Credit of input tax of GST paid

[S.C. WADHWA]

Dear Experts,

We are manufacturers of Food items both as nil rate of GST and taxable. We are going to install a Zero Discharge Plant for Upgradation of ETP. My query is whether GST paid on this plant will be available as input tax credit fully or in some proportion. Please give your expert advise.

REGARDS,

WADHWA

AI Summary

Food Manufacturer Seeks ITC on Zero Discharge Plant; Eligibility Proportional to Exempt Turnover, Section 17(5) Restrictions Apply. A manufacturer of food items, producing both GST-exempt and taxable goods, inquired about the eligibility of claiming input tax credit (ITC) on a Zero Discharge Plant for upgrading their Effluent Treatment Plant (ETP). An expert advised that if the plant is used for both taxable and exempt supplies, ITC will be available proportionally based on the exempt turnover. Another expert highlighted that ITC cannot be claimed on land, buildings, or external pipelines due to restrictions under section 17(5). Additionally, if the plant is capitalized as ETP in the books, ITC is eligible, including support and foundation structures.