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TMI BlogITC Reversal as per Rule 42X X X X Extracts X X X X X X X X Extracts X X X X ..... If more than one business vertical are under same GSTIN itself, while applying Rule 42 for ITC Reversal- Total Turnover of entire GSTIN to be taken or same can be split into segment wise also ? For ex:- Say, under one GSTIN there exists three Business Vertical - Hotel, Courier Plastic. Hotel vertical has taxable and exempt supplies to calculate ITC Reversal for common input credit can we us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the following Common ITC (of Hotel Vertical) * Exempted Supply in Hotel Vertical ---------------------------------------------------------------------------------------------- Total Supply of Hotel Vertical Or We have to consider the Total supply of all vertical (for the denominator) Experts advice Please. - Reply By Ganeshan Kalyani - The Reply = first you have arrive at ITC a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ttributable to hotel vertical from total ITC. then from the ITC of hotel you have to apply the formula which you have mentioned in your query. - Reply By LAKSHMINARAYANAN TR - The Reply = Dear Sir, Let me reiterate with clear examples. All the verticals are registered under the one GSTIN only. Say turnover of each vertical is ₹ 10L each. Total Sales ₹ 30L. Plastic unit is full ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y exempt. No ITC availed all inputs and input services of Plastic Unit. Hotel Unit - Say Taxable is ₹ 7L and exempt is ₹ 3L. Common Credit ₹ 10000. Courier Unit - Fully Taxable services. ₹ 10L Now to apply Rule 42 on ₹ 10000/- which formula is correct ? 10000 * 3L/10L = ₹ 3000/- + 500 (5% of 10000) OR 10000*13L/30L = ₹ 4333/- + 500 Expert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s advice please. - Reply By Ganeshan Kalyani - The Reply = turnover of plastic, hotel and courier division put together is ₹ 30 lacs. total common input tax credit is ₹ 10 thoudand. formula 10,000 x 10 lacs 30 lacs = ₹ 3,333/- ( it means out of common credit of ₹ 10 thousand , ₹ 3,333/- is attributable to each division say, plastic, hotel and courier ͅ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7; 3,333/- of plastic division is ineligible credit. ₹ 3,333/- of courier division is fully creditable . ₹ 3,333/- of hotel division need further birfucate into tax attributable to taxable product and exempt product. Formula : 3,333 x 7 lacs 10 lacs = 2,333. Here, ₹ 2,333/- is eligible credit. hope your query is resolved from above example. - ITC Reversal as per Rule 42 - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Query Started By: - LAKSHMINARAYANAN TR Dated:- 1-3-2018 Goods and Services Tax - GST - Got 3 Replies - GST - Discussion Forum - Knowledge Sharing, reply post by an expert, personal opinion Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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