Tamil Nadu AAR Clarifies GST Liability on Balance Amount of Freight Deposited By Shippers
The present applicant has been filed by a company named B2B Trucks Private Limited (Applicant) before the Authority for Advance Ruling (AAR), Tamil Nadu No. 207, 2nd Floor, Papjm Building, No. 1, Greams Road, Chennai 600 006.
The applicant, B2B Trucks Private Limited, is registered under the GST Act, having GSTIN no. 33AALCB2798J129, and is located at No. 23/Flat No. 3, Mayflower Apartment, First Floor, Satyanarayana Avenue, R. A. Puram, Chennai 600 028. The company is running an online platform that connects shippers and carriers located across all the states of India. However, the company does not directly take responsibility for the physical movement of goods.
The shippers deposit the remaining freight amount into an escrow account. This money is later transferred directly to the carriers once they complete the delivery. The company only helps in moving this money from shippers to carriers. It does not keep any part of the money, charge any extra fees, or use the money in any way.
Because of this, the company is treated as a pure agent under Rule 33 of the GST Rules. This means the freight amount they handle is not their income, and no GST is charged on it.
However, the company does charge a subscription fee for their service. GST will be applied only to this subscription fee, as usual.
Question Asked by Tamil Nadu AAR
Seeking the current Tamil Nadu Advance Ruling (No. 49/ARA/2025), dated November 17, 2025, the applicant has asked the following question:
“Question: Requesting GST exemption in respect of an escrow deposit account to be opened and operated by them solely to facilitate forwarding of freight amounts as deposited by shippers to the accounts of carriers without any deduction.”
Answer Given by Tamil Nadu AAR
Here is the answer given by the Authority for Advance Ruling (AAR), Tamil Nadu, to the question asked by the applicant:
Answer: In answer to the aforesaid question, the AAR has clarified that the applicant, i.e., B2B Trucks Private Limited, is not liable to pay GST (goods and services tax) on the balance amount of freight deposited by the shippers into the current account of the applicant, which in turn is meant to be forwarded to the accounts of carriers without any deduction.
Citation: B2B Trucks Private Limited (AAR Tamil Nadu); Advance Ruling No. 49/ARA/2025, 17/11/2025
