TAKING INPUT TAX CREDIT ON GOODS PURCHASED FOR EXPORT UNDER LUT
WE ARE TRADER OF CHEMICALS. WE PURCHASE MATERIAL WITHIN INDIA AND SALE THEM MAINLY IN INDIA. IN SOME CASES WE EXPORT TO BANGLADESH. WE EXPORT WITHOUT PAYMENT OF IGST UNDER LUT. CAN WE TAKE INPUT CREDIT ON GOODS PURCHASED FOR EXPORT INSTEAD OF APPLYING TO DEPPT FOR REFUND OF SUCH INPUT GST? PLEASE ADVISE
Yes. You should take credit irrespective of whether you are applying for refund or not. If you think that balance of credit amount showing in credit ledger will be utilized in near future and refund amount is not a huge amount then it is not necessary that you have to apply for refund.
Application of refund is made so that ITC (availed on purchases which are exported)can be taken back and there will not excess amount in our credit ledger.