Input tax Credit u/s 17(5) Allowed or Not of Contractor

ITC / Input 304 views 2 replies

sagar jain

article

80 Points Joined December 2012

If Mr. A is a Contractor and Mr.A also doing Sub contract work to Mr. B in this case Construction Service provide by Mr. A and Some material and other items purchased by Mr.A,in this case whether Mr.A is allowable or not Gst input tax credit under section 17(5) of GST Act,2017

Whether same situation is applied on Subcontractor Mr.B and some material and items are purchased so Mr. B is allowable or not Gst input tax credit under section 17(5) of GST Act,2017

Please Suggest me with proper notification and guidlines.

Thanks

Replies (2)

sujith kumar dasa

banglore

1496 Points Joined June 2012

Extract if sec 17(5)

(c) works contract services when supplied for construction of an immovable
property (other than plant and machinery) except where it is an input service for further
supply of works contract service;
(d) goods or services or both received by a taxable person for construction of an
immovable property (other than plant or machinery) on his own account including
when such goods or services or both are used in the course or furtherance of business.
Explanation.––For the purposes of clauses (c) and (d), the expression
“construction” includes re-construction, renovation, additions or alterations or repairs,
to the extent of capitalisation, to the said immovable property;

As per above extract of sec 17(5) if you are in further supply of works contract service then you are eligible for input credit of construction service