Advance Ruling Sought on Taxability of Supplier’s Transactions and Local Authority Status for Thane Municipal Transport Undertaking Not Admissible u/s 97: AAR [Read Order]
The Authority held that questions on the applicant’s status as a local authority and applicability of exemption notifications to services received from suppliers are not admissible under Section 97(2) of the CGST Act.
![Advance Ruling Sought on Taxability of Supplier’s Transactions and Local Authority Status for Thane Municipal Transport Undertaking Not Admissible u/s 97: AAR [Read Order]](https://images.taxscan.in/h-upload/2025/08/02/2072414-advance-ruling-thane-municipal-transport-aar-taxscan.webp "Advance Ruling Sought on Taxability of Supplier’s Transactions and Local Authority Status for Thane Municipal Transport Undertaking Not Admissible u/s 97: AAR [Read Order]")
The Maharashtra Authority for Advance Ruling (AAR) held that the questions raised do not qualify under Section 97(2) of the Central Goods and Services Tax (CGST) Act, 2017, and involve taxability of transactions by the applicant’s suppliers, which is beyond the binding scope of advance rulings.Thane Municipal Transport Undertaking (applicant), a transport undertaking of Thane...
The Maharashtra Authority for Advance Ruling (AAR) held that the questions raised do not qualify under Section 97(2) of the Central Goods and Services Tax (CGST) Act, 2017, and involve taxability of transactions by the applicant’s suppliers, which is beyond the binding scope of advance rulings.
Thane Municipal Transport Undertaking (applicant), a transport undertaking of Thane Municipal Corporation (TMC), is engaged in providing passenger transportation services using public buses primarily within Thane city limits.
The applicant sought advance ruling on three questions: (i) whether it qualifies as a ‘local authority’ under the CGST Act; (ii) whether Entry No. 3 of Notification No. 12/2017-Central Tax (Rate) dated June 28, 2017, as amended, applies to manpower supply services received from suppliers and (iii) whether the same entry applies to bus (electrically operated or not) rental/hire services received from suppliers.
The applicant submitted that it receives these input services to facilitate its passenger transportation operations and emphasized the identical provisions under the CGST Act and Maharashtra Goods and Services Tax (MGST) Act.
The AAR bench comprising D.P. Gojamgunde, Joint Commissioner of State Tax, and Priya Jadhav, Joint Commissioner of Central Tax observed that the first question on ‘local authority’ status does not fall under any clause of Section 97(2) of the GST Act.
The AAR noted that these pertain to the taxability of services supplied to the applicant by third-party suppliers regarding the second and third questions on exemption applicability under Notification No. 12/2017.
The AAR emphasized that advance rulings under Section 103(1) bind only the applicant and jurisdictional officers, not suppliers. The bench observed that allowing such rulings would affect non-parties without appeal rights under Section 100, which is not envisaged under the GST framework.
The Authority rejected the application for admission, finding no basis to proceed on the merits. The application was not admitted under Section 98 of the CGST Act and MGST Act.
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