Budget 2023 GST Proposal
Reversal of ITC on account of non-payment to the Supplier within 180 days
Section 16 is being amended to bring it in line with the return filing system. Where a recipient does not pay the Invoice value and GST thereon to the supplier within 180 days, he is required to reverse the ITC proportionate to such pending payment.
Currently said ITC amount is required to be shown as Output Tax liability and paid along with Interest
In the proposed amendment, it will be shown as reversal of ITC in GSTR 3B and paid along with Interest.
Another amendment provides that the recipient will be eligible to re-avail such reversed ITC once the pending payment has been paid to the Supplier, currently the law is silent on the aspect of whom the payment is required to be made.