80% of purchases of input & Input services from registered persons

[VISWANATH YARRAPAREDDY]

Sir,

One firm is constructed one apartment consisting of 10 flats and one flat sold during the construction period and the GST paid on the same but the remaining 9 flats were sold after obtaining the occupation certificate (OC), hence GST has not paid on 9 flats.

Our doubts are:

1. 80% purchase of input & Input services from registered persons is applicable for entire apartment or only to the extent of one flats

2. If all flats are sold after obtaining the occupation certificate (OC), then still is it applicable (80% of input & input services from registered persons)

[Rajagopalan Ranganathan]

Sir,

In respect of 9 flats which are sold after obtaining occupancy certificate are exempt from tax. Hence the question of availing ITC in respect of these 9 flats does not arise. Therefore the question of availing ITC subject to the condition that 80% purchase of input & Input services from registered persons does not arise. In respect of one flat which was sold prior to obtaining occupancy certificate on which gst has been paid the above condition is applicable.

[Ganeshan Kalyani]

I agree with the views of Sri Rajagopalan Sir.

AI Summary

Input tax credit eligibility limited to units liable to tax; exempt units after occupancy certificate do not qualify. The eighty percent purchase-from-registered-persons condition for claiming input tax credit applies only to units that are taxable (sold before issuance of the occupancy certificate and on which GST is paid). Units sold after obtaining the occupancy certificate are treated as exempt, give rise to no input tax credit, and therefore the eighty percent registered-supplier condition does not apply to those exempt units.