Input Tax Credit Sec 16 (2)-possession of goods rule

[Rakesh Sharma]

Dear Members,

My query is , suppose I have purchase goods on 30.06.22 and goods received on 12.07.22. So in this case can in take gst credit of said invoice in Jun GSTR-3B because goods received before filing of return of june GSTR-3B (20th July)

Thanks

[KASTURI SETHI]

Answer is NO. You will have to fulfill all the conditions laid down under Section 16(2) of CGST Act.

Section 16(2)(b) is very much clear in this context.

[Mahadev R]

Since the return is for the period of June month, it needs to be seen if goods are received in June to claim ITC.

[Shilpi Jain]

As per the new disclosure requirements in GSTR-3B you will have to show the credit in table 4A and reverse it in table 4B of June.

In July this credit can be availed

[KASTURI SETHI]

I agree with Madam Shilpi Jain. Since the goods were received in July, 22, ITC can be taken in July, 22 and not in June, 22.

[giri gattupalli]

respected sir,

good evenig. my query is in the scenario ' where goods received in july-22 before filing of GSTR-3B for month june-22, whether he can claim input in june-22 GSTR-3B or not .please discuss

thanking you

[Mr Rao]

Dear querist,

As rightly explained by Shri Kasthuri ji, one of the conditions for availing the credit is that the goods should have been received by the taxpayer and hence the taxpayer can take credit only in the month of July, 2022 . The GSTR 3B return for July, 2022 will be filed by 20th August, 2022. The querist's argument that the GSTR 3B return for June, 2022 would be filed by 20.07.2022 and as the goods received on 12.07.2022 i.e, before filing GSTR 3B return for June, 2022, does not hold water.

[Ganeshan Kalyani]

Goods should be received in the month for which GSTR-3B is filed. In you case the goods should have been received in the month of Jun. So you cannot claim ITC in the month of Jun. However, the same need to be shown in Table 4(A)(5) and reverse it through Table 4(B)(2). In the month of July you can claim ITC by showing it under Table 4(A)(5) and same ITC to be shown as disclosure in Table 4(D)(1). The new GSTR-3B is not yet made available in GSTN and till that time you can continue current process i.e. claim ITC in July GSTR-3B under Table 4(A)(5).

AI Summary

Input Tax Credit possession rule: ITC claimable only in the tax period when goods are received; prior return cannot include.
ITC may only be claimed in the tax period when goods are actually received; possession of goods is a prerequisite under Section 16(2). If goods invoiced in one period are received in a subsequent period, ITC cannot be taken for the earlier period merely because its return has not yet been filed. Taxpayers should make the required disclosures and reversals in the earlier period's return as mandated by return-format rules and claim the ITC in the period of actual receipt.