Dated: __________

To,
Assistant Commissioner (Designation)
Address: Range__ Ward __
Sector __ (District State and Pin code)

SUBJECT: Reply to Notice Dated on _____ for (Name of company) GSTIN NO: ___________
For the difference in supply value in GSTR 2A Vs GSTR 2B.
Ref ID______________

Respected Sir/Madam,

Greetings!!

1. With reference to the above-captioned subject, we, M/s __________(hereinafter referred as

‘the company’) located at _______________ hereby brings to your kind notice that notice
was issued on Dated __________ In that said notice it is alleged that ITC availed by us
based on GSTR 2A instead of GSTR 2B in the month of Jan 2021 and demanding for the
reversal of ITC which is excess availed from GSTR 2B by us.

2. FACT OF THE CASE:

2.1. This is in reference to your Notice Ref No. __ Dated: ______ issued under section 74 of
the Goods and Services Tax Act, 2017 wherein you have mentioned that we have
Availed Input tax Credit (hereinafter referred to as ‘ITC’) as per Form GSTR-2A instead
of GSTR 2B in the month of JAN.
2.2. We have availed ITC on the basis of GSTR 2A which is Rs ______ instead of Rs
______ as per GSTR 2B. So, we have Availed excess ITC of Rs______.
2.3. It is submitted brief about the business of the Registered Person.

3. PROVISION RELATED TO THIS CASE

It is respectively submitted that Chapter V of Act named “Input Tax Credit” has given
right to the Registered Persson (herein after referred as RP) for the claim ITC as per the
section prescribed in this Chapter. Section 16 prescribed the condition for the claiming of
Input Tax Credit (hereinafter referred as ITC) for the registered person (hereinafter
referred as RP) under the Act, further Section 16(1) used the phrase “as such condition
and restriction as may be prescribed” for the power of making rules in accordance with
Act for the restriction of the ITC by the RP.
3.1. SECTION 16: ELIGIBILITY AND CONDITIONS FOR TAKING INPUT
TAX CREDIT
Subsection (1) Every registered person shall, subject to such conditions and restrictions
as may be prescribed and in the manner specified in section 49, be entitled to take credit
of input tax charged on any supply of goods or services or both to him which are used or
intended to be used in the course or furtherance of his business and the said amount
shall be credited to the electronic credit ledger of such person.
Subsection (2) Notwithstanding anything contained in this section, no registered person
shall be entitled to the credit of any input tax in respect of any supply of goods or
services or both to him unless –

(a) he is in possession of a tax invoice or debit note issued by a supplier registered

under this Act, or such other tax paying documents as may be prescribed;

(b) he has received the goods or services or both. Explanation - For the purposes of this
clause, it shall be deemed that the registered person has received the goods where the
goods are delivered by the supplier to a recipient or any other person on the direction of
such registered person, whether acting as an agent or otherwise, before or during
movement of goods, either by way of transfer of documents of title to goods or
otherwise;

(c) subject to the provisions of section 41, the tax charged in respect of such supply has
been actually paid to the Government, either in cash or through utilisation of input tax
credit admissible in respect of the said supply; and

(d) he has furnished the return under section 39: Provided that where the goods against
an invoice are received in lots or instalments, the registered person shall be entitled to
take credit upon receipt of the last lot or instalment:

Provided further that where a recipient fails to pay to the supplier of goods or services
or both, other than the supplies on which tax is payable on reverse charge basis, the
amount towards the value of supply along with tax payable thereon within a period of
one hundred and eighty days from the date of issue of invoice by the supplier, an amount
equal to the input tax credit availed by the recipient shall be added to his output tax
liability, along with interest thereon, in such manner as may be prescribed: Provided
also that the recipient shall be entitled to avail of the credit of input tax on payment
made by him of the amount towards the value of supply of goods or services or both
along with tax payable thereon.
 Subsection (3) Where the registered person has claimed depreciation on the tax
component of the cost of capital goods and plant and machinery under the provisions of
the Income-tax Act, 1961, the input tax credit on the said tax component shall not be
allowed.

