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ITC on tax paid under Sec 74 (suppression-related), Sec 129 (detention), Sec 130 (confiscation):
AAvailable as input credit
BAvailable only with CBIC permission
CBLOCKED under Sec 17(5)(i)
DAvailable after appeal
Answer & Solution
Correct answer: C. BLOCKED under Sec 17(5)(i)
1. Sec 17(5)(i) blocks ITC on tax paid in accordance with Sec 74 (fraud-related demand), Sec 129 (penalties for detention/seizure) and Sec 130 (confiscation).
2. Such payments are penal in nature; credit on them would defeat the deterrent.
3. Note Sec 74 has been replaced w.e.f. 01.11.2024 by Sec 74A — block continues.
_Source: ICAI BoS CA Final Paper 8, Ch 6 "Input Tax Credit", §Sec 17(5)(i)_
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