Broad provisions regarding availability of input tax credit :
GST system works on granting input tax credit of GST paid on input goods, input services and capital goods.
The principles of availability of input tax credit are broadly as follows.
Input tax credit of SGST/UTGST and CGST payment of SGST/UTGST and CGST – Input tax credit of SGST paid in the State or UTGST paid in Union Territory will be available for payment of SGST on output of goods and services in the same State or UTGST in same Union Territory. Similarly, input tax credit of CGST paid within the State will be payable for payment of CGST on output of goods and services within the State.
Credit of SGST/UTGST/CGST paid in one State or Union Territory cannot be utilized for payment of SGST/UTGST/CGST in other State or Union Territory.
Input tax credit of IGST – Input tax credit of IGST can be utilized for payment of IGST, CGST and SGST/UTGST on output goods and services in that order.