XYZ(Mumbai) had received an order for carrying out a work at Ratnagiri. He appointed a Contractor to carry out this work. The contractor is registered with GST at Gujarat. Contractor will be coming to Ratnagiri and carrying out the work at site. Contractor will charge IGST or CGST + SGST to XYZ for carrying out this work?. In both the cases i.e. IGST or CGST + SGST, can XYZ claim ITC on the same?
In order to make transaction tax efficient the sub-contractor should charge IGST from contractor considering POS being Maharashtra where the recipient is located. The contractor (XYZ) will charge CGST + SGST from the recipient at ratnagiri being located in same State.
ITC for IGST credit can be availed against the CGST + SGST liability.
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