New ITC 16(4) relief procedure. Quick analysis by CA Umesh Sharma

Summary

In this video, CA Umesh Sharma discusses Notification Number 22 issued on October 8, 2024, addressing issues related to ITC disallowance under Section 164. The notification outlines the rectification process for orders passed under various sections and specifies eligibility criteria for registered persons affected by disallowed ITC. Key steps include filing a rectification application within six months and providing detailed information about the original order. The video emphasizes the role of officers in processing these applications and the importance of clarifications regarding pending appeals. Viewers are encouraged to stay updated on developments related to this notification.

Takeaways

• 📜 The notification number 22, issued on October 8, 2024, addresses the rectification of ITC (Input Tax Credit) orders under section 164.
• 🔄 ITC orders were previously disallowed due to late filing of returns, but this notification allows for rectification.
• 📅 The changes from this notification will take effect from November 1, 2024, and require online applications through the GSTN network.
• ✅ Eligible individuals include registered persons with orders passed under sections 73, 74, 107, and 108.
• ⚖️ The notification specifically applies to cases where no appeal has been filed against disallowed ITC orders.
• 🔍 Clarifications are needed for cases where appeals are pending regarding the rectification process.
• 📝 Applicants must file for rectification within six months after November 1, 2024.
• 📊 A detailed application must be submitted, including information on the demand and the expected exemption.
• 🚀 Officers will pass rectification orders within three months after the application is filed.
• 🔗 It is important to provide complete details, including GSTN numbers and order specifics, in the application.

Q & A

What is the primary purpose of Notification Number 22 issued on October 8, 2024?

The primary purpose of Notification Number 22 is to address and rectify issues related to the denial of Input Tax Credit (ITC) under Section 164, particularly for cases where returns were filed late.

When does the rectification order from Notification Number 22 come into effect?

The rectification order will come into effect on November 1, 2024.

Who is eligible to apply for the rectification of ITC orders under this notification?

Eligible applicants include registered persons whose orders were passed under Sections 73, 74, 107, or 108, where ITC was disallowed due to late filing of returns.

What is the application timeframe for filing a rectification under this notification?

The application for rectification must be filed within six months of November 1, 2024.

What steps must an applicant take to file for a rectification of ITC?

An applicant must submit details about the demand and expected relief along with their application for rectification.

What forms will the officer use to process the rectification orders?

The officer will use DRC-08 or LP-04 forms to pass rectification orders, depending on whether the original order was contested.

What are the key sections related to ITC eligibility mentioned in the notification?

The key sections related to ITC eligibility mentioned are Section 165, which provides ITC for specific financial years, and Section 166, which addresses cases where registration was canceled and reinstated.

What clarification is needed regarding pending appeals related to ITC?

Clarification is needed on how cases with pending appeals will be handled, specifically whether they can be rectified or withdrawn, and how the appellate authority should process them.

What information must be included in the application for rectification?

The application must include GST numbers, order types, applicable financial years for ITC claims, and details about the applicant's demand.

What future updates are expected regarding Notification Number 22?

Further updates and clarifications regarding the notification and its implementation are expected as the effective date approaches.