System not in confirmation with Rule 39(e) of CGST Rules, Goods and Services Tax - GST

[RadheyShyam Mangal]

As per Section 20 of the CGST Act, input tax credit on account of IGST Credit can be distributed by Input Service Distributor as IGST or CGST.

As per Rule 39(e) of CGST Rules, which prescribes procedure for distribution of credit by Input Service Distributor, says input tax credit on account of IGST can be distributed as IGST itself.

The GSTR-6 available online has one loophole i.e. it is not according to Rule 39(e) of CGST Rules because in case of ISD and recipient of credit are in the same state it doesn't have column for distribution of IGST credit as IGST credit.

What should be done.

If I go ahead and distribute IGST credit as CGST credit in the same state then I will be complying Section 20 but there will be violation of Rule 39(e) of CGST Rules.

Though we all know Rules cannot override Act.

Please opine on the same

Posts / Replies

[DR.MARIAPPAN GOVINDARAJAN]

Rules cannot over ride the provisions of Act. There may draft error in Rule 39(e). If it is pointed out to the GST Council an amendment may be brought in future by GST Council. Earlier I also pointed out such discrepancies to the GST Council which has been later amended.