ITC claim of Cess paid

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This query is : Resolved

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This discussion clarifies whether input tax credit (ITC) can be claimed on Cess paid during the purchase of motor vehicles, in addition to CGST and SGST. The advice given is that ITC on Cess can only be used to offset Compensation Cess liability on outward supplies, not other GST taxes. Furthermore, no refund is available for Cess paid if there is no corresponding Cess liability on outward supplies.

DIVYESH JAIN

DIVYESH JAIN (Querist)

15 November 2022 Dear Sir,

One of my client has paid CESS while purchase of motor vehicle apart from CGST and SGST.

My query is can I claim the input tax credit of Cess amount while calculating my GST liability. There is no CESS liability on outward supply.

Incase ITC cannot be claimed can I get the refund of CESS paid.

Please help me in this matter.

Regards,
Divyesh Jain

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

15 November 2022 The input tax credit of this Cess can be only used to pay Compensation Cess, and no refund can be claimed.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

15 November 2022 1.The input tax credit of this cess can be only used to pay compensation cess and not the other taxes like CGST, SGCT or IGST.
2. No refund allowed for cess paid.

DIVYESH JAIN

DIVYESH JAIN (Querist)

15 November 2022 Ok Sir, Thanks for your reply

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