TaxTMI 
TaxTMI 
“ Xyz” is a manufacturer and supplier registered in Chennai and Karnataka under GST. All supplies are effected from Chennai only. He has a rented building in Karnataka for assembling and meeting of the members and distributors to promote business. The Building owner is a registered person in Karnataka and issues tax invoices collecting CGST & SGST. Is “ Xyz“ eligible to avail and utilise ITC on building rent paid?
ITC claim on rented building
08 Sep 2024 
28 Replies 
5434 Views Asked by
Input tax credit eligibility: Chennai registration may claim ITC if Karnataka unit invoices IGST as inter state supply.
Where a rented building in Karnataka is billed by the landlord under CGST/SGST, the Chennai GSTIN cannot directly claim ITC; an alternative is for the Karnataka registration to invoice the Chennai registration for business promotion services as an inter state (IGST) supply so Chennai can avail ITC, subject to place of supply rules, valuation under Rule 28, adequate documentation and potential departmental scrutiny. (AI Summary)
Where a rented building in Karnataka is billed by the landlord under CGST/SGST, the Chennai GSTIN cannot directly claim ITC; an alternative is for the Karnataka registration to invoice the Chennai registration for business promotion services as an inter state (IGST) supply so Chennai can avail ITC, subject to place of supply rules, valuation under Rule 28, adequate documentation and potential departmental scrutiny. (AI Summary)