NIL GSTR-1 filed under QRMP despite reporting sales in GSTR-3B (B2C supplies)

[Bishal]

A taxpayer registered under the QRMP scheme since FY 2020-21 has always filed NIL GSTR-1 for all quarters, but has correctly disclosed B2C outward supplies and paid the applicable GST in GSTR-3B for the respective months.

There are no B2B transactions involved, so no recipient ITC is affected. The error is purely procedural, but it has resulted in a mismatch between GSTR-1 and GSTR-3B for multiple past years.

What is the best possible remedy now, considering:

• The statutory time limit for rectifying GSTR-1 for FY 2020-21 and 2021-22 has already lapsed under Section 37(4) of the CGST Act.

• The taxpayer wants to correct records to avoid mismatch notices and future disputes.

• All taxes have already been paid, and there is no revenue loss to the Government.

Experts are requested to advise on:

1. Whether old B2C supplies can still be reported in the current GSTR-1, and if so, the correct reporting method.

2. Any departmental intimation or reconciliation statement that should be filed to avoid notices.

[KALLESHAMURTHY MURTHY K.N.]

Sir, 

Please read the Article  "RECTIFICATION OF GSTR - 1 FORM" dated 13-03-2024 in this Forum under Articles.

The department will view the irregularity of the Taxpayer as the sales are a tax evasion-prone commodity at first, and suspect that tax on all supplies is declared in GSTR-3B. Penalty may be proposed for non-filing of GSTR-1. Better to submit the details of sales effected manually before the LGSTO.

 

AI Summary

GSTR 1 rectification: late B2C reporting may be time-barred; submit manual sales reconciliation to the local tax office to mitigate notices. A QRMP taxpayer filed NIL GSTR-1 while reporting and paying tax on B2C supplies in GSTR-3B, causing historical mismatches; statutory time limits now preclude electronic amendment of past GSTR-1s, so the error is procedural with no revenue loss. Department may view the pattern as irregular and propose penalties for non-filing. Practical mitigation recommended is preparing a reconciliation of B2C sales and submitting those details manually to the local tax office/LGSTO, citing the reconciliation to seek regularisation and reduce likelihood of mismatch notices.