CBIC Clarifies ITC Eligibility for Goods Delivered Under Ex-Works Contracts

The Central Board of Indirect Taxes and Customs (CBIC) has issued a clarification regarding the eligibility of Input Tax Credit (ITC) for goods delivered under Ex-Works contracts. According to the clarification, businesses that engage in Ex-Works contracts may still be eligible to claim ITC if certain conditions are met. The clarification aims to resolve confusion surrounding whether goods delivered under such contracts qualify for ITC. Ex-Works contracts, where the buyer takes possession of goods at the seller’s premises, have led to complexities in GST treatment, particularly regarding the eligibility for ITC. The CBIC’s directive provides businesses with the clarity needed to ensure compliance with GST provisions.