Transfer of ITC without filing ITC-02

[ROHIT GOEL]

Dear Experts,

Assessee was a Pvt Ltd company and got converted into LLP in FY 2019-20. It voluntarily cancelled GST Regn of company and got new Regn as LLP. Post conversion, it realised that it did not claim about Rs 25 lakhs eligible ITC which was reflected in GSTR-2A of company. This ITC was claimed by LLP post conversion in its 3B. Now GST Deptt has raised demand on LLP as it has claimed Rs 25 lakhs excess ITC which is not reflected in its GSTR-2A but in 2A of company. I understand that correct route would have been to claim ITC in GSTR-3B of company and then transfer to LLP via ITC-02.

However, as per deeming provisions of LLP Act 2008, LLP was entitled to all rights vested in favour of company post conversion. Can assessee contest that ITC could still be claimed despite not appearing in 2A of LLP and despite not filing ITC-02?

AI Summary

LLP Faces GST Challenge Over Unclaimed ITC; Experts Suggest Legal Avenues for Relief Despite Procedural Errors An assessee, initially a private limited company, converted to an LLP in FY 2019-20, canceled its GST registration, and obtained a new one. It later realized it did not claim Rs 25 lakhs in eligible ITC from the company's GSTR-2A, which the LLP claimed in its GSTR-3B. The GST Department demanded repayment, as the ITC did not appear in the LLP's GSTR-2A. Experts suggest that the LLP may argue its entitlement to the ITC under the LLP Act, despite procedural errors. Filing a writ in the High Court or using case law on procedural errors might provide relief.