26 December 2019
Dear Sir, We are in construction business (mainly government contract like road). Purchased commercial vehicle i.e.JCB machine & Roller and these are used exclusively at construction site. I am going to Section 17 (5) of CGST containing blocked credit and having doubt availability if ITC on: 1) Purchase of commercial vehicle JCB/Roller 2) Expenditure incurred on theses commercial vehicle like Servicing & Insurance. It would be great help to me if you can provide notification in support your expert advice. Thanks a Lot
26 December 2019
Sec. 17(5) says that ITC in respect of motor vehicle used for transportation of passengers and ITC on vessels and aircrafts shall not be available except in certain cases. So, ITC on motor vehicles which are used for transportation of goods is nowhere restricted under sec. 17(5).
In your case, as the vehicles mentioned above are mainly used for transportation of goods at site, the credit on the same is eligible. Further, the credit on insurance, repair and maintenance on motor vehicle used for transportation of goods is nowhere restricted. What is restricted is the insurance services, repairs etc., on the motor vehicles referrred to in clause (a) or (aa) ie., motor vehicles used for transportation of passengers, vessels and aircrafts.
26 December 2019
Sec. 17(5) says that ITC in respect of motor vehicle used for transportation of passengers and ITC on vessels and aircrafts shall not be available except in certain cases. So, ITC on motor vehicles which are used for transportation of goods is nowhere restricted under sec. 17(5).
In your case, as the vehicles mentioned above are mainly used for transportation of goods at site, the credit on the same is eligible. Further, the credit on insurance, repair and maintenance on motor vehicle used for transportation of goods is nowhere restricted. What is restricted is the insurance services, repairs etc., on the motor vehicles referrred to in clause (a) or (aa) ie., motor vehicles used for transportation of passengers, vessels and aircrafts.
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