How to claim Credit if GST rate paid on yarns higher than Fabrics

Question : Man-made textile yarns have been kept at 18% while fabrics have been kept at 5%. If I buy yarn worth Rs. 100 by paying tax at 18% i.e. Rs. 18/- and I sell grey fabrics at Rs. 150/- considering 50% value addition by paying tax at 5% i.e. Rs. 7.50, what will be the treatment of remaining input credit of Rs. 11.50. Whether I would get refund of remaining credit and how much credit would I get?

Answer: You will be eligible for full ITC of Rs. 18/- paid on your inputs i.e. yarn but whatever credit remains unutilized will remain in your electronic credit ledger and no refund of the same will be allowed.

GST on Textile : FAQ’s

GST on Export : FAQ’s

GST on MSME : FAQ’s

GSTIN / PAN and Invoice information in Shipping Bill

Bond or LUT along with Shipping Bill

Drawback after GST regime

Related Topic on GST