CBIC clarifies on restriction in availment of input tax credit in terms of rule 36(4) of Central Goods and Services Tax Rules, 2017

Nov 13, 2019 | by Avantis RegTech Legal Research Team


Finance & Taxation Compliance

The Central Board of Indirect Taxes and Customs (CBIC) on November 11, 2019, has clarified on restriction in availment of input tax credit (ITC) in respect of invoices or debit notes, the details of which have not been uploaded by the suppliers under section 37(1) of the Central Goods and Services Tax Act, 2017, which specifies the procedure for furnishing the details of outward supplies.

CBIC Vide Notification No. 49/2019- Central Tax, dated October 09, 2019 which specifies the above condition for availment of ITC. Therefore, to ensure uniformity in the implementation of the provisions of the law across the field formations, CBIC clarifies various issues. This being a new provision, the restriction is not imposed through the common portal and it is the responsibility of the taxpayer that credit is availed in terms of the rule 36(4) of the Central Goods and Services Tax Rules, 2017, which specifies the Documentary requirements and conditions for claiming input tax credit, and therefore, the availment of restricted credit in terms of rule 36(4) shall be done on self-assessment basis by the tax payers. 

CBIC has given clarification after examined various issues regarding implementation. The issues are as under:

1.What are the invoices or debit notes on which the restriction under rule 36(4) of the CGST Rules shall apply?

2.Whether the said restriction is to be calculated supplier wise or on consolidated basis?

3.FORM GSTR-2A being a dynamic document, what would be the amount of input tax credit that is admissible to the taxpayers for a particular tax period in respect of invoices / debit notes whose details have not been uploaded by the suppliers?

4.How much ITC a registered taxpayer can avail in his FORM GSTR-3B in a month in case the details of some of the invoices have not been uploaded by the suppliers under subsection (1) of section 37.

5.When can balance ITC be claimed in case availment of ITC is restricted as per the provisions of rule 36(4)?

[Circular No. 123/42/2019– GST]


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