Input tax credit restriction: credit disallowed where supplier of input service charges a higher State tax rate than recipient is charged. A proviso is inserted restricting input tax credit: where a supplier of an input service in the same line of business charges State tax at a rate higher than that charged to the recipient, credit on that input service in excess of the tax paid or payable at the lower rate shall not be taken; an illustrative example demonstrates that the recipient may claim credit only up to the tax corresponding to the lower rate. The notification also substitutes wording, omits a sub-item and deletes two annexure classification entries.
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Input tax credit restriction: credit disallowed where supplier of input service charges a higher State tax rate than recipient is charged.
A proviso is inserted restricting input tax credit: where a supplier of an input service in the same line of business charges State tax at a rate higher than that charged to the recipient, credit on that input service in excess of the tax paid or payable at the lower rate shall not be taken; an illustrative example demonstrates that the recipient may claim credit only up to the tax corresponding to the lower rate. The notification also substitutes wording, omits a sub-item and deletes two annexure classification entries.
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