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CS Professional · Goods and Services Tax (GST) and Corporate Tax Planning · Input Tax Credit and Computation of GST Liability

Under Section 41 of the CGST Act, 2017 (as substituted w.e.f. 1 October 2022), a registered person is entitled to avail credit of eligible input tax in which manner?

Eligible input tax credit is availed as self-assessed by the registered person in his return, and the amount is credited to his electronic credit ledger, subject to prescribed conditions and restrictions. No prior officer approval is needed under Section 41(1).

  1. AAs self-assessed, in his return, with the amount credited to his electronic credit ledgerCorrect
  2. BOnly after the jurisdictional officer verifies each invoice and approves the credit
  3. COnly on the basis of the auto-populated figure, with no self-assessment allowed
  4. DOnly after the supplier files an annual return covering the supply

Explanation

Section 41(1) lets every registered person, subject to prescribed conditions and restrictions, avail eligible input tax credit as self-assessed in his return, and the amount is credited to the electronic credit ledger. No officer approval or supplier annual return is required by this sub-section.

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