Nature of business: "spare parts sales and wheel allignment service"
How should we treat gst liability and reverse charge for a machinery which is purchased on sept-2017 for 18 lacs + 18% tax is now selling for 9.5 lacs + 18% gst?
As per Rule 44 of CGST Act :
The ITC is to be reverse for balance remaing Life of Machinery .
Life of Capital Asset is 60months & You used the same for 16 (if sold in jan19 today)
Remaing life is 44 months (60-16)
ITC on machiney =324000/- (18% of 18lac)
To calculate input tax credit attributable to Remaing Life = 324000 × 44 ÷60 = 237000/-
And
Now the Sale value is 9.5 lac & GST on sale @ 18% comes to 171000/-
Hence amount higher has be deposited ie 237000/-
CAclubindia
