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input credit on capital goods

19 May 2017

If I purchased a capital good on 20.06.2017 and it remains in transit till 20.07.2017.
means I received the capital good in GST regime.

Query- whether I will be able to take credit or no and why?

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13 Replies

ROHIT YADAV (Finance Analysist) (607 Points)
Replied 19 May 2017

Yes, Credit is admissible provided CG received in factory with eligible document.

1 Like

DEVENDER SHARMA (PROP) (33 Points)
Replied 19 May 2017

in which section

ROHIT YADAV (Finance Analysist) (607 Points)
Replied 19 May 2017

Under Rule-4 of CCR.

CA Altamush Zafar (GST Consultant) (15907 Points)
Replied 19 May 2017

Unfortunately this situation is not covered by section 140 cgst act (transition provision), i dont know whether intentionally or by mistake. Credits will not be available.

CA Surbhi Singhal (CA CS NCFM Dip-IFR B.Com) (983 Points)
Replied 19 May 2017

Credit will be taken in GST in terms of Section 16. Transitional provision will not be applicable.

CA Altamush Zafar (GST Consultant) (15907 Points)
Replied 19 May 2017

I doubt it because invoice would contain excise duty and vat instead of GST

CA Surbhi Singhal (CA CS NCFM Dip-IFR B.Com) (983 Points)
Replied 19 May 2017

Invoice should be taken under GST, after implementation.

CA Altamush Zafar (GST Consultant) (15907 Points)
Replied 20 May 2017

But if removal of goods is done before appointed date then credits will not be available. That was the essence of query.

Jatin Jindal (41 Points)
Replied 20 May 2017

I m also in doubt for this type of problem

Hadi Husain Husaini (IDT Consultant) (99 Points)
Replied 22 May 2017

Hi Devender,

A very apt question

Section 140 [5] only talks about availing credit of inputs and input services in transit because as per Section 140[1] there is no carry forward of credit pertaining to inputs and input services unless mentioned in the returns. However, Section 140[2] poses no such conditions for carry forward of credit pertaining to capital goods.

So in my view, input credit can be availed in case of capital goods in transit.