If a supplier purchases goods with GST paid at the rate of 5 % and 18%, and he sells goods at the rate of 5%, can he claim the 18% GST refund?
For example, a red chilli manufacturer purchases plastic material @ 18% and red chili @ 5% and then sells his red chilli @ 5% then input tax @ 18% not used, what is procedure of this ITC claim?
Dear Tarun,
In terms of section 54 of CGST Act, where the credit has accumulated on account of rate of tax on inputs being higher than the rate of tax on output supplies (other than nil rated or fully exempt supplies), except supplies of goods or services or both as may be notified by the Government on the recommendations of the Council, the registered person could apply for refund.
O P Bagla & Co LLP
New Delhi
CA Inter
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Karia Overseas
Ahmedabad
CA
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