A registered Second hand dealer (A) purchses good from another registered dealer (B) under marginal tax scheme of gst, can A avail the ITC fully on the purchases made from B? please give us the overview in Marginal Scheme of GST for second hand dealers.

Reply—As per Rule 32(5) of the CGST Rules, 2017, where a taxable supply is provided by a person dealing in buying and selling of second hand goods i.e., used goods as such or after such minor processing which does not change the nature of the goods and where no input tax credit has been availed on the purchase of such goods, the value of supply shall be the difference between the selling price and the purchase price and where the value of such supply is negative, it shall be ignored.

A second hand dealer is not eligible to claim ITC on purchase of goods.