GST Credit on -COST allocation to Other unit -head of ineligible Credit items

[Prem Choudhary]

Dear Expert

please advice on input tax credit is eligibility , One Manufaturing Company has 5 manufaturing units in different states and all unit has maintaining separate books and return in GST . And every month each unit is raising tax invoice on other units for cost incurred / facilities provided to employee of other units by using 'SAC -998599 Other Support Service'. However in Cost allocation invoice the component of following cost is also included :-

1. Taxi Hire charges:- ( providing unit has paid GST under RCM)
2. Fooding charges
3. Hotel bills
4. Medical support etc

please advice other unit can eligible of ITC of all components under Other Support Service.

AI Summary

Manufacturing Firm Queries ITC Eligibility for Inter-Unit Costs; Experts Mostly Agree on Ineligibility Except for Hotel Bills A manufacturing company with five units across different states inquires about the eligibility of input tax credit (ITC) for costs allocated between units, specifically costs like taxi hire charges, food, hotel bills, and medical support. The units issue tax invoices to each other under 'Other Support Service' using SAC 998599. Responses from experts vary: some state that ITC is not admissible for most components except hotel bills, while others reference amendments to the CGST Act, suggesting ITC eligibility if the service is obligatory under any law. However, the consensus leans towards ineligibility for most components.