GST – Input credit for invoices missed in FY 2017-18
GST was introduced in India on 1st July 2017 with immense criticism and with an apprehension from the business community that the compliance burden will increase to a great extent under the GST regime. Government introduced three returns to furnish details of sales and purchases separately along with a final return in GSTR-Form 3. However, considering the several representations from business community and practical difficulties faced by small businessmen, the government introduced a simplified monthly return in form GSTR-3B.
Under the GST Law, taxes paid on purchases in a month can be claimed as input credit by furnishing details of such purchases in the return of the said month. However, if input credit of any purchase invoice is missed to be claimed in a month, the same can be claimed in the return of the subsequent month. This facility of claiming credit of missed invoices of earlier months can, however, be claimed only till the due date for filing the monthly return for September of the succeeding financial year. If for any reason, any invoices for the financial year 2017-18 were omitted to be included in the returns till September 2018, the corresponding input credit is permanently lost. This is a huge financial loss forthe genuine businessmen. Many businessmen have now realised that many invoices for financial year 2017-18 have inadvertently been missed by them to be included in their GST returns. However since the due date for GSTR-3B for September 2018 has already expired, the department is refusing to give credit for invoices pertaining to financial year 2017-18.
Recently in a writ petition filed beforethe Gujarat High Court – AAP & Co. Chartered Accountants v/s. Union of India &Ors. (Special Civil Application No. 18962 of 2018)it was contended that GSTR-3B is not a substitute for a monthly return. The Honorable Gujarat High Court accepted this contention and held that since a change in the due date for filing the monthly return – GSTR-3 for September 2018 has not yet expired, the input tax credit for financial year 2017-18 can still be claimed by filing the monthlyreturn – GSTR-3 for September 2018. The Honorable High Court held that GSTR-3B is an additional requirement and not a substitute for the monthly return.
This comes as a huge relief to the genuine businessmen who have missed to claim input tax credit for financial year 2017-18 in GSTR-3B returns filed till September 2018. Although this decision is given by Gujarat High Court, the benefit of the same can also be claimed by the dealers in Maharashtraby seeking proper legal advice.
