In re Indian Cotton Solutions.Com Private Limited (GST AAR Andhra Pradesh)
Whether they can utilize /refund the ITC which is readily available in GST Portal, for the vehicles purchased by them for the purpose of their core business activity?
It is submitted that the firm purchased five vehicles to use as mobile cotton labs, for the purpose of testing of quality of cotton. It is argued that. the business itself is testing and the lab (launched on vehicles) are to be considered as prime business components, without which there can not be any supply of services. Hence to be considered as eligible for ITC.
Input Tax Credit on the vehicles purchased by the applicant for the purpose of their business will fall under Sec.17(5). The text of Sec 17(5) is as under-
“Notwithstanding anything contained in sub-section (1) of section 16 and subsection (1) of section 18. input tax credit shall not be available in respect of the following, namely:— (a) motor vehicles and other conveyances except when they are used— (i) for making the following taxable supplies, namely:— (A) further supply of such vehicles or conveyances ; or (B) transportation of passengers: or (C) importing training on driving. flying, navigating such vehicles or conveyances; (ii) for transportation of goods”.
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