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ITC on ship repair (Dry Dock)

E.KALAIKOVAN (Sr. Accounts Manager ) (339 Points)

01 November 2021

Sir,

ITC on Capital goods (Ship/Vessel) is eligible for Transport of Coastal goods. In Shipping, Every 2 1/2 years ships/vessels are to be reparied. This is mandatory. The capital expenditure will be accounted as Dry Dock. This will written off 2 1/2 years. \

ITC on capaital goods is for 5 years (60 months). Dry dock is for 2 1/2 years, ITC on Dry Dock is eligible?

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5 Replies

Rajendra Prasad (Employee Private) (1833 Points)
Replied 02 November 2021

ITC on capital goods, can be claimed if it used for the furtherance of Business and subject to Section 17(5) eligibility.
Further the 5 years situation will comes valuation of asset when you are desposing off.

E.KALAIKOVAN (Sr. Accounts Manager ) (339 Points)
Replied 02 November 2021

Sir,

Dry Dock cost will be written off in 2 1/2 years. Without the Dry Dock repair, ship can not be taken into business.

Rajendra Prasad (Employee Private) (1833 Points)
Replied 02 November 2021

That is not in eligible criteria.
To avail Input credit required Tax Invoice, receipt of Goods or services or both, and supplier has to be file returns.