Page 41 - Chap7 ITC

3. The amount of the credit distributed shall not exceed the amount of credit available for distribution.
The credit related to an input service must be distributed only to the particular recipient to whom that
4.
input service is attributable.

If the input service is attributable to more than one recipient, the relevant ITC is distributed pro
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rata to such recipients in the ratio of turnover of the recipient in a State/ Union Territory to the
aggregate turnover of all the recipients to whom the input service is attributable and which are
operational during the current year.

6. ITC pertaining to input services which are common for all units, is distributed to all the recipients
in the ratio of turnover in the prescribed manner.

7. ITC available for distribution in a month shall be distributed in the same month and the details
thereof shall be furnished in the prescribed form.

8. Both ineligible and eligible ITC are to be distributed separately.

9. ITC of CGST, SGST/UTGST and IGST are to be distributed separately.

10. ITC of CGST, SGST/UTGST in respect of recipient located in the same State/Union Territory is
distributed as CGST and SGST/UTGST respectively.
11. ITC of CGST and SGST/UTGST, in respect of a recipient located in a different State/Union territory,
is distributed as IGST (total of ITC of CGST and SGST/UTGST which were to be distributed to such
recipient).

12. ITC on account of IGST is distributed as IGST.

Q.34
Sarani Weavers, at Pune, Maharashtra is a registered input service distributor and intends to
distribute ITC for the month of March. The following are the details available for such distribution:

Branch Turnover of the ITC specifically attributable
last quarter (₹) to the branch (₹ )
Ganganagar Branch (Rajasthan) 10,00,000 IGST: ₹ 12,000
CGST: ₹ 3,000
SGST: ₹ 3,000
Madhugiri Branch (Karnataka) 5,00,000 Nil
Kosala Branch (UP) 15,00,000 Nil
Mumbai Branch (Maharashtra) 20,00,000 IGST: ₹ 1,50,000
CGST: ₹ 15,000
SGST: ₹ 15,000
lTC available on input services used commonly for all branches is as under:
CGST: ₹ 60,000
SGST: ₹ 60,000
IGST: ₹ 1,20,000
lTC (IGST) of ₹ 10,000 pertaining to March (last year) was inadvertently not distributed. Whether the same
can be considered for distribution in March this year?
Madhugiri, Karnataka branch uses input services to manufacture exempted products. Turnover excludes
duties & taxes payable to Central and State Government. Determine the manner of input tax distribution.
[Study Mat] [CA Final MTP April 24]
Answer: As per section 20 read with rule 39 of CGST Rule 2017:

1. Total GST credit (CGST+ SGST + IGST) of ₹ 18,000 specifically attributable to Ganganagar Branch,
Rajasthan will be distributed as IGST credit of ₹ 18,000 only to Ganganagar Branch, Rajasthan [Since
recipient and ISD are located in different states].

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