No input credit if invoice not appearing in GSTR 2A /2B

The CBIC has issued Notification No. 39/2021 dated 21-12-2021 through which Section 16 of CGST Act, 2017 has been amended and new clause has been inserted with effect from 01 January 2022 which reads as

• “(aa) the details of the invoice or debit note referred to in clause (a) has been furnished by the supplier in the statement of outward supplies and such details have been communicated to the recipient of such invoice or debit note in the manner specified under section 37;”
• Explanation – As per Section 16(2) (aa) ITC on invoice or debit note can be availed only when details of such invoice/ debit note have been furnished by the supplier in his outward supplies (GSTR-1) and such details have been communicated to the recipient of such invoice or debit note

New Conditions w.e.f. 01 January 2022 for availing input tax credit

All the below mentioned conditions shall be satisfied to avail Input Tax Credit:

• The recipient is in possession of tax invoice or debit note issued by a supplier.
• The details of the above-mentioned invoice or debit note have been furnished by the supplier in the statement of outward supplies i.e., GSTR 1 and such details have been communicated to the recipient of such invoice or debit note (GSTR 2A/2B)
• The recipient has received the goods or services or both.
• The tax charged in respect of such supply has been actually paid to the Government.
• The recipient has furnished the return under section 39 of the CGST Act.

Therefore, with the introduction of section 16(2)(aa) with effect from 01 January 2022, Input Tax Credit cannot be availed in the monthly returns, if the corresponding credit is not reflecting in GSTR- 2A / 2B.

The GST authorities were already questioning the availment of input tax credit if the same was not being reflected in GSTR 2A / 2B. Now, with the introduction of this provision, it has become imperative for the business to be more vigilant and it would be better to have more stricter procedure for choosing a vendor and also the payments should be linked with appearance of invoice in GSTR 2A / 2B.

Nakul Sharma, Audit Associate, SW India