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ITC calim of fy 2017-18 and fy 2018-19, Goods and Services Tax - GST

Issue Id: - 116550
Dated: 20-7-2020
By:- Madhavan iyengar
ITC calim of fy 2017-18 and fy 2018-19

  • Contents

A Company has accounted for ITC in the books of accounts in FY 2017-18 and FY 2018-19 based on invoices received and also goods / services have been received in the respecting accounting years ie FY 201718 and FY 2018-19

However in GSTR 3B the same has not been availed ie in returns

Query can the Company now in July 20 avail the ITC ( of FY 2017-18 and FY 2018-19) as mentioned above in GSTR 3B returns to be filed for July 20.

Experts please clarify

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Posts / Replies

Showing Replies 1 to 15 of 18 Records

1 Dated: 20-7-2020
By:- Rajagopalan Ranganathan


The time limit for taking ITC for 2017-18 is GSTR-3B return filed for the month of September 2018, that is 20.10.2018. For the year 2018-19 the time limit is GSTR-3B return file for the month of September 2019, that is 20.10.2019. After this date it is not possible to take ITC for past period.

2 Dated: 20-7-2020
By:- Mahir S

ITC for the past 2 financial years cannot be availed as on today, as rightly discussed above.

3 Dated: 20-7-2020
By:- Madhavan iyengar

Then there is no equity in law as i have recd material, have invoice, and made payment and have used the material to produce finished goods / services which are sold and then output tax is discharged on the said finished goods/ services.

why then ITC should be denied

4 Dated: 20-7-2020

There is a failure on your part. I endorsed the views of the experts.

5 Dated: 20-7-2020

Sh. Madhavan Iyengar Ji,

The time limit fixed under Section 16(4) of CGST Act for availment of ITC has to be adhered to. Has it no statutory value ? Why do you not recognize the time frame ?

6 Dated: 20-7-2020
By:- Madhavan iyengar

Kasturi sir

Accepted 100% legal provisions will hold ground as the provisions have been enshrined in the CGST Act

but dont you feel the law is tilted against the assessee and in earlier law in daiichi case where the apex court has held that ITC is a indefeasible and a vested right.

7 Dated: 20-7-2020
By:- Mahir S

Even under CEx law, the time limit for availment of cenvat credit was fixed as 1 year from the date of relevant document.

If you keep on availing ITC after 3 years period, how would the CA auditors n Dept Audit officer verify if u had not availed it earlier. For your one document, they cannot recheck the previous year documents, to confirm that u had not availed it previously.

Time period for availment of ITC is a settled law.

8 Dated: 21-7-2020
By:- Mahir S

However, you may request and refer the matter to GST Council for such extension of time.

But ultimately, it would create burden on Govt revenue.

9 Dated: 21-7-2020
By:- Ganeshan Kalyani

Sir, the taxpayer has to maintain purchase register, input credit account in his books of accounts. Before, filing of GSTR-3B one has to reconcile ledgers and determine correct input tax credit. On a monthly basis or on quarterly basis as per the periodicity of return one has to carry out the reconciliation. The time limit given is sufficient to reconcile. Say, if a taxpayer has forgot to claim credit of Apr 2019 invoice then he has time to take the credit till Sept 2020. So, he has 17 months to take credit. If invoice pertaining to March 2020 is left to be taken then he has 6 months time. Ideally this much time limit is enough for a taxpayer to claim the unclaimed credit.

10 Dated: 21-7-2020
By:- Ganeshan Kalyani

Sir, the time limit also serves the purpose of building discipline in the taxpayer to claim the credit on a timely basis.

11 Dated: 21-7-2020
By:- Mahir S

Very well explained, Ganeshan ji..

12 Dated: 22-7-2020
By:- Spudarjunan S

Dear Sir,

As rightly explained by the experts above, strict reading of the provisions of the law you may not be eligible to avail the ITC of 17-18, 18-19 as on today.

However, that doesn't stop you from litigating the same with Judiciary, where already two cases are pending in this regard in Gujarat HC - Niyati Constructuions SCA 5268 of 2020 & Madhya Pradesh HC - Shreeji Earth Movers WP 5434-2020.

You can litigate stating that the time limit u/s 16(4) relates with return u/s 39 and 3B is not a return u/s 39. Refer the rationales in the judgement of Hon'ble High Court of Gujarat in the case of AAP and co and also an interim relief order passed by Hon'ble High Court of Andhra Pradesh in the case of Panduranga Stone Crushers.

You can challenge the retrospective amendment made vide notification no.49/2019 in Rule 61(5) as it is affecting your substantiating rights and alos there are several grounds for challenge - 

You need to rationally decide whether it is worth to litigate or to be conservative. Moreover, the facts and circumstances of the assessee would also be a major factor to be considered for opting to litigation.

13 Dated: 22-7-2020
By:- Madhavan iyengar

thanks experts for very good analysis and providing an insight into this issue. from the replies received from all experts we can conclude that any itc left to be claimed within statutory period will lapse.

14 Dated: 23-7-2020

Dear Madhavan iyengar Ji,

Q. Accepted 100% legal provisions will hold ground as the provisions have been enshrined in the CGST Act but don't you feel the law is tilted against the assessee and in earlier law in daiichi case where the apex court has held that ITC is a indefeasible and a vested right.

Reply : ITC/CENVAT/MODVAT is a facility. CGST law is not tilted against the assessee. Time limit is an absolutely must to monitor ITC availment. Without the bar of time limit, it is not possible to curb the misuse of the ITC facility. During my posting in Audit, I had detected such cases wherein the party had availed credit twice on the same invoice after two or three years. There is a reason behind the time bar limit for taking credit.At that time there was no restriction of time limit. MODVAT (earlier it was called modvat, thereafter, CENVAT and now ITC) was first introduced in the year 1986. From 1986 to June, 2020, a large number of fraudulently availed cases have been detected by the department. Modvat/Cenvat/ITC schemes are successful only in those countries where people avail credit honestly. Not going to the past, even after implementation of GST (within years) the department has detected unaccountable fraud cases of ITC. ITC was taken on the strength of invoices where firm does not exist. This is on record of the department.

2. If there is no time bar restriction on availment of ITC, there will be chaos. Most of the assessees do not object to time-bar restriction. What is objectionable is "ITC BLOCKED" Section 17 (5). When Govt. has made the law, "Credit must be used in the course of business or furtherance of business why credit should be blocked on one ground or other. Why to create Section 17(5) ? Time bar restriction is not injustice but blockage of ITC is injustice. Tax payers pay tax on their inputs, input services and capital goods but they cannot take credit because of various restrictions imposed under Section 17(5). Such ban should be lifted. Govt. should create some other source of income instead of blocking the ITC.

3. This Section of blockage of credit will generate litigation. Wait for the internal audit and CAG Audit. Tax payers are committing Himalyan blunders regarding availment of ITC and in other fields also.

4. Instead of blockage of credit , Govt. should fix ratio between payment tax by cash and through ITC. Earlier it was known as PLA : Cenvat ratio. Value addition portion should come from Electronic Cash Ledger. Fixing of ratio is better than blockage of ITC.

15 Dated: 25-7-2020
By:- Bhavika Chothani

For 2017-18 the last date to take ITC was filing date of GSTR-3B of March 2019. For 2018-19 the last date was filing date of GSTR-3B of September 2019.

Since both the dates are elapsed now, so you cannot take the ITC for 2017-18 and 2018-19 now


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