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2021 (9) TMI 381 - AAR - GSTInput tax credit - Belated filing of return by the supplier i.e. after the due date of filing of annual return for the relevant financial year - credit already claimed on the invoices raised by the supplier pertaining to the period Jan-2020, Feb-2020 and March-2020 for which the supplier has actually paid the tax charged in respect of such supply to the Government - entitlement of reversal via cash or through utilization of input tax credit admissible in respect of such supply - requirement to reverse ITC already availed, where M/s Gayatri Project Ltd. has actually paid the tax. HELD THAT - The applicant has availed credit of input tax upon receipt of services from M/s Gayatri Projects Limited and has furnished the return under section 39 for the relevant tax periods. The applicant is also in possession of tax invoices issued by the supplier of services. So, the applicant has complied with the conditions for availing of input tax credit specified in clause (a), (b) and (d) of sub-section (2) of section 16 of the GST Act - it is evident that while the applicant has availed input tax credit in the months of January 20, February 20 and March 20 respectively, the supplier has declared such outward supplies made by him in his respective FORM GSTR-1 in the month of November 20 and has also paid the taxes on such supply upon furnishing of return in FORM GSTR-3B in the month of November 20. Whether such belated compliances by the supplier towards payment of tax to the Government would disentitle the applicant to avail of input tax credit as per the condition laid down in sub-section (c) of section 16 of the GST Act read with the rules made there under? - HELD THAT - The entitlement of input tax credit is governed by sections and rules made under CHAPTER V of the GST Act and Rule respectively. Further, section 41 of the GST Act which deals with Claim of input tax credit and provisional acceptance thereof speaks that every registered person shall be entitled to take the credit of eligible input tax on self-assessment basis subject to such conditions and restrictions as may be prescribed. We admit that FORM GSTR-2B has been made effective from 01.01.2021 but at the same time, the applicant cannot deny that the provisions of sub-rule (4) of rule 36 was already in force during the period when the applicant has availed of input tax credit issues of which we are dealing with in this case. It is thus concluded that the applicant has availed of input tax credit in excess of his entitlement prescribed under sub-rule (4) of rule 36 - The applicant is not entitled for input tax credit claimed by him on the invoices raised by M/s Gayatri Projects Ltd. pertaining to the period Jan-2020, Feb-2020 and March-2020 for which the supplier has furnished FORM GSTR-1 and FORM GSTR-3B in the month of November 20 and the applicant is, therefore, required to reverse the said input tax credit.
Issues Involved:
1. Entitlement of input tax credit (ITC) claimed by the applicant on invoices raised by the supplier for the period January 2020, February 2020, and March 2020. 2. Requirement for the applicant to reverse the ITC already availed if the supplier has paid the tax belatedly. Issue-wise Detailed Analysis: 1. Entitlement of Input Tax Credit (ITC): - The applicant, a producer and supplier of coal, availed ITC on services received from the supplier for the tax periods January 2020, February 2020, and March 2020. - The supplier declared these supplies in FORM GSTR-1 and furnished the return in FORM GSTR-3B in November 2020, beyond the due date. - Section 16 of the GST Act prescribes the eligibility and conditions for taking ITC. The applicant fulfilled conditions under section 16(2)(a), 16(2)(b), and 16(2)(d) by possessing tax invoices, receiving services, and furnishing returns under section 39. - However, the supplier paid the tax in November 2020, which raised the question of whether the applicant could claim ITC despite the supplier's delayed compliance. - Rule 36(4) of the GST Rules, effective from 09.10.2019, restricts ITC availment if the supplier has not uploaded invoice details. The applicant availed ITC in violation of this rule as the supplier uploaded the details in November 2020. - The auto-drafted FORM GSTR-2B, effective from 01.01.2021, indicated a "Return Filed Post Annual Cut-off" for the applicant's November 2020 period. However, this form did not have statutory force for the periods in question (January 2020 to March 2020). 2. Requirement to Reverse ITC: - Considering the restrictions under section 16(2)(c) and rule 36(4), the applicant availed ITC in excess of the entitlement prescribed. - The ruling concluded that the applicant is not entitled to the ITC claimed for the invoices raised during January 2020, February 2020, and March 2020, as the supplier's compliance was delayed. - Consequently, the applicant is required to reverse the said ITC. Ruling: - The applicant is not entitled to the ITC claimed on the invoices for January 2020, February 2020, and March 2020, as the supplier furnished FORM GSTR-1 and FORM GSTR-3B in November 2020. - The applicant must reverse the ITC availed for these periods. - This ruling is valid subject to the provisions under Section 103 until declared void under Section 104(1) of the GST Act.
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