Input tax credit on imported goods

[Yatin Bhopi]

Dear expert

We are manufacturer and regularly import our raw materials. IGST paid goods on which bill of entry is received and goods laying at port or warehouse outside factory whether eligible to avail Input tax credit as per Section 16 (2) (b) and will be treated as receipt of goods?

[Ganeshan Kalyani]

When you clear the goods from the customs import duty is payable.

[Yatin Bhopi]

Sir,

My query is once we paid the taxes on imprted goods and on recipt of bill of entry (but goods still laying at port or in rented wearhouse outside factory) are we eligible to avail input tax credit?

[Nash Industries I Pvt Ltd]

ITC is eligible only if the goods are received and tax is paid on them. If the goods are not received, then the credit cannot be claimed In the instant case, the place where the goods are stored is to be declared as additional place of business an then the credit can be availed.

Regards

S.Ramaswamy

AI Summary

Input tax credit eligibility: credit arises only upon receipt of imported goods; external storage needs declared place of business. ITC on imported goods is claimable only when the goods are received and tax is paid; payment of IGST and bill of entry alone, while goods remain at port or an external warehouse, does not permit credit. If goods are stored outside the registered factory, the storage location must be declared as an additional place of business to avail ITC; customs clearance and import duty payment are prerequisites to treating receipt as complete.