CBIC Notifies Clarification on GST liability and ITC in Warranty/ Extended Warranty

The CBIC has issued a clarification regarding GST liability and Input Tax Credit (ITC) applicability on warranty and extended warranty services. The circular emphasizes that warranty services provided along with goods are considered part of the supply of goods, while separately charged extended warranties are treated as distinct supplies. For claiming ITC, it's essential that the warranty is separately charged and the supplier of the goods or services has discharged the GST liability. This clarification aims to streamline tax treatment and compliance in warranty scenarios under GST.