Subsection (4) A registered person shall not be entitled to take input tax credit in
respect of any invoice or debit note for supply of goods or services or both after the due
date of furnishing of the return under section 39 for the month of September following
the end of financial year to which such invoice or invoice relating to such debit note
pertains or furnishing of the relevant annual return, whichever is earlier

Further Central Goods and Service Tax Rules 2017 (hereinafter referred as Rule) is
having Chapter V named “Input Tax Credit” for the clamming the condition in
additional of Section 16 for the Registered Person , Rule 36 deal in documentary
evidence for the calming the ITC, Rule 38 prescribe the process whereas payment is not
made by the receipt to the supplier within 180 days and so on the difference aspect of the
availment of ITC.

3.2. RULE 36. DOCUMENTARY REQUIREMENTS AND CONDITIONS FOR

CLAIMING INPUT TAX CREDIT -
Sub Rule (1) The input tax credit shall be availed by a registered person, including the
Input Service Distributor, based on any of the following documents, namely -
(a) an invoice issued by the supplier of goods or services or both in accordance with the
provisions of
section 31.
(b) an invoice issued in accordance with the provisions of clause (f) of sub-section (3) of
section 31, subject to the payment of tax.
(c) a debit note issued by a supplier in accordance with the provisions of section 34.
(d) a bill of entry or any similar document prescribed under the Customs Act, 1962 or
rules made thereunder for the assessment of integrated tax on imports.
(e) an Input Service Distributor invoice or Input Service Distributor credit note, or any
document issued by an Input Service Distributor in accordance with the provisions of
sub-rule (1) of rule 54.

Sub Rule (2) Input tax credit shall be availed by a registered person only if all the
applicable particulars as specified in the provisions of Chapter VI are contained in the
said document, and the relevant information, as contained in the said document, is
furnished in FORM GSTR-2 by such person:
 Provided that if the said document does not contain all the specified particulars but
contains the details of the amount of tax charged, description of goods or services, total
value of supply of goods or services or both, GSTIN of the supplier and recipient and
place of supply in case of inter-State supply, input tax credit may be availed by such
registered person.

Sub Rule (3) No input tax credit shall be availed by a registered person in respect of
any tax that has been paid in pursuance of any order where any demand has been
confirmed on account of any fraud, willful misstatement, or suppression of facts.

Sub Rule (4) Input tax credit to be availed by a registered person in respect of invoices
or debit notes, the details of which have not been uploaded by the suppliers under sub-
section (1) of section 37, shall not exceed [5 per cent] of the eligible credit available in
respect of invoices or debit notes the details of which have been uploaded by the
suppliers under sub-section (1) of section 37.
Provided that the said condition shall apply cumulatively for the period February,
March, April, May, June, July and August 2020 and the return in FORM GSTR-3B for
the tax period September 2020 shall be furnished with the cumulative adjustment of
input tax credit for the said months in accordance with the condition above.
Further department has issued Notification No 82/2020 dated 10th Nov 2020 amended
the Rule 60 which as under w.e.f. 01st Jan 2021, GSTR 2B is introduced in the Rule by
this notification itself in the Rule 60, which deal for the details of inward supply on the
procedural aspect only for the GSTN use.

