The GSTN recently introduced downloading Excel file of back up data pertaining to GSTR9’s Table 8A. This comes after several requests where assesses are not able to reconcile GSTR2A with the Values populated in GSTR9.
Background:
As per GSTR9, the value Auto-populated in Table 8A has to be justified with break up details by the Assessee with classifying the Input Tax Credit (ITC) on how they have treated in their books. The Balance ITC left over (Auto populated Value minus ITC Considered by the Assessee) will be:
ITC available as per Supplier’s GSTR1 but Ineligible as per Recipient’s records
ITC available as per Supplier’s GSTR1 but the Recipient missed to avail the ITC within stipulated time.
Hence the reconciliation of Table 8A is very important to declare by the Assessee in his Annual Returns.
However, the GSTR2A was available for month wise in the GSTN portal and even if we download all the 12 month’s GSTR2A data and consolidate them, the total values are not matching with GSTR9’s Table 8A. So there was a request from several taxpayers to give the break up details of what actually considered in the Table 8A of GSTR9.
Considering the genuineness of the request GSTN also provided a simple excel file to download the details auto populated in Table 8A
Analysis:
The single file download option for entire year is a very helpful feature to understand what are the Invoices are considered in GSTR9 despite the data available in GSTR2A and the documents at Recipient’s hand.
Till this Table 8A download was enabled, the general opinion about the values in GSTR9 Table 8 is
Value of GSTR2A Invoices + Debit Notes – Credit Notes = GSTR9 Table 8
On analyzing Table 8A data of GSTR9 the findings show that the total Invoices available in the GSTR2A is not populated to GSTR9 Table 8A fully and there are some Invoices which are not considered as eligible for GSTR9.
Thus, the total of GSTR2A is not equal to Table 8A of GSTR9, because
GSTR2A is the list of ‘all Invoices’ uploaded by the Suppliers in their GSTR1
Table 8A of GSTR9 is the list of Invoices ‘eligible’ for Annual Returns
So, what are the ineligible Invoices which is available in GSTR2A but not in GSTR9? It is classified as under:
- Place of Supply (PoS) is different from the Recipient State in case of Inter-State Transactions
- Reverse Charge Documents uploaded by the Supplier in their GSTR1
- Invoice Date is after the Cancellation of Supplier’s GSTN
- Return Filed by the Supplier after Annual Cut off Date
- Recipient’s GSTN amended by the Supplier in their GSTR1 B2B Amendment
These Invoices were marked as “NO” for ‘ITC available’ by the GSTN itself in the Table 8A Report – Ref Coloumn Q of B2B and Coloumn S of B2BA
Let us see briefly whether these are really ineligible and what actions to be taken from Recipient side:
1. Place of Supply Different
If the Supplier is from State A and the Recipient is in State B, the Supplier has to mention Place of Supply as State B for all type of B2B transactions irrespective of IncoTerms. Even if the sales is on Ex-Works basis, the place of supply should be the recipient place as the goods is having movement till recipient state. Hence the PoS to be mentioned as Recipient State
There are some exclusions like
In case of Hotel and Accommodation, the Place of Supply will be the place of the building situated.
In case of International Courier transactions to the Recipient who is situated in other countries, the place of supply will be Other Country (Ref Section 12(8) of IGST Act)
In Such cases, the Place of Supply will always differ and according to GSTR9 Table 8A, these are INELIGIBLE for availing ITC.
This is highly debatable point, as the Courier of Export Documents are for the furtherance of Business and should eligible for ITC. Hope the GSTN and CBIC will come up with a clarification on this at the earliest.
2. Reverse Charge Documents:
If the Service Provider is Registered under GST and filed his GSTR1 returns with mentioning it is a ‘Reverse Charge’ transaction, those Invoices will be populated to Recipient’s GSTR2A & Table 8A of GSTR9. However the GSTN has marked such transactions as ‘INELIGIBLE’ and the values of the same will not populated into GSTR9 Table 8.
This is because, the tax is being paid by the Recipient and Recipient will be claiming the ITC (if eligible) under ITC of Inward Supplies received from Registered Persons liable to Reverse Charge in Table 6D of GSTR9
Hence NO IMPACT for the Recipient as he will be availing the eligible ITC in another coloumn
3. Invoice date is after date of GSTN Cancellation
If a supplier’s GSTN was cancelled for some or other reasons, (example non payment of tax for two return periods) but later the Supplier has reactivated his GSTN and uploaded all his Invoices; paid all pending taxes, those Invoices will be available in GSTR2A and Table 8A of GSTR9.
