Lok Sabha Question No. 3218 (UNSTARRED), answered on 2023-03-20
Subject: GST Input Tax Credit
Ministry: FINANCE
Asked by: Sanjay Haribhau Jadhav, Omprakash Bhupalsinh alias Pawan Rajenimbalkar

3218. Shri Sanjay Jadhav:

Shri Omprakash Bhupalsinh alias Pawan Rajenimbalkar:

Will the Minister of FINANCE be pleased to state:-

- (a) whether it is a fact that the availability of Goods and Services Tax (GST), Input Tax Credit (ITC) has been restricted to the date of return in the month of September in the coming year;
- (b) whether it is a fact that if any businessmen has filed return on the basis of their accounts and bills due to some personal or monetary reasons but their ITC are being freezed/not considered and if so, the details thereof and the corrective steps taken by the Government in this regard;
- (c)  whether the actual  ITC of these businessman are being invalidated reportedly due to some error in the laws despite the fact that they are fulfilling their duties of filing return with late fee and if so, the details thereof and the reaction of the Government thereto;
- (d)  the  step  taken  by  the  Government  in  correcting  the  error  and  providing  justice  to businessmen; and
- (e)  the  steps  being  taken  by  the  GST  Council  to  address  the  issue  and  provide  relief  to  the common man?

## ANSWER

## THE MINISTER OF STATE FOR FINANCE

## (SHRI PANKAJ CHAUDHARY)

(a) Sub-section (4) of Section 16 of the Central Goods & Services Tax Act, 2017, as amended w.e.f. 1st October, 2022 vide the Finance Act 2022, provides that a registered person shall not be entitled to  take  input  tax  credit  in  respect  of  any  invoice  or  debit  note  for  supply  of  goods  or services  or  both  after  the  30th  day  of  November  following  the  end  of  financial  year  to  which such  invoice  or  debit  note  pertains  or  furnishing  of  the  relevant  annual  return,  whichever  is earlier.

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE

## LOK SABHA UNSTARRED QUESTION No. 3218

TO BE ANSWERED ON MONDAY, MARCH 20, 2023/PHALGUNA 29, 1944 (SAKA)

## GST INPUT TAX CREDIT

(b) to (e) As per provisions of the CGST Act, 2017, a registered person can avail input tax credit only 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 -

(i) furnishing of return under section 39,

(ii) possession of tax invoice or debit note issued by the supplier,

(iii) furnishing of details of the said invoice or debit note by the concerned supplier in the statement of outward supplies and communication of such details to the recipient,

(iv) receipt of the goods or services or both,

(v) actual payment of the tax charged in respect of such supply to the Government by the concerned supplier,

(vi) availment of input tax credit not later than 30th day of November following the end of financial year to which such invoice or debit note pertains or furnishing of the relevant annual return, whichever is earlier, and

(vii) non-availment of input tax credit in respect of supplies specified in sub-section (5) of section 17.

To facilitate  recipients  in  availment  of  due  input  tax  credit  in  respect  of  supplies  received  by them and to nudge suppliers towards timely reporting of their supplies, 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.

Further, to ease the process for complying with the condition for availment of input tax credit under section 16(2)(c) of CGST Act, 2017, a mechanism has been prescribed vide Rule 37A of CGST  Rules,  2017,  whereby  the  time  period  for  reversal  of  input  tax  credit  by  a  registered person in the event of non-payment of tax on the said supply by the supplier has been extended till 30 th September of next financial year and for re-availment of such credit, if the supplier pays tax subsequently.

Moreover, all the changes in law and procedures in relation to Central Goods & Services Tax Act,  2017 and Central  Goods & Services Tax Rules, 2017 take place on recommendations of GST Council.

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