Goods and Services Tax – Started By: – narendra patel – Dated:- 18-5-2018 Last Replied Date:- 11-12-2018 – Suppose a capital good (purely for business purpose) is purchased for 80,000. on 1.4.2018. So CGST part will be 7200. We avail 1/5 part (1440) for current year and put reversal entry of 5760. Now, in next year we claim next 1/5 part (1440). My question: 1. Do we claim next year ITC on 1.4.2019 or 31.3.2020 (ie exactly 1 year after purchase or at the end of next FY) 2. Under which section of GST, do we claim ITC of next year. 3. Under which section of GST, do we enter reversal enter of current year.Please advise. – Reply By KASTURI SETHI – The Reply = Restriction of one year is for availment and not for utilization. Can be used at any
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I SETHI – The Reply = Dear Querist, You can take full ITC on capital goods in one year. Reversal (you are talking) is required on account of usage of tax paid inputs/capital goods in the business or furtherance of business in respect of exempted as well as taxable supply of goods or services. Are you engaged in exempted as well as taxable supply ? – Reply By KASTURI SETHI – The Reply = Dr.Govindarajan Ji, Sir, What I want to say is as under :- During pre-GST era, Cenvat Credit on capital goods was allowed as 50% in first financial year and balance (50% ) in next financial year. In GST regime, ITC on capital goods can be taken in full in one year. (year of purchase). Earlier condition of taking credit in two installments has been dispensed w
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).Thank you very much.If my conclusion from above discussion is wrong, please advise. – Reply By Shashank Mutha – The Reply = Respected kasturi Sethi & Govindrajan ji I think that if we charge depreciation on capital goods at the end of financial year than we can't avail ITC . I refer Sec 17 (5) of CGST Act about BLOCK CREDIT If I am wrong than kindly guide us Thank you (waiting for reply) – Reply By Shashank Mutha – The Reply = #DR.MARIAPPAN GOVINDARAJAN – Reply By Shashank Mutha – The Reply = #KASTURI SETHI – Reply By Ganeshan Kalyani – The Reply = In case of capital goods used for taxable goods then full credit can be taken in one year. And in case of capital goods used partially for business and partially for other purpose or pa
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