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TMI Blog2018 (7) TMI 881X X X X Extracts X X X X X X X X Extracts X X X X ..... TC shall also be reversed in the electronic ledger of the same month - If the applicant supplies seeds (exempted item) in packaged form using such packing materials (taxable item), to its own branches in other States, then no ITC could be claimed on the packaging material used for the said exempted supply of seeds. Whereas, if the applicant supplies only packing material to own branches in other States, then the ITC involved in purchase of such packing material could be availed as per section 17(2) of CGGST Act, 2017. Ruling:- The applicant is not entitled to ITC on the packing material used for packaging seeds, while making such exempted supply of seeds to their own branches and to other purchasers. They are however, entitled for ITC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aging materials/commodities etc. which are required for processing and packing of seeds. III. They also use to transfer aforesaid taxable inputs like packaging materials and other consumables from one branch to another and from one processing unit to another. 3. Contention of the applicant:- I. The applicant wants to use Input Tax Credit (ITC) on the aforesaid purchased packaging materials and keep credit till they are in their stock. II. The applicant transfers aforesaid taxable inputs within its own branches situated in various States across India and are required to pay GST merely for these inter-branch transfers. It was thus their contention that they are liable for multiple tax which is against the core principles of GST. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eof, which are naturally bundled and supplied in conjunction with each other in the ordinary course of business, one of which is a principal supply; Illustration.- Where goods are packed and transported with insurance, the supply of goods, packing materials, transport and insurance is a composite supply and supply of goods is a principal supply; ii U/s. 8 of CGGST Act, 2017:- Tax liability on composite and mixed supplies. The Tax Liability on a composite or a mixed supply shall be determined in the following manner, namely:- (a) a composite supply comprising two or more supplies, one of which is a principal supply, shall be treated as a supply of such principal supply. (b) a mixed supply........... Iii U/s. 16( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or effecting taxable supplies including zero-rated supplies under this Act or under the Integrated Goods and Services Tax Act and partly for effecting exempt supplies under the said Acts, the amount of credit shall be restricted to so much of the input tax as is attributable to the said taxable supplies including zero-rated supplies. 5.2 As per the above stipulated provisions of section 17(2) of CGGST Act, 2017 any registered recipient can claim ITC to the extent of taxable stock or taxable outward supply shown in their returns. The registered recipient cannot claim ITC on the amount of taxable supply component included in the total amount of exempted supply. The amount of unclaimed ITC shall also be reversed in the electronic ledger of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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