ITC utilisation

[Madhavan iyengar]

while compiling data for filing GSTR-9

a) if we have noticed any ITC credit wrongly taken can we reverse the ITC in May 19 or June 19 3B or later also or this ITC is required to be paid in cash suppose during audit also some reversals have to be done then can it not be done thru balance ITC available in electronic ledger

b) In case any additional liability arises on account of outward supplies can it be discharged through ITC or it has to be paid in cash

Fundamental issue:

In GSTR-9 form they have specified that we have to pay cash to clear liability but is there no provision in act since ITC is a inherent right to discharge GST liability the GST liability can be discharged thru ITC or ITC and balance thru cash where ITC is not sufficient

Govt gets the tax on output liability so why they are insisting for cash payment

readers kindly enlighten

AI Summary

GST Input Tax Credit: Can Additional Liabilities Be Settled with ITC or Must They Be Paid in Cash? A participant in a discussion forum raised queries about the utilization of Input Tax Credit (ITC) under the Goods and Services Tax (GST) regime. The participant questioned whether wrongly taken ITC can be reversed in subsequent months or if it must be paid in cash, and if additional liabilities from outward supplies can be settled using ITC. The response highlighted that, although logically ITC should cover liabilities, a specific notification mandates cash payment for additional liabilities via Form DRC-03, despite having sufficient ITC balance. The participant sought clarification on why cash payment is insisted upon.