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GST input on service form another state

Nikkk (CA) (63 Points)

24 May 2024

Dear Experts.

Just want to discuss about GST input on service received in another state

Service receiver -in State 1

Service provider - in State 2

Service provided in State 2 and Service receiver not registered in state 2

invoice issued with IGST

Can service receiver take IGST input in this case ?

Please provide solution with section reference.

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3 Replies

CA Sachin M Jain (CA | GST | Refunds | Advisory | Litigation) (1337 Points)
Replied 24 May 2024

Will answer your question with example :
When Mr A registered in state of Maharashtra visit Gujarat and stage in hotel hotel will charge CGST and SGST because of place of supply rules .
Now Mr A who is not registered in Gujarat cannot claim ITC of said CGST & SGST.
Even when Hotel by mistake levy IGST mr. A should not and cannot claim ITC of GST charged by the said hotel in Gujarat.

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CA Sachin M Jain .8O975. l5447

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Mohammed Nadeem Ansari (99 Points)
Replied 24 May 2024

Yes, the service receiver can take IGST input in this case. According to Section 7(3) of the IGST Act, the supply of services between two different states is considered as a supply in the course of inter-state trade or commerce, which in this case is evidenced by the invoice being issued with IGST. Therefore, the service receiver can take IGST input credit, as per the provisions of Section 16 of the CGST Act, 2017, subject to the conditions and restrictions specified therein.