Mutual Fund Redemption Treated as Sale; ITC Reversal Rules Apply: AAAR Gujarat

In re Zydus Lifesciences Ltd (GST AAAR Gujarat)  The Appellate Authority for Advance Ruling (AAAR), Gujarat, recently delivered its decision in In re Zydus Lifesciences Ltd., upholding the ruling of the Gujarat Authority for Advance Ruling (GAAR) on the issue of input tax credit (ITC) availability in respect of common inputs and input services used for subscription and redemption of mutual fund units. Zydus Lifesciences Ltd., a pharmaceutical manufacturer, utilized surplus funds for investment in mutual fund schemes. The company redeemed such investments whenever liquidity was required. While...