ITC Eligibility

[Ethirajan Parthasarathy]

As per sec.16(1) of CGST Act, ITC is allowable on expenditure incurred used or intended to be used in the “course or furtherance of his business”.

My query is whether ITC on professional fee incurred in connection with buy back of shares or issue of shares by a limited company are eligible for credit.

AI Summary

Input Tax Credit on Professional Fees for Share Buybacks and Issuance Eligible Under Section 16(1), CGST Act A query was raised regarding the eligibility of Input Tax Credit (ITC) on professional fees related to the buyback or issuance of shares by a limited company under the GST framework. Respondents generally agreed that such fees are eligible for ITC, as these activities are considered in the course or furtherance of business under Section 16(1) of the CGST Act. The definition of 'business' under Section 2(17) is broad and includes activities incidental to business operations. Some responses noted that this interpretation could be subject to legal interpretation, but the consensus was that ITC is applicable.