TaxTMI 
TaxTMI 
.jpg){kind=logo}
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
ISD to SEZ units
05 Mar 2018 
5 Replies 
5889 Views Asked by
ISD distribution to SEZ: whether input tax credit can be allocated and how tax characterisation affects refund rights.
Whether an Input Service Distributor may distribute credit to a Special Economic Zone unit: one practitioner cites Section 16 of the IGST Act and concludes credit cannot be distributed to an SEZ unit or developer; FAQ guidance states common credit is distributed pro rata, distributions to recipients outside the State are IGST, and distributions within the State are CGST; practical issues include supplier GST collection practices, LUT/refund mechanisms, and unregistered suppliers; another practitioner considers ISD distribution of IGST to SEZ permissible and that SEZ recipients paying GST can obtain refunds. (AI Summary)
Whether an Input Service Distributor may distribute credit to a Special Economic Zone unit: one practitioner cites Section 16 of the IGST Act and concludes credit cannot be distributed to an SEZ unit or developer; FAQ guidance states common credit is distributed pro rata, distributions to recipients outside the State are IGST, and distributions within the State are CGST; practical issues include supplier GST collection practices, LUT/refund mechanisms, and unregistered suppliers; another practitioner considers ISD distribution of IGST to SEZ permissible and that SEZ recipients paying GST can obtain refunds. (AI Summary)