My Client has one Head Office at Mumbai and have lots of Branches. In 2017-18 Mumbai HO has not taken GST Registration under ISD. He has lots of GST ITC Credit in respect of services as below
– Service directly provided to all branches but invoice raised to HO
– Services having the HO, but distribution of ITC.
As Client has not taken registration under ISD, they have raised the invoices to branch and transfer the credit.
Whether HO raised the Invoices for services, which was provided to branches and HO directly by third party and Invoice raised at HO only.
Which type of services they can transferred without ISD registration and which type of not.
Plz Suggest (if possible plz mention the related rules / section / notification
ISD is a mechanism to transfer the credit of services taken by an HO for common use. Even if ISD registration is not there a company is required to raise the bills for a cross charge for services provided by them to their branches. Next question is of valuation. What should be the valuation for those supplies? Valuation rules provide that where the related person is eligible for input tax credit the invoice value shall be the value for the purpose of valuation. In your case, you can raise invoices with all the expenses paid for and can even add your margin. This will automatically shift the ITC to the branches.