Question71: 1. My one of the clinet is manufacturing Textile fabric having HSN Code 5407 for which GST Rate is 5% and for this raw material is Plastic Granules having HSN code 39012000 with GST Rate @ 18%.According to our present rate structure substantial ITC is accumulated due to more input while less input. weather balance input available can be carry forward in next year or it will be refunded in the same year.

2.What means of 'NO ITC ACCUMULATION' in HSN Code 5407

Answer The refund of inverse credit under Section 54 not applies to textile and railways part as per notification 5/17 of central tax The balance can be carry forward in next years without any time limit If you start trading or manufacturing any product where value addition is high then this ITC can be consumed You can also start some service to consume this ITC
Please note that only refund is restricted but use of one credit in other product is permitted
You can do some tax planning (Reply dt. 12/3/2018)