ITC for FY 2018-19 is denied bcoz GSTR 1 filed after Oct 2019

[chetan jadhav]

Dear All,

In one my clients case, GSTR 1 for FY 2018-19 is uploaded after Oct 2019. Becoz of this, customer denied to make any payment for invoices raised in FY 2018-19 stating he will not get the credit (ITC) as GSTR 1 was not filed before Oct 19.

Grounds taken by the customer is based on

1) Proviso inserted to section 16(4) and section 37(3) of CGST Act, 2018

Registered person shall be entitled to take input tax credit after the due date of furnishing of the return under section 39 for the month of September, 2018 till the due date of furnishing of the return under the said section for the month of March, 2019 in respect of any invoice or invoices relating to such debit note for supply of goods or services or both made during the financial year 2017-18, the details of which have been uploaded by the supplier under sub-section (1) of section 37 till the due date for furnishing the details under sub-section (1) of said section for the month of March, 2019.

2) GSTR-9 (Table 8A) the credit as appearing on 31.10.2019 as per GSTR-2A is autopopulated and any further credit is not allowed. Had the Government the intention to allow credit on self assessment basis, they would not have restricted credit in annual return.

3) Since my client have uploaded invoices post Sep 19, credit pertaining to those invoices has not been shown in our GSTR-2A downloaded on 14th Oct of customer i.e after last date of uploading invoices. Basis that he has debited my client's account

My views are that though my client has filed GSTR 1 after oct 19, it does not affect the ITC eligibility of customer based on following grounds - .

1. Proviso inserted to section 16(4), enable the tax payer to claim the input tax credit for the FY 2017-18 after due date of filling GSTR 3B for Sep 2018 subject to the condition that, the details for same are uploaded in GSTR 1 by supplier

2. Above proviso specifically stating FY 2017-18. Above proviso was inserted to cover the specific situation for FY 2017-18.

3. Most importantly, it has been clarified by the department vide press release (C.B.I. & C. Press Release No. 62/2018, dated 18-10-2018) that, It is clarified that the furnishing of outward details in FORM GSTR-1 by the corresponding supplier(s) and the facility to view the same in FORM GSTR-2A by the recipient is in the nature of taxpayer facilitation and does not impact the ability of the taxpayer to avail ITC on self-assessment basis in consonance with the provisions of section 16 of the Act

4. Nowhere in section 16(4), it is stated that, credit would not be allowed unless the details are reflecting in GSTR 2A before due date of furnishing return u/s 39. In order to claim the credit, one need to satisfy the 4 conditions stipulated in section 16(4).

5. It would be pertinent to note that, GSTR 1 filling for FY 2018-2019 is still activated. Had the intention been to deny the credit for FY 2018-19 after due date of GSTR 3B, the government would have deactivated GSTR 1 filling for FY 2018-2019 after Oct 2019

I would like to know the views of other experts.

Thank you

AI Summary

Client Denied ITC for FY 2018-19 Due to Late GSTR-1 Filing; Press Release Cited Lacks Legal Authority A client is denied Input Tax Credit (ITC) for FY 2018-19 because their GSTR-1 was filed after October 2019. The customer's refusal to pay is based on provisions in the CGST Act and the status of GSTR-2A as of October 31, 2019. The client argues that filing GSTR-1 late does not affect ITC eligibility, citing a press release clarifying that GSTR-1 and GSTR-2A are for taxpayer facilitation, not ITC eligibility. Replies suggest the case is time-barred under current law, with the press release lacking legal authority, and advise pursuing the case for potential future support.