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Punjab Sales Tax on Services Act, 2012 QUESTION #2569
Question 1
Under section 16B(1), input tax adjustment is NOT allowed in respect of capital goods (plant, machinery, equipment) that are:
  • Fully depreciated
  • Not exclusively useable or used in providing taxable services✔️
  • Imported rather than locally purchased
  • Older than five years
Correct Answer Explanation
Section 16B(1)(a) prohibits input tax adjustment in respect of capital goods (plant, machinery, equipment and others) NOT EXCLUSIVELY USEABLE OR USED in providing taxable services — partial use does not qualify.