Ineligible ITC claimed and reversed- 74A

[Deepak Bubna]

Hello,

Can penal provisions of section 74A be invoked if ineligible ITC which department deems as bogus ITC is claimed and reversed in same month in GSTR-3B ?

Thanks in advance.

AI Summary

Debate on Penalties for Ineligible ITC Claims Reversed in Same Month Under GST Act Section 74A A participant in a discussion forum raised a query regarding the applicability of penal provisions under Section 74A of the GST Act when ineligible Input Tax Credit (ITC) is claimed and reversed within the same month in GSTR-3B. Responses varied, with some participants asserting that penalties should not apply since the ITC was not utilized, citing relevant court judgments. Others noted the potential for a culpable state of mind under Section 135, and the necessity of showing and reversing ITC as per circular guidelines. The discussion highlighted differing interpretations and legal precedents.