ITC of Trucks

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This discussion clarifies whether Input Tax Credit (ITC) can be claimed on trucks purchased for the business of supplying sand. The core business involves selling sand to registered dealers at 5% GST, including free transportation. In instances where only transportation services are provided, 12% GST is collected. The consensus is that ITC on the transportation services can be claimed, referencing relevant GST notifications that allow for full ITC under specific circumstances for transport service providers.

CA Pawan Koradia

CA Pawan Koradia (Querist)
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16 November 2021 Respected Sir/Madam
We purchase sand from the register/unregister dealer and then sell it to the registered dealer @5% GST with transportation (free of cost), it is our main business.
In some cases, we had also provided only transportation service from where we collected GST @12% (forward charges)
In this scenario can we claim ITC on the truck purchased for the supply of sand?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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16 November 2021 Yes, ITC over the transportation services can be claimed.

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Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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16 November 2021 Notification no 20/2017 Central Tax (Rate) date on 22nd August, 2017, GST

Notification No. 20/2017-Central Tax (Rate) 22nd August, 2017.

Seeks to amend notification No. 11/2017-CT(R) to reduce CGST rate on specified supplies of Works Contract Services, job work for textile & textile products, printing service of books, newspapers etc, admission to planetarium, and, also to provide option to GTA & transport of passengers by motorcab service providers to avail full ITC & discharge CGST @ 6%

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