Circular No. 170/02/2022-GST-Mandatory furnishing of correct and proper information of inter-State supplies and amount of ineligible/blocked Input Tax Credit and reversal thereof in return in FORM GSTR-3B and statement in FORM GSTR-1-Simplified

Hello readers, Due date of GSTR-3B approaching so at request of my friends I will try to explain changes in GSTR-3B in simplified manner-

1. Furnishing of information regarding inter-State supplies made to unregistered persons, composition taxable persons and UIN holders:

Registered taxpayers are not reporting correct details of inter-State supplies made to unregistered persons, to composition taxpayers and to UIN holders as required to be declared in Table 3.2 of FORM GSTR-3B (Additional information) as taxable value and tax payable already reported in Table No 3.1 of said Form. Correct details also need to reported in Table 7B or Table 5 or Table 9/10 of GSTR-1. Any amendment relating to above supplies also need to be given effect to in Form GSTR-3B

Further, POS need to be correctly reported in case of B TO C transactions in case Invoice value of amount of Invoice exceeds Rs 50000 as name and address of recipient need to be mentioned in tax invoice.

Reason for reporting-Tax reaches the Consumption State as per the principles
of destination-based taxation system.

2. Furnishing of information regarding ITC availed, reversal thereof and ineligible ITC in Table 4 of GSTR-3B

TABLE 4 (A) – Total ITC (eligible as well as ineligible) is being auto-populated from statement in FORM GSTR-2B. (Except the ineligible ITC on account of limitation of time period as delineated in sub-section (4) of section 16 of the CGST Act or where the recipient of an intra-State supply is located in a different State / UT than that of place of supply)

TABLE -4(B)(1) – Registered person will report reversal of ITC, which are absolute in nature and are not reclaimable such as-

  • Rule 38 (reversal of credit by a banking company or a financial institution)
  • Rule 42 (reversal on input and input services on account of supply of exempted goods or services
  • Rule 43 (reversal on capital goods on account of supply of exempted goods or services) of the CGST Rules
  • Reporting ineligible ITC under section 17(5) of the CGST Act .

TABLE -4(B)(2) :

Registered person will report reversal of ITC, which are not permanent in nature and can be reclaimed in future subject to fulfilment of specific conditions such as-

  • Rule 37 of CGST Rules (non-payment of consideration to supplier within 180 days)
  • section 16(2)(b) and section 16(2)(c) of the CGST Act
  • Reversal of any ITC availed in Table 4(A) in previous tax periods because of some inadvertent mistake.

Such ITC may be reclaimed in Table 4(A)(5) on fulfilment of necessary conditions . Further, all such reclaimed ITC shall also be shown in Table 4(D)(1)

Eligible ITC- Net ITC Available will be calculated in Table 4 (C) which is as per the formula (4A – [4B (1) + 4B (2)]) and same will be credited to the ECL of the registered person.

  • No details of ineligible ITC will be required to be provided in Table 4(D)(1).
  •  Very Important –
    • ITC not available, on account of limitation of time period as delineated in sub-section (4) of section 16 of the CGST Act or where the recipient of an intra-State supply is located in a different State / UT than that of place of supply, may be reported by the registered person in Table 4D (2). Such details are available in Table 4 of FORM GSTR-2B.
    • Reversal of ITC of ineligible credit under section 17(5) or any other provisions of the CGST Act and rules thereunder is required to be made under Table 4(B) and not under Table 4(D) of FORM GSTR-3B.

Queries related to above mailed at mamta0581@gmail.com or Contact -9813458638.

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