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Entries reflected in GSTR-2A lead to Income Tax Demands

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Entries reflected in GSTR-2A lead to Income Tax Demands
Vivek Jalan By: Vivek Jalan
January 3, 2023
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We have witnessed various disputes under GST on account of GSTR-2A Vs GSTR 3B mismatches wherein the ITC claimed in GSTR 3B does not appear in GSTR 2A. However, there is a reverse twist to the case also. In case certain transactions appear in the GSTR-2A but are not taken in the purchases, then there may be an allegation of suppression of turnover. Further it may also lead to a dispute in Income Tax also.

As we know that Data sharing between GST department and Income Tax is now the order of the day. Admitted/demanded tax in one statue would lead to a demand in another. One must also be careful of auto-populated data and corresponding demands in one law as this may lead to demand in another law also. We know that under GST, demands are raised for fake invoices when the allegation may be that the recipient of goods or services are beneficiaries and master minds of transactions. The said demand is for the mischief of receipt of invoices without corresponding supply of goods/services. Now, many a times it is seen that the transaction appeared in the GSTR-2A and even though the ITC may not be availed, even then allegations are raised by The GST Department for suppression of turnover.

Denial of such allegations as well as certificates from professionals would not suffice until and unless one has disputed the fact of the transactions appearing in GSTR - 2A itself. Further even though there may be an uncrystallised demand in GST, the matter can still be opened in Income Tax also.


By: Vivek Jalan - January 3, 2023



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