Input Tax Credit

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ITC on immovable property used for renting
Blog
Kapil Mittal

Admissibility of Input tax Credit on construction of immovable property when used for renting

Judgment of Hon’ble High Court of Orissa in the matter of M/s Safari Retreats Private Limited interprets provisions of Section 17(5)(d) of CGST Act, 2017 to check admissibility of Input Tax Credit paid on procurement of goods or services used for construction of immovable property for own purpose of assessee. Hon’ble High court has held that as petitioner is paying GST on rental income which is arising out of investment on which GST has been paid and since there is no break in chain of business from point of procurement of material and services for construction till renting of immovable

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recredit of rejected itc refund
Blog
Kapil Mittal

Input tax credit of rejected refund amount can be taken manually by taxpayer if not recredit by tax authorities

Where rejection of refund claim by the GST authorities, the rejected ITC should be recredit to Input tax credit ledger of taxpayer for utilisation. However Since there is no mechanism to do so, this resulted in certain difficulties to taxpayers in cases where the existing Input Tax Credit (‘ITC’) was not recredited by tax authorities for utilisation.  In this case, the Gujrat High Court (‘HC’) has provided valuable guidance on the subject in the case of M/s. Garden Silk Mills Ltd. Vs. Union of India (R/Spl Civil Appl No. 7397 Of 2018) vide order dated 11 April 2019. It has

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Matching of ITC
Blog
Kapil Mittal

INPUT TAX CREDIT UNDER GST | MATCHING | REVERSAL | RECLAIM

Goods and Service Tax (“GST”) is a value addition based tax, i.e., tax should be paid on value added only and therefore, is it framed on two fundamental pillars, i.e., output tax liability and Input Tax Credit (“ITC”). With introduction of GST, government wanted to overcome all possible issues confronted by department and taxpayer in pre-GST regime. One of crucial issue was to check matching of Input Tax credit claimed by taxpayer, such as, under Service Tax, Central Excise or Value Added Tax (“VAT”) department was not able to verify correctness of ITC claimed by taxpayers without manual intervention. Considering

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Manner of Utilisation of ITC
Blog
Sachin Jindal

Order of Utilisation of Input tax credit

Input Tax Credit (“ITC”) is a fundamental concept of Goods and Service Tax (“GST”). GST is levied in 3 forms viz. Integrated Goods and Service Tax (“IGST”), Central Goods and Service Tax (“CGST”) and State/Union Territories Goods and Service Tax (“SGST/UTGST”). GST portal maintains separate ITC accounts for all such forms of GST, i.e., GST input on account of IGST gets credited into ITC ledger of IGST. Similar process is applicable for CGST & SGST/UTGST also. As separate accounts are maintained for all type of GST, it is pertinent to get clarity about order and manner of utilisation of ITC.

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ITC to fabric manufacturer (1)
Goods and Service Tax
Sachin Jindal

Refund of ITC to fabric manufacturer and textile job worker

Refund of accumulated Input tax credit to fabric manufacturer and fabric processor in textile sector on account of inverted duty structure has been disallowed initially. Such dis-allowance was in pursuant to power vested under section 54(3), department issued Notification No. 5/2017-Central tax (Rate) dated 28th June, 2017 wherein it specified list of items on which no refund will be allowed on ground of inverted duty structure. There after some major circular and notification have been issued by department to allow refund of ITC to fabric manufacturer and textile job worker on account of inverted duty structure. Accordingly latest CBIC has

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