ITC Reversal in GSTR-9 Disclosure

[Pankaj Sharma]

Looking for clarification on reversal of ITC presentation in GSTR-9.

Fact: We have claimed ITC for FY 2017-18 on which reversal required under rule 42 and for the same liability created in books says ₹ 10000+10000. Now this reversal has been show as output tax liability in Table 3(a) of Sept 18 and paid accordingly.

Now, we have disclosed this in Table 12 of GSTR-9 and Tax Payable & Paid in Table 14. Is it correct or not?

Or we have to disclose the same in Table 7(c) and difference shall be negative then how paid amount will be disclosed.

Please discuss and provide valuable suggestion.

[Praveen Nair]

Hi Pankaj

The input tax credit in respect of inputs or input services, which attracts the provisions of section 17(1) or 17(2) of CGST Act, being partly used for the purposes of business and partly for other purposes or partly used for effecting taxable supplies including zero rated supplies and partly for effecting exempted supplies, shall be attributed to the purposes of business or effecting taxable supplies... follows Rule 42.

The above section categorically mentions that "the amount of credit shall be restricted to so much of the input tax as is attributable to the purposes of his business."

Making provisions and not reversing at the time of ITC would attract interest on payment, refer section 39(9) of the CGST Act on applicability of interest for omission or incorrect data in the stated returns.

Reversal of output liability as mentioned by you in the GSTR-3B and disclosure under Table 12 in GSTR-9 seems ok.

AI Summary

Input tax credit reversal under Rule 42: disclose as output tax in returns and report in the annual return. Reversal of input tax credit for portions not attributable to business must follow attribution under section 17 and Rule 42; omissions attract interest under section 39(9). Where ITC is reversed by creating output tax in the periodic return and the tax is paid, disclosing that reversal and the tax paid in GSTR 9 Table 12 and the Tax Payable & Paid summary is a consistent reporting approach, with the periodic return (Table 3(a) of GSTR 3B) showing the immediate liability.