GST Classification of E-Rickshaw Inner Tubes: Uttarakhand Advance Ruling
The Authority for Advance Ruling clarified that E-Rickshaw inner tubes do not qualify for cycle rickshaw tax rates and attract 28% GST.
- Ruling
- Ruling No. 01/2017-18 dated 14th March, 2018
- Dated
- 14 Mar 2018
- Authority
- Authority for Advance Ruling
This page was written by Patron Accounting’s AI from the official release and reviewed before publishing. It explains the document in plain language. It is not the document itself. Where this page and the original differ, the original governs.
The short version
- E-Rickshaws are motor vehicles, not powered cycle rickshaws.
- Inner tubes for E-Rickshaws do not qualify for concessional tax rates.
- These rubber tubes are classified under HSN 4013 at 28% GST.
In short
The company asked if inner tubes for E-Rickshaws qualify for the lower GST rate meant for three-wheeled powered cycle rickshaws. The tax authority decided that because E-Rickshaws lack pedals and are registered as motor vehicles, they are legally distinct from cycle rickshaws. Consequently, parts for E-Rickshaws do not get the tax benefits intended for traditional cycle rickshaws.
What has changed
How it worked before
Businesses were uncertain if the term 'powered cycle rickshaw' in GST notifications was broad enough to include modern electric rickshaws.
What has changed
The authority confirmed that E-Rickshaws are motor vehicles. This means manufacturers and traders must apply the standard 28% GST rate to inner tubes for E-Rickshaws instead of the lower rate reserved for cycle rickshaws.
Who this affects
Manufacturers, distributors, and retailers of E-Rickshaw parts and components.
An example
A parts manufacturer produces rubber tubes specifically for E-Rickshaws. They wonder if they can charge the lower GST rate applicable to cycle rickshaws. Based on this ruling, they must charge the standard 28% rate because their product is for a motor vehicle, not a pedal-operated cycle rickshaw.
What you should do
If you sell E-Rickshaw parts, you should apply the 28% GST rate. Remember that an advance ruling only binds the business that asked and its specific tax office; it is not a general law for all businesses.
If you do nothing
If you apply the lower rate incorrectly, you risk a tax demand for the difference plus interest and penalties. A tax officer may disagree with your classification during an audit, leading to costly disputes. Always ensure your tax classification matches the legal definition of the vehicle.
The terms explained
- Advance Ruling
- A formal decision from the tax department on how GST applies to a specific business situation.
- HSN
- A system of codes used to classify goods for taxation purposes.
- Concessional rate
- A lower tax rate offered by the government for specific goods to support certain industries.
The ruling in detail
Authority for Advance Ruling
M/s Kanam Industries, NNIE-II, Mahuakhera Gunj, Kashipur
Ruling No. 01/2017-18 dated 14th March, 2018 · Uttarakhand
Questions before the authority
- What is the interpretation of the term three wheeled powered cycle rickshaw as provided under Sl. No. 190 of the Schedule 1 to Tariff Notification.
- Is there any difference between an electric rickshaw operated by chargeable batteries (E-Rickshaw) and three wheeled powered cycle rickshaw provided under Tariff Notification.
- Whether inner tubes of butyl rubber used in e-rickshaw would fall within the meaning of term three wheeled powered cycle rickshaw and classification thereof.
Facts
The applicant is a manufacturer seeking clarification on the classification of inner tubes of butyl rubber used in E-Rickshaws. They requested an advance ruling to determine if these tubes qualify as those used in three-wheeled powered cycle rickshaws, which would attract a lower GST rate. The jurisdictional officer reported that E-Rickshaws and powered cycle rickshaws are distinct products.
Ruling
| Question | What the authority ruled |
|---|---|
| Classification of inner tubes for E-Rickshaw | HSN 4013 Attracts 28% GST |
| Status of E-Rickshaw vs Powered Cycle Rickshaw | Distinct items E-Rickshaw is a motor vehicle |
The authority held that E-Rickshaws are distinct from powered cycle rickshaws because they are motor vehicles under the Motor Vehicle Act and lack pedals. Consequently, the inner tubes used in E-Rickshaws do not qualify for the concessional rate applicable to cycle rickshaws. These tubes are classified under HSN 4013 and attract a 28% GST rate.
Reasoning
The authority relied on the definition of powered cycle rickshaw from erstwhile Central Excise notifications, which requires the vehicle to be capable of being pedalled. Since E-Rickshaws are powered solely by electric motors and must be registered as motor vehicles, they do not meet this criteria. The ruling also referenced Supreme Court and Tribunal precedents distinguishing motor-fitted vehicles from cycle rickshaws. Therefore, the goods fall under the general category for inner tubes of rubber rather than the specific entry for cycle rickshaws.
Provisions relied on
- Section 97(1) of the CGST/SGST Act, 2017
- Section 97(2)(a) and (e) of the CGST/SGST Act, 2017
- Notification No. 1/2017-Central Tax (Rate) dated 28th June, 2017
- SSI exemption notification no. 8/2003-Central Excise
- Notification no. 102/76 dated 16-3-1976
For the practitioner
This ruling clarifies that **E-Rickshaws are not powered cycle rickshaws** for GST classification purposes. Practitioners should advise clients that parts for E-Rickshaws do not qualify for the concessional 5% GST rate reserved for cycle rickshaw components. It settles the tax treatment for inner tubes, confirming they are subject to the **standard 28% GST rate**.
Source
This is a summary prepared from the published order, which is a scanned document. It is a reading aid and not the authority: where the two differ, the order governs. Verify every provision against the original before relying on it.
Original order: https://www.gstcouncil.gov.in/sites/default/files/AAR/01-2017-18_dtd_14-03-18_uttrakhand.pdf
Legibility of the scan, as read: high.
Prepared 12-10-2026.
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