eligibility of ITC on invoices which are not uploded by the supplier

[sivarama krishna]

Sir,

The supplier not uploaded the invoices in GSTR-1 return and the credit is not populated in the GSTR-2A return of the purchaser. But the purchaser claimed ITC on the purchase invoices without getting credit in GSTR-2A return. Is it correct?. Is the purchaser eligible to claim ITC on the purchase invoices, even though those invoices were not uploaded in the GSTR-1 return by the supplier?

[KASTURI SETHI]

Go through Rule 36(4) of CGST Rules, 2017 which is as follows:-

[(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 [10 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.].

Better option is to persuade the supplier to upload invoices.

[KASTURI SETHI]

Suppose invoices meant for January, 20 are uploaded in March, 20 by the supplier, the same will be reflected in January, 20. It is understood that late fee will be paid by the supplier for filing late.

[sivarama krishna]

SIR,

I wants know clearly whether the purchaser is eligible to claim ITC on the invoices which were not uploaded by the supplier in GSTR-1 and not reflected in GSTR-2A of the purchaser.

[KASTURI SETHI]

In simple language and for your easiness you will get only 10 % . If you want full credit, persuade your supplier to upload all the invoices.

[sivarama krishna]

Thanq sir. What about ITC (not reflected in GSTR-2A) on purchaes made before October 2019. Is the purchaser eleigible to claim ITC on the purchaes made before October 2019 which are not reflected in GSTR-2A ?. plese clarify

[KASTURI SETHI]

Yes. ITC can be taken in respect of invoices pertaining to the period prior to October, 19. Persuade your supplier to upload the same at the earliest. Your suppliers may be committing some error. When an invoice is correctly uploaded on the common portal ITC will be reflected in 2A. It will be reflected in that particular month i.e. the month in which invoice is issued.

Time limit for availment of ITC

Should be earlier of the two factors :

1. Filing of return under Section 39 for the month of September following end of the financial year i.e. For 18-19 by October, 20 (September return GSTR 3B)

2. Filling of Annual Return.

First option is earlier.

[sivarama krishna]

Sir,

I wants to know the eligibility of ITC on purchases made before October 2019. The supplier not uploaded the invoices in GSTR-1 for the month October 2017 by intention or negligence, is the purchaser eligible to claim ITC on those invoices Which are not uploaded by the supplier till date?

example: The taxable person purchased goods in October 2017 and claimed ITC, the supplier not at all uploaded the invoices in his GSTR-1 return till date. The tax department issued notice to the purchaser that he is not eligible to claim ITC on those invoice which were not uploaded by the supplier in GSTR-1 and orders given to the purchaser to pay tax on those wrong availment of ITC .

which is correct?

1. Is the purchaser is eligible to claim ITC on the purchases ( made in October 2017 ) and the supplier not uploaded the invoices in GSTR-1 return till to date.

2. Is it correct that the issuing of notice by the tax department to the purchaser to pay the tax on claim of ITC on the purchase invoices which were not uploaded by the supplier in GSTR-1 return for the month October 2017( The supplier not uploaded the invoices till date)

Please clarify that whether the purchaser eligible to claim ITC on the purchase invoices relates to October 2017 which are not uploaded by the supplier in GSTR-1 return till date and the supplier not filed GSTR-9 return.

[KASTURI SETHI]

Answer to Question no.1 is NO. Question No.2 Yes. The department is legally correct. You cannot claim ITC for October, 17 now. It is hit by time limit.

[sivarama krishna]

Thanq sir, Thanq very much for spare your valuable time to clarify the doubts

please clarify that

The purchaser purchased goods in October 2017 and claimed ITC in October 2017 GSTR-3B return . There is no delay in claiming ITC by the purchaser. But the supplier not uploaded the invoices in GSTR-1 return for that month. Is it correct to claim ITC on invoices which were not uploaded by the supplier in GSTR-1 during the above period.

[KASTURI SETHI]

If your supplier uploads invoices for Oct., 17 in March, 2020 while filing GSTR-1 for Feb, 20, ITC will be reflected in 2A. You will be able to use the same. It will not be time barred as you have already taken credit provisionally in GSTR-3B for October, 17.

