ITC on Hotel bills & GTA service

[MohanLal tiwari]

Dear experts,

We are having different opinion for admissibility of ITC on :-

1. Hotel Bills - Our sales & marketing team is mostly on tour (domestic & foreign) and taking services of hotels and paying applicable GST. What are the legal provisions preventing us to avail credit on SGST & CGST paid.

2. GTA Services - Most of GTA service providers are raising invoice without charging any GST and we are paying GST @5% under RCM . Please advise if ITC for the same is admissible if not, please specify the ruling / notification issued by authority.

[Nash Industries I Pvt Ltd]

1. The hotel bills would show the intra state GST and this would not help in availing the credit. Foreign Tour no GST under the Indian law. In other words, ITC not available. Please refer to FAQ also in this regard.

2. GTA - ITC eligible.

Regards

S.Ramaswamy

[MohanLal tiwari]

Dear Mr Ramswamy,

Thanks for suggestion, could you please quote ruling in support of eligibility / ineligibility of ITC in both the cases.

[Ganeshan Kalyani]

Section 16 to section 21 talks about eligibility of input tax credit under GST .

[Ganeshan Kalyani]

In which Section 17 of CGST Act, 2017 talks about ineligibility of input tax credit.

[KASTURI SETHI]

I support the views of experts.

[Nash Industries I Pvt Ltd]

Please refer to FAQ' released by CBEC and other state govt The query is answered.

The relevant sections has been quoted by Mr Ganeshan.

Thanks

Regards

S Ramaswamy

[CSSANJAY MALHOTRA]

Dear Mr. Tiwari,

Am taking up Hotel Bills for Domestic Tour as views already shared on other aspects by my friends.

Section 17(5)(b) disallows credit for Food and beverages, hence any inclusion of said amount in Hotel Bill is ineligible for ITC. However Room Rent is eligible for ITC.

Now conditions for admissibility and Non-Admissibility

• If your POS and Hotel is situated in same state, then ITC is eligible for CGST/SGST.
• In case your POS and Hotel is situated in different states, then also CGST/SGST is applicable as per Place of Supply Rules.(Section 12 of IGST Act) and ITC is not eligible, reason being is stated below.

Suppose your POS and Hotel is in different state, then Hotel Business will show POS in his GSTR-1 return as his state. The same entry will not reflect in your GSTR-2 as POS is not your state, which makes you ineligible for credit.

 

[MohanLal tiwari]

Dear Mr Malhotra,

Thanks for clarifying the issue in detail.

I was in opinion that ITC on CGST charged in hotel bills will available. In a recent example, one of our client's customer (inter-state) has insisted for charging SGST & CGST which was charged and posted on GST portal. It was accepted and accounted for accordingly for total GST payable for the month.

AI Summary

Input tax credit on hotel bills: room rent may qualify while food and inter state place of supply issues can restrict CGST/SGST credit. ITC on hotel expenses: food and beverages are ineligible while room rent may be eligible; eligibility depends on Place of Supply alignment - same-state POS allows CGST/SGST credit, differing-state POS can prevent credit due to return reporting mismatches. Foreign hotel services do not attract Indian GST. GTA services subject to reverse charge when uncharged by supplier are treated as eligible for ITC.