ITC ON CONSUMABLE NOT FORMING PART OF FINAL PRODUCT

[ajay chharia]

MY CLIENT IS A MNUFACTURER AND SELLER OF LARGEFORMAT PRINTERS. He consume inks internally for the purpose of TESTING OF PRINTERS, providing Demo to the customers in house or during exhibitions .WHETHER ITC WILL BE ALLOWED ON PURCHASE OF INK

AI Summary

Manufacturers can claim Input Tax Credit on ink used for printer testing and demos under Section 16(1) CGST Act. A manufacturer and seller of large-format printers inquired about the eligibility of Input Tax Credit (ITC) on ink used for testing printers and providing demonstrations. Multiple responses confirmed that ITC is allowable in this scenario, as the ink is used in the course of business, aligning with Section 16(1) of the CGST Act. One-to-one correlation between input and output is not necessary, as supported by a ruling from the Appellate Authority for Advance Ruling in Gujarat. The consensus among respondents was that ITC is permissible for inputs used for demonstration purposes.