Regarding Agriculture equipment's (Shovel) ITC

[mahesh rao]

All Dear Experts,

Good Morning,

Sir we are manufacturing the shovel that is 0% product.

1. My quires is we have purchased the raw material like( Sheets, Pipes) with gst invoice. So can we taken input that ITC from raw material invoice ITC?

2. Some person told me you have to reverse the ITC which is purchase of raw material with gst.

Sir I am so confused please advice me that should I taken ITC input from Purchase Or Not. and Will I have to reverse the ITC.

AI Summary

Input tax credit eligibility limited where outward supplies are exempt; credit is usable only against taxable supplies later.
Supply of shovels is exempt; entitlement to Input Tax Credit on tax paid for raw materials depends on whether the taxpayer makes taxable outward supplies. If the taxpayer has taxable supplies, ITC on purchases may be availed and used against taxable liabilities without one to one correlation. Where outward supplies are only exempt, ITC on inputs used for those supplies is not claimable and refunds for ITC accumulated due to exempt supplies are not available. ITC may be accumulated and utilised later if taxable supplies are undertaken, subject to eligibility to avail credit.