Home Forum Goods and Services Tax - GST Month 4 2019 2019 (4) This
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ITC reversal sec.(42) or not. - Goods and Services Tax - GSTExtract We are engaged in Raw Cotton Ginning Pressing and Cotton Seed oil mill factory. We buy Raw Cotton From farmers and are required to pay RCM. (RCM was suspended but Raw cotton RCM was started again as per notif. 43/2017 - central tax (rate) - 14-11-2017. The output Products are cotton bales - Taxable @5% and Cotton Seed @5%. Cotton Seed is sold to oil Mill. We have our own mill. After crushing output products are oil@5% and Cotton seed oil cake ( cattle feed) - Tax free (as per notification 27/2017 dt. 22-09-2017 . Now the question is, are we people liable to do reversal of itc under section 42(3) of RCM ITC and other ITC on monthly basis or we do not need to reversal. People are having different opinion. It is said that we not liable to do reversal. Some say it is Tax free supply - so no reversal needed. Some say it is Non GST supply - so no reversal needed. Some say it is NIL rated supply - so no reversal needed. Few are saying that they will claim refund after filing annual return GSTR 9. Please clarify this matter as CA's are also divided on this issue.
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