renting a cab

Where the Government notifies the services which are obligatory for an employer to provide to its employees under any law for the time being in force.

For Example: Karnataka Shops and Establishment Regulations mandates IT sector employer to ensure that cab facility is provided to female employees working during night shift. Any cab facility provided for transport of female employees is mandated by statute and credit of the same would be available to the employer.

Such inward supply of goods or services or both of a category is used by a registered person for making an outward taxable supply of the same category of goods or services or both or as part of a taxable composite or mixed supply.

For Example: Corporate party organized by hiring an Event Manager. Event Manager is contracted to ensure all arrangements relating to food, guests, lighting, decoration, cab services for pick up and drop etc. Event Manager uses the services of a caterer to serve food at the party and engages a rent-a-cab operator to pick-up and drop guests.

(i) Credit to Event Manager for food and Rent-a-Cab services: Available since inward supplies have been used for making outward supplies. (ii) Credit to Company: Available since they are availing composite supply of event management and not a standalone supply of various elements contained in organizing such event.