Eligibility of credit availed on the basis of cross charge invoice issued by head office

[Abhijeet Mane]

I had availed credit on the basis of cross charge invoice issued by head office but now officer has denied the credit by stating that invoice is not sa per rule 46 (as it is different from normal invoice).

As per rule 46 there is no provision for format or mandatory title of cross charge invoice.

[Sadanand Bulbule]

Dear querist

It is too technical observation/interpretation. As long as the conditions of Section 16 are complied, ITC cannot be denied. Provide the substantiating material evidences in support of your entitlement.

[KASTURI SETHI]

After in agreement with Sh.Sadanand Bulbule, Sir, I add that Rule 46 and Section 31 should be read conjointly. Contents and parameters laid down therein should be adhered to.

[Shilpi Jain]

If only invoice format is a defect, correct the format.. issue theinvoice by the branch in the proper format!!

What can be rectified can be rectified and benefit should not be denied

[Padmanathan KV]

what is the actual allegation in the SCN? ie. what is the difference which the officer is pointing out to deny ITC? has all applicable the particulars in Rule 46 included in the said invoice?

Also what is the date of this invoice and date of SCN? 

[Ganeshan Kalyani]

Every taxpayer has a particular format of the invoice maintained in their accounting system. In case of sale /supply, the tax invoice is designed and system generated. But for cross charge the format of tax invoice is not used and instead an excel format or FI module invoice is used which obviously differs in look and format. Hence, the officer has his doubt. Nothing to worry. You can explain the practical difficulties in maintaining the exact same format of invoice in both SD module and FI module of SAP, if you are following SAP. Otherwise, you check your accounting package and find out the fact of not having same format of invoice and reply to the officer accordingly.

AI Summary

Input tax credit eligibility: cross charge invoice format discrepancies may affect entitlement unless statutory conditions are met. ITC entitlement is contested where a head office cross charge invoice differs from the regular tax invoice format; entitlement depends on satisfaction of the statutory eligibility conditions rather than mere invoice appearance. Taxpayers should produce documentary evidence that the supply, tax and recipient particulars meet eligibility criteria, consider rectifying or reissuing invoices if curable, and explain ERP or accounting system reasons for format differences when replying to a notice.