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16 December, 2017

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No Input Tax Credit of Hotel Stay Unless You Registered in State of Hotel Location

No Input Tax Credit of Hotel Stay Unless You Registered in State of Hotel Location

Dear Friends,

I Recently received a Query on GST As Under.

"My company is registered with GST in Kolkata,India & I am a director. I travel to Varanasi for business purpose to Varanasi & stay in a hotel. I ask the Hotel to draw a bill in the name of my company with GST Number. The hotel happily does so. Will input benefit"

Image result for hotel reception

Reply:- As per Section 12(3) of IGST Act, 2017

The place of supply of services,–– 

(b) by way of lodging accommodation by a hotel, inn, guest house, home stay, club or campsite, by whatever name called, and including a house boat or any other vessel; or

(c) by way of accommodation in any immovable property for organising any marriage or reception or matters related thereto, official, social, cultural, religious or business function including services provided in relation to such function at such property; or

(d) any services ancillary to the services referred to in clauses (a), (b) and (c),

shall be the location at which the immovable property or boat or vessel, as the case may be, is located or intended to be located:

Hence in the present case the Place of Supply shall be UP (Varanasi) and Credit to that Effect shall also  be passed on GSTIN of UP. Since there is no debar to such credit under Section17(5) specifically, if one is registered in UP then credit can be obtained otherwise NOT.


CA Ankit Gulgulia (Jain) | +91-9811653975

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