Reversal of ITC on capital goods from over all sales 80% supply is exempted, Goods and Services Tax - GST

[PN ELAMPARRUTHY]

During audit asking to reversal the Common credit . Basically firm is Rice Mill,Sale of rice in Above 25 KG. any case related or any AAR

Posts / Replies

[KASTURI SETHI]

Pl. elaborate your query. It is too short to reply correctly.

[PN ELAMPARRUTHY]

purchased plant machinery for processing of paddy into rice and husk . rice mostly exempted product and its by product husk and some 5 kg and 10 kg sales happening . for Eg from total Turnover 5 cr means 50 lakhs only taxable . from 18-19 not reversed any ITC ..

[Shilpi Jain]

If you have used any goods or services commonly for taxable and exempt product then you would have to reverse credit of GST in proportion of the exempt turnover.

[Padmanathan Kollengode]

I agree with experts. Also see if your client is exporting rice. Even if exempted, credit will be eligible towards zero-rated supply.