Eligibility of ITC

[Manoj Kumar]

Dear Sirs,

Whether ITC is admissible for the followings:-

1. Uniforms purchased for employees.

2. Stationery items and house keeping materials

3. Monthly taxi fare paid for pick up and drop up at home

4. GST paid to Service Provider for EPF of employees

5. GST paid for Water Can (20 ltrs), Pet bottles (500 ml & 1000 ml)

6. Courier Charges

7. GST paid to Service Provider for Air Freight Service (Export) and Ocean Freight Service(Import)

[YAGAY andSUN]

1. Uniforms purchased for employees.Yes

2. Stationery items and house keeping materials. Yes

3. Monthly taxi fare paid for pick up and drop up at home. No

4. GST paid to Service Provider for EPF of employees Yes

5. GST paid for Water Can (20 ltrs), Pet bottles (500 ml & 1000 ml) No

6. Courier Charges. Yes

7. GST paid to Service Provider for Air Freight Service (Export) and Ocean Freight Service(Import). Yes

[Kishan Barai]

Its simple that when services procured for the furtherance of business ITC would be available. Else Not

[KASTURI SETHI]

I support the views of both experts.

[YAGAY andSUN]

The pre-requisites for availing credit by registered person are:

He is in possession of tax invoice or any other specified tax paying document.He has received the goods or services. “Bill to ship” scenarios also included.Tax is actually paid by the supplier.He has furnished the return.If the inputs are received in lots, he will be eligible to avail the credit only when the last lot of the inputs is received.He should pay the supplier, the value of the goods or services along with the tax within 180 days from the date of issue of invoice, failing which the amount of credit availed by the recipient would be added to his output tax liability, with interest [rule 2(1) & (2) of ITC Rules]. However, once the amount is paid, the recipient will be entitled to avail the credit again. In case part payment has been made, proportionate credit would be allowed.

[Ganeshan Kalyani]

Input tax credit is eligible on the inward supplies made in course or furtherance of business subject to ineligible credit as given in the law.

[Padmanathan KV]

ITC ON WATER PURCHASED AND ON TAXI(PICK&DROP) ARE ALLOWED ASSUMING YHEY HAVE TO BE PROVIDED UNDER A CONTRACT WITH THE LABOUR OR AS PER GOVT. ORDERS.

[Ganeshan Kalyani]

Water is for personal consumption and hence not eligible for credit.

[YAGAY andSUN]

In law assumption do'nt work only facts and legal position works.

[Ganeshan Kalyani]

Agreed .

AI Summary

Input tax credit eligibility for business supplies affirmed; documentary, receipt, payment and reversal conditions determine entitlement. ITC is admissible for supplies made in furtherance of business: uniforms, stationery/housekeeping, courier, and export/import freight; GST on provident fund services was treated as admissible. Monthly employee taxi fares and bottled water for personal consumption were generally not admissible except where provided under contract or mandate. Claiming ITC requires possession of tax invoice, receipt of goods/services (including last lot receipt rules), tax paid by supplier, filing of return, and reversal if payment to supplier is not made within the stipulated period, with proportionate rules for part payments.