Kerala floods: Businesses may have to return GST credit on destroyed goods

Businesses may not only have to surrender the availed of credit but also pay penalty interest on the amount

Businesses in Kerala, still trying to recover from the recent floods, might have to pay back input tax credit availed of for “goods lost, stolen, destroyed or written off”. They might also have to pay a penalty of 18 per cent on the credit already claimed.

A recent instruction from the state’s goods and services tax (GST) authorities to zonal officers indicates this. The business would also not be allowed to claim any un-availed input tax credit for “goods lost” or “destroyed”.

According to Section 17(5) (h) of the Central GST Act, businesses that have already claimed input tax credit