DEAR SIR I RUNNING A GAS DISTRIBUTION AGENCY (HP GAS FOR HOME CONSUMPTION) AND I HAVE PURCHASED AUTO TROLLY FOR TRANSPORTION OF GAS CYLINDERS TO CUSTOMERS. WHETHER I AM ELIGIBLE TO CLAIM ITC OR THERE IS ANY RESTRICTIONS ON APPROVED CAPACITY LIMIT. PLEASE GUIDE US

Reply—As per Section 16(1), ITC can be availed on goods and services which are used in the course of furtherance of business. Since the words ‘goods’ have been used, it implies that goods includes 'Capital goods' and ‘inputs’.  ITC is available on purchase of Capital goods in one time.

 However section 17(5) of CGST Act, 2017, restrict Input tax credit on few goods and services.

A taxpayer can claim ITC on Motor Vehicle when used for Transportation of goods. Restriction on taking ITC is on Passenger vehicle, kindly refer section 17(5)(a) of CGST Act.