INPUT TAX CREDIT

[GOWLI MALLIKARJUNA]

DEAR SIR

WE ARE THE MANUFACTURES OF SPONGE IRON IN ANDHRA PRADESH, STARTED OUR COMMERCIAL PRODUCTION ON 31.03.2011 AND SOLD THE GOODS ON CONSIGNMENT SALES( ONLY ONE TRANSACTION WORTH OF RS.3.50 LACS). WE CAN CLAIM FULL INPUT TAX CREDIT ON PURCHASE OF CAPITAL GOODS WORTH OF 30.00 LACS.

PLEASE ADVISE US.

AI Summary

Manufacturer Seeks Guidance on Claiming Full ITC for Capital Goods Post Consignment Sale; Review KVAT Act Rules Advised. A manufacturer of sponge iron in Andhra Pradesh, who began commercial production in March 2011, sought advice on claiming full input tax credit (ITC) on capital goods worth 30 lakhs after making a consignment sale of 3.5 lakhs. A consultant advised reviewing the ITC rules under the KVAT Act for guidance.