CBIC vide circular no. 142/12/2020 – GST dated 9th October, 2020 has clarified the procedure for cumulative application of sub-rule 4 of rule 36 of the CGST Rules, 2017 for the months of February, 2020 to August 2020 in GSTR-3B for the month of September, 2020.
The registered persons shall reconcile the ITC availed in GSTR-3B with the invoice details reflected in the GSTR-2A for the period Feb-20 to Aug-20.
The registered persons are required to check the details of invoices uploaded by their suppliers in their GSTR-1 for the period Feb-20 to Aug-20 till the due date of furnishing GSTR-1 for the month of September, 2020 as reflected in GSTR-2As.
The cumulative amount of ITC availed for the said months in FORM GSTR-3B should not exceed 110% of the cumulative value of the eligible credit available in respect of invoices or debit notes the details of which have been uploaded by the suppliers till the due date of furnishing GSTR-1 for the month of September, 2020.
The excess ITC availed arising out of reconciliation during this period, if any, shall be
required to be reversed in Table 4(B)(2) of FORM GSTR-3B, for the month of September, 2020.
Failure to reverse such excess availed ITC on account of cumulative application of sub-rule (4) of rule 36 of the CGST Rules would be treated as availment of ineligible ITC during the month of September, 2020.