TaxTMI 
TaxTMI 
A Pvt. Ltd. Co. running restaurant, wants to trade separately in Masala product through E-Commerce platform, but this business division if register as separate business vertical, can it claim ITC/claim refund because of inverted tax structure.
GST refund
13 Mar 2025 
6 Replies 
1336 Views Asked by
Input Tax Credit refund under inverted duty structure can be claimed for a separate business vertical subject to compliance.
Registering the masala trading activity as a separate business vertical permits independent GST treatment; if inputs attract higher tax than outputs, the vertical may claim refund of unutilized Input Tax Credit under the refund provisions. Eligibility requires separate GST registration, distinct accounts and records, sale through a registered e commerce platform, absence of exempt supplies that would disqualify ITC, and compliance with filing and evidentiary conditions. Recent high court decisions support refund claims even when inward and outward supplies are the same, but departmental guidance may constrain procedural acceptance. (AI Summary)
Registering the masala trading activity as a separate business vertical permits independent GST treatment; if inputs attract higher tax than outputs, the vertical may claim refund of unutilized Input Tax Credit under the refund provisions. Eligibility requires separate GST registration, distinct accounts and records, sale through a registered e commerce platform, absence of exempt supplies that would disqualify ITC, and compliance with filing and evidentiary conditions. Recent high court decisions support refund claims even when inward and outward supplies are the same, but departmental guidance may constrain procedural acceptance. (AI Summary)