REDUCTION OF ITC AVAILABILITY UNDER GST
REDUCTION OF ITC AVAILABILITY UNDER GST
ITC LIMIT TO 10% INSTEAD OF 20% UNDER GST
Central Government by availing the powers under sec 164, and on the recommendations of the council, substtituted the of 20 per cent to the words 10 per cent with effect from 1st Jan, 2020.
Here a new rule 86A also inserted as the conditions for availing credit under Electronic Credit Ledger.
REDUCTION OF ITC AVAILABILITY UNDER GST
LIMIT ON ITC IN CASE OF MISSING INVOICES
86A. Conditions of use of amount available in electronic credit ledger.-
(1) The Commissioner or an officerauthorised by him in this behalf,not below the rank of an Assistant Commissioner,having reasons to believe that credit of input tax available in the electronic credit ledger has been fraudulently availed or is ineligible inasmuch as-
a)the credit of input tax has been availed on the strength of tax invoices or debit notes or any other document prescribed under rule 36-
i.issued by a registered person who has been found non-existent or not to be conducting any business from any place for which registration has been obtained; or
ii.without receipt of goods or services or both; or
b)the credit of input tax has been availed on the strength of tax invoices or debit notes or any other document prescribed under rule 36 in respect of any supply, the tax charged in respect of which has not been paid to the Government; or
c)the registered person availingthe credit of input tax has been found non-existent or not to be conducting any business from any place for which registration has been obtained; or
d)the registered person availing any credit of input tax is not in possession of atax invoiceor debit note or any other document prescribed under rule 36,may, for reasons to be recorded in writing, not allow debitof an amountequivalent to such creditin electronic credit ledgerfor discharge of any liability under section 49 or for claim of any refund of any unutilised amount.
(2)The Commissioner, or theofficer authorised by himunder sub-rule (1) may, upon being satisfied that conditions for disallowing debit of electronic credit ledger as above, no longer exist, allow such debit.
(3)Such restriction shall cease to have effect after the expiry of a period of one year from the date of imposing such restriction.”.
4. In the said rules,with effect from the 11thJanuary, 2020, in rule 138E, after clause(b), the following clauseshall be inserted, namely:-
“(c)being a person other than a person specified in clause (a), has not furnished the statement of outward suppliesfor any two months or quarters, as the case may be.”.
Read full notification here in English
in Hindi
Sub-rule (4)of rule 36 prescribes that the ITC to be availed by a registered person in respect of invoices or debit notes, the details of which have not been uploaded by the suppliers under sub-section (1) of section 37, shall not exceed 20 per cent. of the eligible credit available in respect of invoices or debit notes the details of which have been uploaded by the suppliers under sub-section (1) of section 37. The eligible ITC that can be availed is explained by way of illustrations, in a tabulated form, below.
In the illustrations,
say a taxpayer “R” receives 100 invoices(for inward supply of goods or services) involving ITC of Rs10 lakhs, from various suppliers during the month of Oct, 2019and has to claim ITC in his FORM GSTR-3B of October, to be filed by 20thNov,2019
Read full Rule here http://www.cbic.gov.in/resources//htdocs-cbec/gst/circular-cgst-123_New.pdf
ITC LIMIT TO 10% INSTEAD OF 20% UNDER GST
Central Government by availing the powers under sec 164, and on the recommendations of the council, substtituted the of 20 per cent to the words 10 per cent with effect from 1st Jan, 2020.
Here a new rule 86A also inserted as the conditions for availing credit under Electronic Credit Ledger.
REDUCTION OF ITC AVAILABILITY UNDER GST
LIMIT ON ITC IN CASE OF MISSING INVOICES
86A. Conditions of use of amount available in electronic credit ledger.-
(1) The Commissioner or an officerauthorised by him in this behalf,not below the rank of an Assistant Commissioner,having reasons to believe that credit of input tax available in the electronic credit ledger has been fraudulently availed or is ineligible inasmuch as-
a)the credit of input tax has been availed on the strength of tax invoices or debit notes or any other document prescribed under rule 36-
i.issued by a registered person who has been found non-existent or not to be conducting any business from any place for which registration has been obtained; or
ii.without receipt of goods or services or both; or
b)the credit of input tax has been availed on the strength of tax invoices or debit notes or any other document prescribed under rule 36 in respect of any supply, the tax charged in respect of which has not been paid to the Government; or
c)the registered person availingthe credit of input tax has been found non-existent or not to be conducting any business from any place for which registration has been obtained; or
d)the registered person availing any credit of input tax is not in possession of atax invoiceor debit note or any other document prescribed under rule 36,may, for reasons to be recorded in writing, not allow debitof an amountequivalent to such creditin electronic credit ledgerfor discharge of any liability under section 49 or for claim of any refund of any unutilised amount.
(2)The Commissioner, or theofficer authorised by himunder sub-rule (1) may, upon being satisfied that conditions for disallowing debit of electronic credit ledger as above, no longer exist, allow such debit.
(3)Such restriction shall cease to have effect after the expiry of a period of one year from the date of imposing such restriction.”.
4. In the said rules,with effect from the 11thJanuary, 2020, in rule 138E, after clause(b), the following clauseshall be inserted, namely:-
“(c)being a person other than a person specified in clause (a), has not furnished the statement of outward suppliesfor any two months or quarters, as the case may be.”.
Read full notification here in English
in Hindi
Rule 36(4) Earlier
In the illustrations,
say a taxpayer “R” receives 100 invoices(for inward supply of goods or services) involving ITC of Rs10 lakhs, from various suppliers during the month of Oct, 2019and has to claim ITC in his FORM GSTR-3B of October, to be filed by 20thNov,2019
Read full Rule here http://www.cbic.gov.in/resources//htdocs-cbec/gst/circular-cgst-123_New.pdf
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