CS Executive · Tax Laws and Practice · Input Tax Credit and Computation of GST Liability
Under the CGST Act, 2017, ITC of integrated tax available in a registered person's electronic credit ledger must be utilised in which order?
IGST credit must first be used to pay IGST. Any balance can then be used for CGST and thereafter for SGST or UTGST, in that order. The taxpayer cannot choose the order freely, because section 49(5)(a) prescribes it.
- AFirst towards IGST, then CGST, then SGST/UTGSTCorrect
- BFirst towards CGST, then SGST/UTGST, then IGST
- CFirst towards SGST/UTGST, then CGST, then IGST
- DAt the taxpayer's choice among IGST, CGST and SGST in any order
Explanation
Section 49(5)(a) provides that IGST credit is first used for IGST, and any balance is used for CGST and then State/UT tax, in that order. The other options reverse or free the order, which the section does not allow.
Did you get it right without looking?
One question tells you little. A timed set on Input Tax Credit and Computation of GST Liability shows your real accuracy, how long you take and where you lose marks.
More Input Tax Credit and Computation of GST Liability questions
- Ashoka Builders Ltd, a registered real estate developer, buys cement and hires contractors to construct an office building on its own land. …
- Gupta Enterprises received an invoice dated 10 February 2025, which pertains to the financial year 2024-25. As per section 16(4) of the CGST…
- Mehta Industries claims depreciation under the Income-tax Act, 1961 on the full cost of a machine, including the GST of Rs 90,000 charged on…
- Section 49A of the CGST Act, 2017 begins with the words 'Notwithstanding anything contained in section 49'. What does this signify?
- A registered person uses ITC availed under the CGST Act to pay IGST dues in a valid return under section 39(1). What follows under Section 5…
- Sunrise Pharma Ltd uses a common input service for both taxable supplies and exempt supplies. The input tax on the service is ₹1,80,000. Und…