Lok Sabha Question No. 4258 (UNSTARRED), answered on 2023-03-27
Subject: Simplification of GST Input Tax Credit
Ministry: FINANCE
Asked by: Sanghamitra Maurya, Keshari Devi Patel

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE

## LOK SABHA UNSTARRED QUESTION No. 4258

TO BE ANSWERED ON MONDAY, MARCH 27, 2023/CHAITRA 6, 1945 (SAKA)

## SIMPLIFICATION OF GST INPUT TAX CREDIT

†4258. Dr. Sanghmitra Maurya:

Shrimati Keshari Devi Patel:

Will the Minister of FINANCE be pleased to state:-

- (a)  whether  the  Government  proposes  to  simplify  and  facilitate  the  effect  of  GST  Input  Tax Credit (ITC) paid on purchases under GST law and if so, the details thereof and the manner in which the Government is likely to do this;
- (b) if not, the reasons therefor;
- (c) whether the Government is aware that several business establishments were not able to give the  details  of  their  sales  in  2017-18  and  2019-20  due  to  ignorance  of  GST  law,  lack  of knowledge  about  the  portal  and  technical  shortcomings  and  if  so,  the  details  thereof  and  the reaction of the Government thereto;
- (d)  whether  the  Government  has  taken  any  immediate  steps  for  the  convenience  of  the  said establishments and if so, the details thereof;
- (e) whether the dealers had claimed ITC on the basis of their account books and bills and if so, the details thereof;
- (f)  whether  taxpayers  are  being  continuously  pressurized  by  giving  notices  of  online  ITC mismatches and if so, the details thereof and the reasons therefor; and
- (g) the reason for not giving ITC on the basis of the account books and bills and the details of the steps taken by the Government to resolve these mistakes and shortcomings?

## ANSWER

## THE MINISTER OF STATE FOR FINANCE

## (SHRI PANKAJ CHAUDHARY)

- (a) & (b) Government has, as per recommendations of GST Council, taken a number of measures to simplify and streamline availment of input tax credit by the registered persons under GST.

These measures, inter alia , include:

(i) auto drafted Input Tax Credit statement in FORM GSTR-2B is made available to the registered persons,

(ii)  details  of  input  tax  credit  and  outward  supplies  are  auto-populated  in  the  return  in FORM GSTR-3B on the basis of FORM GSTR-2B and FORM GSTR-1,

(iii) to facilitate timely availment of input tax credit by recipients and to nudge suppliers to  report  details  of  supplies  in  timely  manner,  the  CGST  Act  has  been  amended  to provide  for  sequential  filing  of  details  of  outward  supplies  in  FORM  GSTR-1  and  to provide for furnishing of details of outward supplies of a tax period under sub-section (1) of section 37 in FORM GSTR-1 as a condition for furnishing the return under section 39 for the said tax period in FORM GSTR-3B.

(c)  to  (e)  It  has  been  reported  that  during  the  initial  period  of  implementation  of  GST  in  the financial years 2017-18 and 2018-19,  in  many  cases,  the  suppliers    failed  to  furnish  correct details  of  outward supplies  in  their  FORM  GSTR-1,  which    led  to  certain  deficiencies  or discrepancies  in FORM  GSTR-2A  of  their  recipients.  Where the concerned recipients availed input tax credit on the said supplies, discrepancies arose between the amount of ITC availed by such persons in their returns in FORM GSTR-3B and the amount as available in their FORM GSTR-2A.

To facilitate the taxpayers in availment of due input tax credit in such cases, for FY 2017-18 and 2018-19, a detailed mechanism has been prescribed vide Circular no. 183/15/2022-GST dated 27.12.2022, based on the recommendations of the GST Council.

(f) & (g) As per provisions of the CGST Act, 2017, a registered person can avail input tax credit not  simply  on  the  basis  of  ledger  accounts  or  bills  but  also  subject  to  the  conditions  and restrictions as specified in section 16 and section 17 of CGST Act, 2017, read with Rules made thereunder, inter  alia ,  including  the  furnishing  of  details  of  the  invoice  or  debit  note  by  the concerned supplier in the statement of outward supplies and communication of such details to the recipient. To facilitate registered persons in availment of correct input tax credit and to help them ascertain discrepancies, if any, between input tax credit available as per FORM GSTR 2B and that availed in FORM GSTR 3B, a comparison report is made available on the common portal.

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