Question35: Assesses is a component manufacturer registered under GST. He sells his old car which was used by assessee for travelling for business purpose. Is GST applicable on the sale of car.
Also, if the assesses sells his one of his old machine, will it be under GST purview.

Answer: According to the provisions of Section 7(1) of CGST Act, 2017 all forms of supply of goods or services or both such as sale, transfer, barter, exchange, licence, rental, lease or disposal etc. made for a consideration by a person in furtherance of business would be covered under the term 'Supply' and would be leviable to tax under the GST regime at the appropriate rate applicable according to relevant HSN Code, irrespective of the fact whether credit has been availed or not under earlier of existing regime.

Further Schedule II also specifies that 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;

Thus GST is applicable on sale of car as well as on sale of old machine.

The rate of tax is as applicable on relevant product HSN code. But on sale of old car vide Notification No. 09/2018 -Integrated Tax (Rate) dt. 25th January, 2018, reduce rate from 28% to 18%/12% on old and used motor vehicles on the basis of engine capacity and length of motor vehicles under HSN 8703 /87 and Vide Notification No. 1/2018-Compensation Cess (Rate) dt. 25th January, 2018 , compensation cess on all old and used motor vehicles shall be NIL w.e.f 25.01.2018(Reply dt. 14/3/2018)