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Input Tax Credit in special circumstances

Section 18(1) of CGST Act, 2017

a) A person who has applied for registration under this Act within thirty days from the date on which he becomes liable to registration and has been granted such registration shall be entitled to take credit of input tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock on the day immediately preceding the date from which he becomes liable to pay tax under the provisions of this Act;

b) A person who takes registration under sub-section (3) of section 25 shall be entitled to take credit of input tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock on the day immediately preceding the date of grant of registration;

(c) where any registered person ceases to pay tax under section 10, he shall be entitled to take credit of input tax in respect of inputs held in stock, inputs contained in semi-finished or finished goods held in stock and on capital goods on the day immediately preceding the date from which he becomes liable to pay tax under section 9:


The credit on capital goods shall be reduced by such percentage points as may be prescribed (i.e. 5% points per quarter of a year or part thereof from the date of the invoice or such other documents on which the capital goods were received by the taxable person).

d) where an exempt supply of goods or services or both by a registered person
becomes a taxable supply, such person shall be entitled to take credit of input tax in
respect of inputs held in stock and inputs contained in semi-finished or finished goods
held in stock relatable to such exempt supply and on capital goods exclusively used
for such exempt supply on the day immediately preceding the date from which such
supply becomes taxable

The credit on capital goods shall be reduced by such percentage points as may be prescribed (i.e. 5% points per quarter of a year or part thereof from the date of the invoice or such other documents on which the capital goods were received by the taxable person).

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