in GSTR-3B for the month of April 2019, an ITC of Rs. 1000000/- was excessively taken in GSTR-3B, but the same was reversed in April 2020 in GSTR-3B. The reversal was not separately shown. Rather the same was netted off i.e. to say that total ITC for the month of April 2020 was 2500000/-, but we took net ITC of 1500000/- only.
The same was also shown and reflected in GSTR-9 for the FY 2019-20 & 2020-21.
Now during the audit, department is not allowing the reversal. How can we go about this?
Dispute Over Reversal of Excess ITC Not Shown Separately in GSTR-3B; Consider Reconciliation and Consultation A participant raised a query about an excess Input Tax Credit (ITC) of Rs. 1,000,000 claimed in April 2019, which was reversed in April 2020 but not separately shown in GSTR-3B. The reversal was reflected in GSTR-9 for FY 2019-20 and 2020-21. During an audit, the department did not accept the reversal. Suggestions included showing reconciliation for 2020 ITC, consulting a Chartered Accountant, and considering litigation. A circular was mentioned, suggesting the possibility of reversing excess ITC on a net basis, but the querist was advised to refer to it as a correction or rectification. (AI Summary)
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