availibility Input tax credit as per GSTR-3B

[shivashankar mr]

Purchases made & Input tax availed in GSTR-3B as per books. Which is not reflected in GSTR-2B

can be disallowed from Department ?. any judgement in favour of trader.

[KASTURI SETHI]

What is the period involved  ?

[Sadanand Bulbule]

Yes — they can issue a show-cause / demand if they believe statutory conditions (Section-16) are not satisfied, or supplier hasn’t paid tax / filed returns.

But courts have protected bona fide buyers where:

a) buyer has genuine invoices, evidence of payment (bank transfers), receipt of goods/services;

(b) supplier’s default or mismatch was for reasons beyond buyer’s control; and

(c) revenue did not carry out a proper supplier-side investigation before reversing the buyer’s credit.

Refer: Supreme Court SLP judgement in Assistant Commissioner of State Tax, Ballygunge Vs. Suncraft  Energy Pvt Ltd. - 2023 (12) TMI 739 - SC Order

Non reflection of supplies in GSTR-2A or 2B itself cannot be sole reason to deny ITC benefit, unless truth is found out.

[KASTURI SETHI]

Dear Sir Ji,

The judgement of Supreme Court in the case of Suncraft Energy - 2023 (12) TMI 739 - SC Order refers to GSTR-2A and NOT GSTR-2B. Both returns have different dates of enforcement. GSTR-2A was enforced w.e.f. 9.10.2019 vide Notification No. 40/19-CT dated 09.10.2019 and GSTR-2B was enforced w.e.f. 1.10.2022. Refer Rules 60(7) and 36(4)as amended.

Hence the period is the most crucial here in order to place reliance upon the above referred judgement.

[Sadanand Bulbule]

Dear Sirji

Absolutely I go with your analysis. 

Querists need to disclose full facts to get correct reply. 

[KASTURI SETHI]

Dear Sir Ji,

Highly thankful to you for your concurrence. 

[Ganeshan Kalyani]

Officer will go by rule and deny the credit. At higher forum you may get relief.

[KASTURI SETHI]

Yes, Sir. Statutory records are very much basis of availing ITC. If the transactions are genuine with documentary evidence, relief on merits is possible at the First Appellate Authority or GSTAT etc. The querist must fight for  fair justice.

AI Summary

ITC claimed in GSTR-3B but absent in GSTR-2B: Section 16 conditions, evidence, and relief for bona fide recipients If input tax credit is shown in GSTR-3B but not in GSTR-2B, tax authorities can issue show-cause notices or deny ITC if statutory conditions (Section 16) are not met or the supplier hasn't paid/filed returns. Courts have granted relief to bona fide recipients where invoices, payment proof and receipt of goods/services exist, the supplier's default was beyond the buyer's control, and authorities failed to properly investigate the supplier; however, cited case law referring to non-reflection in GSTR-2A may not apply to GSTR-2B due to different enforcement dates and rules, so the relevant tax period and documentary evidence are crucial and appellate relief is possible on merits.