Say your business has a head office in Ahmedabad and you have just registered a godown-cum-branch in Indore. You now hold two GSTINs under one PAN. From the first day of the next month, those two GSTINs file their own GSTR-1 and GSTR-3B, keep their own credit ledgers, and treat each other as separate taxpayers. Every stock transfer between them needs a tax invoice.
That much most owners hear from their consultant. What catches them later is the other half: some tests still run at PAN level, the transfers between your own branches count towards those tests, and the books have to come back together into one set for income tax. This guide covers both halves, with the numbers worked out.
When does one PAN end up with more than one GSTIN?
GST registration is State-wise. Under Section 25(1) of the CGST Act, you register in every State or Union Territory from which you make taxable supplies. A branch, depot or warehouse in another State therefore means another GSTIN, even though the PAN, the legal entity and the owner stay the same.
Within one State, a second GSTIN is optional. Rule 11 of the CGST Rules lets a business with more than one place of business take a separate registration for each of them. Businesses usually do this when a factory and a trading unit, or two divisions, want separate returns and separate credit pools. One condition owners often miss: the composition scheme is all or nothing across the PAN. Section 10(2) allows it only if every registration under the same PAN opts in, and Rule 11 repeats the point for separate registrations inside a State.
Why does GST treat your own branches as separate people?
Section 25(4) says each registration of the same person is a "distinct person". Schedule I then treats a supply between distinct persons, made in the course of business, as a supply even when no money changes hands. The result is that moving stock from your Ahmedabad GSTIN to your Indore GSTIN is a taxable inter-State supply. Ahmedabad raises a tax invoice and charges IGST. Indore books it as a purchase and claims the credit.
Moving goods between two godowns that sit under the same GSTIN is different. That is not a supply, so it goes on a delivery challan under Rule 55, not an invoice. Mixing these two up is the most common error we see in branch books.
For valuation, Rule 28 asks for the open market value of the transfer. In practice most branch transfers rely on the second proviso to Rule 28: when the receiving branch is eligible for full input tax credit, the value you declare on the invoice is accepted as the open market value. If the receiving branch makes exempt sales or cannot take full credit, value the transfer properly and keep your working on file.
What is checked at PAN level and what is checked per GSTIN?
This is the part that decides how you set up the books. Returns and tax payments are GSTIN by GSTIN. Several thresholds look at aggregate turnover, which Section 2(6) of the CGST Act defines on an all-India basis for persons having the same PAN.
Item | Tested or done at | What it means for you |
|---|---|---|
GSTR-1, GSTR-3B, tax payment | Each GSTIN | Separate returns and separate electronic credit ledgers. ITC in one GSTIN cannot pay tax due in another. |
E-invoice applicability | PAN (aggregate turnover above ₹5 crore in any year from 2017-18) | Once the PAN crosses, every GSTIN under it issues e-invoices for B2B supplies, including branch transfers. |
QRMP eligibility | PAN (aggregate turnover up to ₹5 crore) | The option is then exercised GSTIN by GSTIN. |
GSTR-9 and GSTR-9C | PAN for the threshold, GSTIN for filing | GSTR-9 is not required up to ₹2 crore aggregate turnover (from FY 2024-25). GSTR-9C applies above ₹5 crore. Each GSTIN files its own. |
Income tax return, tax audit, TDS | PAN and TAN | One set of financial statements for the whole entity, whatever the number of GSTINs. |
Note what the definition includes: inter-State supplies between persons with the same PAN. Your own branch transfers count towards aggregate turnover even though, for the business as a whole, they are not sales at all.
A worked example: how branch transfers can push you into e-invoicing
Take a hypothetical electrical goods distributor. The goods in this example are taxed at 18%. For FY 2025-26:
Ahmedabad GSTIN sales to customers: ₹3,70,00,000
Indore GSTIN sales to customers: ₹75,00,000
Stock transferred from Ahmedabad to Indore on tax invoices: ₹90,00,000 taxable value
Sales to outside customers come to ₹4,45,00,000. That is the figure the owner has in mind, and it is under ₹5 crore. GST aggregate turnover adds the inter-State transfers: ₹4,45,00,000 + ₹90,00,000 = ₹5,35,00,000. The PAN has now crossed ₹5 crore, so both GSTINs must issue e-invoices from 1 April 2026, and GSTR-9C is due for FY 2025-26 for each GSTIN.
Now look at one month of transfers to see the tax side. In October, Ahmedabad sends Indore goods worth ₹7,50,000 across five invoices. IGST at 18% is ₹1,35,000, so the invoices total ₹8,85,000. Ahmedabad reports this as a B2B supply in GSTR-1 and pays ₹1,35,000 in its GSTR-3B. Indore sees the same ₹1,35,000 in its GSTR-2B and claims it. Across the PAN, the net tax is zero. The cost is cash flow and paperwork, plus the risk that one side records it and the other does not.
How do you keep the books for each GSTIN?
Section 35(1) of the CGST Act requires books at the principal place of business, and where more than one place is on the registration certificate, the records for each place must be kept at that place. In accounting terms, you need GSTIN-wise registers that still roll up into one entity. Two set-ups work:
One company, branch-tagged. One set of books, with every voucher tagged to a GSTIN and GST reports run per GSTIN. Simpler for consolidation, but tagging errors go straight into the wrong return.
