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Input Tax Credit under the revised GST Law

Goods and Services Tax - GST - By: - Sanjeev Singhal - Dated:- 16-12-2016 Last Replied Date:- 17-12-2016 - There is drastic change in the Capital Goods definition under Revised GST Law from GST Law. Under the GST law definition was very exhaustive though under the Revised GST law It is quite simple. Under GST law, Capital goods was defined under Section- 2(20) and Under CCR, 2004 the same was provided under Rule 2(a) and both the definition were almost same except some words here and there. But .....

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business. Sec. 2(52) input means any goods other than capital goods used or intended to be used by a supplier in the course or furtherance of business; Sec.2 (53) input service means any service used or intended to be used by a supplier in the course or furtherance of business; Sec. 2(55) Input Tax in relation to taxable person, means the IGST, including that on import of goods, CGST and SGST charged on supply of goods and services to him, and include the tax payable under section 8(3) but does .....

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penalty] and the said amount shall be credited to his ECL [electronic credit ledger]. Input tax credit for pipe line and telephone tower fixed to earth by foundation and structural support shall be available as follows: 1/3 in the first year when goods received 1/3 in the next year The balance in subsequent financial year No person can claim credit but subject to provision of sec. 36, except the following in possession:; Invoice or debit note Received the goods or services Tax charged on such su .....

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after filing of the return u/s 34 for the month of September following the end of financial year to which invoice relates or furnishing of the annual return which ever is earlier . Apportionment of credit or blocked credit [Sec. 17] A] where the goods and services are used partly for business or partly for personal purpose by RTP, the amount of credit shall be limited to ITC pertain to used for business. B] where the goods or services are used by RTP partly for taxable supplies including zero ra .....

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ve or take 50 of the eligible credit on input, capital goods and input services. E] Despite the provision of Sec. 16[1] and Section 18 [1][2][3][4] ITC shall not be available on the following; a] motor vehicle other conveyance except the following i] for making the following taxable supplies further supply of such vehicle or conveyance transporting of passenger imparting training on driving , flying ,navigating such vehicle or conveyance. ii] for transportation of goods b] supply of goods or ser .....

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rty other than plant and machinery except when such input services used for further supply of work contract service. D] goods or services used by RTP for construction of immovable property on his own a/c , other than plant and machinery, even when used in course or furtherance of business. E] goods and services on which tax has been paid u/s 9. F] goods and services used for personal consumption G] goods lost, stolen, destroyed, written off, disposed off by way of gift or free samples. H] any ta .....

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nder sec.9 , will be entitle to claim ITC on input, semi finished and finished goods and capital goods on immediately proceeding the day on which he is liable to pay tax. Provided that credit on capital goods shall be reduced by percentage point as prescribed. Where an exempt supply of goods and services by RTP becomes taxable, will be entitle to claim ITC on input, semi finished and finished goods and capital goods on immediately proceeding the day on which he is liable to pay tax. Provided tha .....

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o section- 9 for composite scheme, where his goods or services become exempt under section -11, shall pay an amount by debit to electronic credit ledger or cash ledger, equivalent to input tax on stock and capital goods, reduced by percentage point, immediately proceeding the day of switching over and exemption of goods. In case of disposed of capital goods, RTP shall pay an equal amount of input as reduced by percentage point or on transaction value of such capital goods which ever is higher. B .....

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year from the date of sent out. ITC can be claimed even if the goods directly sent to job worker. One year shall be computed from the date of receipt of material by Job worker. If the goods have not been returned within the stipulated period the same shall be treated as supply to job worker from the date of goods sent out. Principal subject to such condition as prescribed, entitled to take credit of ITC on capital goods sent to job worker. Credit shall be valid if such goods have been received b .....

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[Section -21] ISD can distribute the ITC as prescribed , credit of CGST as CGST or IGST or IGST as IGST or CGST by issuing documents containing the amount of ITC where the ISD and Recipient is located in different states .........................> Under CGST Act. ISD can distribute the ITC as prescribed , credit of SGST as SGST or IGST by issuing documents containing the amount of ITC where the ISD and Recipient is located in different states. ......................................> Under .....

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distribute the ITC subject to the following : only on prescribed document containing the details as prescribed. The amount of credit distributed can not exceed the amount of credit ITC can be distributed only to that recipient eligible. Can be distributed to attributable recipient. If more than one recipient, it shall be on pro rata based on the turnover of the state, of the relevant period. Recipient should be operational in that relevant period. Manner of recovery of credit Distributed in exc .....

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edit can be availed if such goods and services are used or intended to be used in the course or furtherance of business. Q. Does input tax includes tax on CGST/SGST/IGST paid on input goods, input services and capital goods A. Yes . In terms of definition 2[19], 2[52] and 2 [53]. It may be noted that ITC on capital goods is permitted in one installment except pipeline and telephone tower. Q. Where goods and services receive by taxable person are used for both taxable and non taxable supplies, we .....

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