The GST Council’s 45th meeting was held today in Lucknow under the chairmanship of the Union Finance & Corporate Affairs Minister Smt. Nirmala Sitharaman. The GST Council has announced that the date of issuance of the debit note shall determine the relevant financial year for claiming the Input Tax Credit (ITC) on the supply of goods or services.
With effect from January 1, 2021, the date of issuance of debit note (and not the date of underlying invoice) shall determine the relevant financial year for the purpose of section 16(4) of the CGST Act, 2017.
As per Section 16(4), the assessee cannot claim the input tax credit on the supply of goods or services after the due date of furnishing of the return under section 39 (i.e. GSTR-3B) for the month of September following the end of the financial year or furnishing of the relevant annual return, whichever is earlier.
Rule 36(4) of CGST Rules, 2017 to be amended, once the proposed clause (aa) of section 16(2) of CGST Act, 2017 is notified, to restrict availment of ITC in respect of invoices/ debit notes, to the extent the details of such invoices/ debit notes are furnished by the supplier in FORM GSTR-1/ IFF and are communicated to the registered person in FORM GSTR-2B.
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