GST DEPARTMENT STARTED SENDING NOTICES UNDER SECTION 16(4) OF THE CGST ACT, 2017

We know that the due date of claiming ITC for F.Y. 2017-18 and F.Y. 2018-19 was 30th Apr, 2019 (March, 2019 GSTR-3B) and 20th Oct, 2019 (Sep, 2019 GSTR-3B) respectively [Section 16(4) of the CGST Act, 2017].

Some taxpayers have filed their GSTR-3B for such F.Y. after due date as mentioned above and have claimed the ITC for F.Y. 2017-18 and F.Y. 2018-19 respectively.

As such ITC is not eligible to claim under the GST Act, the GST department has started sending notices to those taxpayers who have claimed ITC for such F.Y. as mentioned above.

E-mails received by some taxpayers are as under :

(1.) Dear Taxpayer, As you are aware, in terms of provisions of section 16(4) of the CGST Act, 2017 any of the registered persons filing their GSTR-3B return in respect of the last two financial years (July, 2017 – March, 2018 and 2018-19) after 30.04.2019 and 20.10.2019 respectively, could not have availed any credit on invoices or a debit note pertaining to the relevant F.Y. except in respect of IGST paid on import of goods by such registered persons. Accordingly, any credit availed in violation of provisions of section 16(4) is inadmissible.

Records indicate that you have filed your GSTR-3B return for Mar, 2019 after the said due dates in which you have availed credit of Rs. 2,98,144.12 which is inadmissible under section 16(4) of the CGST Act, 2017.

You are advised to deposit the amount equivalent to tax paid using such inadmissible credit through Form DRC-03 with applicable interest.

(2.) Dear Taxpayer, As you are aware, in terms of provisions of section 16(4) of the CGST Act, 2017 any of the registered persons filing their GSTR-3B return in respect of the last two financial years (July, 2017 – March, 2018 and 2018-19) after 30.04.2019 and 20.10.2019 respectively, could not have availed any credit on invoices or a debit note pertaining to the relevant F.Y. except in respect of IGST paid on import of goods by such registered persons. Accordingly, any credit availed in violation of provisions of section 16(4) is inadmissible.

Records indicate that you have filed your GSTR-3B return for Jan, 2018 after the said due dates in which you have availed credit of Rs. 1,530 which is inadmissible under section 16(4) of the CGST Act, 2017.

You are advised to deposit the amount equivalent to tax paid using such inadmissible credit through Form DRC-03 with applicable interest.

2 thoughts on “GST DEPARTMENT STARTED SENDING NOTICES UNDER SECTION 16(4) OF THE CGST ACT, 2017”

    1. You have to do proper reconciliation and to find the amount of ITC which was claimed in GSTR-3B which is mentioned in notice send by the department.

      You have to deposit the same amount of tax by using DRC-03 with interest. Submit a copy of reconciliation and reply at jurisdictional office of department.

      For further assistance, please send the copy of notice at taxconcept4@gmail.com

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