TaxTMI 
TaxTMI 
A registered taxpayer has received services from an unregistered person during FY 2018-19 on which he is liable to pay tax (IGST) under RCM but no invoice was issued at the time of service received and no tax was paid. After being observed by the department in 2023, the RTP raised the invoice and paid the IGST along with interest, and at the same time availed ITC on the tax so paid under RCM on the contention that the date of invoice raised doesn’t violate Sec. 16(4). Is the RTP eligible for the ITC?
ITC Eligibility under RCM
07 Sep 2024 
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Input tax credit eligibility for delayed self-invoice under reverse charge depends on tax payment and compliance, subject to penalties.
When a recipient issues a self-invoice for supplies from unregistered persons and pays tax, the financial year for calculating the time-limit to avail ITC is the year in which that self-invoice is issued, provided tax is paid and other ITC conditions and restrictions are met; delayed issuance may attract interest and possible penal consequences, and allegations of fraud or suppression can still bar ITC. (AI Summary)
When a recipient issues a self-invoice for supplies from unregistered persons and pays tax, the financial year for calculating the time-limit to avail ITC is the year in which that self-invoice is issued, provided tax is paid and other ITC conditions and restrictions are met; delayed issuance may attract interest and possible penal consequences, and allegations of fraud or suppression can still bar ITC. (AI Summary)