my client is Rent a Cab provider and send cars to XYZ travel agency and charge 5% GST.
Now XYZ travel agency send those cars to ABC company and collect 5% GST from company.
my question is : XYZ travel agency is eligible to take credit of 5% GST charged in my bill. if yes, please share notification.
Yes ITC will be allowed as it is an exception to section 17(5) of CGST act.
Normally on services of Rent a cab the GST paid is blocked and no credit is available.
BUT since XYZ is further supplying the same services of Rent a cab,
ITC will be allowed to XYZ.
I hope this helps.
CAclubindia
