Clarification in respect of utilization of input tax credit under GST.

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..... Nurpur and Una, H.P 4. The Asstt. Commissioner of State Taxes and Excise, Incharge Distt. Kinnour, H.P Dated Shimla-9 2nd Aug., 2019 Madam/Sir, Subject: Clarification in respect of utilization of input tax credit under GST. Section 49 was amended and Section 49A and Section 49B were inserted vide Himachal Pradesh Goods and Services Tax (Amendment) Act, 2018 [hereinafter referred to as the HPGST (Amendment) Act]. The amended provisions came into effect from 1st February 2019. 2. Various doubts have been raised by trade and industry regarding challenges being faced by taxpayers due to bringing into force of section 49A of the Himachal Pradesh Goods and Services Tax Act, 2017 (hereinafter referred to as the HPGST Ac .....

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..... entral tax) remains un-utilized in electronic credit ledger. 4. The newly inserted rule 88A in the HPGST Rules allows utilization of input tax credit of Integrated tax towards the payment of Central tax and State tax, or as the case may be, Union territory tax, in any order subject to the condition that the entire input tax credit on account of Integrated tax is completely exhausted first before the input tax credit on account of Central tax or State / Union territory tax can be utilized. It is clarified that after the insertion of the said rule, the order of utilization of input tax credit will be as per the order (of numerals) given below: Input tax Credit on account of Output liability on account .....

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..... Central tax Discharge of output liability on account of State tax / Union Territory tax Balance of Input Tax Credit Integrated tax 1000 200 100 0 Input tax Credit on account of Integrated tax has been completely exhausted Central tax 0 100 - 100 State tax / Union territory tax 0 - 200 0 Total 1000 300 300 100 Option 2 .....

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