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Deemed supply

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Gayathri G

16 Points Posted on 01 February 2023

A company's head quarter located in Mumbai. It has branches in telangana and in AP.
In AP for the FY 2019-20 no outward transactions, but ITC of Rs 2,50,000 accumulated.
My query is, does A P branch raise invoice to telangana to pass on ITC.
Thanks in advance.

Replies (5)

Quick Summary

This discussion addresses a company's query about transferring accumulated Input Tax Credit (ITC) from its Andhra Pradesh (AP) branch, which had no outward transactions but a significant ITC balance, to its Telangana branch. While initially considering invoice raising or ISD registration, the consensus leans towards the possibility of transferring ITC, though the exact mechanism and compliance requirements, especially concerning 'deemed supply' and the applicability of ITC-02 for business transfers, require careful consideration.

CA Rashmi Gandhi

Chartered Accountant

86505 Points Posted on 01 February 2023

Yes you can do so .

CA Altamush Zafar

GST Consultant

15986 Points Posted on 01 February 2023

If there is no actual supply taking place then it can be considered as fake invoicing.

daksham raj

38 Points Posted on 04 February 2023

If HQ registered as isd then it can pass on itc

CA Rashmi Gandhi

Chartered Accountant

86505 Points Posted on 04 February 2023

Yes it can pass through ITC-02

CA Altamush Zafar

GST Consultant

15986 Points Posted on 04 February 2023

ITC 02 only filed on transfer of business. Here no transfer of business is taking place.
ISD also cannot be used in this case since ITC already in balance of one state. ISD issued when service of common benefit between two or more registration is procured