NEW PROVISION OF ITC UTILIZATION

S K and Associates

SECTION 49A

Notwithstanding anything contained in section 49. The input tax credit on account of central tax, state tax or union territory tax shall be utilized towards payment of integrated tax , central tax, state tax or union territory tax, as the case may be, only after the input tax credit available on account of integrated tax has first been utilized fully toeards such payment. 

NOTE- But after inset this section utilization method changed  

Example :

Let us take basic figures for filing the GSTR-3B. Following is the data to be filed in the return:

	Tax Liability(in Lakhs)	Input Tax Credit(in Lakhs)
IGST	100	200
SGST	100	50
CGST	100	50

 AS PER OLD PROVISION

Solution:

Let us first see what is done while filing the return until now:

	ITC Available-	IGST (200)	CGST (50)	SGST (50)	To be paid by Cash Ledger
	Tax Liability
IGST	100	100	–	–	–
CGST	100	50	50	–	–
SGST	100	50	–	50	–

AS PER NEW PROVISION

Now let us  see how the Input tax credit should be availed as per the provisions of the CGST Act:

	ITC Available-	IGST (200)	CGST (50)	SGST (50)	To be paid by Cash Ledger
	Tax Liability
IGST	100	100	–	–	–
CGST	100	100	–	–	–
SGST	100	–	–	50	50
ITC Balance		–	50	–