Under Section 16 CGST Act 2017, INPUT TAX CREDIT (ITC) is available subject to conditions including:
A(i) Receipt of GOODS/SERVICES; (ii) TAX INVOICE; (iii) Tax actually PAID by supplier; (iv) RETURN furnished; AND (v) within the time limit (earlier of 30 November of next FY or filing of annual return)
Bonly paid invoice (cf. CGST Act 2017, Section 16) (cf. CGST Act 2017, Section 16) (cf. CGST Act 2017, Section 16) (cf. CGST Act 2017, Section 16) (cf. CGST Act 2017, Section 16)
Cany voucher (cf. CGST Act 2017, Section 16) (cf. CGST Act 2017, Section 16) (cf. CGST Act 2017, Section 16) (cf. CGST Act 2017, Section 16) (cf. CGST Act 2017, Section 16)
Dsupplier discount (cf. CGST Act 2017, Section 16) (cf. CGST Act 2017, Section 16) (cf. CGST Act 2017, Section 16) (cf. CGST Act 2017, Section 16) (cf. CGST Act 2017, Section 16)
Answer & Solution
Correct answer: A. (i) Receipt of GOODS/SERVICES; (ii) TAX INVOICE; (iii) Tax actually PAID by supplier; (iv) RETURN furnished; AND (v) within the time limit (earlier of 30 November of next FY or filing of annual return)
1. Section 16 CGST Act 2017 prescribes ELIGIBILITY AND CONDITIONS for INPUT TAX CREDIT (ITC):
2. CONDITIONS:
3. (a) Recipient must POSSESS a TAX INVOICE / debit note;
4. (b) Recipient must have RECEIVED the goods or services;
5. (c) TAX must have actually been PAID by supplier to Government;
6. (d) Recipient must have FURNISHED RETURN under Section 39;
7. (e) Payment must be made to supplier within 180 DAYS of invoice (otherwise ITC reversed);
8. (f) ITC must be claimed within TIME LIMIT — earlier of 30 November of next FY or filing of annual return.
9. INELIGIBLE ITC (Section 17(5)): motor vehicles, food/beverages, life insurance, gym/health, civil construction, etc.
10. Hence option B is correct.
_Source: CS Executive Paper 4 Tax Laws (ICSI BoS) + Income Tax Act 1961 + CGST Act 2017 — CGST Act 2017, Section 16_
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