ITC ON HOTEL STAY AND FOOD FOR DIRECTORS/MANAGERS
Query (Issue) Started By: – SAFETAB LIFESCIENCE Dated:- 10-7-2018 Last Reply Date:- 11-7-2018 Goods and Services Tax – GST
Got 5 Replies
GST
Dear Experts,
Our Directors/Managers visiting outstation on business trip .
Please clarify whether we are eligible for ITC for the following cases.
1. IGST charged on Lodging Bills of Other state hotels.
2. IGST charged on Food Bills of Other state hotels.
3. CGST + SGST charged on Lodging Bills of Local state Hotels where our GST registration is held.
4. CGST + SGST charged on Food Bills of Local state bills where our GST registration is held.
Reply By Rajagopalan Ranganathan:
The Reply:
Sir,
According to Section 12 (3) (b) of
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ral tax.
However the scheme of GST Act seems to be that GST Registration is State specific. Outside the State such person is an "un-registered person".
Therefore, in view of the above hotel owners in a State are liable to charge /cgst and SGST and not IGST though their customers belong to other State. According to Section 49 (5) (e) & (f) of CGST Act, 2017 "the amount of input tax credit available in the electronic credit ledger of the registered person on account of the central tax shall not be utilised towards payment of State tax or Union territory tax and the State tax or Union territory tax shall not be utilised towards payment of central tax. In view of the above my view is that you cannot avail the credit of said tax
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Reply By Ganeshan Kalyani:
The Reply:
Sir, you can take credit of the CGST and SGST charged by the hotel in the State where you have registration. The food bill is not eligible for credit as it falls under personal consumption which is excluded in Sec 17(5) of CGST Act.
The hotel cannot charge IGST. The provision stated by Sri Rajagopalan Sir supports this view.
Reply By KASTURI SETHI:
The Reply:
Admissibility of ITC depends on the major factor whether IGST is applicable or CGST & SGST and applicable of these taxes depends upon the determination of place of supply.
In my view in this regard, Rule of thumb is as under:-
(i) If there is movement of goods from one State to another State IGST is applicable. Similarly, if there is a
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