ITC on RCM
The document to claim ITC on RCM is Self Invoice and not the invoice issued by the vendor. Self invoice is raised in the month of payment of GST under RCM. And the timeline for taking credit begins from the date of self invoice.
If the vendor invoice is dated March 2026 but the RCM at that expense is paid in September 2026 then the self invoice would be raised in September 2026 after making GST payment and ITC time limit would be counted from September 2026.
The above has been clarified by the CBIC vide Press release dated 03.07.2019.
The condition of payment to the vendor within 180 days is not applicable to RCM as the tax is paid by the recipient himself.
Payment to Air transporter, bus service provider through as an agent
I am taking this point again to touch upon the payment condition of 180 days to the Indigo , Akasa, Spicejet, Red bus , the actual service provider. Normally the agent Thomas Cook or other local agents book tickets for the passenger. They raise their invoice for service rendered. And another invoice is raised to claim the reimbursement of ticket cost. Now the provision u/s 16(2) of CGST Act requires a recipient to make payment to service provider within180 days. This condition is not fulfilled as the payment is not made to airlines or bus operators. The payment is in fact made to Thomas Cook. And they pay to the airline.
Also, there is no ledger or account in the books of the recipient for Indigo, Akasa or Red bus.
In this case, a correlation of payment made on reimbursement invoice to Thomas Cook needs to be done with the airline ticket invoice details given as a support to that reimbursement invoice. Also, the airline invoices populate in GSTR 2B. The same can also be compared with invoice listings given by agents to match and claim the credit.
ISD credit
ISD credit is populated in table 4(A)(3) of GSTR 3B of the recipient on the filing of GSTR 6 by the Input Service Distributor (ISD).
The credit so distributed is supported by an invoice issued by ISD. The ISD is an office of the same company in a different state or in the same state. It may be a Head office or branch office which receive common services I.e. services received for all the branches including the same branch. Classic example is Tax audit, GST audit services.
The credit allocation to respective branches is done on the basis of turnover. It may be the previous month or the previous year. Previous year turnover is generally considered for allocation as the financials are audited.
The recipient of the ISD credit need not go into the working of ISD distribution. It may rely upon the ISD invoice for taking ITC. The responsibility of correct allocation lies on the ISD.
The timeline to claim credit on the ISD invoice does not hit by section 16(4). This is because the credit is first claimed by ISD following the condition prescribed in section 16 and distribution is a subsequent activity of just distributing the credit.
Import ITC
The basis for claiming ITC on import of goods is the ‘Bill of Entry ‘ (BOE). This document prepared by the importer is verified by the customs officer and the basis of the same customs duty is paid.
The Customs portal (ICEGATE) automatically transmits the BOE details to the GST Portal , more specific to table 4(A)(1) of 3B.
The timeline of section 16(4) does not apply to BOE ITC. But there is another view that BOE is equivalent to Invoice and therefore the timeline of section 16 (4) applies to BOE as well.
BOE ITC also appears in GSTR 2B. There are notices when the importer claims ITC basis BOE copy when the details are not populated into 2B. On submission of BOE copy officers do accept the same and waive off the notice.
However, to pull the details to 2B from icegate you may go to Services > User Services > Search BoE.
ITC on Rent
Office rent or godown rent is generally paid on the basis of an agreement. The owner does not raise a monthly invoice. However, he files GSTR 1 regularly. The details also populate into 2B of the recipient. Whether the absence of invoice fulfils the condition of section 16(2)(a) of CGST Act? The answer is No.
An education to the owner is required on the importance of actually issuing an invoice. Till then the ITC can be taken on the basis of 2B.
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