UTILISATION OF ITC AFTER INSERTION OF SECTION 49A AND 49B
By: – Nitika Aggarwal
Goods and Services Tax – GST
Dated:- 21-2-2019<\/p>\n
UTILISATION OF ITC AFTER INSERTION OF SEC 49A
\nIn midst of changes vide CGST Amendment Act, 2018 there is an insertion of new sections i.e. 49A and 49B in CGST Act, 2017, which has paved its way in new direction. Let's analyze the impact of the same on the industry:-
\nSection 49(5) of CGST Act, 2017 provides the set off policies against the liabilities of CGST, IGST, SGST and UTGST from Input tax credit available. Prior to amendment in CGST Act, 2017 via CGST Amendment Act, 2018, Section 49(5) of the act reads as under:-
\nSection 49(5) of CGST Act, 2017:-
\n“(5) The amount of input tax credit available in the electronic credit ledger of the registered person on account of
\n(a) integrated tax shall first be utilised towards payment of integrated tax and the amount remaining, if any, may be utilised towards the payment of central tax and State tax<\/p>\n
= = = = = = = =<\/p>\n
Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n IGST = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n f any such tax.". = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n","protected":false},"excerpt":{"rendered":" UTILISATION OF ITC AFTER INSERTION OF SECTION 49A AND 49BBy: – Nitika AggarwalGoods and Services Tax – GSTDated:- 21-2-2019 UTILISATION OF ITC AFTER INSERTION OF SEC 49A In midst of changes vide CGST Amendment Act, 2018 there is an insertion of new sections i.e. 49A and 49B in CGST Act, 2017, which has paved its … Continue reading “UTILISATION OF ITC AFTER INSERTION OF SECTION 49A AND 49B”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-16917","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/16917","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=16917"}],"version-history":[{"count":0,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/16917\/revisions"}],"wp:attachment":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=16917"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=16917"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=16917"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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\nSGST & UTGST
\nSGST
\nSGST
\nIGST
\nCGST
\nUTGST
\nUTGST
\nIGST
\nCGST
\nFollowing are the examples for better understanding the aforesaid provision of the act:-
\nExample 1:-
\nWhen ITC of IGST is available and IGST liability is NIL
\nITC
\nITC Amount
\nLiability
\n1st Adjustment
\n2nd Adjustment
\nBalance to be Paid in Cash
\nBalance ITC
\nIGST
\n200
\n–
\n–
\n–
\n–
\nCGST
\n200
\n350
\nRs.200-200 (CGST )
\n₹ 150-150 (IGST)
\n–
\n–
\nSGST
\n200
\n250
\n₹ 200-200 (SGST )
\n₹ 50-50 (IGST)
\n–
\n–
\nExample 2:-
\nWhen ITC of IGST is available along with the liability of IGST
\nITC
\nITC Amount
\nLiability
\n1st Adjustment
\n2nd Adjustment
\nBalance to be Paid in Cash
\nBalance ITC
\nIGST
\n200
\n50
\nRs. (50-50)
\n (IGST)
\n–
\n–
\n150
\nCGST
\n200
\n350
\n₹ 200-200 (CGST )
\n₹ 150-150 (IGST)
\n–
\n–
\nSGST
\n200
\n250
\n₹ 200-200 (SGST )
\n50
\n–
\nHowever, the aforesaid position of set off against the ITC available after insertion of section 49A and 49B vide CGST Amendment Act, 2018 has been changed. Let's ana<\/p>\n
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\nPayment for
\nFirst set off from
\nThen set off from
\nIGST
\nIGST
\nCGST and SGST
\nCGST
\nIGST
\nCGST
\nSGST
\nIGST
\nSGST
\nExample 1:-
\nWhen ITC of IGST is available and there is no liability of IGST
\nITC
\nITC Amount
\nLiability
\n1st Adjustment
\n2nd Adjustment
\nBalance to be Paid in Cash
\nBalance ITC
\nIGST
\n200
\n0
\n–
\n–
\n–
\n–
\nCGST
\n200
\n350
\n₹ 200-200 (IGST )
\n₹ 150-150 (IGST)
\n–
\n50
\nSGST
\n200
\n250
\n₹ 200-200 (SGST )
\n50
\n–
\n Example 2:-
\n When ITC of IGST is available along with the liability of IGST
\nITC
\nITC Amount
\nLiability
\n1st Adjustment
\n2nd Adjustment
\nBalance to be Paid in Cash
\nBalance ITC
\nIGST
\n200
\n50
\n(50-50)
\nIGST
\n–
\n–
\n–
\nCGST
\n200
\n350
\nRs (150-150)
\n (IGST )
\n₹ 200-200 (CGST )
\n–
\n–
\nSGST
\n200
\n250
\n₹ 100-100 (SGST)
\n–
\n50
\n–
\nNow, this shall lead to accumulation of input tax credit on account of CGST, SGST and UTGST, which was fully utilized prior to insertion of section 49A. Cash flows of trade dealers might wedged <\/p>\n
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