Question

Can a Goods Transport Company claim refund of input tax credit of GST which were paid at the time of procurements of truck and on their operating expenses such as repair & maintenance, purchase of spare parts, renting of office premises etc. If yes, than what is the procedure to claim refund of ITC

Answer

Facts of the case: GTA company have booked ITC on procurement of trucks, i.e capital goods and on repair and maintenance, i.e input services.

Law applicable: As per section54(3) of CGST refund of ITC can be filled only in the following cases,

(i) zero rated supplies made without payment of tax;
(ii) where the credit has accumulated on account of rate of tax on inputs being higher than the rate of tax on output supplies (other than nil rated or fully exempt supplies), except supplies of goods or services or both as may be notified by the Government on the recommendations of the Council

Interpretation: Refund of unutilized ITC is available only in above two cases. Assuming that outward supply in your case is not zero rated (since the same has not been mentioned in your question), refund of ITC can not availed since as per 54(3)(ii) refund is eligible only in case of inputs not input services and not capital goods.

Conclusion: Assuming that your outward supply is not zero rated, refund of ITC can not be availed in case of input services and capital goods. (Reply dt. 18/03/2019)