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2022 (1) TMI 1056 - APPELLATE AUTHORITY FOR ADVANCE RULING, GUJARATUtilisation of Input Tax Credit - outward supply of Gold & Silver bullion - payment of output tax on Castor Oil Seeds - Whether the Input Tax Credit (ITC) legitimately earned by the appellant and lying as balance in Electronic Credit Ledger can be utilised for payment of GST on an outward supply, which has no nexus with the inputs on which the ITC has been taken? - time limit for filing appeal - HELD THAT:- The appellant has shown the date of communication of the Advance Ruling as ‘30.01.2021’. Thus, it is observed that the present appeal filed on 19.02.2021 has been filed within the prescribed time limit of 30 days from the date of communication of Ruling, as prescribed under Section 100(2) of the CGST Act, 2017 - Even otherwise, the last date for filing appeal stands extended w.e.f. 15.03.2020 Whether Input Tax Credit validly taken on any ‘input’ can be utilized for payment of ‘output tax’ (GST) on any outward supply, which has no nexus with the inputs on which ITC was taken? - HELD THAT:- Section 16(1) of the CGST Act only states the eligibility and conditions for taking ITC. It does not impose any restriction on utilisation of the legitimately earned ITC. It does not prescribe that ITC available in electronic credit ledger to be utilized only for the specific outward supply, on whose inputs such ITC was availed - Section 16(1) nowhere mandates to prove one-to-one correlation of particular inputs with particular outward supply. In other words, Section 16(1) does not require that payment of outward tax on particular outward supply can be made only from the ITC taken on particular inputs, which have nexus or connection with that outward supply. The requirement of Section 16(1) is that the inward supply should be used or intended to be used in the course or furtherance of the business of taxpayer. In this case, it is undisputed that the inward supply of Gold and Dore bars are intended to be used in the course of business of the appellant, i.e. outward supply of Bullion etc. This undisputed fact entitled the appellant to take input tax credit on such inputs. Once such input tax credit is validly taken, it can be utilised for payment of ‘output tax’ [GST] on any taxable or zero rated outward supply of the appellant - the amount of input tax credit lying in electronic credit ledger can be utilised by appellant for making any payment of output tax payable by him. Needless to say that all provisions regarding determination, restriction and reversal of input tax credit and payment of tax, as prescribed Chapters V and X of the CGST Act and Chapters V and X of the CGST Rules, would be applicable, which are not under covered under the question raised in the application for Advance Ruling in present case. The payment of output tax on Castor Oil Seeds through utilization of Input Tax Credit taken on Gold & Silver Dore Bars etc. cannot be denied merely on the ground that the inputs have no nexus with outward supply.
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