TaxTMI 
TaxTMI 
TaxTMI 
Handling GST Notices for GSTR-3B Table 4D(2) Reversals, re-claim & Reversals, etc...Filing GSTR-3B the right way henceforth to save litigation
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....andling GST Notices for GSTR-3B Table 4D(2) Reversals, re-claim & Reversals, etc...Filing GSTR-3B the right way henceforth to save litigation<br>By: - Vivek Jalan<br>Goods and Services Tax - GST<br>Dated:- 21-11-2025<br><br>The Core Issue is that Circular No. 170/02/22 dated 06.07.2022 was issued with an objective as follows: "It is desirable that correct reporting of information is done by the re....
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....gistered person in FORM GSTR-3B and FORM GSTR-1 so as to ensure correct accountal and accurate settlement of funds between the Central and State Governments" Now the SGST Department across the Country are issuing notices with the following - * ITC reversal on basis of the following computation - * Table 8(D) of GSTR 9 is required to be reported in GSTR-3B in Table 4D(2) for disclosures of ine....
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....ligible ITC * In some states, the requirement is to reclaim the amounts as above in GSTR-3B Table 4B(5) reverse in GSTR-3B Table 4B(1) and then report the ITC in GSTR-3B Table 4D(2) This brings us to the Pointers - 1. Incase in earlier periods i.e. prior to July 2022 when Circular No. 170/02/22 was issued, disclosures under GSTR-3B Table 4D(1) under ineligible category have not been made, then....
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.... it is a non-compliance. A contention of the taxpayers may be that clear directions like Circular 170 were missing earlier. 2. From the tax period in JULY 2022, ie post Circular 170 was effective, the above plea may not suffice, especially after notification of the requirements of circular in around November 2022. 3. To reclaim and reverse old ITC - it would create an issue of time barring unde....
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....r Section 16(4) of the CGST Act, 2017 for the reclamations. However, reversals it would be an admission. It is important to note here that while SGST Departments may require such a disclosure, yet the CGST Anti-evasion units, may see a non-compliance with Section 16(4) of the CGST Act, 2017. Hence the taxpayers must be careful. 4. As per Proviso to Section 39(9) of the CGST Act, 2017, no rectifi....
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....cation of any omission or incorrect particulars shall be allowed in the returns after the thirtieth day of November following the end of the financial year to which such details pertain, or the actual date of furnishing of relevant annual return, whichever is earlier. Hence, the question remains whether such an ask would stand the test of judiciary. Notwithstanding the above points, it remains it....
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.... is now very apparent that filing GSTR-3B should not be seen as a mere formality. Correct disclosures may save taxpayers from litigation and wrong disclosures may put them into litigation. Many taxpayers who had not implemented Circular 170 should start filing the return the right way, else there would be losses to the State Governments and penalties for non-compliances may be made. Reply By Pur....
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....ushothaman Gopalan as = The Circular does not create a statutory obligation to artificially avail ITC that is either: * ?ineligible under Section 17(5), or * ??not allowable earlier due to non-filfilment of conditions u/s 16(2), or * ??not intended by the Assessee to be availed in that period. Thus, the demand that Assessee "should have taken credit and reversed it" has no basis in Law.&n....
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....bsp; Circulars cannot override the Act; this is settled by the Supreme Court in CCE vs Ratan Melting & Wire Industries. - 2008 (10) TMI 5 - Supreme Court Dated: 23-11-2025<br> Scholarly articles for knowledge sharing by authors, experts, professionals ....