Sec 17(5)(b) — ITC is BLOCKED on:
AFood and beverages, outdoor catering, beauty treatment, health services, cosmetic surgery — except when used for further supply of such services
BAll staff welfare expenses without exception
CAll accommodation services
DOffice stationery
Answer & Solution
Correct answer: A. Food and beverages, outdoor catering, beauty treatment, health services, cosmetic surgery — except when used for further supply of such services
1. Sec 17(5)(b) blocks ITC on food & beverages, outdoor catering, beauty treatment, health services, cosmetic & plastic surgery, membership of club/health/fitness centre, life insurance and health insurance, leave/home travel concession for employees.
2. Exception: when used for further supply of such services (e.g. a restaurant buying food ingredients), or when notified.
3. Exception: when obligated under any law for the time being in force (e.g. mandatory canteen under Factories Act).
_Source: ICAI BoS CA Final Paper 8, Ch 6 "Input Tax Credit", §Sec 17(5)(b)_
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