Category: Input Tax Credit

The credit on goods/ services used partly for business and partly for non-business purposes will be allowed proportionately to the extent it is attributable for business purposes. The manner of calculation of such credit is provided in Rule 42(1) of the CGST Rules, 2017.

(ICAI FAQ PUBLICATION 06-09-2017 -: Apportionment of credit and blocked credits: FAQ NO.11)

In terms of Section 16(4) of the CGST Act, a registered person is not entitled to claim input tax credit in respect of any supply of goods or services after the earlier of following two events:
(a) Due Date of filing of the return under Section 39 of the Act for the month of
September following the end of financial year to which such invoice or invoice
relating to such debit note pertains, i.e. 20th October;
(b) Furnishing of the annual return. In terms of Section 44, the due date of filing annual return is 31st December following the end of the financial year.
However, in cases of credit in special circumstances like new registration, voluntary registration, etc. the credit will not be available after the expiry of one year from the date of issue of tax invoice.

(ICAI FAQ PUBLICATION 06-09-2017 INPUT TAX CREDIT: FAQ NO.10)

No, Section 16(3) provides that input tax credit will not be allowed on the tax component of cost of capital goods/ plant and machinery, if the depreciation on the said tax component is claimed under the provision of Income Tax Act, 1961 by the taxable person. Therefore, the registered person has an option to either claim depreciation (under the Income Tax Act, 1961) or claim credit under the GST law, on the said tax component.
For example:
Cost of Asset= 1,000/-
Tax = 100/-
Total = 1,100/-
If depreciation is charged on 1,000/-, then credit will be available under the GST law and if depreciation is charged on 1,100/- then credit will not be available.

(ICAI FAQ PUBLICATION 06-09-2017 INPUT TAX CREDIT: FAQ NO.9)

Yes. Explanation to Section 16(2)(b) of the CGST Act provides for deemed receipt of goods where the goods are delivered by the supplier to the recipient or any other person on the direction of the recipient, whether acting as agent or otherwise, before or during movement of goods.

(ICAI FAQ PUBLICATION 06-09-2017 INPUT TAX CREDIT: FAQ NO.8)

No, there is no provision under the GST law to allocate part payment of the invoice towards the taxes first so that the input tax credit can be allowed. Second proviso to Section 16(2) of the CGST Act clearly provides that the entire value of supply (with tax) is to be paid within 180 days from the date of issue of invoice. Therefore, as long as the entire payment is made within 180 days, the recipient would be entitled to claim the credit in full.
Assuming that only part payment is made within 180 days, availing of proportionate credit based on such part payment is not provided for under the CGST Act. However, Rule 37 of the CGST Rules, provides for availability of the amount of input tax credit availed of proportionate to such amount paid to the supplier. 

(ICAI FAQ PUBLICATION 06-09-2017 INPUT TAX CREDIT: FAQ NO.7)

In terms of second proviso to Section 16(2) of the CGST Act, the time limit prescribed is one hundred and eighty days (180 days) from the date of issue of invoice by the supplier of services/goods. If the recipient fails to pay the value of supply (with tax) within 180 days, such input tax credit would be payable by the recipient along with applicable interest.
The above time limit is not applicable to supplies that are liable to tax under reverse charge mechanism.

(ICAI FAQ PUBLICATION 06-09-2017 INPUT TAX CREDIT: FAQ NO.6)

The tax paying documents have been prescribed under Rule 36 of the CGST Rules.
The ITC shall be availed by a registered person [including the Input Service Distributor (ISD)] on the basis of any of the following documents:

 An invoice issued by supplier of goods or services or both;
 An invoice raised by the recipient in case of inward supplies from unregistered persons or reverse charge mechanism supplies, subject to payment of tax;
 A debit note issued by a supplier of goods or services or both;
 A bill of entry or any similar document prescribed under the Customs Act, 1962 or Rules made there under for the assessment of integrated tax on imports;
 An Input Service Distributor (ISD) Invoice or ISD Credit Note or any other
document issued by an Input Service Distributor for distribution of credit.

(ICAI FAQ PUBLICATION 06-09-2017 INPUT TAX CREDIT: FAQ NO.5)

1. Yes. Input tax credit will be available in full with respect to inputs and capital goods, subject to fulfillment of the prescribed conditions under Section 16(2) of the CGST Act.
2. Even in the case of supply of goods in lots/ installments, the credit would be available in full on the receipt of the last lot/ installment.

The existing concept of partial credit on purchase of capital goods under the CENVAT Credit Rules, 2004 (i.e. 50% in the year of receipt and 50% in subsequent years) has been done away with.

(ICAI FAQ PUBLICATION 06-09-2017 INPUT TAX CREDIT: FAQ NO.4)

1. Input tax credit means the credit of central tax, state/ union territory tax and integrated tax available to a registered person on the inward supply of goods or services or both, made to him excluding the tax paid on supplies liable to composite tax.
2. It further includes the integrated tax applicable on import of goods or services and the tax payable under reverse charge mechanism.

(ICAI FAQ PUBLICATION 06-09-2017 INPUT TAX CREDIT: FAQ NO.2)