ISD can distribute ITC to SEZ or not.

[Alkesh Jani]

Dear Experts,

If a company is having his head office in Delhi and three factory in three different states and one unit in SEZ. The head office had taken registration as ISD also.

The query is :-

ISD can distribute ITC to its SEZ unit or not.

Thanks

[KASTURI SETHI]

ISD can distribute ITC ( credit of input service only) to SEZ.

[Alkesh Jani]

Sir,

Thanks for your reply.

Sir one more query, what if one of the unit is EOU unit. Can ISD distribute to its EOU?

With regards,

[KASTURI SETHI]

No such restriction. Emphasis is on service distribution in relation to the turnover of the preceding financial year.

[Yash Jain]

Dear Sir,

In Offline Utility of ISD 6, the Option for SEZ is also there and hence we can take ISD Credit for SEZ.

Also it will be visible in GSTR 2 for SEZ, please check.

Regards

[Ganeshan Kalyani]

I am also of the view that ISD can distribute credit to Sez and iou as well.

AI Summary

ISDs Can Distribute Input Tax Credit to SEZ Units; No Restrictions for EOUs, Based on Previous Year Turnover. A company with its head office in Delhi, registered as an Input Service Distributor (ISD), inquired whether it can distribute Input Tax Credit (ITC) to its Special Economic Zone (SEZ) unit. Experts confirmed that ISD can distribute ITC, specifically credit of input service, to SEZ units. Additionally, there is no restriction on distributing ITC to Export Oriented Units (EOU), with distribution based on the turnover of the preceding financial year. The discussion also highlighted that the Offline Utility of ISD includes options for SEZ, and the credit will be visible in GSTR 2 for SEZ.