TaxTMI 
TaxTMI 
Restaurant business is required to charge GST@5% without any ITC i.e. availment of ITC is not allowed to restaurant business. And as per Circular No. 170/02/2022-GST, ITC is required to be claimed as per GSTR-2B and reversal if any can be made in Table 4(B)(1) or Table 4(B)(2). In which table should restaurant business reported reversal of whole ITC and on what basis that specific table is selected for reversal.
ITC reversal
23 Nov 2023 
9 Replies 
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ITC reversal: classify restaurant ITC as permanent or other for correct GSTR-3B reporting to avoid misclassification.
The dispute concerns whether ITC unavailable under the concessional rate for restaurant services should be reported as a permanent, non-reclaimable reversal in Table 4(B)(1) of GSTR-3B or treated under other reversal mechanics, balancing the notification's condition, the non-binding nature of a circular, and practical GST portal constraints; many advisers recommend Table 4(B)(1) for practical risk avoidance while acknowledging statutory ambiguity about strict row-based categorisation and potential corrective recrediting. (AI Summary)
The dispute concerns whether ITC unavailable under the concessional rate for restaurant services should be reported as a permanent, non-reclaimable reversal in Table 4(B)(1) of GSTR-3B or treated under other reversal mechanics, balancing the notification's condition, the non-binding nature of a circular, and practical GST portal constraints; many advisers recommend Table 4(B)(1) for practical risk avoidance while acknowledging statutory ambiguity about strict row-based categorisation and potential corrective recrediting. (AI Summary)