GST - Place of Business - Guest House

[KSA Associates]

Assessee ABC ltd has GST registration in 2 states i.e. Maharashtra & Karnataka respectively. Earlier, the employees as well as foreign personnel of parent entity of the ABC Ltd used to stay in the Hotels of the Karnataka state for the business purpose. But since the Hotel Expenses started increasing, the management of ABC Ltd decided to take the Guest House on yearly rent Basis in Karnataka. The Question is whether ABC LTD can take GST Credit of same like of Hotel? Also whether is mandatory to add this guest house as additional place of Business.

The Guesthouse is used for meetings, stay purpose etc. for furtherance of Business.

AI Summary

Input tax credit on rented guest house may be available but faces Section 17(5) blocking and reverse charge risks.
Eligibility for input tax credit on a guest house used for employee and business visitor accommodation depends on business use and exclusion from statutory blocked credits; authorities have in some instances disallowed ITC under Section 17(5). If the landlord does not levy GST, reverse charge may apply. Practitioners recommend Advance Ruling, robust documentation of business use, and cautious compliance due to possible disputes or retrospective amendments. The question whether the guest house must be added as an additional place of business on the GST portal remained unresolved in the discussion.