Gst inter branch

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AAYUSHI JAIN

53 Points Joined December 2012

Please advise in following situation

1. ABC co. is having 2 branches A abd B located in different states.

2. B has incurred an expense.

3. Branch A makes the payment direct to vendor on behalf of branch B.

4. Expense is booked in books of B only payment transfer entry is made between A & B.

5. Above case is liable for GST ?

6. This is the case where one branch has incurred expese for another branch ?

Replies (2)

2 things to be examined here..
1. can this adjustment be called as supply?
2. if so, whether A can be called as pure agent?

Now you should look for agreement of expenses, if branch A had entered for expenses with vendor or branch B...?

hence based on case to case it has to be assessed.

according to me, on clear reading of ur question, its just a financial adjustment within the company, which can't be termed as supply. hence not chargeable to GST