Multi State Co Operative Society can claim ITC

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vinesh k g (Querist)
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11 February 2021 Respected Sir,
Kindly advice A Multi State Co Operative Society can claim ITC under section 17(2) of CGST Act. Is It cover under act as Financial institution, eligible for 50% ITC.

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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09 July 2024 A Multi-State Cooperative Society (MSCS) under the CGST Act is eligible for Input Tax Credit (ITC) under specific conditions, particularly under Section 17(2) which deals with blocked credits. As per Section 17(5)(h) of the CGST Act, financial institutions are eligible for a 50% ITC on inputs, input services, and capital goods.

For an MSCS to qualify as a financial institution under the GST law and be eligible for this 50% ITC, it must primarily engage in activities as a financial institution. This typically includes activities such as providing loans, advances, or financial services.

However, the specific eligibility of an MSCS for ITC under Section 17(2) should be verified based on its predominant activities and the nature of its transactions. It is advisable to consult with a GST expert or tax advisor who can review the details of the cooperative society's operations and provide guidance specific to its situation. They can help determine whether the society qualifies as a financial institution under the GST law and is eligible for the 50% ITC provision.

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