Gehna Ltd. of Jodhpur (Rajasthan) is a registered manufacturer of cosmetic products. Gehna Ltd. has furnished following details for a tax period:…

Computation of ITC available with Gehna Ltd. S. No. Particulars Eligible input tax credit CGST (₹) SGST (₹) IGST (₹) 1. Raw Material Purchased from local registered suppliers [Note 1(i)] (₹ 1,06,250 x 9%) 9,562.50 9,562.50 Purchased from local unregistered suppliers [Note 1(ii)] Nil Nil Purchased from Punjab from registered supplier [Note 1(i)] (₹ 1,00,000 x 18%) 18,000 Raw material imported from USA [Note 1(iii)] 22,732 2. Consumables [Note 2] (₹ 1,56,250-31,250) x 9%] 11,250 11,250 3. Monthly rent for the factory building to the owner in Rajasthan [Note 3] 9,000 9,000 4. Salary paid to employees on rolls [Note 4] Nil Nil Nil 5. Premium paid on life insurance policies taken for specified employees [Note 5] (₹ 2,00,000 x 9%) 18,000 18,000 - Total 47,812.50 47,812.50 40,732 Add: Opening balance of ITC 20,000 15,000 15,000 Total ITC [Note 7] 67,812.50 62,812.50 55,732 Computation of net GST payable Particulars CGST (₹) SGST (₹) IGST (₹) Intra-State supply 78,750 78,750 Inter-State supply 67,500 Exports under LUT [Note 6] Nil Nil Nil Total output tax liability 78,750 78,750 67,500 Less: ITC 67,812.50 62,812.50 55,732 Net GST payable (rounded off) 10,938 15,938 11,768 Notes: (i) Credit of input tax (CGST & SGST/ IGST) paid on raw materials used in the course or furtherance of business is available. (ii) Tax on procurements made by a registered person from an unregistered supplier is levied only in case of notified goods and services. Therefore, since no GST is paid on such raw material purchased, there does not arise any question of ITC on such raw material. (iii) IGST paid on imported goods qualifies as input tax. Therefore, credit of IGST paid on imported raw materials used in the course or furtherance of business is available. ITC on consumables, being inputs used in the course or furtherance of business, is available. However, since levy of GST on high speed diesel has been deferred till a date to be notified by Government, there cannot be any ITC of the same. ITC on monthly rent is available as the said service is used in the course or furtherance of business. Services by employees to employer in the course of or in relation to his employment is not a supply in terms of section 7 read with Schedule III to the CGST Act, 2017. Therefore, since no GST is paid on such services, there cannot be any ITC on such services. ITC on life insurance service is available if the same is obligatory for an employer to provide to its employees under any law for the time being in force. Export of goods is a zero rated supply. A zero rated supply under LUT/bond is made without payment of IGST. Since export of goods is a zero rated supply, there will be no apportionment of ITC and full credit will be available.