Sale of old machinery under gst

[Allauddin Patel]

My question 

Dear sir ..

I works in cotton ginning factory (regular taxpayer)..

Can we purchase old ginning machinery and sale this machinery later??

Assume if we purchase 

Taxable value 1000000

Input tax  180000 (18%)

Later sale 

Taxable value  1200000

Output tax 216000 (18%)

Can we do this 

[Sadanand Bulbule]

Yes. You can do it, since it is not blocked under Section 17 of the Act. 

[YAGAY andSUN]

Yes, as a regular taxpayer, your cotton ginning factory can purchase old ginning machinery and later sell it. You can claim Input Tax Credit (ITC) of ?1,80,000 at the time of purchase, provided the supplier issues a proper tax invoice and other GST conditions are met. When you sell the machinery for ?12,00,000, you must charge 18% GST (?2,16,000) and pay it to the Government. This is permissible under GST law, as long as proper documentation and compliance are maintained.

[Allauddin Patel]

Can we sell this machinery as scrap ?

If yes then should we need to mention in tax invoice ginning machinery and its hsn or scrap and its hsn ?

Kindly clarify me

AI Summary

GST on sale of used machinery: Input Tax Credit at purchase allowed; resale is a taxable supply requiring GST and proper documentation. Replies state a regular taxpayer may claim Input Tax Credit on purchase of used ginning machinery if supplied with a proper tax invoice and other GST conditions are met; on resale the transfer is a taxable supply requiring GST at the applicable rate on the taxable value, with proper documentation and compliance. A question remains whether an invoice for sale as scrap should describe the item as ginning machinery with its HSN or as scrap with a scrap HSN.