Case Law Details
In re Tata Sia Airlines Limited (GST AAR Haryana)
Now, to decide the method of distribution of input tax credit from HO to BO, it is pertinent to discuss the relevant provisions regarding ‘input service distributor’. The term ‘input service distributor’ is defined under section 2(61) of the CGST Act, as under:
“Input Service Distributor” means an office of the supplier of goods or services or both which receives tax invoices under section 31 towards the receipt of input services and issues a prescribed document for the purposes of distributing the credit of Central tax, State tax, integrated tax or Union territory tax paid on the said services to a supplier of goods or services or both having the same Permanent Account Number as that of the said office”.
3.13 The ISD is the ‘recipient’ as defined under section 2(93) of the CGST Act as it is the person making payment of consideration for the supply of goods or services. The very basis of the ISD related provisions under the CGST Act is that the ISD is not a supplier of goods or services, does not make any ‘outward supply’ under section 2(83) of the CGST Act but is entitled to distribute credit under the provisions related to distribution of ISD under the CGST Act and the rules made there under.
3.14 It is also important to note that the ISD mechanism is meant only for distributing the credit on common invoices pertaining to input services only and not goods (inputs or capital goods). (Ref: GST Flyer, Chapter 10). Therefore, in the present case, the input GST credit pertaining to services only on the procurement made by HO towards maintenance of aircraft (including lease thereof) shall be distributed by way of input service distributor mechanism and the credit pertaining to goods (including capital goods) shall be distributed by way of normal registration mechanism.
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