SECTION 17(5) OF CGST ACT , BLOCKED CREDIT UNDER GST

ITC will not be available in respect of the following:

  1. Motor vehicles and other conveyances

EXCEPTIONS

  • for transporting the goods (e.g. GTA)
  • for making the following taxable supplies, namely:
    • further supplying such vehicles or conveyances (e.g. Maruti dealers)
    • Transporting the passengers (e.g. OLA)
    • imparting training on driving, flying such vehicles or conveyances (e.g. Driving Trainers)

2. The following supply of goods or services or both—

i). food and beverages, beauty treatment, cosmetic and plastic surgery, health services, outdoor catering

EXCEPTIONS

Where an inward supply of goods or services or both of a particular category is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as an element of a taxable composite or mixed supply;

ii). Membership of a club, health and fitness centre;

iii).Rent-a-cab, life insurance and health insurance

EXCEPTIONS:

  • The Government notifies the services which are obligatory for an employer to provide to its employees under any law for the time being in force (e.g. call centers)
  • Such inward supply of goods or services or both of particular categories is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as part of a taxable composite or mixed supply (e.g. UBER)

iv). Travel benefits extended to employees on vacation such as leave or home travel concession

3. Works contract services

when supplied for construction of immovable property (other than plant and machinery)

EXCEPTIONS:

Where it is an input service for the further supply of works contract service;

4. Goods or services or both received by a taxable person for construction of immovable property (other than plant or machinery) on his own account including when such goods or services or both are used in the course or furtherance of business.

NOTE: Construction includes reconstruction, renovation, addition, alteration or repair to the extent of capitalisation

5. Goods or services or both on which tax has been paid under section 10

6. Goods or services or both used for personal consumption

7.Goods

  • Lost or
  • Destroyed or
  • Stolen or
  • written off or
  • Disposed off or
  • By way of Gift or Free Samples

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