Input tax credit

[Guest]

If Goods against an Invoice are received in lots or instalments ITC can be availed only upon receipt of last lot or instalments. What happens if the movement is not completed before the due date of furnishing the September Return or Annual Return.

[KASTURI SETHI]

Credit should be taken only on physically receipt of goods i.e. installments. If movement is not complete by September end, it will have effect on maintainance of books of accounts. From Central Excise aspect, you can take credit next month on receipt of goods physically. How it will impact accounting entries, other experts having commerce background may throw light.

AI Summary

Input tax credit: entitlement arises only on physical receipt of goods, affecting return timing and accounting. Entitlement to Input tax credit for goods delivered in instalments arises only on physical receipt of the goods; if the final instalment is not received before a return filing date, the credit cannot be claimed in that return and must be reflected in accounting and books when receipt occurs, with practice indicating recognition in the subsequent period when goods are physically received.