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  1. Siddharth
  2. Second Hand Cars
  3. Monday, December 11 2017
I have Toyota Corolla Altis registered in my Firm name, now planning to sell same. What GST is applicable on sale of car as its registered in company name.
Admin Accepted Answer
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Hello,

This has been replied earlier also
Still to answer in brief - No GST is applicable on sale of used car by a company or Firm (who is not involved in trading of cars as main business)

and give detailed reply

GST on Sale of Cars @ 18% is the liability when Seller is
> Registered as Used Car Dealer and makes profit on overall transaction (purchase cost - selling cost)
or
> Involved in Sale-Purchase of Car on Commission Basis

As per Official Statement by Dr. Hasmukh Adhia as published in Indian Express - GST will apply only on cars sold by registered vendors (essentially known as Used Car Dealers or Car Showrooms)

Here is a copy of statement as mentioned in Economic Times too
https://www.mycarhelpline.com/images/GST-UsedCar.jpg

So - no GST is to be paid if you are not into Business of Used Cars irrespective of fact that
> You are selling to direct Individual or Employee within company
> You are selling car to Dealer

However, its a dealer whose GST Liability will occur only when he sell car later to someone else, and that liability also will only occur when he makes Profit on sale.

Hope should help !!


  1. more than a month ago
  2. Second Hand Cars
  3. # 1
Arpit Bakliwal Accepted Answer
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As per 7 (1) (d) read with Schedule II clause 4 (a) -

7. (1) For the purposes of this Act, the expression “supply” includes––
(d) the activities to be treated as supply of goods or supply of services as referred
to in Schedule II.
Schedule II
4. Transfer of business assets
(a) where goods forming part of the assets of a business are transferred or
disposed of by or under the directions of the person carrying on the business so as
no longer to form part of those assets, whether or not for a consideration, such
transfer or disposal is a supply of goods by the person;
6. A car which is a part of the business assets of the company as the same is capitalized
in the books, if transferred, then vide section 7 (1) (d) read with Schedule II clause 4
(a) of the said Act shall be termed as a “Supply” and vide section 9 shall be a taxable
supply.

Pursuant to the provisions above, if the Car has already capitalized in the books, GST shall be applicable


  1. more than a month ago
  2. Second Hand Cars
  3. # 2
Vikram jadon Accepted Answer
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Dear sir,

I read your article on margin GST. I have a query, In the business of used cars while we transfer our stock from one company to another (same owner) with the different name, state & gst number.
Is it necessary to show us that sale on profit to create a margin and charge gst on it.or we can show all such stock transfer between our companies without any profit because we can't take Input on it.

In my opinion because we can't take input on such transfer so we should not charge gst on our company to avoid extra tax liability.

Please clarify and guide on the same.


Thanks & Regards


  1. more than a month ago
  2. Second Hand Cars
  3. # 3
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