points claiming ITC of GST registration on goods


One of the primary complicated problems that have caused extreme uncertainty for a standard taxpayer is of claiming the refunds of IGST. That has incurred on the exports of the products. Most of those IGST refunds are in relation with the period surpassing one year since the presentation of the GST registration in India.

  • In this context, the CBIC had passed the CGST (12th Amendment) Rules 2018 as to create the method of the IGST refunds much easier. Consequently, the CGST Rule 96(10) has currently been amended to enable the exporters to assert the refund the IGST paid. That they’ve paid on the exports of capital goods procured by them below the Export Promotion Capital assets (EPCG) theme.
  • However, everybody is aware of that claiming a refund of IGST by a business person. That have a GST registration isn’t that easy. Especially, if that relates to the capital assets, one has to take of bound parameters.
  • In this article, you may able to comprehense the key aspects to be thought-about. While claiming the input credit of the GST paid for capital goods.

What are those factors we would like to think about while claiming the input of the GST registration paid on capital goods? 

  1. In GST, input credit will claim on the capital goods. Only if depreciation of tax element hadn’t claimed. This implies if the depreciation has availed on an asset. Then the input can’t claim in any respect.
  2. The Input Tax credit (ITC) on the capital assets will claim totally with the merchant. Who is having a GST registration only if those capital goods had used any just for the provision of GST taxable assets or services. That means, if machinery bought for processing milk. Then the input can’t avail thereon as milk is out of GST reach.
  3. Input Credit of capital goods shall restrain entirely. If the capital assets had used just for producing, marketing. It offers exempt goods or services. It shall restrict if the asset bought for private use.
  4. Just in case an asset employed partly for taxable supplies and rest for exempted provides. And then the input credit associated with the actual month. That relates to exempt supplies shall reverse on a good turnover basis.


Here, the useful life of the asset had taken into account five years. Hence, the credit associated with a selected month shall determine with dividing total ITC quantity of the particular asset with sixty months (i.e. 5 years). So, the credit relating with exempt provides shall reverse in proportion with the exempt turnover of the month. This could explaine as below-

  • Credit owing to a month = Total input availed on the asset/60
  • Credit owing to exempt supplies = (Te X Exempt turnover within the month)/Aggregate turnover of the month

Therefore, the They shall reverse with interest.

  1. Credit of the capital goods lost, stolen, damaged, written off or disposed of as present or free samples, or used for private use shall not claime.

These are some of the important things. Every trader having GST registration has take care of while claiming input of GST.

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