Section 20 of CGST Act, 2017 : Section 20: Manner Of Distribution Of Credit By Input Service Distributor

Explanation using Example

Imagine a company, ABC Ltd., which has its head office in Mumbai and branches in Delhi and Bangalore. The head office incurs an advertising expense that benefits all branches. The head office is registered as an Input Service Distributor (ISD) under the GST regime.

ABC Ltd. receives an invoice for the advertising service, which includes GST. As an ISD, the head office needs to distribute the GST credit from this invoice to its branches.

Under Section 20 of the CGST Act, 2017, the head office will distribute the GST credit as follows:

• It will issue a document to Delhi and Bangalore branches with details prescribed ...

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