ITC on work contract

You can avail ITC

But
Input Tax Credit is NOT available

Revised Model GST Law mentions that input tax credit is not available for-

works contracts services when supplied for construction of immovable property, other than plant and machinery, except where it is an input service for further supply of works contract servicegoods or services received by a taxable person for construction of an immovable property on his own account, other than plant and machinery, even when used in course or furtherance of business.

On analysis, one finds this provision is quite contradictory.

For example, any contractor/builder will not enjoy any input tax credit on the input services if he constructs any building. But he will enjoy input tax credit on input service for further supply of works contract service. These two sentences are confusing and contradictory.

Input tax credit is available to both a builder and a taxable person while constructing plant and machinery. But input tax credit is not available to any taxable person who constructs on his own account even if it is for business use.

This entire section is confusing and contradictory and further explanations are required.

ITC of material will be available to contractor. but the party to whom bill is issued by contractor will get ITC, instead he can claim ITC on Service Charge mentioned in Tax Invoice by contractor.

17(5) restriction is not to the contractor but to the awarder

Yes ,.. you can avail ITC

ITC for works contract can be availed only by one who is in the same line of business and is using such services received for further supply of works contract service. For example a building developer may engage services of a subcontractor for certain portion of the whole work. The subcontractor will charge GST in the tax invoice raised on the main contractor. The main contractor will be entitled to take ITC on the tax invoice raised by his sub-contractor as his output is works contract service. However if the main contractor provides works contract service (other than for plant and machinery) to a company say in the IT business, the ITC of GST paid on the invoice raised by the works contractor will not be available to the IT Company

U can't claim

pankaj sir, please see view of Mr.praveen k reddy.I think , this is very confusing topic.
what happens if there is no sub contractor.

You can take ITC, no problem, please see Mr. Pankaj reply

Even though there is no Sub contractor , Contractor can avail itc on his inward supplies, Question is to whom he is supplying can avail ITC , so if recepient is from same line of Business, like Builder, developer, Subcontractor then Yes,.. else itc is Not available

Thanks sir,Now there is no confusion.