A dealer has some unutilized GST input tax in electronic credit ledger. From a particular date, the goods dealt by him becomes non taxable and hence writes off the balance of input tax in electronic ledger.
Can this write off be disallowed u/s 43B , since relevant input taxes were incurred in earlier years or can be disallowed as “ Prior Period expenses”.
Dealer Faces Input Tax Reversal Under CGST Act Due to Non-Taxable Goods; Section 18 and Rule 44 Invoked A dealer with unutilized GST input tax in their electronic credit ledger faces a situation where their goods become non-taxable, prompting them to write off the balance. The question arises whether this write-off can be disallowed under Section 43B as prior period expenses. Two respondents agree that the input tax should be reversed, referencing Section 18 of the CGST Act, 2017, and Rule 44 of the CGST Rules, 2017, supporting the reversal of the input tax credit. (AI Summary)
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