Whether the Input Tax
Credit of Central Tax Paid in Haryana be Available to the Applicant who is
Registered in Rajasthan State?
To this end, we need
to examine the ITC provisions of the CGST Act, Relevant Section is reproduced
here:
Section 16(1):-
Ø Every
registered person shall, subject to such conditions and restrictions as
may be prescribed and in the manner
specified in section 49, be entitled
to take credit of input tax charged on any supply of goods or
services or both to him which are used or intended to be used in the course or
furtherance of his business and the said amount shall be credited to the
electronic credit ledger of such person.
Ø After
going through the Section 16(1) above, which allows credit of input tax to a
registered person, subject to conditions and restrictions, it is necessary to know what Input Tax is. The term input tax has
been defined in Section 2(62) which is also being reproduced for sake of convenience
Section 2(62)
Ø “Input Tax” in relation to a registered
person, means the central tax, State
tax, integrated tax or Union territory tax charged on any supply of goods or
services or both made to him and includes—
·
On perusal of the Section 2(62) as
reproduced above, it becomes clear that the input tax inter alia is Central Tax charged on inward supply of a
registered person.
Central Goods and Services Tax (Central GST) levied
under Section 9.
·
After going through the Section 9,
we find that Section 9(1) is relevant to the instant matter. So we are
reproducing the provisions of Section 9(1) of CGST Act for the sake of convenience
Section 9(1)
Ø Subject to the provisions of
sub-section (2), there shall be levied a tax called the central goods and services tax on all intra-State
supplies of goods or services or both, except on the supply of
alcoholic liquor for human consumption, on the value determined under section
15 and at such rates, not exceeding twenty per cent., as may be notified by the
Government on the recommendations of the Council and collected in such manner
as may be prescribed and shall be paid by the taxable person.
Ø Going through the above Section 9(1), we come across a phrase “Intra-State
Supplies of Goods
or Services”. Section
8(2) of the
Integrated GST Act, 2017 define “intra-state supplies of Services’. This
Section is being reproduced for the sake of convenience
Section 8(2)
Ø Subject
to the provisions of section 12, supply of services where the location of the
supplier and the place of supply of services are in the same State or same
Union territory shall be treated as intra-State supply:
Ø Provided
that the intra-State supply of services shall not include supply of services to
or by a Special Economic Zone developer or a Special Economic Zone unit.
CONCLUSIONS
Ø From
above we find that credit of input taxis
admissible to a registered person, subject to conditions and
restrictions, and input tax
inter alia is Central tax
charged on inward supply of a registered person.
Ø Going further, Central taxis Central GST levied under Section 9
of the
CGST Act. After going through the Section 9(1) above, we find that
the Central GST is
a tax levied on all intra-state supplies of goods or services both
Ø Going
ahead, Intra-state supply of service,
as per Section 8(2) of the Integrated Tax Act, 2017 means supply of services
where the location of the supplier and place of supply of services are in the same state.
Ø Thus
crux of the matter is that for a person registered in Rajasthan, Central GST or Central taxis a tax
levied under Section 9 ibid on supplies
having both location of the supplier and place of supply in Rajasthan.
At this point it becomes absolutely clear that ITC of the Central
GST or Central tax would be available to a person registered in Rajasthan if
the location of the supplier and place of supply of the services are in Rajasthan
In other words, ITC of the
Central tax charged in Haryana is not available as in this case both the
location of the supplier and the place of supply of the services are in the
State of Haryana.
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