[anand rao]

Respected Sir,

Please clarify me, we have availed ITC on purchase invoice and for FY-2018-19 but we not made payment on time and for one year we made payment, but still till seller not uploaded the Sales in GSTR-1, is we need to reverse the ITC or any other suggestions please provide sir.

[KASTURI SETHI]

Your ITC pertains to the year 18-19. In this scenario, you cannot take ITC until it is reflected in GSTR 2 A return which is auto-populated.

[KASTURI SETHI]

Reflection invoices in 2A is an absolutely must. If not reflected, you may get SCN from the department for reversal along with interest and penalty may also be imposed. Since you have taken ITC, ITC will not be hit by time bar limit but you will have to persuade your supplier to upload the invoices in GSTR-1 now.

[Nikhil Ranade]

Dear Sir

I am a seller to firstcry and we were doing a wrong filing and instead of digital age gst we by mistake have been filing in urd category from 2017 till now.

Now after 3 yrs firstcry is holding our payment and asking us to recetify all old entry from 2017. I think we can only do changes from April 2019 and not beyond that. I understand we did mistake but even forstcry did not come back and ask us to recetify. Can they hold our payment for this. As payment is made for supply of good and compliance is a different issue.

Thanks

Nikhil

[KASTURI SETHI]

Rectification is possible only through jurisdictional GST Range Officer. Range Officer will contact the concerned officer of Common Portal Officer make a humble request in writing to the Range Officer. Without rectification your buyer cannot take ITC. I hope your problem will be solved. Make efforts.

[Bill Bohm]

Dear Sethi Sir,

Thank you for your valuable inputs. Really very helpful.

My situation is: I received a supply from seller in Sep 2020 with GST invoice. I accounted the same in my GSTR 3B. The seller did not file my invoice in GSTR-1. After much dispute, now, in Feb 2021, he refunded my entire bill amount and asked me to return the supply. I returned the goods and received refund.

The ITC claimed by me in 3B for Sep 2020 purchase was filed on 24 Oct 2020. I never utilized "this ITC" until i filed 3B for Dec 2020 on 10 Jan 2021.

Now, how do i reverse "this ITC". Should i file DRC 03 under Voluntary Payment or ITC Mismatch in 2A/3B or ITC Mismatch in 1A/ 3B?

Also, 24% interest applicable from 24 Oct 2020 till date OR 10 Jan 2021 (date of utilizing "this ITC") till date?

Kindly help Sir.

Thank You in advance.

[KASTURI SETHI]

Mr.Bill Bohm,

You are to reverse under Table No.4 against serial no. (B) (2)-------Others of GSTR 3B and NOT through DRC-03.

Interest is to be paid in cash through Electronic Cash Ledger. In my interest is to be paid for the period ITC has been utilised.

This is my view. Other experts may differ.

[Bill Bohm]

Dear Sethi Sir,

Thank you so much for taking the time and replying.

Your opinion sounds very logical & practical - Thank you Sir.

Kind Rgds.

[KASTURI SETHI]

Dear Bill Bohm, Thank you very much. It gives me immense pleasure when the querist is satisfied with my interpretation, analysis and conclusion .I reply only when I am fully satisfied with the correctness of legal interpretation. Difference of opinion is always there. You see that even in the same court and in the same bench two judges do not agree and the matter is referred to third bench.

AI Summary

Input tax credit availability limited where supplier invoices are not uploaded; supplier upload and GSTR-2A reflection restore credit eligibility. ITC on invoices not uploaded by the supplier is limited by a statutory cap relative to credit from uploaded invoices; full credit requires supplier upload so the invoice reflects in GSTR-2A. If a purchaser has already taken provisional ITC and the supplier later uploads the invoice, the credit will be available and not time-barred. Absent reflection in GSTR-2A, authorities may require reversal, payment of interest and penalties; reversals should be effected through the purchaser's return entries rather than separate voluntary challans. Persuading supplier compliance or seeking portal rectification is the recommended remedy.