INPUT TAX CREDIT NOT ALLOWED UNDER GST

Section 17 (5) – Negative List of ITC

(a) Motor vehicles & conveyances

Exception are :-
 For further supply of such vehicles or conveyances
 Transportation of passengers
 Motor Driving school
 Transportation of goods (eg. GTA paying GST @12%)

(b) Food and beverages, Outdoor catering, Beauty treatment, Health services and Cosmetic and plastic surgery

Exception are :-
 If the category of inward and outward supply is
– same or
– belongs to a mixed or composite supply.

(c) Membership of a club, health and fitness centre

(d) Rent-a-cab, Life insurance, Health insurance and Travel benefits extended to employees on vacation(ITC will be allowed for travel for business purposes)

Exception are :-
 Services which are obligatory for an employer to provide to its employees
 If the category of inward and outward supply is
– same or
– belongs to a mixed or composite supply.

(e) Works contract services when supplied for construction of an immovable property

Exception are :-
 Plant or Machinery
 For further supply of works contract service

(f) Goods or services for construction of an immovable property
– on his own account or
– for used in the course or furtherance of business (i.e capitalized in books)

Exception are :-
 Plant or Machinery (Eg. ITC is available on inputs used to manufacture P&M)

(g) Goods or services on which tax has been paid under Composition Scheme

(h) Goods or services received by a nonresident

Exception are :-
 Goods imported by him (i.e. IGST paid on Import of goods)

(g) Goods or services used for personal consumption

(h) Goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples

(i) Any tax paid in accordance with sections 74, 129 and 130 (Fraud Cases)