9911796707
TMI BlogClarification on availability of input tax credit as per clause (b) of sub-section (2) of section 16 of the West Bengal Goods and Services Tax Act, 2017 in respect of goods which have been delivered by the supplier at his place of business under Ex-Works Contract.X X X X Extracts X X X X X X X X Extracts X X X X ..... ered by the supplier at his place of business under Ex-Works Contract. Reference has been received from automobile sector seeking clarification on availability of input tax credit (hereinafter referred to as "ITC") as per clause (b) of sub-section (2) of section 16 of the West Bengal Goods and Services Tax Act, 2017 (hereinafter referred to as the "WBGST Act") in respect of goods which have been delivered by the supplier at his place of business under Ex-Works Contract. 1.2 It has been stated that in automobile sector, the contract between the automobile dealers and the Original Equipment Manufacturers (OEMs) is generally an Ex-Works (EXW) contract, and as per the terms of the contract, the property in goods (i.e. vehicles) passes to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vices or both. One of the conditions as per clause (b) of the said sub-section (reproduced below) is that a registered person is not entitled to claim ITC in respect of any supply of goods or services or both unless he has "received" the said goods or services or both. The Explanation to the said clause provides for deemed receipt of goods and services in certain scenarios. "Section 16. Eligibility and conditions for taking input tax credit. … (2) Notwithstanding anything contained in this section, no registered person shall be entitled to the credit of any input tax in respect of any supply of goods or services or both to him unless, - ... (b) he has received the goods or services or both. Explanation.- For the purposes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... direction of such registered person, whether acting as an agent or otherwise; b) such direction may be given before or during movement of goods; and c) the goods may be delivered either by way of transfer of documents of title to goods or otherwise. 3.2.1 The said Explanation provides that where goods are delivered by the supplier to any other person, whether acting as an agent or not, upon the direction of the registered person, and where such delivery occurs either through transfer of documents of title to goods or otherwise, the registered person is deemed to have "received" such goods for the purpose of the clause (b) of sub-section (2) of section 16 of the WBGST Act. Accordingly, in cases where goods are delivered by the supplier ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such handing over of the goods by the supplier to the transporter, at his factory gate, for their onward transmission to the said registered person (the dealer). 3.4 The same principle is applicable in respect of supply of other goods also where the contract between the supplier and recipient is an EXW contract, and as per terms of the contract, the goods are to be delivered by the supplier to the recipient, or to any other person (including a transporter) on behalf of the recipient, at his (supplier's) place of business and the property in the goods stands transferred to the recipient at the time of such handing over. In such cases, the said goods can be construed to have been "received" by the said recipient at the time of handing over ..... X X X X Extracts X X X X X X X X Extracts X X X X
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