¹[ (1) Except as provided otherwise in this Act, a registered person, in the course of his economic activity, shall be entitled to an input tax credit against the Value Added Tax imposed on a taxable supply, except in the following cases, namely:—

(a) ²[except the cases of buy-sale of inputs between registered supplier and the recipient of supply under same ownership, if the value of a taxable supply exceeds Taka 1,00,000.00 (Taka One Lakh) only; and the full consideration against such supply is paid through means other than by banking or mobile banking channel; ]

(b) ³[if output tax payable against the said service is not mentioned separately in the return by the service recipient as per section 20, in the case of receipt of imported service; ]

(c) if input tax credit is not taken in the tax period when inputs have been purchased or collected through invoice or bill-of-entry or within succeeding ⁴[six tax periods];

(d) ⁵[Value Added Tax paid on the goods or services under the custody or possession or supervision of another person, except manufacturing goods under contract, where applicable;]

(e) if any goods or service has not been entered into the Purchase Book of Accounts ⁶[or Purchase-Sale Book of Accounts] prescribed by Rules;

(f) if name, address and registration number of both the buyer and the seller are not mentioned in the tax invoice;

(g) when supply is received from the importer, if the invoice issued by the importer does not contain the ⁷[Goods Declaration] number of the concerned import consignment and when the description of the goods supplied in the invoice issued by the importer and ⁸[proper commercial description in the light of the description of goods in the ⁹[Goods Declaration] is not matched; ]

(h) input tax involved with Bank Guarantee portion, in case of raw-materials or goods released furnishing Bank Guarantee, until, the causes for which Bank Guarantee was furnished have been finally settled ¹⁰[:]

¹¹[Provided that in such a settlement, the rebate may be availed within the six tax periods following the date of release of the bank guarantee or the date of final payment of duties and taxes, whichever is later ]

(i) input tax paid on inputs used in the manufacturing of exempted goods and rendering of exempted services;

(j) Turnover Tax paid under the purview of Turnover Tax;

(k) Supplementary Duty paid on goods or service used in the manufacture of goods or rendering of service;

(l) Value Added Tax paid on the purchase of inputs for supply of such prescribed goods or service on which ¹²[the rate of VAT is below 15 percent except for export] or fixed VAT remain imposed;

(m) ¹³[Except for the supply of services,] input tax paid against such inputs or goods not declared in the Input-Output Co-efficient ¹⁴[;

(n) additional increased input tax ¹⁵[of 7.5 (seven point five) percent], if new Input-Output Coefficient is not submitted in case of total input price changes more than 7.5 (seven point five) percent] ¹⁶[;

(o) if goods or service is supplied at lower price than input cost.]

(2) No input tax credit shall be allowed against an acquisition or import, if-

(a) such acquisition or import relates to a passenger vehicle, or its spare parts or for the repair and maintenance services of such vehicle; then the input tax credit may be allowed when dealing in vehicles, renting them out or supplying transportation services are included in the economic activities of such person and the vehicle is acquired for that purpose;

(b) such acquisition or import relates to entertainment or is used to provide entertainment; then provided the input tax credit may be allowed when provision of entertainment relates to such person’s economic activities and the entertainment is provided in the normal course of his economic activities;

(c) such acquisition relates to a person’s membership or right of entry in a club, association, or society, of a sporting, social, or recreational nature;

¹⁷[(d) such acquisition is more than 80 (eighty) percent of goods transportation related service expenditure. ]

(3) In support of his claims for input tax credit at the time of submission of return, the registered person shall have to keep in possession the following documents, namely:–

(a) in case of import, the ¹⁸[goods declaration] bearing the name of the importer, address and business identification number;

(b) in case of supply, a tax invoice issued by the supplier;

¹⁹[(c) ***]

(d) in case of sub-section ²⁰[(2)] of section 20, treasury challan in support of deposit of tax ²¹[;

(e) bill issued by the concerned organization which shall be considered as invoice, in case of taking credit of the VAT paid on gas, water, electricity ²²[, bank, insurance, port] and telephone service] ²³[;

²⁴[(f) invoice issued by bank, mobile banking service provider and digital payment gateway organization against payment of electricity bill by customers, which shall be considered as invoice, under prescribed conditions and method.] ]