Input Service Distribution in case of single unit

[Mehul Pandya]

Sir,

We have single unit in India and some Service Tax billing done at our head office like Financial Services, Audit Fess Etc. and payment done from our head office. In this case do our head office need to get Input Service Distributor Registration even though we have only one unit in the country. Can we as manufacturer may avail cenvat credit by simply endorsement done by our head office on the respective Invoice / Bill ?

Thank you

[Ganeshan Kalyani]

Sir in my view you have register as Input service Distribution because the invoice is in the name of Head Office. And I assume that though you have only one factory but would be having distribution centre at various location. So the service availed in such case would be for that location also. Therefore I am of the view that HO should get register as ISD. An invoice has to be issued by HO to distribute the credit to the Factory.

Thanks.

[Rajagopalan Ranganathan]

Sir,

I agree with the views of Shri. Ganeshan Kalyani Sir. It will avoid unnecessary audit objections and fruitless legal battles.

[KASTURI SETHI]

Sh.Mehul Pandya Ji,
Though there are a few latest judgments of CESTAT wherein it has been held that if assessee has only one manufacturing unit, registration as ISD is not required. Assessee can take credit even if invoice is in the name and address of their Head Office.

But better option is to get the Head Office registered as ISD as already advised by Sh.Rajagopalan Ranganathan Sir and Sh.Ganeshan Kalyani, Sir. Litigation must be avoided.

[DR.MARIAPPAN GOVINDARAJAN]

In this case registration for Input Service Distributor is a must

AI Summary

Company with Single Unit in India Advised to Register Head Office as ISD for Service Tax Compliance A discussion on a forum addresses whether a company with a single unit in India needs to register its head office as an Input Service Distributor (ISD) for service tax billing and payment conducted at the head office. The consensus among respondents is that registration as an ISD is advisable to avoid audit issues and legal complications, despite some legal precedents suggesting it might not be necessary. The head office should issue invoices to distribute credit to the factory, ensuring compliance and minimizing potential disputes.