Question ID :
31673
Input tax credit
As per GST Act input credit can be taken only when goodsservices are “received”.
Does it mean for payment towards AMC for 12 Months, one has to take credit 112th every month since service is not “received” for unexpired period of AMC.
Posted by
Ethirajan
on
Jun 04, 2018
Filed Under
GST
The first proviso to sb-section 2 of Section 16 of CGST Act 2017 restricts registered person to avail ITC if goods are received in lots or instalments.
however AMC is a contract agreed for providing services for the future period and in my opinion the restriction of above provision is not applicable.
Experts may give their opinion if I am wrong.
Thanks
Posted by
CA. LONIKAR SHASHIKANT ACHYUTR on
Jun 05, 2018
Answer ID :
69796
As per my opinion, section 16(2)(b) covers both goods and services, since services are also covered, recipient should actually have received the service so as to claim the ITC on the said service.
Posted by
RAHUL RUSTAGI on
Jun 19, 2018
Answer ID :
69797
And it goes in line with accounting as well. Pre-paid expenses should be recognised (on monthly basis) indicating that services are not yet received for next 11 months. Similarly, ITC on pre-paid expenses should not be claimed for those 11 months. Views of experts are most welcomed
Posted by
RAHUL RUSTAGI on
Jun 20, 2018