ITC REVERSAL ISSUE

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This query is : Resolved

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A client claimed Input Tax Credit (ITC) in 2017-2018 despite having no taxable supplies. The tax department has now issued a notice demanding repayment of this ITC. The query concerns whether the ITC can be reversed in the February 2020 GSTR-3B, or if payment must be made via DRC-03. The advice provided is to reverse the ITC in the February GSTR-3B, negating the need for DRC-03.

vijaya simha

vijaya simha (Querist)
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19 March 2020 One of my client has claimed ITC during the year 2017-2018 but there is no taxble supplies. Now in the month of Jan 2020 the department send notice to pay the ITC claimed during the year 2017-2018 as there is no taxable supplies. My doubt is whether can I reverse that ITC in the month of Feb 2020 GSTR-3B since it is there in credit ledger or I have to pay the ITC through cash in DRC-03. Kindly clarify me. thank you