GST ITC Available On Trading Of Meat Products, Packed Cold Cuts Spices, Masala Powder: Karnataka AAR

The Karnataka Authority for Advance Ruling (AAR) has ruled that the GST Input Tax Credit (ITC) is available for the trading of meat products, packed cold cuts, spices, and masala powder.

The two-member bench of M.P. Ravi Prasad and Kiran Reddy T. has observed that input tax credit has to be availed of in terms of sections 16 and 17 of the CGST Act 2017 read with Rule 42 of the CGST Rules 2017.

The applicant is in the business of trading in fresh and semi-processed meat products like chicken, mutton, fish, pork, all types of packed cold cuts, spices, masala powder, etc. They were trading in both taxable and exempted goods. The percentage of exempt goods traded is around 90%, and the remaining 10% are taxable goods.

The applicant sought an advance ruling on the issue in respect of the percentage of GST input tax that should be claimed for the nature of business for services received from the service providers.

The AAR has held that since the applicant is involved in the supply of both taxable and exempt supplies, the applicant has to avail of the input tax credit proportionately in terms of sections 16 and 17 of the CGST Act 2017 read with Rule 42 of the CGST Rules 2017.

Provisions under Section 16 of the Central Goods and Services Tax (CGST) Act, 2017 relating to the "Eligibility and Conditions for Taking Input Tax Credit (ITC)".

Section 17 of the Central Goods and Services Act, 2017 (CGST Act) deals with the apportionment of credit and blocked credits.

Applicant’s Name: Meat Mart Unit of the New Bangalore Ham Shop

Date: 23-01-2023

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