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IGST Mechanism and availability of ITC, Goods and Services Tax - GST

Issue Id: - 117966
Dated: 24-5-2022
By:- Archna Gupta
IGST Mechanism and availability of ITC

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Dear All

Suppose the supplier is registered in UP and he makes inter state supply to the recipient in Delhi and charges IGST. Let's assume the POS of this transaction is Haryana (or any state other than Delhi).

My query is whether the recipient of Delhi can avail ITC of IGST paid on this transaction where the POS is any state other than Delhi.

Thanks in advance.

Archna Gupta

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Posts / Replies

Showing Replies 1 to 15 of 20 Records

1 Dated: 25-5-2022
By:- Alkesh Jani


In this regards, my view is, If the POS is as per the direction of recipient in Delhi, Yes, ITC is available.


2 Dated: 25-5-2022

Sh.Alkesh Jani Ji,

I agree with your views. What situation created doubt in the mind of querist ?

3 Dated: 26-5-2022
By:- Archna Gupta

Dear Sir

The query arose because POS mentioned on the bill is different state than the registered state of Recipient. That means revenue arising to another state. In that case my question is if the revenue is accruing to Haryana, will he be allowed to set off that ITC (accruing to Haryana) from the liability of Delhi State (where recipient is registered).


4 Dated: 26-5-2022


In this hypothetical query, does the recipient in Delhi act as an intermediary ? Is the recipient in Haryana a consumer ?

5 Dated: 26-5-2022
By:- Archna Gupta

Dear Kasturi Ji

Let us take a situation. Supplier registered in Delhi having commercial property in Haryana. He lets out that property to a recipient registered in UP. The supplier will charge IGST on rental invoice and the POS will be Haryana. However the recipient (Tenant) is only registered in UP.

My query is whether the tenant can avail ITC of IGST where the POS is Haryana but he is registered in UP.

As per GST portal also the answer is coming "yes" but still I am not getting the proper reason behind that. Can you provide some legal backing?

6 Dated: 28-5-2022
By:- Ganeshan Kalyani

Archna Madam, the query raised by you initially differes from the query at point 5.

7 Dated: 28-5-2022
By:- Ganeshan Kalyani

Madam, as per your query at point 5, my view is that , a person has to obtain registration from the place from where he is supplying the goods or services. Here, the property is at Haryana, so the supplier at Delhi has to obtain registration in Haryana. Since recipient of UP comes and stay at Haryana the Haryana location has to charge CGST+SGST.

8 Dated: 28-5-2022
By:- Altamush Zafar

If POS is different from the state in which the recipient is registered portal do not allow the ITC

9 Dated: 28-5-2022

Sh.Ganeshan Kalyani Ji,

I agree with your views at serial nos. 6 & 7 above. Reason behind change of question is that the query is hypothetical. If not hypothetical, full facts are not being disclosed by the querist.

10 Dated: 29-5-2022
By:- Shilpi Jain

These kind of situations do arise. Say a property is taken on rent in Karnataka by a person in Telangana and the landlord is also in Telangana.

Then supplier charges igst with pos karnataka.

Will the TS recipient be eligible for credit?

11 Dated: 29-5-2022
By:- Archna Gupta

Dear Shilpi

The query raised by me is very logical query. In fact I discussed the same issue with many Indirect tax experts. All answered in if and but. I checked the same in GSTR-2B also. In GSTR-2B if tax involved are CGST and SGST then it is obvious we can not claim ITC if POS is different state but if IGST is involved then GSTR-2B is allowing ITC. That I understood but only issue is I am not able to understand the reason behind that.

One of our expert has suggested to take registration in that state where the property is let out but it is not compulsory to take registration in every state where we are letting out our property and if ITC of IGST is allowed then all the problems will be sorted but the question is why GST portal is allowing ITC of IGST and if it is correct then which legal provision is justifying it.

12 Dated: 29-5-2022
By:- Amit Agrawal

First real question, to my mind, is which legal provision denies such ITC in given situation?

Second question, to my mind, is why gst registration is not compulsory for such "recipient" in state where such property is physically located?

A holistic discussion can be done once we try to get answers to these questions, in my humble view.

13 Dated: 30-5-2022

Common Portal System 's software is not 100% in synchronisation with the GST ACTS. In case there is disharmony between the two the assessee is to follow the GST Act. An assessee is not responsible such disharmony.

14 Dated: 30-5-2022
By:- Shilpi Jain

The eligibility of this credit is a question which will have to be answered by courts in future.

15 Dated: 31-5-2022

The simplest things are being made complicated unnecessarily. The querist is keen to seek relief from the experts (by way of opinion) and NOT from the Court, it being time consuming journey.


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