Revised timelines for taking Input Tax Credit pertaining to Financial Year 2017-18

This is to apprise you regarding the recent judgement of the Gujrat High Court in the case of AAP and Co. v. Union of India, 2019-VIL-314-GUJ wherein the Court was dealing with the validity of Press Release dated October 18, 2018. The press release restricted the time limit to avail input tax credit (‘ITC’) for Financial Year (‘FY’) 2017-18 till October 25, 2018 i.e. the due date of filing of return in GSTR-3B for the month of September.

In numerous updates, as referred in trail mails, we informed that the last date to avail ITC pertaining to FY 2017-18 is due date of filing of annual return. In the above case, the High Court has affirmed our interpretation. The Court observed that GSTR-3B is not a return in lieu of return in GSTR-3. Further, the Court noted that the return under Section 39 is GSTR-3 and not GSTR-3B. Consequently, the time limit to avail ITC for FY 2017-18 shall be the date of furnishing of annual return for that year.

We are happy to share our Managing Partner Puneet Bansal’s podcast on this issue at https://youtu.be/SHnsaLmSPyY. Puneet has attempted to lucidly explain the underlying legal provisions, reasoning in the above judgment as well as the next steps that the taxpayers can take.