Section 17(2) Rule 42 - Goods and Services Tax - GST

While filling GST annual return for FY 2019-20 assesse shown PPF interest, FDR interest of Rs 3,00,000 as exempt income in Table 5D of GSTR-9 . Assesse shown taxable Income of Rs 3 crore in GSTR-9 in table 4. Now the GST department issued DRC-01A notice for reversal of proportionate ITC Rs 32,400/- (i.e. 1% of total ITC Rs 32,40,000/-) as per section 17(2) read with rule 42 Q1 : Whether we have to pay the proportionate ITC or any remedy available to us. Please provide reference of Section, Rule, Case law. Q2: Normally we do not report the PPF interest and bank interest income in GSTR-1 . Is it compulsory to show bank interest in GSTR-9 . Thanks in advance