicle.

4.3 Motor vehicles for carrying less than ten passengers are classified under Heading 8703 of the First Schedule of the Customs Tariff Act, 1975 (hereinafter the Tariff Act), which is adopted in the GST Act for classification. Sub-heading 8703 10 covers the vehicles specially designed for travelling on snow, golf cars and similar vehicles. The term „similar‟ narrows the scope to specific use other than carrying passengers on hire on regular roads. All other sub-headings except the residual sub- heading 8703 90, refer to vehicles fitted with an internal combustion engine. E- rickshaws or electrically operated three-wheeled vehicles are, therefore, classifiable under Tariff heading 8703 90 10 of the Tariff Act. 4.4 A three-wheeled motor vehicle without the battery pack does not have the essential character of an „electrically operated vehicle.‟ However, it is neither a vehicle fitted with an internal combustion engine. Unless it is equipped with any device like solar panels that may supply energy for its locomotion, it is not classifiable as a vehicle under Sub-heading 8703 of the Tariff Act. However, it includes the chassis fitted with the motor to convert electrical energy into the mechanical energy to put the vehicle into locomotion once the battery pack is attached. Such a device is called the engine of the vehicle. It is, therefore, classifiable under Tariff-head 8706 00 31, being the chassis fitted with an engine of a vehicle under sub-heading 8703. Based on the above discussion, we rule as under,

RULING

A three-wheeled motor vehicle is classifiable under HSN 8703 as an electrically operated vehicle, provided it is fitted with the battery pack. Otherwise, it will be classifiable under HSN 8706. This Ruling is valid subject to the provisions under Section 103 until and unless declared void under Section 104(1) of the GST Act.