GST Input Tax Credit - Please Clarify

[Ravi Chandra]

My Organization is Distrcit Central Cooperative Bank, We Pay Service Tax(now GST) on bill submitted by manpower agency who supplies manpower to our organization(Ex: 100000 is bill and GST 18% = 18000/- per month). And we collect Service tax (now GST) from customers for issuing DDs/Cheques and other services etc., and total collected service tax(or GST) will be around 20000/- per month. And total business area is within district only. In this case can we claim input tax credit if yes how much it is. And Manpower agency(which gives services to us) is belongs to our district only.

[KASTURI SETHI]

Supposing that your bank is body corporate, you are required to pay GST under RCM and you can take ITC after depositing GST in cash. You will take credit on the strength of challenge. For banks there is some other procedure also which has to be gone through.

[SHIVKUMAR SHARMA]

Shri Kasturi Sethi Sir,

Please Confirm whether Manpower supply is covered under RCM in GST. If Yes, Please give reference.

[KASTURI SETHI]

Sh.Shiv Kumar Sharma Ji,

You are absolutely right. 'Manpower service' does not find place in the list of services under RCM, approved by GST Council on 19.5.17.

AI Summary

Input tax credit: availability hinges on reverse charge classification; manpower supply clarified as not under reverse charge. Claiming input tax credit depends on whether the bank is required to pay GST under the reverse charge mechanism. If RCM applies, the bank must deposit GST in cash under RCM rules and may claim ITC thereafter subject to procedural and documentary conditions; however, manpower-supply services were clarified as not listed under RCM, meaning ITC for manpower invoices would be claimed under the normal supplier-charged GST regime if all ITC conditions are met.