1. Availment of ITC in respect of Debit Notes

Amendment in Section 16(4): –

From 01st Jan 2021, registered tax payer shall not be entitled to take input tax credit in respect of any tax invoices or debit note issued for the supply of goods or services or both after the date of furnishing of GSTR 3B for the month of September following the end of the FY to which such debit note or the invoice pertains or furnishing of the relevant annual return, which-ever is earlier.

The amended sub-section (4) of section 16 of the Central Goods and Service Tax Act 2017 delinks the date of issuance of the debit notes, from the date of issuance of the underlying invoices for the purpose of availing ITC.

2. Dates relevant to determine the Financial Year for the purpose of section 16(4): –

Date of Issue of Debit Notes: – The date of issue of the debit note (not the date of underlying invoices) shall determine the relevant financial year for the purpose of section 16(4) of the CGST Act. w.e.f. 01st January 2021.

ITC in respect of Debit notes issued prior to 01st January 2021

Availment of ITC on or after 01st January 2021, in respect of the debit notes issued prior to 01st January 2021, shall be governed by the amended provisions to sub-section (4) of section 16 and whereas where as if the ITC have been availed prior to 01st January 2021 in respect of the debit notes issued prior to 01st January 2021 shall be governed by the existing provision of section i.e. the date of issue of underlying invoices in respect of which debit note have been issued shall determine the relevant financial year for the purpose of section 16(4) of the CGST Act2017.

3. Carrying physical copy of invoices in case of movement of goods

In case where the supplier has generated e -invoice, Invoice Reference number (IRN) have been embedded in Quick Reference (QR) code, in that case there is no need to carry physical copy of the invoices during the movement of goods.

Source- Circular No. 160/16/2021-GST | Dated the 20th September, 2021

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