Rules Rule 38 of CGST Rules i.e Claim of credit by a banking company or a financial institution i.e. 50% Input for NBFCs and Banks

Financial Year: 2017

Rule 38 of CGST Rules 2017

 

Claim of credit by a banking company or a financial institution

 

 

 

A banking company or a financial institution,

including a non-banking financial company,

engaged in the supply of services

by way of accepting deposits

or extending loans or advances

 

that chooses not to comply with the provisions of sub-section (2) of section 17

in accordance with the option permitted under sub-section (4) of that section,

shall follow the following procedure, namely,-

 

 

(a) the said company or institution shall not avail the credit of,

 

(i) the tax paid on inputs and input services that are used for non-business purposes; and

 

(ii) the credit attributable to the supplies specified in sub-section (5) of section 17, in FORM GSTR-2;

 

 

(b) the said company or institution

shall avail the credit of tax paid on inputs and input services

referred to in the second proviso to sub-section (4) of section 17 and not covered under clause (a)

 

(c) fifty per cent of the remaining amount of input tax

shall be the input tax credit admissible to the company or the institution and

shall be furnished in FORM GSTR-2;

 

(d) the amount referred to in clauses (b) and (c) shall,

subject to the provisions of sections 41, 42 and 43,

be credited to the electronic credit ledger of the said company or the institution.

 

 

Thanks

CA Rahul Gupta