Can i claim ITC on GST incurred on installation of CNG Kit in vehicle?

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This query is : Resolved

Quick Summary

As a proprietor with a personal car used for business, you may not be able to claim Input Tax Credit (ITC) on the GST incurred for installing a CNG kit. Generally, ITC on vehicles and their additions is restricted unless the vehicle is specifically used for passenger transportation or driving instruction. This restriction is outlined in Section 17(5) of the CGST Act, 2017.

Amit Joshi

Amit Joshi (Querist)
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02 June 2022 Hi

I am a proprietor and own a used car (no corporate registration etc.) I recently got a CNG kit installed in my car. I use this car for business purposes.

Would it be possible to claim ITC on this CNG kit installation? Its quite high @ 28%!!

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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02 June 2022 Not possible, ITC can't be claimed on car or on any additions to it.

R. B. Yadav (CMA, LLB)

R. B. Yadav (CMA, LLB) (Expert)
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02 June 2022 If you are in the business of transportation of passenger by car or in the business of training of driving of motor vehicle and car you purchased is used for these purpose, you may claim the input credit. Else, it is restricted under section 17(5) of CGST Act, 2017.

Thanks

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