The dust has not yet settled on the recent implementation of the Goods and Services Tax, so it is the most appropriate time to take up a discussion regarding the actual net result of the tax on the infrastructure of our country.

GST implementation was indeed a long-awaited, welcome decision by the government which has helped construction equipment industry to align tax rates at a single point.

It has helped the industry by relieving them from various procedural restrictions which existed while goods were under transit, like e-waybills, transit passes and its connected returns and assessments.

Removal of checkposts has resulted in significant reduction of transit time.

Withdrawal of various forms existing under VAT regime like Form C, H, F etc., has helped the industry to concentrate on their core business, resulted in reduction in manpower and/or channelising such resources to other core areas and also mitigated the risk associated with non-receipt of these forms.

Unlimited availability of input credit, by change in the definition of input credit, for all transactions, is one more significant advantage.


This enabled flow of credit directly into the system with verification facility, resulting in more input compared to VAT and service tax.


Interstate stock transfer 

  • Payment of GST for interstate stock transfer which is treated as a sale, resulting in IGST liability, was made available as full credit in the destination location. This has resulted in tax savings to the manufacturer. Additionally, all tax on interstate purchase was not available as input credit under VAT regime whereas now it is available.
  • Elimination of virtual branches established only for the purpose of documentation and taking credit has been eliminated completely.
  • Time limit allowed for passing credit notes for longer period compared to VAT is one more welcome step.

 Steps which should be taken by GST council in next meetings:

  • With the current challenges in web-based reconciliation, assessee’s are finding it difficult to file GSTR-1 by the 10th of the subsequent calendar month.
  • There is Change in the GST numbers of many customers which need to be corrected after following up with the customers,and it takes time. Thus, GSTR-1 and GSTR-3B should be allowed to be filed together.
  • HSN Code wise classification of goods should be made uniform across all dealers without restricting it to 2, 4 and 8 digits for various categories based on scale of operation.
  • Allowing ITC based on the original invoice of the supplier without depending on GSTR-2A. Also Cross reconciliation of ITC should be deferred to the annual return.
  • The data of IGST paid while importing an item is available with ICEGATE and the GST website should be automated for taking this data from ICEGATE. It will immensely simplify reconciliation.

If these aspects are addressed appropriately, it will help the construction equipment industry in a big way and heighten the ease of doing business in India.