Earlier on 11th November 2019, CBIC had clarified that ITC is to be availed based on Invoices or debit notes reported by suppliers. Any invoices or debit notes not reported by suppliers (beyond a specified limit) should be reversed in Form GSTR 3B.
Due to the outbreak of COVID-19 relief was provided to taxpayers vide Notf No 30/2020-CT, dated 03.04.2020, whereby it had been prescribed that the condition made under sub-rule (4) of rule 36 of the CGST Rules to be checked cumulatively for the tax period February, 20 to August, 20. Any adjustment for the said periods shall be made in Return in Form GSTR 3B to be furnished for the month of September, 20.
Now, CBIC has issued a circular to Departmental officers to clarify that the applicability of said provisions is in force and taxpayers are to reconcile the ITC and avail the ITC in Form GSTR 3B for September, 20. The cumulative amount of ITC availed for the said months in FORM GSTR-3B should not exceed 110% of the cumulative value of the eligible credit available in respect of invoices or debit notes the details of which have been uploaded by the suppliers under sub-section (1) of section 37 of the CGST Act, till the due date of furnishing of the statements in FORM GSTR-1 for the month of September 2020
Important to note that any invoice uploaded by suppliers beyond the due date for furnishing Form GSTR 1 shall not be taken into account for computation of eligible ITC. Any invoices reported by suppliers beyond the due date should not be availed while furnishing For GSTR 3B for Sept 20 and availing such credit shall be deemed as availing excess credit.
It has been advised to ascertain the details of invoices uploaded by their suppliers under subsection (1) of section 37 of the CGST Act for the periods of February 2020 to August 2020, till the due date of furnishing of the statement in FORM GSTR-1 for September 2020 as reflected in GSTR-2As. (Due date for Sept 20 is 11th Oct, 20)
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