In a move to ease GST compliance and accelerate business operations, the Finance Ministry on Friday made ‘GSTR-2A’ form as the sole prerequisite for ITC claims under GST. This comes as a major relief from the earlier procedure that mandated submission of all purchase invoices for a given month. Reportedly, GSTR-2A monthly form is auto-generated and contains all transaction details between a business and its supplier. Here a few points to take note of if you file ITC claims.
- GSTR-2A will be a proof of the account of the supply against which Input Tax Credit will be claimed by the taxpayer.
- In case the supplier has failed or delayed to file GSTR-1 and subsequently not all invoices are reflected on the claimant’s GSTR-2A form, the proper officer if necessary has the right to request hard copies of missing invoice details in the GTSR-2A form.
- The Proper Officer need not seek invoice copies in case details of the same are part of the GSTR-2A form of the corresponding period as well as have obtained clarification from Principal Chief Commissioners.
- A particular Tax Authority can no longer deny ITC reimbursements if the claimant has received green signal for the same from a counterpart tax authority (Centre or State). This comes in the light of rising complaints where ITC claims have not been disbursed on flimsy grounds like the validity of the primary sanctioning authority.
- The GST Policy Wing further said a few cases have come to notice where a tax authority, after receiving a sanction order from them, has refused to disburse the relevant sanctioned amount calling into question the order on certain grounds.
- Unless the ITC request falls under sub-section (11) of section 54 of the CGST Act, no disbursements (approved by a particular Tax Authority) can be put on a standstill.
- Any adjustments on current or outstanding ITC amount, if valid, can be done by the refund disbursing authority (even if not done by the refund sanctioning authority).
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A Positive Step Ahead
The retired ITC claim procedure was taxing on both fronts i.e it increased the already cumbersome workload and compliance cost. Hence, the Finance Ministry’s decision to make GSTR-2A form the single proof document to make ITS Claims comes as a huge relief for claimants. This is certainly a long-awaited welcome move as claimants now can get ITC refunds by submitting a printout of FORM GSTR-2A alone instead of the host of invoice copies that had to be submitted before.