GST Notice query urgent-ASMT-10

This query is : Resolved

CA Parul Saxena (Querist)
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23 October 2024 You are discharging your outward tax liability with maximum utilization of ITC and depositing the cash below the ratio of 10%,therefore you are directed to explain your position on the same..3

I have been asked above mentioned query..what does it mean? and how to explain this? this is for the financial year 2020-21

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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05 November 2024 Explain the nature of your business and why you have a high ITC utilization ratio (e.g., you are a manufacturer or wholesaler with significant purchases).
Provide details of your input supplies and how they are directly related to your outward supplies.
Explain why you are depositing less than 10% in cash (e.g., due to liquidity issues, temporary cash flow problems, or genuine business reasons).
Provide evidence of your efforts to generate revenue and improve cash flows.
Attach relevant documents, such as: GST returns (GSTR-3B, GSTR-1); Invoices and payment vouchers for input supplies; Bank statements showing cash deposits and ITC utilization; Financial statements (e.g., balance sheet, profit and loss account)
If applicable, mention any changes in business operations, expansion, or contraction that might have affected cash flows.

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