ITC reflected in GSTR-2A but 3B not filed by vendor

[Prem Choudhary]

Dear Expert

please advice ,if the invoices are reflected in GSTR-2A but not filed 3B by vendor. whether we can presumed that the compliance are met and we are eligible to take ITC and no any exposure.

[KASTURI SETHI]

Not entitled to ITC in terms of Section 16 of CGST Act, 2017. Read Section 16 (2) (a) & (d) of CGST Act, 2017. Filing of GSTR 3B return is a statutory requirement not only for availing ITC but otherwise also. . GSTR 3B return is proof of payment (debiting) of tax. into Govt.Account. Only challan is not sufficient. Debiting the amount is an absolutely must and filing of GSTR 3B proves that amount stands deposited into Govt. Account. Without debiting, it remains in your account and NOT in Govt. account..

[Prem Choudhary]

Sir

Our query in context of reconciliation b/w Purchase Register vs 2A found that few invoices of vendors are reflecting in our 2A and purchase Register but vendor has not filed 3B.

[KASTURI SETHI]

You have changed the question. In your first query, you said ",if the invoices are reflected in GSTR-2A but not filed 3B by vendor". It indicates all invoices were reflected in GSTR 2A and but NO GSTR 3B was filed.

Now the situation is different. A few invoice been left in GSTR 2A and in respect of a few invoices GSTR 3B was not filed. I mean to say some invoices were not accounted for in both returns.

If any invoice (s) have been left in GSTR-1 and not accounted for in GSTR 3B return accordingly, you should account for the same in both the returns next month and also deposit/debit GST with interest. Mention the actual date of invoice next month.

 

[CSSANJAY MALHOTRA]

Refer to Section 16(2)(c) of CGST Act. ITC is not eligible if tax has not been paid in GSTR-3B.

[Spudarjunan S]

Sir,

In terms of section 16(2)(c) of CGST Act, for the purpose of availing the input tax credit the tax charged in respect of such supply has been actually paid to the Government, either in cash or through utilization of input tax credit admissible in respect of the said supply.

Action to be taken from your end:-

Verify the from the GSTN portal based on the supplier's GSTN whether the vendor is filing monthly GSTR-3B or not apart from filing GSTR-1.

If the status in portal shows "filed" that is the paramount level of compliance you can do --> avail the credit.

If from the status in the portal you came to know he has not filed monthly GSTR-3B --> on a conservative option don't avail the credit, if availed the reverse the credit.

However, if the amount involved is humongous, from a litigation point of view you may take a stand that the conditions in section 16 of CGST Act where drafted keeping in mind of implementation of GSTR-1,2,3 mechanism and the same is not being implemented, the ITC availability in the hands of recipient wouldn't be questioned rather the tax has to be collected from supplier.

AI Summary

Input Tax Credit availability depends on supplier's GSTR-3B filing; verify payment status before claiming credit. Entitlement to input tax credit requires that tax charged on the supply be actually paid to the government; filing of GSTR-3B is treated as evidence of such payment. Appearance of invoices in GSTR-2A or possession of invoices alone does not satisfy the payment condition. Recipients should verify the supplier's filing status on the GST portal, avoid claiming credit where the supplier has not filed or deposited tax, and reverse any credit erroneously availed until the supplier accounts for and pays the tax with applicable interest.