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All QuestionsCategory: GST CompliancesITC for Works Contractors
Profile photo of Vikas SinhaVikas Sinha asked 2 months ago

ITC for Works Contractors

If any works contractor purchased cement, bricks, steel bars for completion of construction of a building for which he got contract from a Company then will the GST paid while purchasing those raw material be available as ITC or NOT? if not then how should he charge bill to company for the work and avoid double taxation.. 

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4 Answers
Profile photo of Deepak Bholusaria, CADeepak Bholusaria, CA Staff answered 2 months ago

Yes, contractor will get credit. 

Profile photo of Vikas SinhaVikas Sinha answered 2 months ago

But it is stated in GST law that There is no ITC available to works contractor so please explain

Profile photo of Sachin AgrahariSachin Agrahari Staff answered 2 months ago

Dear Sir,
As per Provisions of Section 17(5)(c) of CGST Act, 2017 is as:
             (c) works contract services when supplied for construction of an immovable property (other than plant and                                machinery) except where it is an input service for further supply of works contract service;
It means ITC will not available to builder because it is not an input service for further supply of works contract service but for a work contractor it is an input service for further supply of works contract service so he will be eligible to claim ITC.
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Profile photo of Pranita GuptaPranita Gupta Staff answered 2 months ago

Yes, the contractor will be eligible for claiming credit since he is engaged in further supply of Works Contract Service.