Input credit on receipt of certain goods and services are specifically made ineligible vide section 17(5) of CGST Act which is termed as “Blocked Credit”. The blocked credit as applicable w.e.f. 1-2-2019 is summarized below:
ITC is not available in respect of the following-
1. Motor vehicles for transportation of persons having approved seating capacity of 13 persons or less including the driver, except when used for further supply, transportation of passengers, or training.
o ITC on its leasing, renting, or hire is also not allowable, except when used for making outward supply of the same category of goods and services, or as an element of mixed/ composite supply earlier disallowance was in respect of all motor vehicles. Now, the disallowance is only in respect of motor vehicles with a seating capacity of up to 13 persons.
2. Vessels and aircraft, except when used for further supply, transportation of passengers, or training transportation of goods.
a. ITC on its leasing, renting, or hire is also not allowable, except when used for making outward supply of the same category of goods or services, or as an element of mixed/ composite supply.
3. General insurance, servicing, repairs and maintenance of motor vehicles, vessels and aircrafts which are not eligible for ITC, except when used for making outward supply of the same category of goods or services, or as an element of mixed/ composite supply.
4. Food, beverages, outdoor catering, beauty treatment, etc. except when used for making outward supply of the same category of goods or services, or as an element of mixed/ composite supply.
5. Membership of a club, health, and fitness center.
6. Travel benefits extended to employees on vacation.
7. Works contract service for construction, repairs, renovations, additions, alternation, re-construction of immovable property except when used for further supply of works contract service.
8. Construction, repairs, renovations, additions, alterations, re-construction of immovable property except for plant and machinery on his own account.
9. Tax paid under composition scheme under section 10 of CGST Act.
10. Goods and services received by a non-resident taxable person except goods imported by him.
11. Goods and services used for personal consumption.
Goods lost, stolen, destroyed, written off, or given as gifts or free samples.
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