Reversal of Own Consumption of Cement in Civil Immovable Structure

[Prem Choudhary]

Dear Expert

Please advice for reversal of ITC in case own consumption of Cement in Civil immovable structural work.

whether rate of reversal is @ 28% or proportion ITC used in Cement. ?

for your GST on Cement @28%

[Ganeshan Kalyani]

Sir cement used in construction is not eligible for thd input tax credit claim. Therefore, the input tax credit taken should be reversed.

[KASTURI SETHI]

In the scenario explained, ITC on cement is fully disallowed as advised by Sh.Ganeshan Kalyani Ji.

[Prem Choudhary]

Sir

Cement is own production and consumption in the scenario , in case own consumption output gst is not payable. But we need to reverse itc used in production of cement for own consumption (other then plant and machinery ) under sec 17(5)

[Mahadev R]

In terms of Section 17 (5)(d), goods or services or both received by a taxable person for construction of an immovable property (other than plant or machinery) on his own account including when such goods or services or both are used in the course or furtherance of business.

Therefore, in the present case the inputs used in cement which in turn used in construction could get disallwed

AI Summary

Clarification on Input Tax Credit Reversal for Cement Used in Construction under GST's Section 17(5). A discussion on the reversal of Input Tax Credit (ITC) for cement used in constructing civil immovable structures under the Goods and Services Tax (GST) framework. The query revolves around whether the reversal rate should be 28% or proportional to ITC used. Experts responded that ITC on cement used in construction is not eligible and should be reversed. It is clarified that for own consumption of cement, output GST is not payable, but ITC used in cement production must be reversed according to Section 17(5), which disallows ITC for construction of immovable property except for plant and machinery.