ISD to SEZ units

[LAKSHMINARAYANAN TR]

Hi,

Can Input services Distributor distributes credit to one of their units in SEZ? if so, how to distribute when both of them in same state? IGST or not?

Thanks in Advance.

Durai

AI Summary

Can Input Services Distributors Distribute Credit to SEZ Units Within Same State Under GST? Section 16 IGST Act Discussed. A discussion on a forum addresses whether an Input Services Distributor (ISD) can distribute credit to a Special Economic Zone (SEZ) unit within the same state under the Goods and Services Tax (GST) framework. One participant references Section 16 of the IGST Act, 2017, suggesting that credit distribution to SEZ units is not permissible. Another participant explains that common credit can be distributed pro rata and clarifies how CGST and IGST credits are distributed within and outside the state. There are practical challenges mentioned, such as suppliers insisting SEZ units pay GST and issues with unregistered suppliers. The consensus is that SEZ units can pay GST and seek refunds.