ISSUE OF THE ITC & GST NUMBER

This query is : Resolved

TARIQUE RIZVI (Querist)
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08 January 2020 Respected Sir,

If the shipments are the effected through the port of Andhra Pradesh, the expenses related with the shipments should also be claimed on Andhra Pradesh GST Number then only then ITC can b claimed.

& if by the way inadvertently bills of the expenses related with the above shipments drawn by the shipping lines or by the shipping are issued to us on Maharashtra GST Number, ITC can not be claimed.

Please guide me & oblige.

CA SANDESH MAHIPAL

CA SANDESH MAHIPAL (Expert)
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11 January 2020 kindly elaborate your query

Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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09 July 2024 Based on the scenario you've described regarding claiming Input Tax Credit (ITC) under GST for expenses related to shipments, here’s a clear guide on how to handle the situation:

### Input Tax Credit (ITC) and Place of Supply:

1. **Place of Supply for Transport of Goods:**
- According to GST laws in India, the place of supply for transportation of goods by sea is determined based on where the goods are located when the services are performed. In your case, if the shipments are effected through the port of Andhra Pradesh, the place of supply for the transportation services would typically be Andhra Pradesh.

2. **ITC Eligibility Based on Place of Supply:**
- To claim Input Tax Credit (ITC) on expenses related to the shipments (such as freight charges), the GSTN (GST Identification Number) of the recipient (your company) on the invoice should match the state where the place of supply is determined. In your case, it should ideally be Andhra Pradesh GSTN if the shipments are through the port in Andhra Pradesh.

3. **Correct Invoicing and ITC Claim:**
- **Correct Scenario:** If the bills for shipping expenses are issued with Andhra Pradesh GSTN, and the place of supply is Andhra Pradesh, then you can claim ITC on these expenses against your Andhra Pradesh GST registration.
- **Incorrect Scenario:** If the bills are mistakenly issued with Maharashtra GSTN (where your company is not registered for GST purposes related to these shipments), you cannot claim ITC on these invoices because the GSTN does not match the place of supply.

### Practical Steps to Ensure Correct ITC Claim:

- **Ensure Proper Documentation:** Request shipping lines or shipping agents to issue invoices with the correct GSTN that matches the place of supply (Andhra Pradesh, in your case).
- **Review and Reconcile Invoices:** Regularly review invoices received for shipping-related expenses to ensure they are correctly issued with Andhra Pradesh GSTN.
- **Communicate with Suppliers:** Communicate with shipping suppliers to update their records and ensure future invoices are issued correctly.

### Conclusion:

To summarize, you can claim Input Tax Credit (ITC) on expenses related to shipments through the port of Andhra Pradesh, provided the invoices for these expenses are correctly issued with Andhra Pradesh GSTN. If invoices are issued with Maharashtra GSTN or any other GSTN not matching the place of supply, you cannot claim ITC on those invoices. It’s crucial to maintain proper documentation and ensure invoices reflect the correct GSTN to avoid ITC challenges during audits or reconciliations. If you encounter invoices with incorrect GSTN, contact the supplier promptly to rectify and reissue them with the correct GSTN to ensure compliance and proper ITC claim.

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