Regarding Claiming Input Tax credit

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This query is : Resolved

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A sole proprietor in the construction business is unsure about claiming Input Tax Credit (ITC) on steel purchased for a client's house. They are questioning if this constitutes a works contract on immovable property and if they are eligible for the credit, especially since they are filing nil returns. Additionally, they need clarification on whether to charge GST on the final bill, even if below the threshold, particularly if they have taken voluntary GST registration.

Jeeva

Jeeva (Querist)
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08 April 2022 A sole proprietor doing construction business registered under GST, Purchases steel for a house he is constructing for his client. He received Input tax credit on the steel he purchased but he has no business with respect to GST and is filing only Nil return.

Two questions
1. Since its immovable property and can this be considered as works contract on a immovable property and hes not liable to take input credit for the same or is it different to the above statment.

2. At end of the contract is he supposed to Charge a bill for the contract with GST even though he is below the GST threshold limit.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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09 April 2022 1 ITC can be taken on construction contract where GST is charged on work done.
2 No GST in case of threshold not reached and not registered under GST.

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Jeeva

Jeeva (Querist)
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09 April 2022 Thank you for your timely reply sir, what if the business is taken voluntary registration does it mean it has to charge GST on the bill no matter what ?

CA Puja Sharma

CA Puja Sharma (Expert)
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09 April 2022 Yes voluntary registration have been taken then GST have to be charged in the bill.

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Jeeva

Jeeva (Querist)
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09 April 2022 Thanks for your time and reply much appreciated

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