3.3. RULE 60. FORM AND MANNER OF ASCERTAINING DETAILS OF

INWARD SUPPLIES -
Sub Rule (1) The details of outward supplies furnished by the supplier in FORM
GSTR-1 or using the IFF shall be made available electronically to the concerned
registered persons (recipients) in Part A of FORM GSTR-2A, in FORM GSTR-4A and
in FORM GSTR-6A through the common portal, as the case may be.
Sub Rule (2) The details of invoices furnished by an non-resident taxable person in his
return in FORM GSTR-5 under rule 63 shall be made available to the recipient of
credit in Part A of FORM GSTR 2A electronically through the common portal.
Sub Rule (3) The details of invoices furnished by an Input Service Distributor in his
return in FORM GSTR-6 under rule 65 shall be made available to the recipient of
credit in Part B of FORM GSTR 2A electronically through the common portal.
Sub Rule (4) The details of tax deducted at source furnished by the deductor under sub-
section (3) of section 39 in FORM GSTR-7 shall be made available to the deductee in
Part C of FORM GSTR-2A electronically through the common portal
Sub Rule (5) The details of tax collected at source furnished by an e-commerce operator
under section 52 in FORM GSTR-8 shall be made available to the concerned person in
Part C of FORM GSTR 2A electronically through the common portal.
Sub Rule (6) The details of the integrated tax paid on the import of goods or goods
brought in domestic Tariff Area from Special Economic Zone unit or a Special
Economic Zone developer on a bill of entry shall be made available in Part D of FORM
GSTR-2A electronically through the common portal.
Sub Rule (7) An auto-drafted statement containing the details of input tax credit shall
be made available to the registered person in FORM GSTR-2B, for every month,
electronically through the common portal, and shall consist of -
(i) the details of outward supplies furnished by his supplier, other than a supplier
required to furnish return for every quarter under proviso to sub-section (1) of section
39, in FORM GSTR-1, between the day immediately after the due date of furnishing of
FORM GSTR-1 for the previous month to the due date of furnishing of FORM GSTR-1
for the month;
(ii) the details of invoices furnished by a non-resident taxable person in FORM GSTR-5
and details of invoices furnished by an Input Service Distributor in his return in FORM
GSTR-6 and details of outward supplies furnished by his supplier, required to furnish
return for every quarter under proviso to sub-section (1) of section 39, in FORM
GSTR-1 or using the IFF, as the case may be, -
(a) for the first month of the quarter, between the day immediately after the due date of
furnishing of FORM GSTR-1 for the preceding quarter to the due date of furnishing
details using the IFF for the first month of the quarter;
(b) for the second month of the quarter, between the day immediately after the due date
of furnishing details using the IFF for the first month of the quarter to the due date of
furnishing details using the IFF for the second month of the quarter;
(c) for the third month of the quarter, between the day immediately after the due date of
furnishing of details using the IFF for the second month of the quarter to the due date of
furnishing of FORM GSTR-1 for the quarter;
(iii) the details of the integrated tax paid on the import of goods or goods brought in the
domestic Tariff Area from Special Economic Zone unit or a Special Economic Zone
developer on a bill of entry in the month.
Sub Rule (8) The Statement in FORM GSTR-2B for every month shall be made
available to the registered person -
(i) for the first and second month of a quarter, a day after the due date of furnishing of
details of outward supplies for the said month, in the IFF by a registered person
required to furnish return for every quarter under proviso to sub-section (1) of section
39, or in FORM GSTR-1 by a registered person, other than those required to furnish
return for every quarter under proviso to sub-section (1) of section 39, whichever is
later;
 (ii) in the third month of the quarter, a day after the due date of furnishing of details of
outward supplies for the said month, in FORM GSTR-1 by a registered person required
to furnish return for every quarter under proviso to sub-section (1) of section 39.

3.4. Further as per the important advisory in the notification in the Para 8, below are
mentioned.

Taxpayers are advised to ensure that the data generated in FORM GSTR-2B is
reconciled with their own records and books of accounts. Taxpayers shall ensure that
a. No credit shall be taken twice for any document under any circumstances.
b. Credit shall be reversed wherever necessary.
c. Tax on reverse charge basis shall be paid.
3.5. It is submitted since ITC is regulated by the S16 read with Rule 36 as per the law, Rule
60 deal for the manner for the outward supply by the outward supplier only, we are the
recipient side, so same 2B cannot be considered for the claiming of ITC for aforesaid
period,
3.6. further Rule 36(4) which prescribe the 5% additional ITC by the RP is details of invoices
uploaded by the supplier, herein details of invoice means ITC reflected in the GSTR 2A
of the RP as communicated by the department itself as well as GSTN on multiple times,
so Rule 36 should be considered for the purpose of availing the ITC by the RP which
talks about the GSTR 2A not for the GSTR 2B.

4. ACCEPTANCE AND REQUEST

4.1. So based on the above-mentioned details, it is submitted that ITC can be availed based
on the GSTR 2A amount as per the Act, which is availed by us, GSTR 2B is for the
reference purpose only as on date by the department itself, there is no legal backing.
4.2. We would request you to drop the Show Cause Notice and we would further request
your lordship to provide us “Opportunity of Being Heard” before passing any order
against us.

Thanks & Regards

For Company Name

Authorized person
Designation

Annexure:
A. GSTR 2B
B. GSTR 2A
C. Reconciliation data of the ITC claimed Vs ITC availed in the GSTR 2A