ITC Balance available in Electronic Credit Ledger for payment of GST Liability on Supply of Castor Oil Seeds can’t be utilised: AAR [Read Order]

ITC Balance- Electronic Credit Ledger - payment of GST liability - supply of Castor oil seeds - AAR - taxscan

The Gujarat Authority of Advance Ruling (AAR) ruled that the Input Tax Credit (ITC) balance available in the Electronic Credit Ledger for payment of GST liability on supply of Castor oil seeds can not be utilised.

The applicant M/s. Aristo Bullion submitted that they also intend to procure Castor oil seeds directly from the Agriculturists who produce the same in their farms and after procuring the said Castor oil seeds they intend to supply in the Domestic market as well as intend to export the same; that as per their understanding, as of now “Agriculturists” are not required to obtain registration under Section 23 of the CGST Act, 2017; that ‘Castor oil seeds’ is also not covered in the Notification No.4/2017-Central Tax issued under Section 9(4) of the CGST Act, 2017 as amended from time to time

The applicant has sought the advance ruling on the issue Can the applicant use Input Tax Credit Balance available in the Electronic Credit Ledger legitimately earned on the inputs/raw-materials/inward supplies(meant for outward supply of Bullions) towards the GST liability on ‘Castor Oil Seed’ which were procured from Agriculturists and subsequently meant for onward supply.

The coram of Sanjay Saxena and Mohit Aggarwal ruled that the applicant cannot use the Input Tax Credit Balance available in the Electronic Credit Ledger legitimately earned on the inputs/raw- materials/inward supplies(meant for outward supply of Bullions) towards the GST liability on ‘Castor Oil Seed’ which were procured from Agriculturists and subsequently meant for onward supply.

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