Clarification in respect of utilization of input tax credit under GST.

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....t February 2019. 2. Various representations have been received from the trade and industry regarding challenges being faced by taxpayers due to bringing into force of section 49A of the Goa Goods and Services Tax Act, 2017 (hereinafter referred to as the Goa GST Act). The issue has arisen on account of order of utilization of input tax credit of integrated tax in a particular order, resulting in accumulation of input tax credit for one kind of tax (say State tax) in electronic credit ledger and discharge of liability for the other kind of tax (say Central tax) through electronic cash ledger in certain scenarios. Accordingly, rule 88A was inserted in the Goa Goods and Services Tax Rules, 2017 (hereinafter referred to as the Goa GST Rules)....

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....pletely exhausted first before the input tax credit on account of Central tax or State / Union territory tax can be utilized. It is clarified that after the insertion of the said rule, the order of utilization of input tax credit will be as per the order (of numerals) given below: Input tax Credit on account of Output liability on account of Integrated tax Output liability on account of Central tax Output liability on account of State tax/ Union Territory tax Integrated tax (I) (II) - In any order and in any proportion (III) Input tax Credit on account of Integrated tax to be completely exhausted mandatorily Central tax (V) (IV) Not permitted State tax / Union Territory tax (VII) Not permitted ....