CCI Online Learning
50% OFF in CA/CS/CMA Subjects
     
CIBIL

Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Email

Share More

Clarification on availment GST ITC for Feb,20 to Aug, 2020 - Rule 36(4)

Rohit Kumar Singh 
on 12 October 2020

LinkedIn


CBIC has issued a Departmental Circular No 142/12/2020- GST on 9th October 2020 clarifying the applicability of Rule 36(4) of the CGST Rules, 2017 for the months of Feb 20 to Aug 20.

Earlier on 11th November 2019, CBIC had clarified that ITC is to be availed based on Invoices or debit notes reported by suppliers. Any invoices or debit notes not reported by suppliers (beyond a specified limit) should be reversed in Form GSTR 3B.

Due to the outbreak of COVID-19 relief was provided to taxpayers vide Notf No 30/2020-CT, dated 03.04.2020, whereby it had been prescribed that the condition made under sub-rule (4) of rule 36 of the CGST Rules to be checked cumulatively for the tax period February, 20 to August, 20. Any adjustment for the said periods shall be made in Return in Form GSTR 3B to be furnished for the month of September, 20.

Now, CBIC has issued a circular to Departmental officers to clarify that the applicability of said provisions is in force and taxpayers are to reconcile the ITC and avail the ITC in Form GSTR 3B for September, 20. The cumulative amount of ITC availed for the said months in FORM GSTR-3B should not exceed 110% of the cumulative value 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 of the CGST Act, till the due date of furnishing of the statements in FORM GSTR-1 for the month of September 2020

Important to note that any invoice uploaded by suppliers beyond the due date for furnishing Form GSTR 1 shall not be taken into account for computation of eligible ITC. Any invoices reported by suppliers beyond the due date should not be availed while furnishing For GSTR 3B for Sept 20 and availing such credit shall be deemed as availing excess credit.

Clarification on availment GST ITC for Feb,20 to Aug, 2020 - Rule 36(4)

Any failure to reverse such excess credit shall be treated as availing of Ineligible ITC during the month of September 20. Any excess ITC arising out of availing is required to be reversed in Table 4(B)(2) of Form GSTR 3B for the month of September, 20.

It has been advised to ascertain the details of invoices uploaded by their suppliers under subsection (1) of section 37 of the CGST Act for the periods of February 2020 to August 2020, till the due date of furnishing of the statement in FORM GSTR-1 for September 2020 as reflected in GSTR-2As. (Due date for Sept 20 is 11th Oct, 20)

 

Manner of cumulative reconciliation for the said months in terms of proviso to subrule (4) of rule 36 of the CGST Rules is explained by way of illustration –

Month

Eligible ITC as per CGST Act

ITC Availed in GSTR 3B

Invoices uploaded by Supplier and availed (eligible)

Effect of cumulative application

Reversal required

Feb 20

300

300

270

Maximum eligible ITC in terms of rule 36 (4) is 2450 + [10% of 2450] =2695. Availed ITC - 2750.

Hence, ITC of 55 [2750-2695] would be required to be reversed

ITC reversal to the extent of Rs 55 is required to be made in Sept 2020 GSTR 3B

Mar 20

400

400

380

Apr 20

500

500

450

May 20

350

350

320

June 20

450

450

400

July 20

550

550

480

Aug 20

200

200

150

Total

2750

2750

2450

Sept 20

500

385

350

10% rule to be ascertained independently for Sep 20

IIn the FORM GSTR-3B for Sept 2020, avail ITC of 385 under Table 4(A) and reverse ITC of 55 under Table 4(B)(2)

 

Note - How to comply with the manner of availing of ITC as per Circular -

  1. Download GSTR 2A for Feb to Aug 20 and ascertain eligible ITC as per GSTR 2A (remove RCM invoices and ineligible Invoices)/span>
  2. Check eligible ITC as per books which are availed in GTSR 3B for the months of Feb 20 to Aug 20
  3. Reverse any excess ITC as computed as per books Vs. GSTR 2A +10%. In case there is no excess ITC availed, there is no need to reverse any ITC in GSTR 3B for September 20.

Tags :



Category GST
Other Articles by -
Rohit Kumar Singh 

Report Abuse

LinkedIn



Comments



Popular Articles



CCI Articles

submit article

Stay updated with latest Articles!





GST Live Class    |    x