Summary
CBIC withdrew para 4.6 of Circular 231/25/2024-GST, which had treated ITC on demo vehicles as blocked under section 17(5)(a) where the dealer only acted as the manufacturer's agent. The new circular says such ITC is not blocked for dealers in the agency model.
What it means for you
Authorised car dealers using the agency model can now claim GST credit on test-drive vehicles.
This summary is general information, not legal advice. The outcome of any case depends on its facts; read the source and take advice before acting.
More India updates
- GST notice generated in time but uploaded late due to portal glitch is time-barred2026 · Delhi High Court
- Section 74 GST demand fails if fraud allegations don't name suppliers and transactions2026 · Delhi High Court
- ₹38.47 crore disallowance u/s 40(a)(ia) deleted — Form 26A delayed by portal glitches2026 · ITAT Bangalore
- Retrospective JAO–FAO amendment struck down2026 · Punjab & Haryana High Court
- Form 26AS mismatch alone can't justify a rental income addition2026 · ITAT Mumbai