Can take ITC Shortges and damages of Cement cost debit to transporter.

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This query is : Resolved

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A cement transportation business operating under forward charges with 12% GST is receiving debit notes from cement companies for shortages and damages, with GST charged at 28%. The core question is whether the transporter can claim Input Tax Credit (ITC) on these amounts recovered from their freight bills. Opinions differ, with one view stating ITC cannot be claimed as it's a payment for shortage, while another suggests ITC is claimable as these costs are integral to the business.

Laxmikant

Laxmikant (Querist)
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17 June 2023 We are cement transportation business and provide vehicles for transportation of Cement. We are working under forward charges 12% GST. The Cement Company issue debit not for shortages of Cement and GST claimed 28%.
My question is can we take Input Tax credit on shortages and damages amount recovered from our freight bills.

L.D.Dharmadhikari