FY 2021-22 ITC EXCESS CLAIMED SUPPLIER NOT FILLED IN GSTR-1

[DURAI RAJ]

You have availed excess ITC in GSTR-3B as compared to the tax declared by your suppliers in their GSTR-1 DRC-01 Notice how we have claimed ITC Based on  Available purchase bills how to rectify this notice

AI Summary

Excess ITC Claims Must Be Reversed Under Section 50(3) Unless Valid Documents Prove Eligibility A taxpayer claimed excess input tax credit (ITC) in GSTR-3B compared to the supplier's declared tax in GSTR-1, triggering a DRC-01 notice. The issue requires reconciliation between GSTR-3B and GSTR-2A/2B to verify accuracy. If excess ITC was wrongly claimed, it must be reversed with interest under Section 50(3) of the CGST Act. However, if the supplier failed to file but the recipient has valid documentation, courts have provided relief, recognizing that lawful ITC should not be denied solely due to supplier non-compliance. Section 16(2)(c) mandates that tax must be paid by the supplier for ITC eligibility, but judicial precedents, including a High Court ruling, have favored genuine taxpayers in such disputes.