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  1. Roy Joseph
  2. Second Hand Cars
  3. Tuesday, December 26 2017
Dear Sir,

My employer company has leased a car from another company which provides vehicles to employees on 4 years of lease but if employee leave the company prior to this period then he/she needs to pay the rest amount to get the vehicle transferred to his/her name..

In my case, employer is saying that GST is applicable on resale of vehicle and the car value is exceeding the showroom price even.

Details send by them is as below:

Vehicle: Maruti-Suzuki CIAZ ZDi+ SHVS (Registred in the name of the company)

Base Price: Rs.873296.00
VAT: Rs.126627.92
Road tax/Registration: Rs.102819.00
Net Financed Amt: Rs.1102743.00

Lease Instalment pre tax (excluding FMS) Rs. 22975.00
Tenure: 48
Client Rate / Inherent client rate: 11.5
Residual Value: Rs.337699.00
Start date: 29-04-2016
Closure Date: 15-01-2018
Completed months:20
Completed days:16

Sale Value Pre Tax: Rs.863397.00
GST on sale Value (29.25%): Rs.252543.6225
Total Sale Value: Rs.1115941.00
Sale Value including 1% TCS Rs.1127100.00

MRV inclusive GST: Rs.750000.00
ET Charges (Sale value - MRV): Rs.365941.00

How they calculated the MRV inclusive of GST?
Is this transaction What’s the impact of GST here?
Is the TCS applicable at Noida/UP?

Please advise me on this as they are asking me to pay more than the net financed amount even they already deducted lease installment from my monthly pay.

Waiting for your response.


Roy Joseph
Admin Accepted Answer

GST Cess has been revised at 65% on Lease Transaction for cars bought before July 2017
Where as per slabs Mid Sedan Cars have GST rate of 28%+ 17% Cess = 45% - refer GST Slabs

Based on calculation of 65% calculation criteria on 45% Tax - this effectively comes out to 29.25%
But i am unsure whether this 29.25% GST would be applicable on
> Original Value
> Value left after paying off Lease rentals (essentially the outstanding principle amount + Penalty for Prepaying earlier)

Most likely should be on outstanding amount, but may check with a CA on same
Hope should help !!

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