However, the GSTN marks such Invoices as INELIGIBLE for recipient to avail ITC.
This stand taken by GSTN will highly impact the recipient, as the Recipient would have already paid the payments to his Supplier and he also holding valid documents for claiming ITC. Just because the Supplier has an issue of GST Cancellation and later he paid the tax, the Recipient is not able to avail ITC on such Invoices issued during the Cancelled period.
If the Recipient attempts to recover the Tax loss from the Supplier due to Table 8A ineligibility, the Supplier will not make payment to Recipient as he has already paid the Tax for the Invoices to the Department
In such cases, the Recipients are the most sufferer for no mistake from their side as they have made payment to supplier but not able to avail ITC despite holding valid documents for ITC.
As per section 16(2)(c) of CGST Act, Recipient can avail ITC if the Supplier has paid the Tax to the Government.
In this case even if the Supplier made the payment of Tax to the government, Table 8A restricts Recipient from availing ITC from such Invoices.
Hope the CBIC and GSTN has to look into this issue and make such Invoices available for ITC for the recipient
4. Return filed after the Annual Cut Off date:
A Registered Tax Payer has to declare his Outward Supply details and file his returns with Tax payment for the Invoices issued in a financial year within the Returns for the month of September of the subsequent year.
For Example, the Invoices pertaining to Period 2019-20 can be filed upto 30th September 2020. which is the Annual Cut Off date for the year 2019-20
In case if the Supplier has filed his returns on or after 1st October 2020, for the Invoices issued between 01.04.2019 to 31.03.2020, such Invoices will be shown in GSTR2A & Table 8A of GSTR9 but marked as INELIGIBLE due to ‘Return filed after Annual Cut off Date’
This issue also impacts to Recipient similar to the case explained in previous incidence.
The Recipient received the supplies, holding valid documents, made payment to the supplier but still unable to claim ITC or recover from the Supplier, due to the delay in return filing by the Supplier.
As per Section 16(4) of the CGST Act, 2017, the Recipient cannot claim ITC for the Invoice issued by the Supplier in 2019-20 after 30.09.2020. But there is no restriction in the CGST Act to avail ITC before 30.09.2020 if it is an Eligible Credit. Just because the Supplier has filed his returns and paid tax to the government after September 2020, the Recipient should not have made suffered of monetary loss.
Hope the CBIC and GSTN has to look into this issue and make such Invoices available for ITC for the recipient
5. Recipient’s GSTN amended by the Supplier in GSTR1 B2BA
If the Supplier has wrongly uploaded his Invoices in GSTR1 with the GSTN of Party A, but it is actually belongs to Party B, he can amend his GSTR1 in the Subsequent period to amend GSTN.
In such cases, those Invoices will be available in Party A’s Table 8 of GSTR9 under B2B Amendment, but marked as INELIGIBLE as the Supplier has amended the GSTN of the Invoice later.
This has NO Impact of Recipient Party A as the supplies actually not belongs to him
Now there are two questions arising from the above analysis
Why the GSTN designed the GSTR9 forms with few provisions are not in line with GST Acts and Rules and thus leading to confusions and litigations. This has to be answered and clarified by the department suitably so that the numbers of Table 8A of GSTR9 will become authenticated and help Recipient for Reconciliation.
The Second question is, what if those Invoices not populated in Table 8A of GSTR9? As the Recipient is well eligible to avail ITC as per GST Acts and Rules, cant he claim ITC even if it is not available in Table 8A?
As per GSTR9 Table 8, the Recipient has to give ‘break up details’ of the values appearing in Table 8A which is auto-populated by the GSTN.
The breakups will be like:
- ITC Availed in GSTR3B during the Annual Return period
- ITC Availed in GSTR3B during the Subsequent period of the Annual Return period
- ITC Available in 8A but not availed by the Recipient
- ITC Available in 8A but not eligible for Recipient to claim ITC
Imagine, if all the Suppliers has filed their returns and Recipient has claimed all his eligible credits. As per the scenarios explained above, certain Invoices were marked as INELIGBLE by the department and hence will not added to the value in Table 8A of GSTR9.
In such situation, the ITC availed by the Recipient will be in excess of the Table 8A and he need to reverse the credit as per GSTR9 computation.
In simple words, if the Invoice is marked as Ineligible by GSTN in Table 8A of GSTR9, then the Recipient has to reverse the same from his books.
However as explained above, there are some scenarios which are NOT in line with the Provisions of GST Acts and Rules
Wish the CBIC and GSTN has to look and resolve these issues to help recipients from unnecessary monetary losses.
Author Bio
Well explained nice sir.