Input Tax Credit

[VIGNESH]

sir. kindly clarrify A dealer of biscuts take a new dealership in mobile phones , he runs the business as proprietorship and uses same GST number. Can he set off the GST input on mobile against sale of biscuts or should he maintain product wise accounts and adjsut GSt according to the products sold.

[Rajagopalan Ranganathan]

Sir,

There is no bar in CGST Act for cross utilization of ITC earned in respect of one type of goods for payment of tax on other type of goods. However before doing so it is better to inform the Department in writing about the same to avoid allegation of suppression of fact, wilful mis-statement etc to evade payment of tax by the Department in future.

[KASTURI SETHI]

There is no one to one correlation for availment and utilisation of ITC in CGST Act. ITC must be used in the course or furtherance of business. Registration number will remain the same but you will have to apply for addition of supply of mobile phones in your application for registration already filed.. Registration must be amended to this effect. Amendment is required.

[Ganeshan Kalyani]

I agree with both the experts.

[Himansu Sekhar]

Maintaining product wise stock is required. Credit can be taken and utilised in a combined manner

[KASTURI SETHI]

Yes. Maintaining product wise stock will make the assessee safe.

[Vishesh Goyal]

I agree with Kasturi sir. Registration must be amended to set off the GST input tax credit on mobile against the sale of biscuits. GST number will remain the same but you will have to file an application for the addition of a supply of mobile phones to your GST registration certificate.

AI Summary

GST Input Credit on Mobile Phone Sales Can Offset Biscuit Sales with Proper Documentation and Registration Update A dealer operating under a proprietorship with a single GST number inquires whether GST input credit from mobile phone sales can be offset against biscuit sales. Experts responded that the Central Goods and Services Tax (CGST) Act allows cross-utilization of input tax credit (ITC) across different goods. However, they advised informing the tax department in writing to prevent future allegations of tax evasion. It was also recommended to amend the GST registration to include mobile phones and maintain product-wise stock records for safety. All experts concurred on these points.