(1) An Input Service Distributor shall distribute input tax credit in the manner and subject to the following conditions, namely,-
(a) the input tax creditavailable for distribution in a month shall be distributed in the same month andthe details thereof shall be furnished in FORM GSTR-6 in accordancewith the provisions ofChapter VIII ofthese rules;
(b) the Input Service Distributor shall, in accordance with the provisionsofclause
(d), separately distribute the amount ofineligible input tax credit (ineligible under the provisions of sub-section (5) of section 17 or otherwise) and the amountofeligible input tax credit;
(c) the input tax credit on accountof central tax, state tax, union territory tax and integrated tax shall be distributed separately in accordance with the provisions of clause (d);
(d) the input tax credit that is required to be distributed in accordance with the provisions of clause (d) and (e) of sub-section (2) of section 20 to one of the recipients ‘R1’, whether registered or not, from amongst the total ofall the _ recipients to whom inputtax credit is attributable, including the recipient(s) who are engaged in making exempt supply,or are otherwise not registered for any reason, shall be the amount, “Cl”, to be calculated by applying the following formula - = (+1) xC where, “C”is the amountofcredit to be distributed, period, and “T”is the aggregate ofthe turnover, during the relevant period, ofall recipients to whom the input service is attributable in accordance with the provisions of section 20;
(e) ‘the input tax credit on account of integrated tax shall be distributed as input tax credit of integrated tax to every recipient;
(f) the input tax credit on account ofcentral tax and State tax or Unionterritory tax shall-
(i) in respect of a recipient located in the same State or Unionterritory in which the Input Service Distributor is located, be distributed as input tax credit of central tax and State tax or Unionterritory tax respectively;
"“t)” is theturnover, as referredtoin section20, of‘person R, during the relevant ~~ Hee usta, forte 30 St 2017 634 (9)
(ii) in respect of a recipient located in a State or Union territory other than that of the Input Service Distributor, be distributed as integrated tax and the amount to be so distributed shall be equal to the aggregate of the amount ofinput tax credit of central tax and. State tax or Union territory tax. that qualifies for distribution to such recipient in accordance with clause (d);
(g) the Input Service Distributor shall issue an Input Service Distributor invoice, as prescribed in sub-rule (1) of rule 54, clearly indicating in such invoice thatit is issued only for distribution of input tax credit;
(h) the Input Service Distributor shall issue an Input Service Distributor credit note, as prescribed in sub-rule (1) of rule 54, for reduction of credit in case the inputtax credit already distributed gets reduced for any reason;
(i) any additional amountofinputtax credit on account of issuanceofa debit note to an Input Service Distributor by the supplier shall be distributed in the manner and subject to the conditions specified in clauses (a) to (f) and the amountattributable to any recipient shall be calculated in the mannerprovided in clause (d) and such credit shall be distributed in the month in which the debit note is included in the return in FORM GSTR-6; .
(j) any input tax credit required to be reduced on accountofissuanceofa credit note to ~ the Input Service Distributor by the supplier shall be apportioned to each recipient in the same ratio in which the input tax credit contained in the original invoice was distributed in termsofclause (d), and the amountso apportionedshall be-
(i) reduced from the amount to be distributed in the month in whichthecredit note is included in the return in FORM GSTR-6;or _ (ii) added to the ‘output tax liability of the recipient where the amount so apportionedis in the negative by virtue of the amountofcredit underdistribution being less than the amountto be adjusted.
(2) If the amountof input tax credit distributed by an Input Service Distributor is reduced later on for any other reason for any ofthe recipients, including that it was distributed to a wrong recipient by the Input Service Distributor, the process specified in clause (j) of subrule (1) shall apply, mutatis mutandis, for reduction ofcredit. -
(3) Subject to sub-rule (2), the Input Service Distributor shall, on the basis of the Input Service Distributor credit note specified in clause (h) of sub-rule (1), issue an Input Service Distributor invoice to the recipient entitled to such credit and include the Input Service Distributor credit note and the Input Service Distributor invoice in the return in FORM GSTR-6 for the month in which such credit note and invoice was issued.