Rule 36(4) ITC Restrictions to 10% Cap - due to COVID-19 issue - & Lockdown all over India , how can we take ITC Credit - Need guidance please.

[venkataraman swaminathan]

Dear Sir

Good Morning

As per the present situation of Lockdown all over India and as per the Press Release & as per Finance Minister's announcement , time limit / due date / for all the GST Returns are extended up to June 2020. In these circumstances for the month of March 2020 , purchases, the supplier / service providers /vendors will avail the due date extension and hence they may file their GSTR-1 returns for March 20 belatedly , not on or before 11.04.2020 (falls in the Lockdonw period) . Hence for our ITC Credit by 2A & GL reconcilation will affect huge quantum of Short fall of ITC credit . How can we handle this (Rule 36(4) cap 10%) for Utilization of the ITC . Is there any relaxation in Rule 36(4) . Request guidance on this for March 2020- ITC credit for GSTR-3B .

thanks/regards

v Swaminathan

AI Summary

Input tax credit cap relief framed cumulatively for the lockdown period; claim credit in books if statutory prerequisites met.
Practical issues arise claiming input tax credit due to the Rule 36(4) cap when supplier details are delayed; Notification NN 31/2020-CT treats matching cumulatively for February-August 2020 with adjustments by the September return. Some commentators allege the notification is ultravires to section 16(2)(c) because matching is deferred, while others accept it and stress that the statutory prerequisites for claiming credit-receipt, invoice possession and timely payment-remain unchanged and that credit may be taken in books subject to cumulative cap calculations in GSTR-3B reconciliations.