X Ltd supplies manufactured goods to Y Ltd for Rs 5000 in April 2017; CGST thereon is, say, Rs 500 assuming Tax Rate 10%. Unfortunately X Ltd did not furnish these details in its outward supply to Y Ltd.
While matching the credit, Y Ltd failed to set this right and went ahead with credit claim and utilized the credit against CGST liability. Later, GST officer intimates this mismatch, say by July 2017. In the absence of X Ltd’s due response, Y Ltd may pay back the credit with interest (for wrong credit).
X Ltd rectifies the outward return with details omitted earlier, in Nov 2017. Accordingly, Y Ltd can certainly take back the credit earlier reversed
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CA JAIN ALOK
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