It would not be wrong, if we say the recommendations made by the 53rd GST Council Meeting shows the true intent from Government side for facilitating ease of doing business.
In the meeting, GST Council addresses many important issues faced by the GST taxpayers.
One of the most important issue addressed was inadmissibility of Input Tax Credit (“ITC”) due to non availment of ITC within the time limit prescribed under Section 16(4) of CGST Act, 2017.
As per Section 16(4), ITC can be availed upto due date of filing of GSTR-3B of September month following the end of such financial year to which such invoice or debit note pertains or furnishing of the relevant annual return, whichever is earlier.
However, with effect from 1st October, 2022 the ITC can be availed upto 30th November instead of due date of filing of GSTR-3B of September month following the end of the financial year.
As we all know, GST came into force from 1st July 2017 and in the initial years everyone was learning and adapting to provisions of GST.
As a result some of the taxpayers could not claim the ITC in their GSTR-3B within the time prescribed under Section 16(4).
Further, there are many taxpayers whose GST registrations got cancelled and they could not claim ITC in their GSTR-3B within the time prescribed under Section 16(4).
On this single point, the GST authorities has issued bundle of show cause notices for FY 2017-18, FY 2018-19, FY 2019-20 and FY 2020-21 and raised huge tax demands along with interest and penalty.
The taxpayers approaches the appellate authorities and Hon’ble High Courts but failed to get the relief. As a result the taxpayers were forced to pay the hefty demands just because of mere procedural lapse and faces the huge financial burden.
Thankfully, this time GST council saves the taxpayers from this menace by giving the following big relief at the right time:-
1. The time limit to avail ITC for FY 2017-18, FY 2018-19, FY 2019-20 and FY 2020-21 may be deemed to be 30th November, 2021.
2. Where the GST registration cancelled, then time limit to avail ITC under Section 16(4) to be ignored if the return filed within 30 days of the order of revocation of GST registration.
We hope, after this relief most of the demand raised basis on this point would get dropped and huge time and cost of litigation would be saved.
We are really thankful to the GST council for addressing this important issue in this council meeting.
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(Disclaimer: The content mentioned in the given article based on the personal view of the author and is for the study purpose only)
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This means that those tax payers who could not claim ITC in 17-18, can claim such ITC when provided to file a return on portal. But those whose assessment is made denying such ITC and had paid tax and interest but no final order is passed, will get relief of such paid tax and interest while passing assessment order ?
This is applicable where the taxpayers has claimed the ITC belatedly for FY 2017-18 but before 30.11.2021. Further, whose assessment has been made and order is pending, in that case it is advisable to submit this change as an additional submission before the authority. If the order has been passed then this change should be taken in ground of appeal before the appellate authority.
Hope you get answer of your query.
Regards
Sandeep Saini
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