One company per GSTIN. Each GSTIN has its own ledgers, and the PAN-level accounts are prepared by combining them. Cleaner GST reports, more work at year end.
Either way, link the GSTINs through a pair of inter-branch accounts. In Ahmedabad's books, the transfer is a sale with Indore Branch Account as the debtor. In Indore's books, it is a purchase with Ahmedabad HO Account as the creditor. At month end the two balances must be equal and opposite.
Back to October. Ahmedabad's Indore Branch Account shows a debit of ₹8,85,000. Indore's Ahmedabad HO Account shows a credit of only ₹7,08,000. The difference is ₹1,77,000: one invoice of ₹1,50,000 plus ₹27,000 IGST, dispatched on 30 October and received on 2 November. That is goods in transit, and it is fine as long as you can name it. A difference you cannot explain usually means a missing purchase entry in the branch, which also means credit Indore has not claimed.
What happens to inter-branch sales in your annual accounts?
For income tax and the Companies Act, there is one entity and one PAN. A branch transfer is not revenue for that entity. When you prepare the annual financial statements, eliminate the inter-branch sales against the matching inter-branch purchases, and cancel the two control accounts against each other.
In our example, the profit and loss account should show revenue of ₹4,45,00,000, not ₹5,35,00,000. If the transfers are left in, turnover is overstated by ₹90,00,000, which can distort the tax audit test and every ratio a lender looks at. The GSTR-9C for each GSTIN will then show the transfers as a reconciling item between the turnover in the return and the turnover in the audited accounts. Keep that reconciliation ready; it is the first thing an officer asks for.
How should common expenses be shared since ISD became mandatory?
From 1 April 2025, the Input Service Distributor (ISD) route is compulsory where an office receives invoices for input services used for or on behalf of distinct persons. Think of a single audit fee, a software subscription or an advertising campaign billed to the head office but used by both GSTINs. The head office takes a separate ISD registration and distributes that credit to the branches each month, in proportion to their turnover.
Cross charge is a separate thing. It applies when the head office itself supplies a service to a branch, for example accounts or management support done by head office staff. Circular 199/11/2023-GST says that where the branch is eligible for full ITC, the value of such internally generated services may be taken as nil if no invoice is raised. Tax practitioners still debate the edges of both routes, so if your common costs are large, get the split reviewed once rather than guessing.
A month-end routine for a multi-GSTIN business
Close each GSTIN's sales and purchase registers separately, including all branch transfer invoices.
Match every transfer invoice issued by one GSTIN with the purchase entry in the other. List goods in transit by invoice number.
Reconcile the inter-branch accounts. Any difference beyond goods in transit is a missing or duplicated entry.
Check that inter-State transfers above ₹50,000 moved on an e-way bill, and that each transfer invoice has an IRN if the PAN is above the e-invoice limit.
Run ISD distribution for common input services before the branches file GSTR-3B.
Reconcile GSTR-2B with the purchase register for each GSTIN, then file GSTR-1 and GSTR-3B GSTIN by GSTIN.
Update a PAN-level aggregate turnover figure, so a threshold crossing is noticed in the year it happens rather than after.
Where hisabkitab fits in
hisabkitab handles multi-company and multi-location accounting with branch transfers, so each GSTIN keeps its own registers while you still see the business as one. GSTR-1 and GSTR-3B are filed per GSTIN, GSTR-2B is reconciled with AI against each GSTIN's purchase register, and wrong GSTINs and duplicate invoices are flagged before filing. Branch transfer invoices can carry their IRN and e-way bill through the built-in e-invoicing and e-way bill modules.
If you are a CA handling several multi-GSTIN clients, the CA module gives you one login across clients, with roles, an audit trail and period freeze once a month is filed.
Frequently asked questions
Can I use ITC of one GSTIN to pay tax in another GSTIN under the same PAN?
No. Each GSTIN has its own electronic credit ledger. Credit moves between GSTINs only through a taxable supply between them or through ISD distribution.
Is GST payable on stock transfer between branches in the same State?
Only if the two branches hold separate GSTINs. If both godowns are under one GSTIN, the movement is not a supply and goes on a delivery challan.
Is e-invoicing decided per GSTIN or per PAN?
Per PAN. Aggregate turnover of all GSTINs under the PAN is compared with the ₹5 crore limit, and once it is crossed, every GSTIN under that PAN is covered.
Do I file one GSTR-9 for all my GSTINs?
No. Each GSTIN files its own GSTR-9, and GSTR-9C where it applies. The ₹2 crore and ₹5 crore thresholds are tested on PAN-level aggregate turnover.
Do branch transfers count as sales in my income tax return?
No. For the entity as a whole, a transfer to your own branch is not a sale. Eliminate inter-branch sales and purchases when preparing the annual accounts.
Can one GSTIN be under composition and another under the regular scheme?
No. Section 10(2) allows composition only when all registrations under the same PAN opt for it, so one regular GSTIN rules it out for the rest.
The rules quoted here are from the CGST Act and Rules as they stand in November 2026. You can read Section 25 on the CBIC tax information portal.
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