Goods and Services Tax

What will be the tax impact when capital goods on which ITC has been taken are supplied by taxable person? – Question 31 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 31 – Q 31. What will be the tax impact when capital goods on which ITC has been taken are supplied by taxable person? Ans. As per section 16(15) of the MGL, in case of supply of capital goods on which input tax credit has been taken, the registered taxable person shall pay

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Question 30 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 30 – Q 30. Section 29 of the MGL provides that the ITC would be confirmed only if the inward details filed by the recipient are matched with the outward details furnished by the supplier in his valid return. What happens if there is a mismatch? Ans. In case of mismatch between the inward and outward details, the supplier would be required to rectify the mis-match within a period

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Question 29 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 29 – Q 29. Is there any negative list on which ITC is not permitted? Ans. Section 16 (9) of the MGL provides for the negative list with respect to the admissibility of ITC. It has been provided that the ITC on following items cannot be availed: (a) motor vehicles, except when they are supplied in the usual course of business or are used for providing the following taxable services- (i) transportation of passengers, or (ii) transportation of goods, or (iii) imparting training on motor driving skills; (b) goods and / or services provided in relation to food and beverages, outdoor catering, beauty treatment, health services, c

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Question 28 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 28 – Q 28. What is the time limit for taking ITC? Ans. As per Section 16 (15) of the MGL, ITC cannot be taken beyond the month of September of the following FY to which invoice pertains or date of filing of annual return, whichever is earlier. The underlying reasoning for this restriction is that no change in return is permitted after September of next FY. If annual return is fi

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Question 27 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 27 – Q 27. Who will get the ITC where goods have been delivered to a person other than taxable person ( bill to – ship to scenarios)? Ans. As per explanation clause to section 16(11) of the MGL, for this purpose of receiving the goods, it would be deemed that the taxable person has received the goods when the goods have been delivered to a third party on the direction of such ta

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Where the goods against an invoice are received in lots or instalments, how will a registered taxable person be entitled to ITC? – Question 26 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 26 – Q 26. Where the goods against an invoice are received in lots or instalments, how will a registered taxable person be entitled to ITC? Ans. As per proviso to section 16(11) of the MGL, the registered taxable person shall be entitled to the credit

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Question 25 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 25 – Q 25. What are the conditions necessary for obtaining ITC? Ans. As per Section 16(11) of the MGL, following four conditions are stipulated: (a) The registered taxable person should be in possession of tax paying document issued by a supplier; (b) The taxable person must have received the goods and / or services; (c) The tax charged on such supply has been actually paid to t

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Question 24 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 24 – Q 24. Where the registered taxable person has claimed depreciation on the ta

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A Taxable person is in the business of information technology. He buys a motor vehicle for use of his Executive Directors. Can he avail the ITC in respect of GST paid on purchase of such motor vehicle? – Question 23 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 23 – Q 23. A Taxable person is in the business of information technology. He buys a motor vehicle for use of his Executive Directors. Can he avail the ITC in respect of GST paid

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Question 22 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 22 – Q 22. What is the liability of the principal if the capital goods sent to jo

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What is the time period within which the capital goods sent for job work has to be received back by the principal? – Question 21 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 b

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Which of the following is included for computation of taxable supplies for the purpose of availing credit: (a) Zero-rated supplies; (b) Exempt supplies; (c) Both? – Question 20 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 20 – Q 20. Which of the following is included for computation of taxable supplies for the purpose of availing credit: (a) Zero-rated supplies; (b) Exempt supplies; (c) Both? Ans. Zero rated supplies. – Statutory Provi

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Question 19 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 19 – Q 19. Whether principal has to reverse the input tax credit on inputs which have not been received back from the job worker within 180 days? Ans. Yes, the principal has to reverse the credit along with interest on inputs which have not been received back from job worker within 180 days but he can reclaim the credit on receipt of inputs. – Statutory Provisions, Acts, Rules,

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What is the time period within which the inputs sent for job work has to be received back by the principal? – Question 18 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on

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Question 17 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 17 – Q 17. Whether the principal is eligible to avail input tax credit of inputs

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Question 16 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 16 – Q 16. When shall a taxable person be not entitled to take input tax credit under sub-section (2), (2A) or sub-section (3) of Section 16 in respect of any supply of goods and / or services to him? Ans. As per section 16(4) of the MGL, he cannot avail ITC after the expiry of one year from the date of issue of tax invoice relating to such supply. – Statutory Provisions, Acts,

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Question 15 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 15 – Q 15. Mr. A applies for voluntary registration on 5th June, 2017 and obtained registration on 22nd June, 2017. Mr. A is eligible for input tax credit on inputs in stock as on ………….. Ans. Mr. A is eligible for input tax credit on inputs held in stock and inputs contained in semi-finished or finished goods held in stock as on 21st June, 2017. – Sta

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Question 14 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 14 – Q 14. Mr. B, a registered taxable person was paying tax under composition rate up to 30th July, 2017. However, w.e.f 31st July, 2017. Mr. B becomes liable to pay tax under regular scheme. Is he eligible for ITC? Ans. Mr. B is eligible for input tax credit on inputs held in stock and inputs contained in semi-finished or finished goods held in stock as on 30th July,2017. – St

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A dealer paying tax on compounding basis crosses the compounding threshold and becomes a regular taxable person. Can he avail ITC and if so from what date? – Question 13 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 13 – Q 13. A dealer paying tax on compounding basis crosses the compounding threshold and becomes a regular taxable person. Can he avail ITC and if so from what date? Ans. As per section 16(3) of the MGL, he can avail ITC in

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Question 12 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 12 – Q 12. What would be input tax eligibility in cases where taxable person paying tax under section 7 opts to pay tax under Compounding Scheme under Section 8? Ans. As per section 16(12) of the MGL, the registered taxable person, who was paying tax under section 7 opts to pay tax under Compounding Scheme under Section 8, has to pay an amount equivalent to the input tax credit

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Question 11 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 11 – Q 11. What would be input tax eligibility in case where the goods and/or services supplied by a registered taxable person become absolutely exempt? Ans. As per section 16(12) of the MGL, the registered taxable person who supplies goods and / or services which become absolutely exempt, has to pay an amount equivalent to the input tax credit in respect of inputs held in stock

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Question 10 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 10 – Q 10. What would be input tax eligibility in cases where there is a change in the constitution of a registered taxable person? Ans. As per section 16(8) of the MGL, the transferor shall be allowed to transfer the input tax credit that remains unutilized in its books of accounts to the transferee provided that there is a specific provision for transfer of liabilities. – Stat

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Question 9 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 9 – Q 9. Where goods and/or services received by a taxable person are used for the purpose of business and non-business supplies, whether the input tax credit is available to the registered taxable person? Ans. As per section 16(5) of the MGL, the input tax credit of goods and / or service attributable to only supplies effected for business purpose can be taken by registered taxa

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Question 8 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 8 – Q 8. Where goods and/or services received by a taxable person are used for effecting both taxable and non-taxable supplies, whether the input tax credit is available to the registered taxable person? Ans. As per section 16(6) of MGL, the input tax credit of goods and / or service attributable to only taxable supplies can be taken by registered taxable person. The amount of el

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Question 7 – Draft-Bills-Reports – Input Tax Credit – FAQ on GST dated 21.9.2016 based on Draft Model GST – Question 7 – Q 7. What is the eligibility of input tax credit on inputs in stock for a person who obtains voluntary registration? Ans. As per section 16(2A) of MGL, the person who obtains voluntary registration is entitled to take the input tax credit of input tax on inputs in stock, inputs in semifinished goods and finished goods in stock, held on the day immediately preceding the date o

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