FAQs On Input Tax Credit In GST

The short form of Input Tax Credit in GST is ITC. The term ‘Input Tax Credit’ or ‘ITC’ means the Goods and Services Tax (GST) paid by a taxable person on any purchase of goods and/or services that are used or will be used for business. Input ITC can be reduced from the GST payable on the sales by the taxable person only after fulfilling some conditions.
For example- you are a manufacturer: Tax payable on output (final product) is Rs 450. Tax paid on input (purchases) is Rs 300. You can claim input credit of Rs 300 and deposit the rest Rs 150 as taxes in cash.

Log in to the GST website using your credentials. Click on the “Services” button, then on “Ledgers”, and then click on “Electronic Credit Ledger”. On the Electronic Credit Ledger page, you will be able to check the input tax credit balance as of today’s date as well as Blocked Credit Balance and Provisional Credit Balance.

In the case D.Y. Beathel Enterprises Vs State Tax Officer (Data Cell), Madras High Court suppressed the order passed by the office of levying the entire tax liability on the purchasing dealer without involving the seller, where the payment of tax has been made to the seller under proper compliances of the law, but the same has not been remitted to the Government by the seller.

ITC is not available for motor vehicles used to transport persons, having a seating capacity of less than or equal to 13 persons (including the driver).
However, ITC is available if the seating capacity of such motor vehicles exceeds 13 persons. Further, ITC is not available on vessels and aircrafts. 
For example, ABC & Co. buys a car for their business. They cannot claim ITC.

Businesses can claim input tax credit (ITC) in GST on car hire charges under GST, only if the hiring of the car is in the course of furtherance of business and not restricted under Section 17(5) of the CGST Act.

Every registered person shall, subject to such conditions and restrictions as may be prescribed and in the manner specified in section 49, be entitled to take credit of input tax charged on any supply of goods or services or both.

Microsoft Word – ITC -English.doc
Yes. ITC can be claimed on all the inputs and capital goods in one installment subject to the conditions under Sec 16(2) of the GST.

No, Input tax Credit be utilized for payment of arrears in tax. Section 41(2) deals with a scenario where the tax payable whereon has not been paid by the supplier.