Vehicle Purchase Input Tax Credit Denied Due to Prior Tax Rate Election and GSTR-01 Filing in July 2023

Transport service provider sought advance ruling on input tax credit for vehicle purchase. SC determined that due to prior lower tax rate election and supplier's GSTR-01 filing in July 2023, the applicant forfeited ITC rights. The ruling rejected the claim for Rs. 13,94,702 input tax credit on the Mercedes Benz car purchase, citing statutory return evidence as conclusive.

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Issues:
The judgment involves the application for Advance Ruling under Section 97(1) of TGST Act, 2017 concerning the eligibility of input tax credit on a vehicle purchase and its utilization.

Brief Facts of the Case:
The applicant, a transport service provider, initially paid GST at 5% on output services with limited ITC. Subsequently, the output tax rate was increased to 12% with full ITC. The applicant purchased a Mercedes Benz car and sought to avail input tax credit of Rs. 13,94,702 over 5 years. The purchase invoice was dated 4.8.2023, although it was uploaded in the supplier's GSTR-2B return for July 2023.

Questions Raised:
The applicant sought clarification on whether the GST amount of Rs. 13,94,702 paid on the vehicle purchase could be considered as input tax credit and utilized.

Discussion & Findings:
1. The applicant paid tax at different rates based on ITC availability, forfeiting the right to claim ITC on earlier purchases by opting for a lower tax rate previously.
2. The purchase invoice for the car was reported in the supplier's GSTR-01 in July 2023, indicating the supply was made in that month when the applicant was still availing the lower tax rate without ITC.
3. Statutory returns filed on the common portal were considered as superior evidence compared to physical invoices, leading to the conclusion that ITC related to the car purchase was not available to the applicant.

Ruling:
The Authority ruled that the GST amount of Rs. 13,94,702 paid on the vehicle purchase was not eligible for input tax credit and utilization.

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