Input Tax Credit | Good and Service Tax

Good and Service tax as one says or Goods and Services tax (GST) has been identified as one of most important tax transitions after-independence. Good and Service Tax is a major tax trigger, leading to and overall business transformation for all major industries. Under this tutorial we shall covers sections 16 – Section 22 under Input Tax Credit.

Let us now discuss the various sections under Input Tax Credit.

Section 16. Eligibility and conditions for taking input tax credit

For the purpose of clause (b), it shall be deemed that the taxable person has received the goods where the goods are delivered by the supplier to a recipient or any other person on the direction of such taxable person, whether acting as an agent or otherwise, before or during movement of goods, either by way of transfer of documents of title to goods or otherwise.

Section 17: Apportionment of credit and blocked credit

  1. The option once exercised shall not be withdrawn during the remaining part of the financial year
  2. For the purpose of this clause, the word “construction” includes re-construction, renovation, additions or alterations or repairs, to the extent of capitalization, to the said immovable property.
  3. Plant and Machinery’ means apparatus, equipment, machinery, pipelines, telecommunication tower fixed to earth by foundation or structural support that are used for making outward supply and includes such foundation and structural supports but excludes land, building or any other civil structures.

Section 18: Availability of credit in special circumstances

A person who has applied for registration under the Act within thirty days from the date on which he becomes liable to registration and has been granted such registration shall, subject to such conditions and restrictions as may be prescribed, be entitled to take credit of input tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock on the day immediately preceding the date from which he becomes liable to pay tax under the provisions of this Act.


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