Rule 12 - Communication and rectification of discrepancy in claim of input tax credit and reversal of claim of input tax credit

Rule 12: How to Fix Discrepancies in Input Tax Credit Claims Using FORM GST ITC-1 and GSTR-3

Rule 12 of the Draft GST Return Rules outlines the process for addressing discrepancies in input tax credit claims. Discrepancies are communicated electronically to both the registered taxable person and the supplier via FORM GST ITC-1. Suppliers and recipients can rectify discrepancies in their respective statements of outward and inward supplies for the relevant month. If discrepancies remain unrectified, the recipient must add the discrepancy amount to their output tax liability in FORM GSTR-3 for the following month. Rectification involves aligning the details of outward and inward supplies between the supplier and recipient to resolve the discrepancy.