DEAR EXPERT,
MY QUERY IS UNDER.
I am manufacturing firm. I am purchasing raw material from different suppliers. Sometimes we are purchasing from agents. So we dont know the supplier personally. We have received 3 different DRC-01 for the F.Y. 2018-19 stating that suppliers registration cancelled suo moto. hence ITC need to reverse. initially they have issued summon to us and we have supplied documents as they required. but off the record, they told us that when ever any suppliers GST number cancelled we demand ITC from the receipient too. in one notice they even not issued DRC-01A. We have documents like invoice, E-way bill, payment proof. What can be done in this case.
Manufacturing firm battles ITC denial over suppliers' GST cancellations under Section 29(2)(e); documentation and legal strategy crucial. A manufacturing firm is facing issues with Input Tax Credit (ITC) denial due to the cancellation of their suppliers' GST registration under Section 29(2)(e). The firm received notices demanding ITC reversal for the fiscal year 2018-19. Experts suggest that if the supplier's registration was active during the purchase, the firm has a strong case. However, if the suppliers are involved in fraud, it becomes challenging to claim ITC. Recommendations include preparing comprehensive documentation and being ready for prolonged legal proceedings. The burden of proof lies with the department, and past rulings may support the firm's case. (AI Summary)
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