Memorandum on GST Input Tax Credit Issues

Ahilya Chamber of Commerce & Industry has made a representation to Chairman of GST Council on GST Input Tax Credit Issues and requested that 4 criteria as originally prescribed in Section 16(4) of CGST Act, 2017 should be necessary for tax payer to avail credit of Input Tax and all other hindrances should be removed. They further requested that  there should be a practical approach in deciding late fees, interest and penalties. 

The Chairman,
GST COUNCIL,
NEW DELHI.

Respected Madam,

INPUT TAX CREDIT ISSUES

It needs to be acknowledged that implementation of GST was a quantum jump in Tax Reforms in India and many large industries have greatly benefitted from the same. At the same, time it must be admitted that it was imposed in great hurry necessitating, notifications, circulars, clarifications, press notes and what not running in thousands resulting in a cobweb of myriad provisions. These have also negated the avowed declaration of Hon’ble Prime Minister, Shri Narendra Modi to make in India.

You will agree Ma’am, that seamless credit of ITC is soul and essence of GST. Unfortunately, due to the misuse of ITC by a miniscule number of unscrupulous elements, roadblocks after roadblocks have been put in availing of ITC. The purpose obviously is to prevent wrong availing of ITC. But, while unscrupulous elements keep on inventing newer modes, it is the honest tax payer who Is suffering from these hindrances. Instead of getting a smooth fast track, we are left with a hurdle race.

Our humble submission is that only the 4 criteria as originally prescribed in Section 16 (4) should be necessary for tax payer to avail credit of Input Tax and all other hindrances should be removed.  Also, there should be a practical approach in deciding late fees, interest and penalties; taking into consideration the ground realities and exigencies- in business as well as family – that a tax payer may/has to face.

We trust our submission will merit your kind favourable consideration and necessary amendment will be made at the earliest.

With anticipatory thanks,