proof of receipt of service for availing ITC

[Adarsh Sharma]

As per Section 16(2) of the CGST Act, 2017, the ITC can only be availed after satisfying certain conditions specified therein. One of the condition is 'Receipt of goods or services or both'.

In case of goods, the proof of of receipt may be e-way bill, Invoice, GRN/MRN, physical stock, etc. However in case of services, except the invoice raised by the supplier, what can be the proof of receipt of services so as to comply with the condition of Section 16(2).

[KASTURI SETHI]

What is the nature of service and its SAC ?

[Padmanathan KV]

Agreed with Kasturi Sir.

Some services like Construction services, Job work, may have tangible proof. Some services will require expert certification/opinion. Documentation will be proof in case of certain services such as architectural services, software (source coding etc). Therefore, it will depend on nature of service.

[Adarsh Sharma]

Gentleman,

Construction service by the builder to Land owner in case of Joint Development.

The consideration of construction service is TDR by the Land Owner. The construction is going on but right to sale the area allotted to the Land Owner to the extent of his share is transferred to him by way of sharing agreement and even the builder raised an invoice on the Land owner for construction services.

In this scenario, what is the proof of construction services received by the Land owner from the Builder.

[Shilpi Jain]

The units alloted to Landowner which are either retained or sold to customers is the proof of receipt of the services!!

AI Summary

Proof of receipt of services for ITC: allotment or sale of constructed units establishes receipt in joint development.
Input tax credit requires receipt of services; proof for services depends on their nature and may include supplier invoices, expert certification, or documentary deliverables. For construction services in a joint development agreement where consideration is transfer of development rights, the allotment, retention, or sale of constructed units allocated to the landowner constitutes proof of receipt of services for claiming input tax credit.