2019 (1) TMI 1492 – AUTHORITY FOR ADVANCE RULING, WEST BENGAL – TMI – Input Tax Credit – inward supply – distinct persons – Place of Provision of Services – Can a person, registered in WB, claim ITC for CGST and SGST of other states? – adjustment of ITC of one state’s CGST for payment of another state’s CGST – adjustment of ITC of Tamil Nadu GST for payment of IGST, whereas he is not registered in Tamil Nadu – Held that:- In this case, the location of the supplier, providing hotel, banquet hall or restaurant in Tamil Nadu and the location of the recipient i.e. the Applicant, receiving the service, is also Tamil Nadu. So, the Applicant can avail ITC on the said invoices in Tamil Nadu only, if registered in Tamil Nadu. In no case, the Applicant can claim/adjust/avail ITC outside Tamil Nadu on the said invoices, even if the invoices are issued as B2B mentioning the Applicant’s GSTIN in West Bengal – As input tax and its credit are always linked with whether the person is registered or no
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d in WB, cannot claim ITC for CGST & SGST of other states.
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He cannot adjust the ITC of one state’s CGST for payment of another state’s CGST.
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He cannot adjust the ITC of Tamil Nadu GST for payment of IGST, whereas he is not registered in Tamil Nadu. – Case Number 39 of 2018 Order No. 39/WBAAR/2018-19 Dated:- 28-1-2019 – SYDNEY D SILVA AND PARTHASARATHI DEY, MEMBER Applicant s representative heard: Sanjay Mundhra, Authorized Representative 1. The Applicant, stated to be a supplier of Event Management Services in West Bengal and other states, seeks a Ruling on the following points: a. Can a person, registered in WB, claim ITC for CGST and SGST of other states, b. Can he adjust the ITC of one state s CGST for payment of another state s CGST, c. Can he adjust the ITC of Tamil Nadu GST for payment of IGST, whereas he is not registered in Tamil Nadu? Advance Ruling is admissible on this question under Section 97(2)(d) of the CGST/WBGST Act, 2017 (hereinafter collectively called t
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and the invoices are issued as B2B with the Applicant s GSTIN. These invoices are also reflected in the Applicant s GSTR-2A. Such inward supplies are taken to serve the clients and the Applicant desires to know if ITC can be claimed in the GST Returns in West Bengal on the CGST & SGST paid on such invoices in other states. 3. GST is a destination based tax i.e. consumption tax, which means the tax will be levied where goods and services are consumed and will accrue to that state. Under GST, there are three levels of Tax, IGST, CGST & SGST and based on the place of supply so determined, the respective tax will be levied. Place of supply will be determined by the locations of the supplier and the recipient, in the transactions comprising of the goods/services. IGST is levied where the transaction is inter-state, and CGST & SGST are levied where the transaction is intra-state. So, it is very important to determine place of supply for understanding levy of tax and further avai
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g hotel, banquet hall or restaurant in Tamil Nadu and the location of the recipient i.e. the Applicant, receiving the service, is also Tamil Nadu. So, the Applicant can avail ITC on the said invoices in Tamil Nadu only, if registered in Tamil Nadu. In no case, the Applicant can claim/adjust/avail ITC outside Tamil Nadu on the said invoices, even if the invoices are issued as B2B mentioning the Applicant s GSTIN in West Bengal. 6. The answers to the Applicant s questions, therefore, depend upon whether any component of the tax paid on intra-state inward supplies in a state can be used as an input tax credit for paying the outward tax liability in another state. Section 49(4) of the GST Act provides that the amount available in the electronic credit ledger, as defined under Section 2(46), may be used for making such payment toward outward tax liability. The electronic credit ledger contains the balance of input tax credit on inward supplies as per the return of a registered person. Under
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he tax paid on the inward supplies in that state is not input tax in relation to the said person. As the Applicant is not registered under section 25(1) in Tamil Nadu, the SGST and CGST paid on intra-state inward supply in Tamil Nadu are not input tax to the said person. The GST Act does not contain any concept of input tax to an unregistered person. No credit of it is, therefore, admissible under the GST Act. In view of the foregoing, we rule as under. RULING The Applicant is not registered under Section 25(1) of the CGST Act in Tamil Nadu. The SGST and CGST paid on intra-state inward supply in Tamil Nadu are not, therefore, input tax to the Applicant. The GST Act does not contain any concept of input tax in relation to an unregistered person. No credit of it is, therefore, admissible under the GST Act. So, to answer in the Applicant s language: a. A person, registered in WB, cannot claim ITC for CGST & SGST of other states. b. He cannot adjust the ITC of one state s CGST for paym
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