- Availment of Input Tax Credit which is not restricted as per GSTR-2B: Section 16(2) provided for certain conditions for availing ITC which were as follows: a)Possession of a valid document such as Tax Invoice b)Receipt of goods or services or both on which such ITC is being claimed (Receipt implies that delivery is complete & all risks and rewards have been transferred to the purchaser either by physical movement or by transfer of documents of title. Actual movement of goods is not necessary) c)Tax on such supply has actually been paid d)Return has been furnished u/s 39 New Addition: Input tax credit with respect to a supply may be availed only when such credit has not been restricted in the details communicated to the registered person under section 38 viz GSTR-2B.
2. ITC cannot be availed on provisional basis:
If outward tax liability has not been discharged by the supplier then the recipient has to reverse such input tax credit along with interest. However, once payment of outward tax liability is made by the supplier, the recipient can re-avail such input tax credit.
3. Extension in time limit to avail ITC:
ITC for a financial year can be claimed upto 30th day of November following the end of the financial year to which such invoice or debit note pertains, or furnishing of the relevant annual return, whichever is earlier.
Earlier this time limit was upto the due date of furnishing of the return for the m/o September and the due date for filing GSTR-3B for m/o September is 20th/22nd/24th October. Thus approximately one more month has been granted to avail missed out ITC, i.e., Missed ITC can be claimed latest in the return for the m/o October.
4. Similarly, rectifications in outward supplies in GSTR-1 & 3B can be made upto 30th of November of the following financial year to which the amendment pertains.
5. Amendment in provisions regarding Payment of Tax:
Section 49(4) of the CGST Act,2017 is proposed to be amended so as to:
a) Prescribe restrictions in utilizing the amount available in the Electronic Credit Ledger
b) Allow transfer of amount available in electronic cash ledger under CGST Act of registered person to the electronic cash ledger under CGST/IGST Act of a distinct person, i.e., transfer of ECL balance between branches of same entity is now allowed.
c) Prescribe the maximum proportion of output tax liability which may be discharged through the electronic credit ledger.
6. Interest on reversal of ITC only if same has been utilized:
The interest shall be payable on every reversal of wrongly availed input tax credit only if such credit was utilized by the taxpayer. Further, interest liability shall not be imposed if input tax credit has not been utilized & balance is standing in Electronic Credit Ledger.
7. Rate of interest is being proposed to be standardized @ 18% for all, even for excess claim of ITC.
Such amendment is proposed to be made retrospectively w.e.f. 01st July 2017.