Input Service Distribution and cross charge distinction: ISD allocates input tax credit while cross charge treats inter branch cost recovery as taxable supply.
ISD is a statutory mechanism to distribute input tax credit paid on input services received at an office to other registered persons with the same PAN, requiring ISD invoices, specific allocation to entitled recipients and a separate registration; cross charge denotes charging costs by a head office to branch offices treated as taxable supplies between distinct registrations by deeming fiction, allowing allocation on any reasonable basis where recipients can claim full input tax credit. (AI Summary)