Payment to vendor – A mandatory condition for availing ITC: Multiple absurdities
NITYA Tax Associates is proud to present their recent write-ups in the ‘Article’ series on trending indirect tax issues. A gist of the next article in the series is as under:
Article 42 – “Payment to vendor – A mandatory condition for availing ITC: Multiple absurdities”
While taxes are an intrinsic part of any business, they should never dictate the conduct of a business. The legislature seems to have forgotten this by interfering with taxpayer’s credit period / payment terms under the GST law. Second proviso to Section 16(2) of the Central Goods and Services Tax Act, 2017 provides that Input Tax Credit shall be available to recipient only if he makes payment to the supplier within 180 days from the date of invoice.
Through this article, our Partner, Mr. Deepak Suneja, Managing Associate, Ms. Aasmee Mangla and Executive, Ms. Simran Arora have tried to discuss logic behind this condition and impact on taxpayers whose normal payment terms extend beyond 180 days.
Please click on the below link to read our article titled “Payment to vendor – A mandatory condition for availing ITC: Multiple absurdities“ on the issue