Differences in ITC availed in
GSTR-3B Vs GSTR-2A
INTRODUCTION:
As per the GST Law, input tax credit [ITC] can be availed by the registered person on the inward supplies of goods/services used/intend to be used in course of business of making taxable supplies/zero-rated supplies. ITC can be availed subject to satisfaction of conditions set out in section 16(2) namely the receipt of goods/services, receipt of vendor invoices, tax paid to Govt through cash/credit, and return furnished by the recipient.
Additional conditions for availing of credit were set out namely the details of the invoice/ debit note referred to above should be uploaded by the supplier in his GSTR-1 and the same is reflected in recipients Form GSTR-2B (w.e.f. 01.01.2022).
Also the credit should not be restricted in GSTR-2B (Notified w.e.f. 1st October 2022)
In this article, we will discuss how to deal with the ITC not reflected in GSTR-2A and also gives you an idea to deal with discrepancies between the amount of ITC availed by the registered persons in GSTR-3B.
Let us understand various scenarios.
- Scenario: Where the supplier has failed to file FORM GSTR-1 for a tax period but has filed the return in FORM GSTR-3B for the said tax period, due to which the supplies made in the said tax period do not get reflected in FORM GSTR-2A of the recipients.
Clarification: In such cases, the difference in ITC claimed by the registered person in his return in FORM GSTR-3B and that available in FORM GSTR-2A may be handled by following the procedure provided in para 4 below. - Scenario: Where the supplier has filed FORM GSTR-1 as well as returned in FORM GSTR-3B for a tax period, but he has declared the supply with the wrong GSTIN of the recipient in FORM GSTR-1.Clarification: In such cases, the difference in ITC claimed by the registered person in his return in FORM GSTR-3B and that available in FORMGSTR-2A may In addition, the proper officer of the actual recipient shall intimate the concerned jurisdictional tax authority of the registered person, whose GSTIN has been mentioned wrongly, that ITC on those transactions is required to be disallowed if claimed by such recipients in their FORM GSTR-3B. However, allowance of ITC to the actual recipient shall not depend on the completion of the action by the tax authority of a such registered person, whose GSTIN has been mentioned wrongly, and such action will be pursued as an independent action
- Scenario: Where the supplier has filed FORM GSTR-1 as well as returned in FORM GSTR-3B for a tax period but has failed to report a particular supply in FORM GSTR-1, due to which the said supply does not get reflected in FORM GSTR-2A of the recipient.Clarification: In such cases, the difference in ITC claimed by the registered person in his return in FORM GSTR-3B and that available in FORM GSTR-2A may be handled by following the procedure provided in para 4 below.
- Scenario: Where supplies were made to a registered person and an invoice is issued as per Rule 46 of CGST Rules containing the GSTIN of the recipient, but the supplier has wrongly reported the said supply as a B2C supply, instead of a B2B supply, in his FORM GSTR-1, due to which the said supply does not get reflected in FORM GSTR-2A oft he said registered person.Clarification: In such cases, the difference in ITC claimed by the registered person in his return in FORM GSTR-3B and that available in FORM GSTR-2A may be handled by following the procedure provided in para 4 below.
Further in order to verify whether a tax on supply has been paid by the supplier, following action may be taken by the proper officer-
a. In case the difference between ITC claimed in GSTR-3B vs GSTR-2A exceeds Rs 5 lacs,the proper officer shall ask the registered person to produce a certificate from CA or CMA with UDIN , certifying that supplies have been actually made by the supplier to registered person and tax on such supplies has been paid in GSTR-3B.
b. In case the difference between ITC claimed in GSTR-3B vs GSTR-2A is up to Rs 5 lacs , the proper officer shall ask the registered recipient to produce a certificate from a concerned supplier that said supplies have been actually been made by him and tax on such supplies has been paid in GSTR-3B.
In order to verify the condition of clause (c) of sub-section (2) of Section 16 of CGST Act that tax on the said supply has been paid by the supplier, the following action may be taken by the proper officer:
a. In case, where the difference between the ITC claimed in FORM GSTR-3B and that available in FORM GSTR 2A of the registered person in respect of a supplier for the said financial year exceeds Rs 5 lakh, the proper officer shall ask the registered person to produce a certificate for the concerned supplier from the Chartered Accountant (CA) or the CostAccountant (CMA), certifying that supplies in respect of the said invoices of supplier have actually been made by the supplier to the said registered person and the tax on such supplies has been paid by the said supplier in his return in FORM GSTR 3B. Certificates issued by CA or CMA shall contain UDIN. UDIN of the certificate issued by CAs can be verified from the ICAI website https://udin.icai.org/search-udin and that issued by CMAs can be verified from ICMA Iwebsitehttps://eicmai.in/udin/VerifyUDIN.aspx.
b. In cases, where the difference between the ITC claimed in FORM GSTR-3B and that available in FORM GSTR 2A of the registered person in respect of a supplier for the said financial year is upto Rs 5 lakh,the proper officer shall ask the claimant to produce a certificate from the concerned supplier to the effect that said supplies have actually been made by him to the said registered person and the tax on said supplies has been paid by the said supplier in his return in FORM GSTR 3B.
c. It may also be noted that the clarifications given hereunder are case-specific and are applicable to the bonafide errors committed in reporting during FY 2017-18 and 2018-19.
