ITC Reversal under Section 37

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This discussion clarifies how to report the reversal of Input Tax Credit (ITC) under Rule 37 when a supplier hasn't been paid within 180 days. The core question is whether this reversal should be added to the output tax liability or reported under 'Other Reversals' in GSTR 3B. Reversing ITC effectively cancels the previously claimed credit and may incur interest charges.

Harsh Chaudhary

Harsh Chaudhary (Querist)

08 December 2021 In Case of Reversal of ITC under Rule 37 due to non-Payment to supplier in 180 Days whether the Reversal of ITC is added in Output tax liability or In Reversal (Others)

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

08 December 2021 Reversal of ITC means the credit of inputs utilised earlier would now be added to the output tax liability, effectively nullifying the credit claimed earlier. Depending upon when such reversal is done, payment of interest may also be required.

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Harsh Chaudhary

Harsh Chaudhary (Querist)

10 December 2021 My question is whether the figure to be shown in GSTR 3B Table 3.1(a) Details of Outward Supplies or in GSTR 3BTable 4(B)(2) Other Reversal

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

10 December 2021 Reverse in GSTR 3BTable 4(B)(2) Other Reversal

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