Page 11 - Ch_10 ITC

3 Payment made to travel agency for organizing a free vacation for it's best performance 35,000
awarded employees

4 Payment made for work contract service availed for the construction of pipe line to be 1,05,000
laid outside company's factory
You are required to determine the eligible ITC available to PQR Ltd. for the month of February, 20XX by
giving brief explanations for treatment of various items. Assume all the conditions necessary for availing

ITC have been fulfiled. [CA IPC Dec 21 Exam]
Answer:-
Computation of eligible ITC available to PQR Ltd. for February, 20XX:-

S.No. Particulars GST Explanation
1 Payment for fitness club Nil ITC is blocked u/s 17(5)(b) of CGST Act as said service
membership of employee is not provided by employer to employee under any
statutory obligation.
2 Payment for outdoor catering 55,000 ITC is allowed u/s 17(5)(b) of CGST Act as said service
service for canteen under is provided by employer to employee under a statutory
Factories, Act obligation.

3 Payment to travel agency for Nil ITC is blocked u/s 17(5)(b) of CGST Act as said service
free vacation of employees is not provided by employer to employee under any

statutory obligation.
4 Works contract service availed Nil ITC is blocked u/s 17(5)(c) of CGST Act on works
for construction of pipeline laid contract services for construction of immovable property
outside company's factory
except plant & machinery. Construction of pipeline laid
outside factory premises is excluded from plant & machinery.

Eligible ITC Available 55,000

CCP 09.03.16.00
A Ltd. procured the following goods in the month of December, 20XX:-
S.No. Particulars GST
1 Goods used in constructing an additional floor of office building 18,450
2 Goods given as free sample to prospective customers 15,000
3 Trucks used for transportation of inputs in the factory 11,000

4 Inputs used in trial runs 9,850
5 Confectionery items for consumption of employees working in the factory 3,250
6 Cement used for making foundation and structural support to plant and machinery 8,050

Compute the amount of ITC available with A Ltd. for the month of December, 20XX by giving necessary
explanations. Assume that all the other conditions necessary for availing ITC have been fulfilled. [CA
Inter July 21 Exam]
Answer:- Computation of amount of ITC available with A Ltd. for the month of December, 20XX:-

S.No. Particulars GST(`) Explanation
1 Goods used in constructing Nil ITC is blocked u/s 17(5) of CGST Act on goods received by a
an additional floor of office taxable person for construction of an immovable property on his
building own account even if it is used in the course or furtherance of
business & it is assumed that cost of construction of additional
floor is capitalized.

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