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ITC under Karnataka VAT

This query is : Resolved 

30 January 2023 Dear Sir,
We are a sheet metal manufacturing unit in Bangalore. Purchased a Laser Cutting machine in April, 2017. We do sales of sheet metal products and also provide services of laser cutting or bending only, i.e. job-work. We are under Service Tax. Labour charges under KVAT are zero-rated sales but we include Service Tax in the Invoice to our clients. Will I be able to avail full ITC of the machinery purchase ? Thanks, Ramesh

31 January 2023 No. ITC of VAT of machine is not eligible, because of zero rated supply.

31 January 2023 Thank you for your reply Sir... we are also doing manufacturing sales, hence i presumed we should be able to avail ITC ... thanks for the info

31 January 2023 Whether the machine is used form manufacturing any product having outward VAT liability?

31 January 2023 Almost all the time the machine was and is used for manufacturing with VAT goods only

31 January 2023 Depending upon the usage on manufacturing sheets for sale, you can take ITC credit in proportion.

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