ITC - CONSTRUCTION WORK

732 views
User Avatar

Accountant
90 Points Posted on 23 November 2021

DEAR EXPERTS,

AUTO COMPONENTS MANUFACTURING INDUSTRY, AVAILED ITC OF CONSTRUCTION WORK.

CONSTRUCTION WORK ITC IS IT ELIGIBLE..?

IF NOT WHAT ARE THINGS TO BE DONE.

PLEASE SUGGEST

THANKS & REGARDS

FAREED

0 Reply Share Follow
On 23 November 2021 at 11:15 Report
Replies (7)
Quick Summary
This discussion addresses the eligibility of Input Tax Credit (ITC) for construction work within the auto components manufacturing industry. While Section 17(5) of the CGST Act generally blocks ITC on construction, there are nuances. If construction is specifically for plant and machinery and capitalised accordingly, ITC may be eligible. For general construction, credit is typically ineligible, but ITC on separately capitalised items like furniture, fittings, or equipment may be claimable if properly documented.

User Avatar

GST Practitioner & Accounts
15150 Points Posted on 23 November 2021
As per section 17(5) of the CGST act 2017 , ITC on Construction work is blocked credit not available , So you have to reverse Input Tax credit with interest applicable .
Reply
On 23 November 2021 at 11:30
User Avatar

Accountant
90 Points Posted on 23 November 2021

Thanks for guidance...Mr.Prasad Nilugal

Reply
On 23 November 2021 at 14:24
User Avatar

GST Practitioner & Accounts
15150 Points Posted on 23 November 2021
Well come
Reply
On 23 November 2021 at 14:26
User Avatar

GST Consultant
15986 Points Posted on 23 November 2021

ITC on construction is blocked if it is in the nature of capital expenditure.

Reply
On 23 November 2021 at 17:48
User Avatar

Accountant
90 Points Posted on 24 November 2021

Thanks for guidance...! Mr.Zafar

Thanks for guidance...Mr.Prasad Nilugal

Read more at: https://www.caclubindia.com/forum/details.asp?mod_id=583382
Thanks for guidance...Mr.Prasad Nilugal

Read more at: https://www.caclubindia.com/forum/itc-construction-work-583382.asp
Reply
On 24 November 2021 at 09:44
User Avatar

Partner - Audit & Assistance
4825 Points Posted on 24 November 2021

Cannot directly say ineligible. If I capitalise construction activity which is specifically designed and implemented for Plant & Machinery it gets capitalised to P&M. Such construction is clearly eligible. 

Where it is general construction above comments hold good. Although, to the extent of pure construction credit is ineligible, any furniture and fittings, equipments, P&M which are capitalised separately - credit can be claimed if vendor agreements, accounting is clear. 

Reply
On 24 November 2021 at 10:47
User Avatar

Accountant
90 Points Posted on 25 November 2021

Thanks for your guidance... Mr.Akshay

Reply
On 25 November 2021 at 09:36

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Recent Topics :

  1. APPLICABILITY AND BREAKDOWN OF GST COMPLIANCE ON S
  2. Advance for supply of goods
  3. Question for members: how do you manage client doc
  4. Clarification Required on Invoicing and Receipt of
  5. SEBI Registered VS NSDL Registered RTA
  6. Income tax or capital gain tax for Resident Indivi
  7. PCIT-1 Thane Email address
  8. CA Fees deduction for non audit case allowed?
  9. 5th Letter PAN Mismatch with Surname issues still
  10. Criteria to hire an article

More recent discussions | Post

Related Topics :

Loading