Dear Export,
Refer : GST (CT) Notification no : 49 dt 09.10.2019
3. In the said rules, in rule 36, after sub-rule (3), the following sub-rule shall be inserted, namely:-
“(4) Input tax credit to be availed by a registered person in respect of invoices or debit notes, the details of which have not been uploaded by the suppliers under sub-section (1) of section 37, shall not exceed 20 per cent. of the eligible credit available in respect of invoices or debit notes the details of which have been uploaded by the suppliers under sub-section (1) of section 37.”.
Kindly explain with suitable example above said point.
Kind Regards
V.Ragavan
GST Notification Limits ITC to 20% Without Supplier Invoices; Sparks Debate on Compliance and Legal Challenges A discussion on a GST notification regarding input tax credit (ITC) limitations sparked numerous responses. The notification restricts ITC to 20% of eligible credit if suppliers fail to upload invoices, causing potential losses for buyers. Participants debated the implications, with some agreeing on the need for monthly GSTR 2A reconciliation and supplier engagement to ensure compliance. Concerns were raised about the notification's alignment with existing laws and its potential legal challenges. Suggestions included simplifying tax processes by eliminating ITC in favor of reduced tax rates. Questions about specific ITC scenarios, such as reverse charge mechanism and imports, were also discussed. (AI Summary)
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