Welcome Move for The Businesses: Extension of time period for claiming ITC, issuing

credit notes and amendment in returns.

With effect starting on October 1, 2022, the Central Board of Indirect Taxes and Customs
("CBIC") has recently issued a notification to implement some of the changes suggested in
the CGST Act via the Finance Act, 2022. The following is a summary of these changes:

1. Time limit to claim Indirect Tax Credit (ITC) : Section 16(4) of the CGST Act
specifies that the deadline for claiming ITC (in relation to any invoice or debit note) is
the date on which the returns required by Section 39 (Form GSTR 3B) are due for the
month of September following the close of the financial year to which the invoice or
debit note relates. However, "due date of furnishing the returns under Section 39 for
the month of September" was changed by the Finance Act of 2022 to "30th day of
November," so ITC for any invoice or debit note pertaining to a given financial year
may be accessed on or before November 30 of the following financial year..
2. According to Section 34 of the CGST Act, information on credit notes issued in
connection with purchases made during a fiscal year had to be disclosed in the return
for the month in which they were issued, but not later than September of the following
fiscal year. However, the term "September" has been changed to "the 30th day of
November" in accordance with the revision. In light of this, a credit note for a fiscal
year may now be issued and reported up until November 30 of the next fiscal year.
3. Time limit for rectification/amendments in Forms GSTR-3B: The due date of
furnishing such returns for the month of September of the succeeding financial year
was prescribed as the time limit for rectifying details furnished in the returns
prescribed under Section 39 of the CGST Act for any financial year. The change
extends the deadline for making such corrections to the thirty-first day of November
of the next fiscal year.

Personal Comment.

While the aforementioned provisions are a welcome step for businesses, questions have been
raised regarding whether the last date for ITC claims pertaining to the financial year 2021–
2022 should be the "due date for filing Form GSTR-3B for the month of September 2022
(i.e., October 20, 2022)" or "November 30, 2022." Given that the modification will take
effect on October 1, 2022 (i.e., before the deadline for claiming ITC for the fiscal year 2021–
2022), it is possible to hold that ITC for the fiscal year 2021–2022 may be claimed up to
November 30, 2022.