Input Tax Credit Provisions in brief- Bihar and Kerala

State	BIHAR  {Sec.16 / Rule 12,14,15,}	KERALA  {Sec.11,12,13 / Rule 12-A,12-C,13,14,15,46,47,47-A}
Full VAT Input Tax Credits - Eligibility / admissibility & purposes specified	On VAT-paid purchases upon receipt of Tax invoice; for Sale/resale of taxable goods in/from Bihar; for Capital goods for resale or manufacture of taxable goods; Use in manufacture / packing of taxable goods for sale	On ALL VAT-paid goods purchased, for purposes of Resale in/from Kerala, for use in works contracts, for use as input/capital goods in manufacture / processing of goods; for packing; for inter-State sale.
Conditions / Restrictions	Input tax rebate can be adjusted against Output VAT or CST;  rebate can be carried forward to subsequent months until year-end; and excess can be claimed as refund within 3 mths or can also be carried forward to next year.	Input tax rebate can be adjusted against Output VAT, E.T. or CST;  Excess can be c/f to next Tax periods until last Return of year, and thereafter granted as refund.  Input tax rebate on all Capital goods (over 10 lacs) allowed over period of 3 yrs from date from which Capital goods are put to use; for industrial units the period is 12 mths; If Capital goods are sold/branch transferred, the ITC claimed to be reversed. Decl Form '21-B'/'21-C'/'21-J' from seller prescribed for claiming ITC.
Reduction in Set-offs / Reversal of Input Tx credit	Reduction of 4% of net Purchase price (i.e. set-off available in excess over 4%); in case of Branch Transfers outside Bihar of goods purchased or of finished goods out of raw materials purchased (disposals otherwise than by way of sale).	Reduction of 4.04% of net Purchase price (i.e. set-off available in excess over 4%) in case of Branch Transfers outside Kerala of goods purchased or of finished goods out of raw materials purchased (disposals otherwise than by way of sale); or where the goods sold in inter-State are exempt.
Non-admissibility	No set-off allowed on purchases where (i) Composition Tax is paid (ii) Goods purchased are given out on lease (iii) Capital goods like Civil structure and immovable goods or properties, Vehicles, Office equipments, furniture, electrical fixtures;	No set-off allowed on (i) Air conditioners (ii) Civil structure and immovable goods or properties (iii) Vehicles other than goods delivery vehicle (iv) Office furniture/fixtures/ fittings/equipments (v) Elevators (vi) Computers other than for business puepose (vii) All kinds of cranes, earth movers, JCB, Excavators, Road rollers, concrete mixing machine and other similar machineries used in connection with supply of labour and services (viii) Building materials and fixtures used in construction activities (ix) Capital goods purchased prior to VAT Act (xi) purchases from dealer paying  compounded tax (xii) goods remaining unsold at closure of business.