Input credit on hp goods

Dear Guhan,

You can definately claim Input tax Credit on Goods Purchased under Hypothication. Transactions under Hypothication Sysrem (Under Hire Purchase/Lease Transaction) are treated as Deemed Sales under Article 266 (29A) of Constitution of India. According to this article sale under hypothication system is deemed to be normal sales & the provisions of tax apply to it as they apply to normal sales. In such transactions buyer is the only & real owner & NBFC is just financer. So in my opinion you can definately claim Input Credit.

Regards: -

CA Harshal Pahade

Contact: - 9272344759