ITC on goods purchases for construction

373 views 5 replies
We are distributors of Ice creams.
Purchased water tank for use at business premises.
Purchased vehicles for transportation of Ice creams to retailers.
Purchases Bricks, Asbestos sheets for construction of building.
Purchased Electrical motor for use in premises.
Whether we are eligible to claim ITC?
Requested clarification.
Replies (5)
All are eligible except for those items which are going to be used for construction of building.

Better capitalise it.
1). Purchased Water tank for use at business premises ?

Ans : YES.

2). Purchased Vehicle for transportation of Ice cream to retailers ?

Ans : YES ( Not Blocked U/s 17(5) since used for transportation of goods ).

3). Purchased Electrical Motor for use in premises ?

Ans : YES.

4). Purchased Bricks, Asbestos Sheets for construction of building ?

Ans : NO. ITC on Works Contract Service is BLOCKED U/s 17(5) of the CGST Act 2017. Capitalize these expenditure in your Books.

Warm Regards.
Agree with reply by all above experts, but want to add , If you are carrying your business in rented place than can take ITC for bricks & Shed . No need to capitalise it . can books as Revenue expenditure.
pankaj rawat ji,as per sec17(5)d ITC is blocked on receipt of goods and services for construction of immovable property on own account to the extent of capitalisation.If the said purchases are capitalised then no ITC available otherwise ITC can be availed.
@ Sabita sahoo
yes you are correct that's what I have replied.

The person doing business in rented place cannot capitalised such expenses to Building Account , hence will book it as Revenue expenditure & can claim ITC

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